Conference Transcript - AMPX 2026-03-24

Chip Moore, Analyst — Roth Conference

Okay, good morning, everybody. Welcome back here to the Roth Conference. My name is Chip Moore, sustainability analyst here. Very excited to have the team from Ampryus, Tom, CEO, and Ricardo, CFO, on my right. Great slide up here to begin, Tom, with a little caffeine this morning. Maybe just give people a little overview of the company, you know, the evolution and And what's proprietary, what's differentiated, and what makes that coffee weak?

Tom Stepien, CEO

So thanks for attending. So the company's 15 years old. We started out with one foot in Stanford, where the tech came from, and one foot in China. Some of that is our founding team. And it is all about a silicon anode. Silicon can handle 10 times the amount of lithium, which translates to about a 2x energy increase. so we like we like coffee and we like this analogy because size is important if you're flying drones weight is super important if you're flying drones light electric vehicles robotics all the markets that we're in and because of the silicon anode we can provide twice the energy everything else being equal so we struggled with how do we explain that to the layperson and we came up with the express cell. So that's where we are. I think you may know we did 73 million in revenue last year. That was up 3x. We've guided to about a 70% increase in 2026. We can answer all those questions. But that's where we are. We have an outsourced manufacturing model just to lay that out there. So we designed our batteries in beautiful Fremont, California, and they're made in China, Korea, and contract manufacturing partners in the U.S.

Chip Moore, Analyst — Roth Conference

So you guys are both newer to leadership roles. I guess maybe talk to us about, you know, what drew you, what's been the most surprising things that you've seen since joining?

Ricardo Rodriguez, CFO

Sure, happy to start. So, I mean, I've been in and around batteries for the past eight years or so, And I actually met Kang, our previous CEO, and my predecessor about three years ago, just through the conference circle. And I always thought that Amprix's approach was pretty unique because you find a lot of battery technology companies that are working on one element or one component or even one process within making batteries. but i remember kang telling me pretty specifically like look ricardo unless we're making cells and packaging cells as the end product we don't have a product and therefore no revenues and therefore no company and so the fact that amperes was one of the few technology companies that was really putting it together as a cell you know kind of put it on my radar and so fast forward three years from now i reconnected with the team as i was um leaving my previous company and um and that's why i joined and then you know now seven months later you know that edge gets confirmed even further right um that's the big difference in our portfolio like we actually sell cells not just separate uh battery technology technologies or processes and then I mean the the nimbleness of the team and the resourcefulness of the team is what now energizes me quite a bit actually like to see what we're able to do with only you know 36 million dollars of OpEx which was our OpEx run right here in Q4 is pretty amazing and that gets me

Tom Stepien, CEO

excited yes similar themes Kang and I knew each other back when we worked at applied materials. 16 years ago, we both left to start different battery companies. He landed Ampryus. So it was a very easy connection. I've been in private battery companies, and as you may appreciate, it's a tough space, right? You need to do about five, six things. There's a battery company. Most battery companies do about four or five, and that one is the Achilles heel. Ampryus broke through uh and uh you see that acceleration uh over the last year or so and there's there's plenty to come so it's real uh and the distinction i draw is it's a not a battery technology but it's a business turns out right adjusted ebit positive uh is a super important milestone that we we hit

Chip Moore, Analyst — Roth Conference

in q4 great i think you sort of just answered this but you know originally you were going to vertically integrate with a facility in colorado just talk about you know that shift and psycor versus cymax and why this strategy makes a lot of sense yeah so we took a swing at the bipartisan

Tom Stepien, CEO

infrastructure law when that first came out about four years ago and we're a an awardee and in process of negotiating that 50 million dollar opportunity we realized oh man this this is just over-engineered just did not make sense at the same time we realized that to really serve the market you needed a variety of different battery types just like you have different flavors in your expresso versus tom's latte over there you need to have that variety we have that with the 22 cells in our portfolio some energy focus some power focus some balance so that led us to making the decision to outsource the manufacturing. We would be in serious trouble today because whatever estimate we made three years ago is not what the market needs today. But we have the flexibility now to choose contract manufacturing in the U.S. because you have to obey what our customers want in terms of country of origin. We have the ability to continue to work in China because, gosh, that's the best cost. It's super high quality. We have that flexibility with this outsourced model that we would not have so thanks in part to some heavy left on ricardo we unwound uh colorado uh and we uh we have that behind us you know the

Ricardo Rodriguez, CFO

funny thing chip is if you would have asked the team back in 2023 what would you tool up this plan to make and the team and in fact some people are telling us this now like oh just make a bunch cylindrical cells uh we're actually seeing the market go towards pouch cells and so while um you know speed and flexibility we think are truly a differentiator here in in driving our mode and separating ourselves from the from our peers and it's tough to do that when you've got this captive

Chip Moore, Analyst — Roth Conference

plant that you tooled up to make cylindrical cells and maybe you know as a follow-up to that uh talk about your tolling partners particularly you've you've got one in the u.s coming here in northern california how to think about that and then just how seamlessly you can actually drop in on these lines right i think you said you can almost do it the same day so so how's that process

Tom Stepien, CEO

yeah so we have four cms in china that has served us very well and they will continue we like china we like the quality and many of our customers are insensitive to the manufacturing country of origin we spooled up korea we announced it in may 2025 four months later our korean cm was delivering cells to teledyne flare our customer that has a very small drone we announced in december that there are several more cms in china several more partners there are three today and they we are in the process of standing them up fully industrializing them they will be delivering both cells made in korea but also the contents are important for national defense authorization act you care about the internals of the battery i think that korea will provide 100 internals and some of our customers mostly dow type customers want true blue us fine we announced in january a relationship with nanotech energy in california these things take five six months we working on that and you can imagine that there are other ones coming in the u.s so maybe maybe

Chip Moore, Analyst — Roth Conference

more for you ricardo just talk about cost and profitability and maybe how you can use that as a strategically lever right to drive adoption and how you think about that

Ricardo Rodriguez, CFO

yeah so i mean i think it really all starts with this picture when you're delivering double the energy density on the same uh size and weight package you frankly enable duty cycles that otherwise wouldn't be there. A lot of these UAVs, you know, carry so many devices on them. By the time you power a gimbal, two cameras, a radar, a lidar, a bunch of communications equipment, you wonder how this thing can even fly with existing batteries. And so the duty cycle literally would not be there without a high energy density cell. I mean, even thinking longer term, you look at an eVTOL, an eVTOL will not take off without high power cells and it won't go far without high energy density cells. So you need this blend of high power and high energy to enable these duty cycles. And so we truly think that when you're enabling these duty cycles, you've kind of earned your right to, you know, get paid for all of this development and logistics and coordination that we do, along with the process development that we do to get up and running quickly with quality. And as we mentioned here in our most recent earnings call, we believe that that can get us to the point where we can do 30% plus gross margins reliably. If you look at our side core business, which is what now makes up more than 90% of our revenues, from day one, some of our higher running SKUs have been doing 30% plus gross margins already. Our guide for 2026 has us doing at least 25% gross margins. And so we believe that as long as we keep doing that and as we extend our technical lead as well, because we're also not standing still, that'll enable us to maintain pricing power and get paid our fair share for enabling stuff that otherwise literally would not happen.

Chip Moore, Analyst — Roth Conference

and you brought up guidance you gave guidance for the first time as a public company talk about your visibility there what gives you the confidence I think you you need a little conversion and in the second half of the year but but how

Ricardo Rodriguez, CFO

you're viewing that yeah I mean the way we look at it is we take guidance pretty seriously and you know you can't have it two ways right like what my previous company we had three leading customers doing 90% of our revenues here we have over 550 customers and the revenues are pretty spread out across all of them so within the quarter we are herding cats and dogs you know this in many ways is still a bit of a cottage industry there are a lot of UAV manufacturers a lot of light EV manufacturers a lot of satellite providers who need batteries within them and so we've got very good visibility you know within the next a quarter and a half two quarters as some of these guys start ramping up and getting more professional but you know given the base that was built up last year we believe that growth within that can help us drive the guidance and then we're ready to capture any additional upside that'll come here in the U.S. as you mentioned during the second half and you know I'd rather spend my time and the team's time fulfilling it then you know nerding out over sizing it and so we'll we'll size it with POS and so we do believe that there's some additional upside there for us to take and we'll size it as we execute it and

Chip Moore, Analyst — Roth Conference

you know you talked about herding cats and sort of the analogy there just talk to us about how you go to market right direct with partners and how you see

Tom Stepien, CEO

that evolving yeah so our end users are drones light electric vehicles and then there's a couple other markets that are up and coming a couple other segments robotics uh the evtols is in those early days some of those end users buy sales from us directly and they vertically integrate others buy sales through pack houses packs our sales get assembled into packs they sometimes have cooling. They almost always have some circuitry to make sure that the voltage current is right. And sometimes they have a piece of silicon that runs something called a battery management system. So you figure out, are you empty? If so, then you shouldn't try to draw more energy and vice versa. So there are a lot of pack houses. Those also tend to be cottage industry type of companies but about half of our sales go to pack houses who in turn then provide packs to the aero environments and bae systems and some of our other customers nokia uh we count in that

Chip Moore, Analyst — Roth Conference

same category and maybe just more broadly the the qualification process that you need to hit for some of these uh applications you know how they vary yeah so oftentimes customers come to

Tom Stepien, CEO

with an existing product because that uses off-the-shelf batteries sometimes what you can buy on amazon is good enough but when they realize oh my goodness i can fly twice as far just by changing out the cells that qualification if you're replacing is within you know a quarter right max because the testing is very straightforward if you have people on the craft think air taxis then you have a longer qualification because you got to worry about faa cert you got to make sure you freeze things ahead of time you have to synchronize that that qualification with other parts of your air taxi so that takes a little bit longer we have a pilot line in fremont that thank you for your tax dollars is funded from defense innovation unit dollars we're the only guys in battery land that received money of this type last year it's been increased lately that allows us to win the sockets to win the designs with a quick turn we can make a thousand cells and

Chip Moore, Analyst — Roth Conference

i think you know one of the interesting things uh we've talked about in the past is you know your revenues are just accelerating and the prospects for recurring revenues right via replacements

Ricardo Rodriguez, CFO

just how are you thinking about that potential yeah i mean that's uh that's frankly come out of just trying to understand our end markets and the market sizing more clearly and if you look at the uavs where we play a role right um those uavs that are used on the front lines kind of hold the line tend to be pretty cheap they actually use um remote control car batteries like lithium polymer cells the cost the cost is the main objective and so we are not necessarily on those uavs we're actually on uavs where um you know you're doing surveillance you're doing counter-attack and those tend to come back and on those you know an assumption of having to buy two to three battery packs depending on the duty cycle is very real and it's something that we're going to see play out over time so there is a bit of this you know razor blade model that'll play out not just within the uav market but all of the other markets that we're looking at you know the notion of replacing batteries for devices that work to support space interactions or operations are there uavs will definitely need to swap out batteries given their duty cycles robotics as well light evs you know you see people swap the the batteries on on these electric bicycles and motorcycles and scooters even within the day and so yeah i think we're going to get a much better understanding of that dynamic as as we fulfill the market here and let's talk maybe drone

Chip Moore, Analyst — Roth Conference

dominance act you tom you brought up defense innovation unit uh you know first gauntlet winners i think were selected but it's not a down select you know that they can reapply just

Tom Stepien, CEO

walk us through how involved you are there yeah so we're all over it the u.s is playing catch up on drones um we've seen this on a couple fronts most of our revenue ampere's revenue is in europe for drones, but the U.S. is quickly catching up. They changed some of the rules in the fall, and they announced DDP. The first winners, there were 11 that won out of the 25 that were invited. Several of those are our customers. In the last six, seven days, we saw that Androil got a $20 billion order, mostly on what they call their lattice infrastructure to keep track of drones and everything that's going on the battlefield. This morning, I read that AV or environment got $117 million for their Puma 550. That is evidence that the U.S. is playing catch-up, and we'll see that 75 outside the U.S. on drone, batteries from Ampryus, probably better balanced. They come to us because we got the go-to cell. If you can fly further, if you can carry more, everything else being equal, and we think it is, we should win. That's what you need to believe. that's what we're working towards making sure that we fulfill for you as

Chip Moore, Analyst — Roth Conference

shareholders maybe you know if we switch you're in a leading position here with your batteries but competitive threats have you know would what to you how do you view them solid-state batteries you know some materials plays how do you do

Tom Stepien, CEO

the competitive environment yeah so we're silicon based and silicon is going to be a nice decade going forward we are compatible with solid-state batteries And if you go back in our lab and our R&D spend and the team that we have, they're turning knobs. And the pilot line that is being extended with some DIU dollars helps us do that on a more efficient basis. We're compatible with some of the lithium metal. Silicon is, and lithium metal has some advantages. Batters are complicated, right? It's like picking wines from Napa. There's all these different varieties, and they have different applications. But the good news is that silicon inherently gives you better energy density, silicon inherently gives you faster charging times, and as the industry evolves into moving from liquid electrolyte to more pasty, that's what solid state battery is all about, and there's versions of that pseudo-solid, semi-solid, as they move to different cathodes, right, that is something that we watch very diligently and our inherent silicon foundation is compatible with that

Chip Moore, Analyst — Roth Conference

so done well we should win and you know we talked about drones from the defense angle quite a bit but what about the other applications right where you call emergency services and they send out a drone infrastructure inspection all these agriculture right how do you think about

Tom Stepien, CEO

those markets same story right if you have a drone as first responder and what they do there in municipalities is pre-position the drones in certain parts of the building or certain parts of the city and if there's a 911 call the goal is to get the drone and the camera on site within two minutes that we figure out is the fire real or did the guy actually put out the fire at his barbecue by himself with his hose, and you know what right equipment to dispatch. That's growing something like 1,800 police departments in the U.S. Use that. They also want more flight time if you can get there further, if you can carry additional cameras. Maybe there's an infrared camera. They're finding kids with infrared cameras, right, that wander off from the backyard at dusk. Beautiful stories but same story we should be the uh the the gear provider we should be providing these batteries to all of these applications because we think that it provides this value that is very much in line with what they want to do which is to fly longer to carry more to be more productive

Chip Moore, Analyst — Roth Conference

for their end customers um you know another announcement you made in the past you were chosen by Amazon, part of their accelerator program, one of a small number of companies. Maybe just an update there. You've got a seat at the table. What's the

Tom Stepien, CEO

potential of that? The potential is huge. We have nothing yet to announce publicly. There's a lot of work being done. Amazon, as we all know, is delivering by drones. So you can think, okay, well, maybe there's an opportunity there. Amazon has robots running around their warehouses. Well, okay, would they care about a battery inside those vehicles and there's other things that amazon is doing amazon makes tablets and would you care if a tablet was maybe a little smaller and last a little bit longer so so those are all things that are in discussion nothing nothing yet to talk about but we do have a seat at the table which is super important right it's hard to break into some of these big companies right so if you can get to them and have these discussions engineer to engineer project manager project manager you got a better chance of winning the business than otherwise

Chip Moore, Analyst — Roth Conference

we've got a couple minutes here if there's any audience questions roma a silicon anode from

Tom Stepien, CEO

ambrius is inherently better than a graphite anode from graphite is what is every everything thing 98 of the lithium ion battery market uses a graphite anode with typically an nmc or a cathode so batteries have two parts we replace the graphite anode with a silicon anode and that allows us to have this twice performance that we that we speak to so vanadium is interesting uh there are a couple companies that use vanadium as an additive vanadium super expensive right two hundred dollars a kilowatt hour uh and that's uh yeah that's a challenge there sure yeah so look we have laid some of that out in our investor deck where we're showing three different vectors one is to continue the lead the 450 watt hours numerator and kilogram denominator is about 50 higher than the 300 you can get from standard graphite batteries we want to continue that lead that's our onlyness we're the only guys who can do that we want to continue at the same time we want to make sure that we have the power that the ev tools need ricardo spoke to that but so go ahead and look at the investor deck and that tries to lay out where we're going

Ricardo Rodriguez, CFO

at a macro level i mean they have uh just in different ways right so if you're trying to put silicon in the anode side of the battery as tom was mentioning you can take one of three paths. The first one is you use silicon doping, and in fact your iPhone battery probably has single digit percentages of silicon blended within the graphite in it. The second path, which is the one that we are on, is silicon oxide. There you can use anywhere between 30% to maybe 90% silicon. And then the third path is silicon carbon, which there are some you know relatively well-funded private companies that we're not we're not strangers to silicon carbon we've been testing those materials but they are relatively expensive and you know the yields and making those products are not that high which makes them expensive and so we'll see if they'll catch on but you know frankly even if you get the anode sorted out what we truly do believe is that what does the rest of the cell need to look like and that's where the bulk of our know-how IP and trade secrets is, and what does the separator need to be, what do the electrolytes need to be, what does the anode need to be, and as we continue to optimize that, we're going to be able to continue making more and more, you know, the most out of silicon. Let's not forget, the company started with 100% silicon nanotube chemistry, right, and we all saw in our margins for Cymax that that was not on a scale.

Chip Moore, Analyst — Roth Conference

I think we've got to wrap up there at time, but Tom and Ricardo, thank you so much.