Good afternoon, and thank you for holding. My name is Joe, and I will be your conference operator today. Welcome to Joby Aviation's Third Quarter 2022 Conference Call. [Operator Instructions]. As a reminder, today's call is being recorded, and a replay of the call will be available on the Investor Relations section of the company's website. Please note that some of the company's discussion may today will include statements regarding future events and financial performance and statements of belief, expectation and intent. These forward-looking statements are based on management's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a more detailed discussion of these risks and uncertainties, please refer to the company's filings with the SEC and the safe harbor disclaimer contained in today's shareholder letter. The forward-looking statements included in this call are made only as of the date of this call, and the company does not assume any obligation to update or revise them. This call will also include references to the company's adjusted EBITDA, which is a non-GAAP financial measure. A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP measure is included in today's shareholder letter, which is posted in the Investor Relations section of the company's website. On the call from management today are JoeBen Bevirt, Founder and Chief Executive Officer; Paul Sciarra, Executive Chairman; Didier Papadopoulos; Head of aircraft OEM and Matt Field, Chief Financial Officer. After the prepared remarks, we will open up the call up for questions. I will now hand the call over to Mr. Bevirt.

Good afternoon, and thank you for joining us. It's already been a full year since we started reporting our financial results, and I'm grateful for your continued dedication to learning about our progress. In that first call, we talked about our intention to deliver on transparency for our shareholders. And I believe we've lived up to that goal or 2 months providing you with deep insight into each area of our business and for the first time, last quarter, providing a detailed stage-by-stage look at our progress on certification, which we've updated in today's shareholder letter. During this quarter and consistent with that goal, we opened up the doors to our Marina production facility as part of our inaugural field trip, which I'll talk more about later. A couple of days before that event, we unveiled our Living Lab terminal, which guests were able to experience at the field trip. The lab was developed in partnership with Skyport and is going to serve as a base for us to design the experience our customers will have when they arrive for 1 of our flights. This was just one of several steps we took this quarter to lay the foundation for our future commercial service. We also expanded our long-standing partnership with Uber. Back in 2020, we announced a groundbreaking deal to integrate our service into each other's apps in the U.S. We've now taken that agreement global and with more than 100 million passengers traveling with Uber each year. We've opened the door to delivering seamless, multimodal journey in the international markets around the world. In October, we applied to the Japanese authorities for the validation of our FAA certification, building on a similar path we are taking in the U.K. As with the U.K., we can take advantage of…

Thanks, JoeBen. Good afternoon, everyone, and thanks for joining us today. I'd like to take the opportunity to share our general approach to financial and resource planning at Joby. Our plan has always been built to be adaptable, something that we have talked about consistently over the past year. We adjust our pace and phasing of initiatives to optimize our spending across the organization. This is one of the many benefits of our vertical integration as we can modify our spending and resource plans dynamically because we have a full understanding of all elements of our business and how they fit together. Our early investments, much like our approach to aircraft development remain modest as we iterate rapidly and incorporate learnings before accelerating. Visitors to our first-ever field trip saw our pilot production plant, for instance, where we are building a production line at low volume, to validate and certify our manufacturing processes in partnership with the experts at Toyota. This lower investment approach enables us to prove out scalable technologies prior to the sizable investments required for higher volume production. We take this approach in all parts of our business, enabling us to make timely and appropriately sequenced progress towards our goals across certification, manufacturing and commercialization. We are well capitalized with $1.1 billion in cash and short-term marketable securities at the end of the third quarter. This cash balance excludes the upfront investment of $60 million from Delta, which was received on October 7 through the issuance of common stock. The Delta partnership is unique in the industry, not only for the depth and quality of the operating engagement but also for the financial arrangements, which are outlined in our filed 8-K whereby Delta has the opportunity to invest further up to $140 million through warrants tied to…

[Operator Instructions]. Our first question comes from the line of Andres Sheppard with Cantor Fitzgerald.

Congrats on another quarter. And congrats again on the first public test flight a few weeks back. It was great. We got a chance to attend. That was very well organized. So congrats again. I guess my question is just around certification. I just want to make sure I'm understanding this correctly. So it looks like the full certification got pushed to 2025, but it looks like you also anticipate working with the Department of Defense in 2024. So I guess -- could you maybe just elaborate on how and why that's the case. So certification is now 2025, but still get a chance to work with the DoD in 2024?

Thanks, Andres. I really appreciate you coming out and coming to the field trip. And but again, what I hope you have seen is how hard we're working to bring up both the pilot manufacturing facility, but also all of our processes to be able to build conforming components. And that really is all in service of both of these goals that you laid out, both the service for the DoD in '24 and our commercial passenger service in 2025. With regard to your question on certification on the timeline there, the key piece is to bring the passenger service online, we need to be the SFAR given the change of the FAA made from PART 2117A to Part 2117B. So we need that SFAR completed. That's a work in progress. We will see -- or we expect to see a draft of that in the coming months. And that will increase the certainty that we have. Today, we have more certainty than we've ever had, and this will increase it further. We also have internal pieces that we're driving on in order to deliver on tight certification, either concurrently or in the same timeframe of -- and again, our ambition is to launch the -- our commercial passenger service in 2025.

Got it. Okay. No, that's very helpful. And maybe as a quick follow-up, if I may. Just in regards to your capital needs, right? So obviously, you remain well capitalized, $1.1 billion in cash and equivalents. You also have that shelf out for up to, I believe, it's up to $1 billion. So I'm just wondering, how are you thinking about your capital needs now that the certification timeline got pushed do you anticipate those needs changing? Do you anticipate potentially using that shelf sooner than initially we're targeting? Just any sort of color there would be helpful.

Andres, it's Matt. So as you say, a strong balance sheet that we have, and we're in a fortunate position to lead the industry with that with $1.1 billion in the bank. There's no meaningful change to our cash burn projections that we've seen because we have all the levers we can pull because of the vertical integration around the pace and timing of our spend, especially on those commercialization elements. The other piece that's important to highlight is the DoD operations in 2024. And so you really see those early plans potentially going into DoD service pending the outcome of the contracts that are underway. So we're really focused on being judicious with our spending and making sure our expenses aligned with our priorities around certification and manufacturing. So we don't have any plans in the immediate future to access the shelf, but really took the opportunity to put that in place because it does cover over the next 3 years, and it was just a prudent action to take to be opportunistic should the occasion arise.

Our next question comes from the line of Savi Syth with Raymond James.

This is actually Matt on for Savi. My first question would be for JoeBen. JoeBen, you spoke of filling gaps and translating the prototype design into a certifiable aircraft. Can you maybe elaborate on whether -- is that still a team that needs to be built out? Or is it in regard to aircraft design. And when do you think you'll be comfortable to share some of the additional design specifics for that production aircraft, which is the payload capacity or anything else?

Thanks, Matt, and thanks again for joining us. both today and at both of our facilities. One of the things that I think you've got to see was the remarkable progress that we're making, building our production intent aircraft and both the powertrain components and also the airframe. That really demonstrates the confidence we have and the maturity of the aircraft for building. As you also saw, we've been and heard when with the flight test. That aircraft has been flying since 2019 and again, really demonstrates the maturity of our design. And so we do feel really good. In terms of your question around the gaps of -- on our -- I would point to the acquisition of the Avionics team as an area where we really lean forward and brought in software variation capabilities, which we believe will be crucial for us. And then the other element is on testing as we scale up the -- and testing really moves into focus, the stage 4 of our certification process. The key area to focus on there is that we've just received approval from the FAA on our first certification plan for the flight control computer and this allows us to go and begin for credit conformity testing, which is a huge milestone that laid the blueprint for for all of the electrical systems on the aircraft, and that's going to be really the focus for us as we look to the coming quarters.

Okay. Very good. And thank you for hosting. If I might add, I will say I didn't hear much though when I was there from the aircraft as it was very quiet. So that was pretty special. If I may -- well, my next question for Matt. Could you provide some timelines on when you're thinking about the higher-volume Phase 1 production facility maybe once that is decided, how long it would take to stand up? And are there any financing options you're considering at this point in regard to that facility?

Yes, sure. As you said, we're really focused right now on our pilot plant, which is, call it, 10 of aircraft per year. I'm really pleased with how that's coming together. We're really dialing in now is all those production processes sorry, for production that's required for scaling. What we're looking for is what's that right time to bring that higher volume online. So the way we think of that is really that needs to be in service of commercial service. And so making sure we dial that in, right. We have really good line of sight into all of our lead times for both equipment and the plant itself. So I'm not concerned about us managing that effectively at all. In terms of financing, there are a number of opportunities for us to finance that scalability. We're really pleased with how the U.S. government is leaned into programs like Title VI and actually added additional funding to the Inflation Reduction Act for advanced technologies such as ours. So really encouraged by the support and U.S. governments providing for this sector.

[Operator Instructions]. And our next question comes from the line of David Zazula with Barclays.

Just my question is, first, maybe hopefully not two words within here. But it sounded like the word you used -- for means of compliance were substantially complete this year. And I think that might be different than how you had discussed in the past, I guess, does that represent any incremental uncertainty around the means of compliance in 2022?

Yes, this is Didier. Thanks for the question. In terms of the music compliance, we're like you said, for the most part, compete with these, we're right on track, exactly where we want it to be at this point in the program and really focusing more on transitioning towards the certification plan and then moving into the testing area. Like we said earlier, we're pretty excited to have submitted and got an acceptance from the FAA on our first electronic component flight test -- sorry, qualification test. And that's really more of an outcome of having completed the 11 means of compliance and then a surplan associated with it. So we're exactly where we need to be at this point.

Great. And then digging in relatedly, you have been talking at least for a couple of calls now about the area specific certification plans. Can you just give us a little more color on how many you're intending to submit right now and what the pace we should be expecting on that moving forward?

Yes. I think what's best to do in order to answer this one is to go back to the charts that we have been presenting. And instead of thinking about them in terms of numbers, think about the percentage itself because the numbers could sometimes mislead in very. So as we shared in the charts earlier and in the update, we have just recently submitted 1 more area-specific certification plan. and we expect to make really good progress on those towards the end of the year. So the percentage is the area to focus on for the most part.

Awesome. And then, I guess, if I could just tack in a real quick one. One of the reasons cited for the potential change in time line was the need to hire personnel, I guess, for Matt or JoeBen. Are you having difficulty hiring personnel? Or are there any areas that you're running into challenges hiring that you weren't expecting?

So we are continuing to hire at pace. There are a few areas that we highlighted specifically in test and software where we are aggressively recruiting and -- but we're very pleased with the caliber of the talent that we're bringing in, but are extremely focused on continuing data in a few core areas. And also, again, highlighting the acquisition of the Avionics team to really accelerate the software verification work.

One [indiscernible] -- Avionics acquisition is, to your question about hiring. It's really been a great addition to the team, though originally focused around verification activities. We've also learned that we are able to augment that to leverage their expertise in areas such as the software development. So in my mind, that's definitely paying double dividends and redecide about the breadth of opportunities that it presents on that front.

Our next question comes from the line of Jason Holcomb with Morgan Stanley.

This is Jason on for Kristine today. In regards to the Delta partnership, are you able to provide any additional context on sort of what some of the key milestones are that must be met to potentially receive the additional investment from Delta?

Sure. Jason, this is Paul. Happy to take the question on Delta. As we said in the sort of prepared remarks, we're very excited to be adding Delta to our list of partners, 1 that includes obviously the folks like Uber and Toyota as well. One of the things that made us so excited about this partnership was that it really brought 2 things to the table. First, as Matt referenced in the prepared remarks, it brings capital and potentially more capital to an already strong balance sheet. And then second, it gives us an opportunity to lean into the investments that Delta has already made in terminals and with regulators in some of the cities that we're targeting. Each of those are going to be important pieces to this opportunity. And with respect to your question on the additional investment, I think we can say that there are 2 additional jointly joint milestones that we're going to be focused on to sort of unlock the potential for that investment. The first is around the demo or sort of trial of this locating takeoff and landing infrastructure at 2 of the airports in the markets that we've highlighted. And our teams and the trend a Delta teams are already working on that as well. So we're very excited about what this Delta opportunity can provide over time. And I can say that our teams and internal the Delta teams are working pretty aggressively against the milestones that should unlock those pieces.

Paul. Appreciate that. And then maybe just 1 last quick 1 for Didier. So in terms of means and compliance, so as you sort of noted in your chart, Joby sort of 96% through while the FAAs are at around like 84%. But what is the sort of the delta there? And I guess, what is it that the FAA is sort of still working through that sort of Joy has completed on their end or on your end?

Yes. So there's no -- maybe first, let me try and explain the top line in the bottom, the 96% and the 84%. Really, those are in general what we might be submitting, for example, the difference of this is what we are already with or submitted versus what the FAA has responded there's more of a timing cycle to that. And so one is typically always trying to catch up with the other one. And in terms of what is left, it's not really a specific area of focus left versus others. It really is a combination of small spots here and there. So for the most part, really, pretty good progress on that front, really, it couldn't be happier than where we are right now.

[Operator Instructions]. And our next question comes from the line of Edison Yu with Deutsche Bank.

First one, I wanted to understand some of the nonregulatory reasons for the postponement into 2025. Is there any way you can maybe provide some specific examples about the manufacturing aspect? Is it in the context of just kind of normal scaling up? Or were there things that you kind of wanted to vertically integrate and those are ending up being much harder to do.

Yes. Thank you, Edison. I appreciate it. This is JoeBen. So we have, as you know, really focused on vertical integration, and this is a huge asset, but it also means that we're taking on a heavy lift. And we have been investing in next-generation manufacturing processes, whether that's on the powertrain components and having a full digital system for our work construction or on the composite side with our automated fiber placement across all of those systems, we have to put the processes and procedures in place, and we are building a next-generation aviation company. This is hard work, but it is going to pay massive dividends over the -- both as we're working through the certification of these components in this aircraft, but also for many years to come. And so we believe those investments are really valuable. They have taken a lot of hard work and have taken a little longer than we had hoped. But we feel like we're coming around the corner and that the dividends are really going to start to pay off.

Understood. And I guess if I could ask about the -- maybe the financial implications of that. I think last quarter, it sounded as if you were sort of being a bit more prudent or dialing back the spend, but I think earlier in the Q&A, you had said this doesn't really impact that. So I guess, is it just -- are you offsetting the kind of incremental spend here with cuts elsewhere? Or how does the math kind of work out that there isn't really any change to the kind of spend path?

Yes. Listen, so as you rightly pointed out, we did dial back last quarter, really reflecting external forces. So if you look at the macro factors and the headwinds the industry is large from [indiscernible] inflation, interest rates, commodity prices, we felt it was prudent to make sure our spending has dialed in on certification and manufacturing and really have dialed back elsewhere that proved prudent as we now look at the timeline and the updates we're sharing today. And that does allow us, obviously, to extend our runway somewhat. In addition, we look ahead to how we think about some of those other big investments, Phase 1 manufacturing, obviously, are spending on plan times with production. And so we time those as our scheduled dictates. And so that further extends the runway. And then as we ramp up commercialization, that's a heavy lift. And so as that pushes back, we push those expenses back as well. So again, having that full visibility through the whole stack allows us to dial our spending judiciously.

And our last question comes from the line of Bill Peterson with JPMorgan.

Yes. Thanks for fitting in and just echoing all the other ones you said it's a great thank you guys proud a few weeks back, but thanks for that. One to look at this -- the DoD in more detail, especially in light of commercial services, perhaps starting later as you guys have talked about. I guess what does that look like? I mean, can you support all the branches, how close this aircraft to your conforming aircraft for commercial applications. How should we think about the revenue opportunity? And specifically, is this kind of more like an OEM and aftermarket model where you could collect upfront cash just imagine things are not finalized, but how should we consider the opportunity for sort of 2024 and beyond.

Bill, this is Paul Sciarra. Thanks a lot for the question. We have spent a lot of time, and I think Joby is relatively unique in the category in having these sort of 2 paths to market, one, through FAA certification and to broader consumer service. And then two, through our partnership with the DoD to service and revenue opportunities in that sector. And that obviously stands outside of FAA certification. When we think about that opportunity, we've already announced obviously, the Air Force was our sort of lead branch in terms of evaluating this aircraft for use there. We recently added the marines last quarter who are going to be following progress and that we're working very, very closely. And we think there are opportunities to extend to the other branches as well over time. What that looks like, Bill, is we think there are sort of 2 paths that to take: one is a contract around and contractor operating model. So folks that are similar with government contract. I think should understand what that looks like. And then in turn, another would be a sort of acquisition-type model with sort of maintenance sort of on the background. We don't know yet in the conversation in terms of which way that's going to go, but we think both are viable and they may be different for different branches, depending on the use cases that they're evaluating. In terms of kind of sizing that it's hard to say right now, but look, as we take a look at the number of helicopters that are deployed in the world, U.S. Army, for example, has the largest helicopter fleet with more than 5,000 vehicles in operation. So that gives you some size, I think some way to sort of think about the sort of maximal opportunity that's there. And we're very excited about continuing to accelerate that work and get closer and closer to delivering those into service with [indiscernible].

Okay. That's actually terrific color. I wanted to talk about certification. It sounds like you're saying for whatever has remain the last sort of 10% to 15% remaining to be agreed upon because presumably you may more progress with the quarter end. It sounds like you said it's -- they were to use this combination of small stuff. I guess, any sort of color on what you could say what's remaining? And then maybe for the testing and analysis, what kind of areas are you able to move forward in terms of, I guess, getting 4 credit type of certification. If you can provide any additional details on that, that would be helpful.

Yes, this is Didier. Thanks for the question. So the remaining parts are really distinct subsets parts associated with various systems like flight control systems, propulsion unit endurance system, for example, or acoustics they're in no means a representations of areas of risks or lack of product progress per se, really just a matter of time on those I'm not sure I can say more on that. The areas that we can make progress on really are the ones associated with the area-specific surplans we have submitted in the past and those that have been accepted. This is where, if you look at the 37% progress, you can see here on stage 3, all of these are ones where we can now proceed into the testing phase and start taking 4 credit points, so to say, with the FAA. So the frac control computer electronics unit, which was all designed built in-house and a lot of the -- a lot of you were able to see during the field trip visit. That's 1 of those examples where we have got our surplan approved, our qualification test plan approved and hence, have gotten an okay from the FAA to start the testing and making progress. So that's one of the many examples on that front. Really excited about that. Like JoeBen was saying, one of the great benefits of this is it sets the blueprint for the other electronic parts that will follow really shortly after. So that's an amazing exercise and a great demonstration of the capability of the team here, but also the lock in step coordination with the FAA.

Yes. That's terrific color. If I could just sneak 1 last 1 in. So I know you guys are being proved this ones for math by the way. So I know you guys have been improving on cash spend. But is there anything, I guess, in terms of the next couple of quarters or into next year in terms of lumpiness we should think about and timing of building conforming aircraft or just how to think of like the trajectory in terms of some of the spend, whether it be, I guess, primarily CapEx or maybe other or even OpEx, but as we should sort of contemplate as we look into next year.

Yes, obviously, won't be providing guidance on 2023, at the right time, easily do the fourth quarter earnings call. In the near term, we provided guidance to $320 million to $340 million cash burn, which was lower in the last quarter. We'll be at the low end, if not below that. but that will have some lumpy capital expenditures in the fourth quarter. So there's going to be a lump there that we're going to be spending as we build out our facilities and so forth. And then the next lumps would be really as we look into either aircraft production and that ramping up for Phase 1 -- sorry, phase, Phase 1 manufacturing because the pilot plant, as you guys saw, is largely complete. We showed some parts of the integration line to go and a little bit of powertrain, but largely the big assets are behind us. So I would say, really, it's about aircraft production when we enter into Phase I, and we'll be talking more about that in the future.

Thank you. Ladies and gentlemen, this concludes our question-and-answer session. I now would like to turn the call back to JoeBen Bevirt for any closing remarks.

Thank you all so much. Really, really appreciate your time, and I really appreciate all of you who are able to join us to the field trip that was fantastic. Wanted to -- a number of you that had questions on [indiscernible] timing, I want to be really clear on what we're driving towards. First, we're -- it's important for us to emphasize how important the service with the DoD is in 2024, given the SFAR. And then second, that we are continuing to be laser focused as a company on delivering type as soon as possible, still doing everything we can to hold that in 2024. And so that with that SFAR, we can and commercial service as soon as possible in 2025. And again, thank you all so much for joining us. Really, really appreciate all of your insights in the industry and looking forward to our next call. Have a wonderful evening.

This concludes today's conference. Thank you for your participation. You may now disconnect.