KULR Technology (US:KULR)2024-08-13 00:36Financial Data and Key Metrics Changes - In Q2 2024, the company achieved revenue of $2.43 million, representing a 39% sequential increase from Q1 2024 [5] - Engineering service revenue increased by 76% year-over-year to approximately $1.3 million, marking a record for the company [5] - Total paying customers rose by 42% year-over-year to 27 [5] - Service revenue customers doubled year-over-year to 14, while product revenue customers increased by 25% year-over-year to 15 [6] - Cash used from operating activities decreased by 7%, and cash used in investing activities dropped by 82%, leading to a combined cash use reduction of 13% [18] Business Line Data and Key Metrics Changes - The company made significant investments in its Battery Center of Excellence, enhancing capabilities for battery design, testing, and production [6] - The new facility in Texas is designed to meet growing demands in key industries such as aerospace and defense [7] - The testing service capacity is estimated to reach approximately $2 million per quarter once the facility is fully operational [8] Market Data and Key Metrics Changes - The space economy is projected to reach $1.8 trillion by 2035, with the space battery market expected to grow to $6.35 billion by 2030 [11] - The company is actively engaging with key players in the space economy, including private companies like SpaceX and Blue Origin, as well as traditional contractors like Boeing [12] Company Strategy and Development Direction - The company aims to be a one-stop shop for battery solutions, focusing on rapid testing and prototyping to meet customer demands [10] - Investments in the KULR ONE Space battery architecture are intended to achieve NASA certification for human spaceflight applications [12] - The company is also exploring applications for KULR Vibe in various markets, including AI server cooling and industrial fans [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in resuming year-over-year revenue growth in the second half of 2024 due to new customer wins [6] - The company is well-positioned operationally, with management stating it is in the best position it has ever been in [30] - There have been no negative impacts on the company's pipeline or supply chain due to geopolitical events, and the demand for safer batteries is expected to grow [37] Other Important Information - The first commercial version of the KULR ONE Space battery is set to be available in fall 2024 [13] - The company is expanding its SafeCase application for battery storage and transportation, which is crucial for safety in various sectors [39] Q&A Session Summary Question: Information on bills H.R. 1797 and S.1008 and KULR's involvement - Management has engaged with stakeholders regarding thermal runaway mitigation and is hopeful about the legislation, but cannot comment on specific developments related to Tesla [19][20] Question: Success of KULR Vibe and cost savings - The company sees opportunities in applying KULR Vibe to server fans and is working on projects with Facebook's Open Compute Project [25] Question: Strategy for expanding manufacturing capacity - The company emphasizes being a one-stop shop for key customers and is investing in technical capabilities to maintain a competitive advantage [26][27] Question: Automotive partnerships and market strategy - KULR is serving automotive units with battery testing and SafeCase technology, focusing on high-margin opportunities rather than low-margin EV batteries [28] Question: Plans to reverse stock value decline - Management highlighted significant revenue growth from 2021 to 2023 and expressed confidence in operational performance, though stock price fluctuations are unpredictable [29][30] Question: Funding operations until year-end - The company is evaluating funding needs to maintain a strong balance sheet, which is beneficial for operations and shareholders [31] Question: Outreach to vehicle manufacturers - Establishing industry standards takes time, but the company is working with automotive customers to develop products that could become de facto standards [32] Question: Impact of solid-state batteries on business - The company is testing various battery chemistries and expects solid-state batteries to positively impact future growth [33] Question: Customer confidentiality and new engagements - The customer base has grown by 50% year-over-year, with many engagements involving large OEMs [36] Question: Impact of geopolitical events on revenue - No negative impacts have been observed on the pipeline or supply chain, and the demand for high-powered batteries is expected to grow [37] Question: Current or future space station projects - The company is involved with customers designing private space stations and sees significant opportunities in the growing space economy [38] Question: Application of products in operating batteries - The SafeCase technology is used for battery storage and transportation, with ongoing expansion in various applications [39] Question: Number of automakers KULR is working with - The company is engaged with top automotive OEMs, including Japanese and German manufacturers [40] Question: Examples of service business leading to product sales - The company is beginning to ship sample KULR ONE Space batteries as a result of design service engagements, with expectations for increased production in the future [41]