Good afternoon. Welcome to Amprius Technologies' First Quarter 2024 Earnings Conference Call. Joining us for today's presentation are the company's CEO, Dr. Kang Sun; and CFO, Sandra Wallach. At this time, all participants are in listen-only mode. Following managements remarks, we will open the call for questions. Please note that this presentation contains forward-looking statements, including, but not limited to, statements regarding future product commercialization, new customer adoption, and the timing and ability of Amprius to build its large scale manufacturing facility, expand its manufacturing capacity, scale of business and achieve a sustainable cost structure. These statements involve known and unknown risks, uncertainties and other important factors that may cause Amprius' results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. For a more complete discussion of these risks and uncertainties, please refer to Amprius' filings with the Securities and Exchange Commission. Finally, I would like to remind everyone that this call is being webcast and a recording will be made available for replay on the company's Investor Relations website at ir.amprius.com. In addition to the webcast, the company has posted a shareholder letter that accompanies these results, which can also be found on the Investor Relations website. I will now turn the call over to Amprius Technologies, CEO, Dr. Kang Sun, for his comments. Sir, please proceed.

Welcome, everyone, and thank you for joining us this afternoon. On today's call, I will report our accomplishments from the first quarter. We are also highlighting some of the upcoming milestones, we are expecting for this year. Our CFO, Sandra Wallach, will then discuss our financial results for the period. After that, I will share some closing remarks before opening the call for questions. Before I give a recap of the quarter, I would like to briefly introduce Amprius to those who may be new to the company. As a reminder, here at Amprius, we develop, manufacture and market high-energy density and high-power density batteries with applications across all segments of the electric mobility, including the aviation and the EV industries. Across our battery portfolio, we offer unmatched performance, including batteries capable of specific energy density of 450 watt-hour per kilo, and the metric energy density of 11.50 watt-hour per liter. 10C power capability, the extreme fast charge rates of 0% to 80% scale of the charge in approximately six minutes. The ability to offer it in a wide temperature range of minus 30 degrees Celsius up to 55 degrees Celsius. And the safety design features that enable us to pass the United States military benchmark, new penetration test. Late last year, we achieved a third-party validation of our latest 500 watt-hour per kilo, 1,300 watt-hour per liter battery platform, which we expect will be ready for commercial shipments later in 2024. Each of these performance parameters is critically important to electric mobility applications. Not only do our batteries enable certain aircraft and the vehicles to function, but it enable our customers to achieve their economic targets as well. It's our belief that there are no other commercial batteries on the market that can perform at this levels today. Amprius…

Thank you, Kang. I would now like to spend a few minutes covering some key financial updates. As a reminder, our detailed financials can be found in our shareholder letter. We finished the first quarter with $2.3 million in total revenue. As we previously discussed, our total revenue is the combination of two main revenue streams: product revenue and development services and grant revenue. This quarter, all $2.3 million of our revenue came from our product revenue, representing a 397% increase from the prior year period and 147% sequential increase. These increases were largely driven by shipments to 82 customers in the quarter, a significant increase for Amprius. Although our product revenue remains largely driven by customer purchase orders that can arrive at uneven times throughout the year, we have shown consistent new customer growth and diversification in recent quarters. Also of these customers, only three customers represented greater than 10% of revenue, a testament to our diverse customer set. As we've discussed in prior quarters, our development services revenue comes largely from large development programs that are non-recurring in nature. Moving to our profitability metrics. Our gross margin was negative 190% for the quarter compared to negative 518% in the prior year period and negative 98% in Q4 of 2023. As a reminder, we see significant gross margin variation as our product and services revenue mix fluctuates. Also, we anticipated that factory start-up costs would ramp up as we start Colorado design and preconstruction and still expect this to be the case through at least 2024. Longer-term, we're confident that our GAAP gross margin will begin to normalize as we approach our capacity expansion goals. Now on to our operating expense management. Our operating expenses for the first quarter were $5.9 million, a 6% decrease from the prior year…

Thanks, Sandra. I'd like to reemphasize a few key points before closing. First, Amprius' silicon anode technology continues to demonstrate the unmatched performance in our industry. Amprius' battery command a firm-lead with their combination of 50 energy, power, charging time and temperature performance. They are uniquely positioned for the electrical mobility market. Second, Amprius batteries are commercially available today. Our breakthrough technologies are validated by over 800 customer orders. This quarter, we doubled our number of customers who received the shipments. Not only did we have our normal repeat customers, but 52 were new customers, a testament to our robust demand pipeline. We look forward to further building up our customer book in the coming quarters. Third, we are scaling our manufacturing capacity through building our own production capacities and partnering with toll manufacturing partners. With our rent underway in SiMaxx, our design process moving forward in bright and signed partnerships with additional toll manufacturing partners in place. We remain on track to deliver expanded production capacities to fulfill market demand. Finally, we are looking forward to several exciting upcoming milestones over the rest of the year. We expect to fully optimize our SiMaxx next production process and ramp up production to a 2 megawatt hour run rate exiting the year at our three-month capacity -- facility. This will represent a tenfold increase in our production levels that we had exiting 2023 and give us additional available products for the strategical customers. We look forward to taking advantage of the hundreds of megawatt hours of new cycle product availability provided by our toll manufacturing agreements to reach more customers and expand our current customer engagement. During the summer, we will deliver the 100 anti-hour EV form factor sell to the US Advanced Battery Consortium, USA BC, as a part of…

Thank you. At this time, we'll open the lines for questions. [Operator Instructions] Our first question is from Colin Rusch with Oppenheimer & Company. Please proceed.

Thanks so much. You know, guys, there's an awful lot of new customers. Can you give us a sense of, what the diversity is from a geographic standpoint and an application standpoint? You mentioned mobility. I'm just curious, if you can give us a sense of, who those folks are and, what sort of sampling they're doing at this point.

Yeah, Colin, we have disclosed to some customers. We can disclose. Our customer coverage is quite broad. We primarily in United States and Europe, we also have Asian customers. For example, we have customers in India. Our primary battery application for those customers is still in aviation industry.

Excellent. Thanks so much. And then, you know, as you move into working with the contract manufacturer, can you talk a little bit about how you anticipate your, you know, potential scaling of sales? It seems to me that you guys are in a unique position to grow fairly quickly as you get into the balance of the year from a revenue perspective?

Yeah, we are strengthening our sales team with the introduction of the side core products. We basically resolved the manufacturing capacity issue for that particular product. We have 100 megawatt hour's capacity behind us, both in cylindrical form and in pouch form. So this gave us tremendous support for our customer development effort here. So the company recently we just added more individuals to our sales force.

Thanks so much. And then in Fremont, just the final one from me, can you talk a little bit about the tool qualification and how that's going? Are the machines and primarily the key machine working as you anticipated as you go through all the testing processes.

Yes. In Fremont the only machine is measured is the Centotherm machine which produces the Silicon nanowire we -- equipment off shelf equipment, just like other people are using in the industry. So recently, the Fremont Centotherm machine started producing silicon and for our batteries. So of course, we still need adjust the production protocol propects of the production protocol making it more efficient. This machine, when we see qualification of the machine, what means the machine can produce quality silicon nano and for our battery

Thanks so much guys.

Our next question is from Donovan Schafer with Northland Capital Markets. Please proceed. Q – Donovan Schafer: Hi, guys. Thanks for taking the question. So first, I want to also ask about with the customer orders there -- with there being so many of the E2 or deliveries to customers. So just to kind of cross the Ts and dot the Is, I just want to confirm, so you say 52 of those were two new customers across the electricity or electric mobility sector. Is there any caveat there? Or can I just take the 82 minus the 52 and just say that you got -- you had 30 repeat orders in the quarter. Is that accurate?

Yes, that's the right one. Q – Donovan Schafer: Okay. Great. And then the other part of that is it looks like 76 of those -- the shipments were for SiCore. So I guess that raises the question, do you have some repeat customers were they previously did SiMaxx orders and now they're showing an interest in SiCore. And so, I guess, they had enough interest in SiMaxx, but are also curious to know how this other product potentially works for them. Is that kind of what's going on there?

Yes.

So honestly we -- we have a customer interest in both products. Q – Donovan Schafer: And some of it's crossing over, it seems like...

Those product offer, yes, -- that's why... Q – Donovan Schafer: Okay. Okay. And then I saw in the letter to investors that the initial production in Colorado, you switched to that, that will be for SiCore now instead of SiMaxx. And you say that, that's in response to kind of customer interest. But what I'm curious is, can you give us anything more in terms of like what are the specific attributes about SiCore versus SiMaxx that's causing that interest? And also, is there a difference in manufacturing costs, that's an impact there or one is less expensive to manufacture versus the other?

Yes. One of the reasons we have a tremendous interest for SiCore, because we have more SiCore for customers today, we have a large production capacity behind us, so we can serve a lot more customers. The more customers we serve has more interest to come to us. So that's the reason we look at the momentum we built up here with we probably need due to the cycle first because those customers a better time will we finish our factory, we will have very significant inquiries from our customers. Q – Donovan Schafer: Okay. And actually -- so you've got -- it's the fact that you can have these conversations around SiCore, where you've got the tolling arrangements in place already with some manufacturers. So, you -- that creates more of an interest with the potential customer because, okay, wasn’t ready to provide volume. And then you might as well bring that manufacturing in-house over time. So, then I guess the question there is how long -- when should we start to expect to maybe see that tolling partnership that you've kind of buttoned up with one manufacturer. Do you have any sense around when that could start turning into some kind of a revenue around the SiCore product at a scale, even though it's sort of through tolling?

Yes, we already have -- you can see we have so many customer engagements now, right? So though we believe this year, part of those customers will start some of those customers still in the qualification stage. Not every customer give big orders, but since we have so many customers, we have over 80 customers. We expect section of the customer will place decent orders this year. Q – Donovan Schafer: Okay. And I think that makes sense in terms of sequence that they're going to be incrementally more interested in taking SiCore, qualifying it and figuring out if they can incorporate that into their offering at scale. But to get -- to show that interest and go through that qualification process once you've validated or had handshakes and contracts and so forth signed to people so you can back it up and say, okay, once you place an order, we're ready to go. Okay. Sorry, just thinking that out loud. I'll take the rest of your questions offline. Thank you, guys.

Our next question is from Jed Dorsheimer with William Blair. Please proceed.

This is Mark Shooter on for Jed Dorsheimer. Kang, a question on the 76 customers, say they all come to fruition. And I know you have 100 megawatts in the toll coaters, but is there a scenario in which you'll have to restrict allocation to a certain number of customers?

We have -- Mark, we have a tremendous capacity be had for SiCore -- for SiCore customers, I would say, in 2024, maybe even 2025, we should not have supply issues.

Understood. Okay. And do you see any of those potential customers, is there any restriction on converting to PO based on where the material is coming from? I'm thinking, okay, I'd like to miss a deal if you there waiting for U.S. domestic production. Is that a factor rule in your--

Yes, the customer engaged, they shouldn't have that problem. The customer who has -- the customers who have concerns would not engage with us for tool manufacturing model.

Understood. Okay. Thank you. And lastly here, congrats on the award with the military. Can you give any color on the unit volumes we should be expecting or ASPs or margin, any color of how we should be modeling that?

Yeah, Sandra, let you address this.

So that is a larger order that is scheduled to go out this year, but we haven't given guidance on pricing and margins on that.

Okay. Understood. Thank you.

Our next question is from Chris Souther with B. Riley Securities. Please proceed.

Hey, guys. Thanks for taking my question. So about six months ago we were talking about customer commitments of tens of megawatt hours and indications of hundreds of megawatt hours for SiMaxx. Are most of those commitments for customers that can switch over to SiCore, at least in the interim, if that's the first line you're going to have up and running and maybe even utilize some of the tool manufacturing in the interim? Or can you help kind of understand, like, what the customer evolution is a little bit better as far as switching over to this newer product just because you're going to have a lot more capacity quicker for that product?

Yeah. The customer, Chris, customers who are interested in SiMaxx, they would not easily shift to the SiCore because as you know, we sold out our 2024 capacity for SiMaxx. The demand for SiMaxx is still very strong. So the customer wants to have a SiMaxx product for reasons. SiMaxx not only offers super high energy density, also offers very high power capability. We have a customer interest in both products, but I have not seen a customer willing to compromise, say since the SiMaxx is not readily available, I'm going to use the SiCore.

Okay. So what are the conversations like as far as those customers who were expecting, like, the first line to be in Colorado to be SiMaxx and now it might be a little bit further that they'd have to wait? Is that going to impact any product launches with some of the key customers you talked about previously? Or how do you kind of address that in the interim? I'm curious.

At this time, our design likes to have a first line for SiCore. That doesn't mean we have to wait for two or three years to build a SiMaxx. So the SiMaxx, at the year end we have a full manufacturing protocol for SiMaxx validate at Fremont with this two megawatt facility. So we are ready to go larger scale. So now our plan is we design this factory not only for SiCore, also for SiMaxx. We just procure our first line and production line for SiCore.

Okay. And then can you quantify in any way beyond the customer numbers being impressively quick to grow here? How commitments and indications are for SiCore, that you're kind of clarifying that one for the first line? And are there significant expectations of CapEx savings for that initial line for SiCore versus SiMaxx?

Yes. SiCore line, of course, is based on our estimate SiCore line is relatively lower cost, okay? This is a off-shelf production line, right? So is a proven manufacturing process. Currently, we are using Pro manufacturing partner part to do for us. We know exactly how the process looks like we should have the machine configuration is.

[Operator Instructions] Our next question is from Jeff Grampp with Alliance Global Partners. Please proceed.

Afternoon. Curious going back to the customer count that you guys had in the quarter. Curious if you guys have kind of a percentage of rough numbers that are taking both SiCore and SiMaxx, and wondering if you have a sense or any insight as to the ones that maybe are taking both, is that to maybe assess a better fit within a specific use case? Or might there be customers that could be ultimately be customers of both products for different use cases. Any insight there?

As we mentioned in our call, quarter, a primary driver of our revenue. Last quarter, actually, we have almost -- the people purchase equal amount SiMaxx and SiCore. But we have a lot more new customers for SiCore products because we have capacity available to them. If we have had more capacity for SiMaxx, we will have a lot of more SiMaxx customers as well.

Understood. That's helpful. And for my follow-up, maybe for Sandra. Any rough numbers or time line in terms of when you guys might have a final number to share publicly on the cost of Colorado? Is that something that's months away at year-end or just any kind of benchmark to kind of think about here without holding it to too tight of the time line?

Yes. So we've completed the 30% construction drawings. We believe we'll have the 100% construction drawings at the end of the summer. That will allow us to get a more high confidence cost estimate as well as the schedule. And so I think we should be able to give some sort of guidance in exiting the third quarter.

Great. Look forward to. Thank you.

Thank you.

Our next question is from Amit Dayal with HC Wainwright. Please proceed.

Thank you and good afternoon everyone. With respect to sort of this ramp in new customers, how should we think about revenues for 2024, given that you do have the tolling capacity available? Is there anything in the pipeline that could materialize into sort of an order that is larger than everyone is sort of expecting at this point that could move expectations for 2024 higher than where they are.

So we -- as you see, we are very impressive number of customers today. So at this moment, we don't know which customer can finish their qualification process. We have some customers already placed order for their commercial use. But we have a large reflection of the customer has engaged with us, start purchasing small quantity of the batteries for qualification. I think we may have more clarity. And over that, in Q2, later part of Q2, which customers can start offering our larger orders.

Okay, understood. And then the $2.3 million in sales for 1Q, was it all SiMaxx. If you could just maybe give color on what the mix was between SiMaxx and SiCore?

Yes, great question. So, it was roughly 50-50 between the 2.

Okay. And the SiMaxx was coming...

No, it's a little bit -- I'm sorry, it's a little bit more -- an answer too fast. It's about $1 million in SiMaxx and about $1.3 million in SiCore.

Okay. And SiMaxx all came from Fremont?

Yes. Okay. That's all I have guys. I'll take my other questions offline. Thank you.

At this time, this concludes our question-and-answer session. If you have any additional questions, you may contact Amprius's Investor Relations team at ir@amprius.com. I would now like to turn the call over to Dr. Sun for his closing remarks.

Thanks again, everyone, for joining us today. As a reminder, you may learn more about our company from on the additional updates and learn about upcoming events and presentations from the Investor Relations section of our website. We hope to see you at our upcoming investor conferences and will continue to update you on the exciting progress we are making in both Fremont and Colorado. Finally, I'd like to thank our employees, partners and shareholders for their continued support. Operator?

This will conclude today's conference. You may disconnect your lines at this time and thank you for your participation.