SES AI (US:SES)2022-08-14 17:00Financial Data and Key Metrics Changes - The company ended Q2 2022 with over $400 million in cash, indicating strong liquidity to support commercialization efforts [5][15] - Operating expenses for Q2 2022 were $19.1 million, an increase of $12.5 million from the same period last year [12] - R&D expenses rose to $7.2 million, reflecting higher personnel costs due to increased headcount [12] - G&A expenses increased to $11.9 million, primarily driven by higher personnel costs and external consulting [13] - A noncash gain of $29 million was recorded due to changes in fair value of the sponsor RNO liability [13] Business Line Data and Key Metrics Changes - The company is focused on developing large format 50 and 100 ampere power cells, with production and testing ongoing at facilities in Shanghai and Korea [8][9] - The Shanghai facility has the capacity to produce a few thousand cells per month, currently producing about 30 cells per day [17] Market Data and Key Metrics Changes - Consumer interest in electric vehicles is growing, with OEMs introducing new models rapidly, driving demand for energy-dense batteries [6] - The company has joint development agreements (JDAs) with General Motors, Hyundai, and Honda, positioning it as a leader in next-gen lithium metal battery technology [6] Company Strategy and Development Direction - The company aims to optimize A-samples for its JDA partners by mid-2023 and transition to B-samples thereafter [10] - There is a focus on expanding into other verticals such as drones and eVitals, indicating diversification beyond automotive [9] - The company is building an ecosystem around lithium metal batteries, including partnerships for recycling and supply chain development [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the commercialization timeline, expecting to meet key milestones and maintain strong liquidity [5][15] - The company is optimistic about the impact of the Inflation Reduction Act, which may encourage partnerships and operations in North America [22] Other Important Information - Capital expenditures for Q2 2022 were $7.5 million, primarily for facility build-out in Asia, with total expected CapEx for 2022 remaining between $25 million and $35 million [14][15] - The Shanghai Giga facility has resumed operations after COVID-related shutdowns, enhancing production capabilities [8] Q&A Session Summary Question: Current status of the Shanghai facility and production capacity - The Shanghai facility can produce a few thousand cells per month but is currently producing about 30 cells per day to address issues at a smaller scale [17] Question: Development of Avatar and hiring in this area - Avatar development includes manufacturing data collection and model building for monitoring battery health, with significant hiring in this area [19] Question: Capital spending and facility readiness - The Korean facility will be ready by the end of October, with plans for further expansion to support JDA partners [20] Question: Impact of the Inflation Reduction Act - The act is seen as a positive development, encouraging partnerships and operations in North America [22] Question: Commercialization timeline for non-EV applications - Non-EV applications like drones are expected to have a faster commercialization cycle compared to automotive [23] Question: Transition from A-sample to B-sample - The transition is expected by mid-next year, with specific criteria related to energy density and safety [28] Question: Supply chain scaling for lithium metal anode - The company is collaborating with partners to scale up lithium metal production, with potential joint ventures in the pipeline [30]