Arbe Robotics Ltd. (Nasdaq: ARBE) (“Arbe”), a global leader in next-generation 4D Imaging Radar Solutions, today announced financial results for its second quarter ended June 30, 2022.
Key Q2 2022 Highlights:
- HiRain Technologies, the leading Chinese ADAS Tier 1 supplier, declared that it is undertaking major OEM and autonomous driving projects with Imaging Radars based on Arbe’s chipset, and announced it will reach mass production by 2023.
- Arbe added two new customer engagements in Q2, including a truck OEM that is a leader in Level 2+ truck design, and a new mobility player focusing on Level 4 vehicles.
- Tier 1s submitted five requests for proposal (RFPs) and requests for quotation (RFQs) with Arbe’s chipset to major OEMs, committing to supplying the customer with volumes ranging from 400 thousand to 1 million systems per year.
- Arbe is shortlisted in 8 RFPs / RFQs that bring total potential revenues to $7.5B by the end of the decade.
- GlobalFoundries completed the chipset testing setup toward mass production of Arbe’s chipset, delivered the first significant customer samples shipment, and signed a long-term manufacturing agreement with Arbe.
- Introduced Lynx, an industry-first Surround Imaging Radar, fulfilling the strong market demand for 360° long-range, high-resolution sensing at an affordable price. Designed for multiple installations around the vehicle – as a corner and a back radar for L2+ and higher autonomous vehicles, and even as a front radar for ADAS – Lynx represents a new and lucrative opportunity for Arbe.
- Arbe shareholders extended their lock-up period with respect to their shares. Arbe believes this demonstrates the shareholders’ confidence in the long-term potential of Arbe’s business and its ability to execute on the opportunities ahead.
“During the second quarter, we reached a major milestone with our strategic partner and chip manufacturer, GlobalFoundries, who completed the setup of the Arbe chipset testing facility, thus marking significant progress toward mass production,” said Kobi Marenko, Arbe’s Chief Executive Officer. “GlobalFoundries and Arbe signed a long-term strategic manufacturing agreement that addresses quality assurance, assembly and testing, which we believe will secure the quality and capacity necessary to meet our customer commitments.”
Marenko added, “As we enter the second half of 2022, we are shifting our focus to production and execution. We believe that the launch of our new product, Lynx Surround Imaging Radar, represents a tremendous business opportunity for Arbe as well as for our Tier 1 strategic partners. In addition, the HiRain Technologies production timeline announcement, coupled with the progress achieved by all Arbe Tier 1s, is providing Arbe with a strong position ahead of all other industry players.”
Second Quarter 2022 Financial Highlights
Revenues for Q2 2022 were $1.2 million, an increase from $0.5 million in Q2 2021. Backlog as of June 30, 2022, was $1.5 million. Gross margin in Q2 2022 was 72.8%, compared to 31.9% in Q2 2021, mainly related to economy of scale and a decrease in cost as we worked toward production version.
Operating expenses in Q2 2022 were $13.0 million, compared to $6.9 million in Q2 2021. The increase in operating expenses was primarily driven by an increase in research and development expenses from $5.8 million in Q2 2021 to $9.5 million in Q2 2022. The increase was most notably in labor cost and non-cash share-based compensation expenses, and to a lesser extent, an increase in our material and subcontractors cost supporting our research and development efforts. Additionally, the increase in Sales, General and Administration expenses was associated with Arbe being a publicly traded corporation and to the non-cash share-based compensation expenses. As a result, our operating loss increased from $6.7 million to $12.1 million.
Adjusted EBITDA in Q2 2022, a non-GAAP measurement which excludes share-based compensation and non-recurring public offering expenses relating to our business combination with ITAC, yielded a loss of $9.5 million, compared to a loss of $6.4 million in Q2 2021.
Net loss in Q2 2022 was $11.6 million, compared to a net loss of $10.6 million in Q2 2021. The net loss in Q2 2022 included financial income of $0.5 million as contrasted with financial expenses of $3.9 million in Q2 2021. Q2 2022 financial income resulted from the revaluation of warrants partially offset with exchange rate revaluations and financial interest.
Balance Sheet & Liquidity
As of June 30, 2022, Arbe had $71.3 million in cash and cash equivalents with no debt.
Outlook
Management reiterated the outlook for the full year ending December 31, 2022. Based on current estimates, management expects:
- Revenues to be in the range of $7 million to $11 million, heavily weighted toward the end of the year, when some of the projects are expected to mature
- Adjusted EBITDA to be in the range of ($34 million) and ($38 million)
- The company is on track to reach its $312 million revenue goal for 2025
Conference Call & Webcast Details
Arbe will host a conference call and webcast today at 8:30 am ET. Speakers will include Kobi Marenko, Chief Executive Officer, Co-Founder and Director, and Karine Pinto-Flomenboim, Chief Financial Officer. The Company encourages participants to pre-register for the conference call here. Callers will receive a unique dial-in upon registration, which enables immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.
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