Over $17 million in revenue and $33 million in bookings in the first quarter 2023

Shipped REV7 sensors to over 110 customers in the first quarter 2023

Now targeting annualized merger cost synergies of between $80 and $85 million

SAN FRANCISCO — (BUSINESS WIRE) — May 11, 2023 — Ouster, Inc. (NYSE: OUST) (“Ouster” or the “Company”), a leading provider of high-performance lidar sensors for the automotive, industrial, robotics, and smart infrastructure industries, announced today financial results for the three months ended March 31, 2023. First quarter 2023 financial results are composed of Ouster standalone performance through February 10, 2023 and combined performance of both companies following the merger with Velodyne on February 10, 2023. The first quarter 2022 comparative financial highlights reflect only the results of standalone Ouster.

First Quarter 2023 Highlights

• Over $17 million in revenue¹, up 101% from $8.6 million in the first quarter of 2022.
• Booked² $33 million in business with new and existing customers.
• Gross margins of (2%), compared to 30% in the first quarter of 2022.
• Non-GAAP gross margins of 25% in the first quarter of 2023.
• Shipped over 3,000 sensors for revenue in the first quarter, up 95% year over year.
• Net loss increased to $177 million in the first quarter of 2023 primarily due to the non-cash goodwill impairment charges of $99 million and higher operating losses associated with Velodyne merger, compared to $32 million in the first quarter of 2022.
• Adjusted EBITDA³ loss increased to $27 million, compared to a loss of $23 million in the first quarter of 2022.
• Cash, cash equivalents and short-term investments balance of $257 million as of March 31, 2023.

“Ouster had a strong first quarter of 2023 marked by significant customer demand for our new REV7 sensors, enabling us to both exceed our revenue expectations for the quarter and book $33 million in business with new and existing customers,” said Ouster CEO Angus Pacala. “We also laid the groundwork to realign our cost structure, streamline manufacturing, and deliver on our product roadmap to catalyze further growth.”

The Company’s non-GAAP gross margin was 25% in the first quarter of 2023, reflecting strong demand for the REV7 sensor product line and a quarter-over-quarter rebound in average selling prices for Ouster’s OS sensors. Ouster’s first quarter GAAP gross margins include certain non-recurring or unusual items, including excess and obsolete costs of $3.6 million, associated with the consolidation of product lines and manufacturing transition from the REV6 to REV7 OS sensors, as well as amortization of acquired intangibles. Looking forward, increasing commercial traction for the REV7 sensor and ongoing actions to reduce Ouster’s cost structure support management’s expectations that margins will improve in the second half of 2023.

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¹ First quarter 2023 revenues include $6.4 million in revenue from Velodyne products following the merger but exclude revenues from Velodyne products prior to the merger on February 10, 2023.
² Bookings represent binding contract orders entered during the period.
³ Adjusted EBITDA loss and non-GAAP gross margin are non-GAAP financial measures. See Non-GAAP Financial Measures for additional information and reconciliations of these measures, the most directly comparable financial measures calculated in accordance with U.S. GAAP.

2023 Business Objectives and Updates

1. Drive new business through targeted sales approach to deliver near-term growth
2. Execute on the digital lidar roadmap for OS and DF series to expand serviceable market
3. Develop a robust software ecosystem to accelerate lidar adoption
4. Build a financially strong business to support long-term growth and deliver value to shareholders

Drive New Business: Ouster expanded sales of its new REV7 OS sensors powered by its next-generation L3 chip, shipping sensors to over 110 customers in the first quarter of 2023, including warehouse automation customers such as Vecna Robotics, Cyngn, and Balyo, as well as several large industrial trucking, bus, and mining equipment OEMs. Ouster also announced today that Motional, a global leader in driverless technology, has selected Ouster as its exclusive provider of long-range lidar sensors for its all-electric IONIQ 5-based robotaxis. As part of the serial production agreement, Ouster will supply Motional with Alpha Prime™ VLS-128 sensors through 2026.

Execute on Digital Product Roadmap: Ouster continued to make progress on its digital lidar roadmap:

• OS Series: Rapid progress on the next-generation custom silicon to power its OS sensors, the L4 chip, which is expected to tape out later this year.
• DF Series: On track to deliver early B-samples of its solid-state DF sensors to automotive customers in the second half of 2023.

Develop Robust Software Ecosystem: As part of Ouster’s plans to unify software solutions for the smart infrastructure vertical, BlueCity will be underpinned by Ouster Gemini to add OS sensor compatibility, more features and better overall performance to customers. The Company has received a terrific customer response and a steady increase in software adoption. Ouster has hundreds of active smart infrastructure solution deployments around the world for intelligent transportation systems, crowd and retail analytics, and security monitoring.

Build Financially Strong Business:

• Merger Integration: Ouster expects to realize annualized costs synergies greater than previously announced; now targeting $80 to $85 million exiting the fourth quarter of 2023. The synergy estimate is baselined against the standalone cost structures of the two companies, as of the third quarter 2022. During first quarter 2023, the Company reduced over $50 million in annual run-rate costs, which resulted in a one-time cash expense of approximately $10 million.
• Scaling Manufacturing: As part of its outsourced manufacturing strategy to scale production and reduce costs, Ouster completed the transition of the VLP-16 sensor to Fabrinet in Thailand, and is on track to fully transition the VLP-32 in the second quarter of 2023 and the VLS-128 by the end of the year.

Second Quarter 2023 Outlook

For the second quarter of 2023, the first full quarter post-merger, Ouster expects to achieve $18 million to $20 million in revenue.

Conference Call Information

Ouster will host a conference call and live webcast for analysts and investors at 5:00 p.m. EDT today, May 11, 2023 to discuss its financial results and business outlook. To access the call, please register at https://conferencingportals.com/event/ERDXYEAl.

Upon registering, each participant will be provided with call details and a registrant ID. The webcast and related presentation materials will be accessible for at least 30 days on Ouster’s investor relations website at https://investors.ouster.com. A telephonic replay of the conference call will be available through May 25, 2023. To access the replay, please dial (800) 770-2030 from the U.S. or (647) 362-9199 from outside the U.S. and enter the conference ID number: 93428.

About Ouster

Ouster (NYSE: OUST) is a leading global provider of high-resolution scanning and solid-state digital lidar sensors, Velodyne Lidar sensors, and software solutions for the automotive, industrial, robotics, and smart infrastructure industries. Ouster is on a mission to build a safer and more sustainable future by offering affordable, high-performance sensors that drive mass adoption across a wide variety of applications. With a global team and high-volume manufacturing, Ouster supports over 850 customers in over 50 countries. Ouster is headquartered in San Francisco, CA with offices in the Americas, Europe, Asia-Pacific, and the Middle East. For more information, visit www.ouster.com , or connect with us on Twitter or LinkedIn .