Management Commentary
"2021 was a transformative year for Innoviz. We reached a design freeze for our automotive product InnovizOne and are now working to complete production readiness to launch our customer program," said Omer Keilaf, CEO and co-founder of Innoviz. "Entering the new year with five new pre-production programs as well as serial production programs at advanced stages of negotiations with several key car makers has put us on a trajectory for another successful year. We are well positioned to execute on our plans and we have the needed resources. Our direct engagements, new products, and software solutions give us tremendous confidence in our ability to further capture market share in the automotive industry, continue to penetrate new markets, and solidify our position as a leading LiDAR provider for the automotive industry and beyond."
Commercial Traction
- To date Innoviz secured eight pre-production programs, five of which are listed below. These programs are with leading car makers and other diverse technology-backed companies for a variety of new use cases. This strong momentum, together with Innoviz's ability to serve overlapping customers' needs, positions Innoviz for success in commercial negotiations.
- Innoviz has increased its forward-looking order book from $2.4B to $2.6B, to reflect the expansion of the shuttle program through the use of more LiDARs per shuttle.
- While Innoviz is extensively engaged with key customers in the L2-L3 automotive segment, the Company also expanded its product portfolio with the introduction of Innoviz360, an HD resolution, long range and low-cost surround LiDAR. Innoviz360 will support newly received RFQs for L4 and is a step to expand Innoviz's presence in the non-automotive space.
- The most recent five pre-production agreements are as follows:
- Obayashi Corporation, a major Japanese construction company, selected Innoviz's LiDAR for the new automated tower crane system Obayashi developed as part of its recently announced autonomous solutions for excavation equipment and the construction of concrete dams and backhoe loaders. Innoviz's LiDAR enables the autonomous operation of Obayashi's tower cranes, replacing manual crane operation and promoting safety and cost savings.
- Twinner, a German-based vehicle scanner provider for remarketing and inspection purposes, began testing InnovizOne LiDAR with its Digital Twinn® platform to enhance the capabilities of its sophisticated vehicle scanner. InnovizOne LiDAR will provide a high-quality 360-degree view of the vehicle in order to better assess, inspect and evaluate a vehicle's condition.
- InnovizOne was integrated at three different companies for unique applications: (1) in primary sensors of the AD platform of Whale Dynamics, a Chinese "full stack" L4 autonomous driving developer focused on AD and intelligent traffic applications, (2) for object and obstacle detection in pre-mapped areas by an Asian integrator across passenger and non-passenger programs, and (3) in autonomous crane systems of Syracuse, an Israel-based developer of a system augmenting tower cranes with autonomous operating capabilities.
Technology Leadership
- Successfully demonstrated the first B samples of the automotive-grade InnovizTwo LiDAR sensor. InnovizTwo is offered directly to car makers and Tier 1 companies. With superior performance and reduced cost, InnovizTwo addresses the needs of the consumer car market to support affordable and safe Level 2 and Level 3 autonomy for a wide range of vehicles.
- Developed and introduced Innoviz360, a new patent-pending HD LiDAR category with 10x the performance and significantly lower cost compared to existing solutions. Innoviz believes Innoviz360 will allow it to expand its market share beyond passenger cars and meet the needs of other use cases. Innoviz360 will be compatible with shuttles, robotaxis, and trucks in the automotive space (L4-L5) as well as additional non-automotive applications. Innoviz expects the 360 HD LiDAR samples to be available in the fourth quarter of 2022.
- Released a Level 3 standardization white paper, established through the work of many years with several key vehicle manufacturers. The white paper is another industry milestone towards market consolidation and solidifying the LiDAR requirements for the automotive space.
- While Innoviz is growing its product portfolio, it continues to strengthen its chipset through two new innovative components that will be available during 2023. An updated processing ASIC and a new detector chip will serve to support the existing and new products that Innoviz will develop.
- Selected to participate in the prestigious LiDAR Sensor Standards Consortium led by fka GmbH, a Germany-based research and engineering services company with a history of leading similar automotive testing-standards efforts. The consortium aims to establish standardization, guidelines, and a testing framework for LiDARs to ensure safe autonomous vehicles. The consortium also includes several OEMs and Tier 1 suppliers.
- Achieved compliance with automotive standard IATF 16949:2016. This standard is the most widely used quality management standard for the automotive industry and certifies that Innoviz has the process-oriented quality management systems to enable continued improvements, prevent defects, and reduce variation and waste in the supply chain. The International Automotive Task Force (IATF) is charged with providing improved quality products to automotive consumers worldwide and is composed of world-leading automotive manufacturers, including a key Innoviz partner, BMW.
Corporate Development
Increased employee headcount by 35 people in the fourth quarter of 2021, bringing the Company's total number of employees to 404 at year-end. The increase in headcount was driven by the need to support current and potential programs and new product development. Approximately 70% of the Company's employees are members of the Company's research and development team.
Full Year 2021 Financial Results
In 2021 Innoviz successfully closed a business combination with a SPAC, which provided over $370 million in gross proceeds. Innoviz's operating cash flow during 2021 was within its planned budget. At year-end, Innoviz maintained a high liquidity level consisting of $304 million in cash, short term deposits, and marketable securities, which enables the company to execute its 2022 plans. Revenues for 2021 were approximately $5.5 million, compared to $(9.4) million in 2020. InnovizOne-related revenues in 2021 were approximately $4.3 million, an increase of 28% compared to $3.3 million of InnovizOne-related revenues in 2020. The Company expects InnovizOne sales to continue to increase in 2022 and is also targeting to sell the first samples of InnovizTwo.
Operating expenses for 2021 were approximately $152.6 million, an increase from $66.2 million in 2020. Operating expenses in 2021 included approximately $64.7 million of stock-based compensation compared to $3.2 million of stock-based compensation in 2020. The increase in operating expenses was primarily due to increases in stock-based compensation and people-related expenses.
