AEye, Inc. Q1 FY2026 Earnings Call

Ladies and gentlemen, thank you for standing by. My name is Joyce, and I will be your conference operator today. I would like to welcome you to AEye's First Quarter 2026 Earnings Call. I will now turn the conference over.

Good afternoon, and thank you for joining AEye's First Quarter 2026 Earnings Call. I'm Keaton Olson, Investor Relations Manager for AEye. And with me today are Matt Fisch, Chief Executive Officer; and Conor Tierney, Chief Financial Officer. Earlier today, AEye announced its financial results for the first quarter ended March 31, 2026. A copy of the press release is available in the Investor Relations section of the company's website. Before we begin, today's discussion may include forward-looking statements as defined in the securities laws and regulations of the United States with reference to future events, operating results or performance and are based on our current expectations and assumptions. Any forward-looking statements are subject to inherent risks, uncertainties and changes in circumstances. Our actual results may differ materially from those contemplated by these forward-looking statements. You can find more information about the risks, uncertainties and other factors in the reports AEye files from time to time with the Securities and Exchange Commission, including in our most recent periodic report. The statements to be made are as of today only, and AEye does not intend to update any forward-looking statements regardless of any new information, future developments or otherwise, except as may be required by law. In addition, we will be discussing non-GAAP financial measures on this call, which we believe are relevant in assessing the financial performance of the business. These measures are presented as supplemental information only and should not be considered a substitute for financial information presented in accordance with GAAP. You can find reconciliations of these metrics to the most directly comparable GAAP measures within the press release. Now let me pass the call over to Matt.

Thank you, Keaton, and thank you all for joining our first quarter 2026 earnings call. The quarter unfolded exactly as planned, steady execution, no surprises and a commercial pipeline that continued to grow. Our ecosystem partnerships and manufacturing capability remain strong, and we now have more commercial engagement than at any point in our history. Our funnel continues to be the best barometer to benchmark our progress as revenue tends to be a lagging indicator. As of today, our revenue-generating customer count has grown from 15 to 21 since our last earnings call. I'm also pleased to report that both our issued quotes and active engagements have increased by nearly 40% quarter-over-quarter. These leading indicators, new technical engagements, inbound RFIs and POC activity across automotive, trucking, defense, rail, infrastructure and ITS are all moving in the right direction. These indicators are the data that investors should focus on to understand where we are headed. Quarterly revenue is up almost 60% year-over-year. This meaningful growth is driven by our software-defined architecture and long-range sensing performance and reflects the strong pipeline activity building behind it. AEye's technology gives machines vision, the foundation of physical AI and the prerequisite for every intelligent autonomous system being built today. The market is potentially very large and is accelerating. Barclays projects the physical AI market opportunity could reach as much as $1 trillion by 2035, and LiDAR is the enabling layer that makes it real. AEye's software-defined architecture positions us at the core of that ecosystem and the LiDAR sector's ongoing consolidation has only strengthened our relative position. AEye is on stronger footing coming out of that consolidation than going in, better capitalized, leaner in structure and with a commercial pipeline that continues to expand. The automotive industry appears to be squarely shifting toward AEye-driven safety and software-defined vehicle architectures. And we believe long-range LiDAR is becoming essential to that architecture, not optional. Apollo offers best-in-class detection range when operating behind the windshield and is the only sensor we know of to be customer-proven to reliably detect objects at distances of up to 1 kilometer. Our OEM engagement has increased, driven by recent robotaxi investment announcements, growing trade policy implications and supply chain resilience concerns with OEMs in the passenger vehicle segment actively seeking domestically sourced alternatives. AEye's manufacturing partnership directly addresses that demand. Multiple new RFIs arrived in Q1 across both passenger and commercial vehicle segments and OEMs have begun to reengage as L3 and L4 road maps are being reactivated and expanded. In ground mobility, evaluations by autonomous trucking companies are deepening. Multiple companies have programs underway, and we are now shipping sensors into those evaluations. Apollo should be well suited to serve this expanding addressable market. In transportation and infrastructure, Optus is now live at an active intersection in California in partnership with FlashEye and BlueBand. Additional U.S. smart intersection deployments are in progress. Our APAC expansion strategy is also progressing. An Australian ITS POC has advanced into a discussion of commercial terms. In Korea, we recently concluded a successful customer roadshow engaging with more than 10 OEMs across ITS, rail and mobility sectors. Our business partnership with ATI in China remains strong, and we have four additional customers now evaluating our Apollo LiDAR product. In defense, active shipments continue with an existing U.S. contractor for UAV wire detection. Repeat business is emerging within that account, and Apollo is being evaluated for additional applications, including UGV and counter-UAV with an expectation of multiple new RFQs. A significant development this quarter is our new commercial relationship with Syntech, a global defense systems company with established ties to leading defense primes. Syntech is actively promoting Apollo to its customers and initial shipments are already underway. This partnership has the potential to unlock international defense and aviation markets outside of the United States, meaningfully expanding our addressable pipeline while complementing the domestic engagements we have already built. What drives selection across all of these verticals is consistent. AEye's proven and reliable 1-kilometer detection range with unlimited software-driven adjustability. That flexibility is paying dividends. For example, a defense customer that initially engaged us for a single UAV wire detection application is now evaluating Apollo across three separate use cases without any change to the hardware they have already deployed in the field. This is a key differentiation factor that drives customers to select AEye. Stratos, the newest addition to our product lineup, extends our capability up to 1.5 kilometers of detection range with 500-meter performance behind the windshield at a disruptive price point. Through our manufacturing partnership with Lite-On, AEye's supply chain is globally diversified, providing the flexibility and resilience to navigate geopolitical risk and shifting trade policies that we believe our peers cannot match. Our tech stack is derived from off-the-shelf telecom components, which allows us to compete on cost while delivering the mass manufacturability and high performance our customers require. We continue to build on our partnership with NVIDIA as it is the cornerstone of our automotive and industrial market positioning. Apollo is validated on DRIVE AGX Orin and has been demonstrated on DRIVE AGX, NVIDIA's next-generation centralized automotive compute platform. In March, we joined the NVIDIA Halos AI Systems Inspection Lab, the world's first ANAB-accredited AI systems inspection lab. ANAB accreditation is generally viewed by OEMs as a critical marker of confidence, reliability and quality assurance within their supply chain. Our Optus platform powered by NVIDIA Jetson Orin extends our reach into infrastructure and industrial markets via our diversified software ecosystem. We are giving infrastructure and industrial customers a ready-made path into physical AI without having to build perception capability from scratch. I will now turn the call over to Conor to review our first quarter results.

Thank you, Matt. Our strong commercial momentum is broad-based, showing up across our full addressable market rather than any single vertical. Our active customer base now spans defense, intelligent transportation, rail and logistics and security, a level of diversification we did not have a year ago. And the quality of that growth matters as much as the breadth. We are also seeing a growing pattern of repeat business across the customer base, a meaningful signal of product-market fit and a direct validation of the performance advantages of our architecture. Our commercial progress is beginning to attract broader institutional attention. We added new sell-side analyst coverage this quarter, and we are seeing a meaningful increase in both sell-side and buy-side interactions—an external signal that the commercial activity we have been describing is registering with the investment community. The revenue ramp is in its early stages, but the underlying metrics building behind it give us confidence in the trajectory ahead. Before I move to the financials, I want to spend a minute on what we are increasingly hearing from customers. In my role bridging the financial and commercial sides of the business, this has become one of the most important strategic aspects investors are interested in right now. Customers today are not buying a sensor, they are buying a solution. The question they are asking is no longer whose LiDAR has the best spec sheet, it's who can help me deliver the end-to-end perception capability that my application needs faster and with less integration risk. That shift is showing up in nearly every RFI and RFQ we see. A customer in the security industry recently put it to us bluntly. They don't want to buy from a hardware company. They want to buy from the front-end solution provider that integrates everything. That dynamic applies across all of our target markets, and it is exactly the model AEye has built. Financially, the implication is meaningful. We do not need to absorb the cost or balance sheet impact of acquiring or building those capabilities ourselves to deliver a complete perception solution, a real efficiency advantage as we scale. The proof is in the deal flow. We are seeing a healthy uptick in customer demand for a full end-to-end physical AI solution, not just a stand-alone sensor. We have been able to assemble those solutions through our partner ecosystem with a speed and breadth that we believe our peers constrained by what they own internally cannot match. And as our recent customer additions illustrate, this model is working. Meaningful new programs in defense, infrastructure and adjacent mobility have come to us through or alongside our partners. Moving on to financials. The first quarter 2026 revenue was $101,000, up almost 60% compared to $64,000 in Q1 2025 and up slightly versus Q4 2025. First quarter GAAP operating expenses were $8.9 million compared to $8.3 million in Q4 2025, reflecting higher stock-based compensation and professional fees, alongside continued investment in go-to-market and deployment execution. First quarter non-GAAP operating expenses were $7.4 million, slightly lower than $7.5 million in Q4 2025, primarily due to lower payroll costs, partially offset by increased professional fees. We reported a GAAP net loss of $8.3 million or $0.18 per share in the first quarter compared to a GAAP net loss of $7.3 million or $0.17 per share in Q4 2025. The increase was primarily driven by higher stock-based compensation and professional fees, partially offset by lower personnel costs. On a non-GAAP basis, our net loss was $6.7 million or $0.15 per share, essentially flat compared to a non-GAAP net loss of $6.8 million or $0.15 per share in Q4 2025. First quarter cash burn was $9.2 million, up from $7.5 million in Q4 2025, primarily reflecting Q1 seasonality. Our manufacturing model built on Tier 1 partnerships rather than owned infrastructure continues to keep our cash burn among the lowest in the sector. We ended the first quarter with cash, cash equivalents and marketable securities of approximately $77.2 million compared to $86.5 million at the end of Q4 2025. The sequential decrease reflects the deliberate deployment of resources into commercial operations, the go-to-market investment and operational execution required to convert the pipeline we are building. This is planned resource deployment, fully consistent with the guidance we set at the start of 2026, and we are tracking in line with that plan. We are reaffirming our 2026 full-year cash burn target of $30 million to $35 million reflecting planned investments in commercial execution, sales and marketing and the operational build required to support customers as they move from evaluation into deployment. On a brief housekeeping note, while we are discussing capital, in the days immediately following this call, AEye plans to file a new shelf registration statement with the Securities and Exchange Commission. Our existing shelf is expiring, and this filing is a routine replacement, standard course of business. Our strategy has not changed. Our capital framework has not changed, and the filing does not reflect any near-term financing intentions. The company remains well capitalized with runway well into 2028. Our capital structure also remains simplified and strong with AEye virtually debt-free. That matters directly to the OEMs and industrial customers we are targeting, where multiyear program confidence is a prerequisite for selection. And the architectural point Matt made earlier compounds here. The same software-defined platform that lets us tune Apollo to a customer-specific frame rate, range and field of view is what lets us extend our addressable markets without rebuilding from the ground up each time. Stratos makes that compounding advantage concrete, a third-generation sensor that reaches new performance tiers without a proportional increase in investment and one that drops directly into the same partner-led solutions model. Our peers with fixed sensor capability and internally owned software stacks cannot replicate that flexibility without absorbing significant development and integration costs. For customers who need capability without compromise, that equation continues to resonate. Our expectation for 2026 is unchanged. As technical engagements convert into program commitments, we are building the foundation from which a meaningful revenue inflection can follow. Getting there doesn't require outspending the field. Apollo's performance lead, our software-defined architecture and a partner-led model, combined with a cost structure built for scale, not overhead, make ours a capital-efficient path to a meaningful revenue inflection. I will now hand it back to Matt for closing remarks.

Thank you, Conor. As we look ahead to the remainder of 2026, the focus is unchanged: convert engagements into deployment. The physical AI tailwinds driving this market are real and accelerating. Our technology continues to differentiate us. Our balance sheet provides the stability to execute and the partnerships we have built from NVIDIA to Lite-On to Syntech and others lay the foundation for commercial scale. We are seeing the engagement activity and conversion momentum that give us confidence in our trajectory, and we look forward to demonstrating that progress in the quarters ahead. Operator, we are now ready to open the floor for questions.

Your first question comes from the line of Poe Fratt.

Can you just update us on the collaboration and partnership with NVIDIA? And then maybe give us a couple of milestones that we should be looking for over the rest of the year on furthering that partnership?

Welcome back, Poe. Good to hear your voice. I'd summarize the relationship at this point as strong and progressing. We talked about in Q1 that we had integrated with the latest platform, NVIDIA DRIVE AGX Thor as well as joining the NVIDIA Halos AI lab, which demonstrates our commitment and NVIDIA's support to automotive-grade solutions. Even today, we've got a team out at NVIDIA's headquarters down in Silicon Valley testing the latest Apollo software update; they started at lunchtime and are testing through the night. It's really about validation, the horsepower and the technology that NVIDIA brings to the table. What this is about is validating our capabilities and performance to be ready for that OEM integration phase. If you check the NVIDIA ecosystem website today, we're at the top of the list. Our performance is validated, and we're the top performer on that list today. So what we can think about between now and the end of the year is a validation process. That's the key task for us: to be officially validated on NVIDIA DRIVE AGX Thor, and that's going to be our focus. For example, it's one of the main reasons why we're out there spending long hours today, so we can continue that validation process, get the feedback from NVIDIA, make the product stronger, tune it better and be ready for that OEM integration on their platform.

Great. That's helpful. And then when you look at your customer engagement up to 21 revenue-generating shipments, can you just give us a little more color or detail on the commercial traction within certain key markets? And then, Matt, could you highlight which markets have the shortest selling time versus other markets?

Sure, absolutely. Thanks, Poe. Great question. We're super excited. We're basically at the highest level of commercial engagement we've ever had in this company. We've added that 31% growth in customers across every one of the six market segments Conor talked about earlier. A couple of key highlights: one is defense. That's a real major standout. Our detection range, we believe, is best in the industry. The defense and aerospace customers, and the ground vehicle teams, appreciate that aspect of AEye's Apollo solution. The software-defined LiDAR piece allows us to be very flexible across different use cases in the defense market, and to point out the evidence we talked about in the earnings call: we're working with many major U.S. defense primes. There's one in particular where not only are we getting repeat business, but they are scaling Apollo across multiple of their business units using a new software configuration. No hardware change is required. That expands across the six market segments we mentioned: we can work across each without requiring a new hardware build or major hardware changes. That's significant. In terms of market velocity, we are pleasantly surprised by how fast defense is moving; it's a higher-velocity market than we might have expected traditionally. In other areas, we have Optus, our full perception solution. Conor talked about this earlier: it's not just about the sensor, it's about being able to collect data and then act. We have our Optus solution up on a traffic intersection in the Bay Area today, demonstrating that end-to-end capability. There will be more to come in that space. We also completed an intelligent traffic systems POC in Australia, where they were trying to count trucks, measure delays and manage fleet capacity; they attempted to do it with cameras and radar and couldn't make it work, and we've got them up and running now. The end customer has seen it, and they're very happy with it. Customers are coming to us for that industry-leading detection range—1 kilometer for Apollo and 1.5 kilometers for Stratos—and for that software-defined element of our product, which allows us to scale across market segments and within customers. Those two differentiators are really propelling us forward.

Yes. On lead times, there are probably two distinct patterns. On the automotive side, we're seeing longer lead times—maybe two to three years to get to standard production. Non-automotive timelines have certainly accelerated, but we're still seeing at least six to twelve months in many cases. It can vary between customers and sectors: some move quicker, some move slower. It all depends on the end customer and their priorities.

Yes. I probably forgot to mention Syntech as well, another commercial partner we've added this quarter, further highlighting the expansion across multiple players in the defense space.

Great. Are you in discussions with any additional partners, Matt? Should we see an expansion like, say, in the defense industry, which is huge? Are there others out there that you're looking at partnering with?

Yes, absolutely. I see that on two fronts. One is the integrator or the end customer themselves. As we mentioned in the prepared remarks, we've got about 40% growth in our pipeline—that's a leading indicator of entering the POC phase across all segments. The second piece is Optus. We have four partners today on Optus, and they enable us to drop into each segment very quickly. We have an open platform based on the NVIDIA Jetson platform. It's very easy for developers to work with. As Conor pointed out, we are not constrained by what software we develop in-house; our partners enable us to jump into multiple market segments quickly. Throughout the rest of the year, you can look forward to expansion in the number of software partnerships as well.

Your next question comes from the line of Casey Ryan of AMRX.

Thanks for the great update. There's a lot to chew on here. I actually just wanted to jump into the trucking opportunity. We've been hearing good things about your sensor performance in that space. With those opportunities in trucking, are they ever displacing internal LiDAR production? Or is it all greenfield new truck builds for various manufacturers? How would you describe the nature of the opportunity with some of the truck possibilities?

Casey, thanks, and welcome aboard on the new assignment. We appreciate the coverage. We talked in the prepared remarks about Apollo sensors now in evaluation with multiple L4 trucking players. This has been further catalyzed by announcements about significant investments into that market. It's a mix. There are supply chain resiliency concerns—where sensors are built and where IP comes from—and that has opened new doors for us. There are also cases where our sensor is complementary to existing LiDAR solutions: Apollo's range performs well for heavy vehicles because they have a longer braking distance. In some cases we're complementing existing solutions to provide more coverage. Trucks are large objects and face many different scenarios—not just highway driving, but pulling off the shoulder and re-entering traffic safely. One learning from these evaluations is that they need more coverage from LiDAR, which has helped drive interest in Apollo.

One thing to add: the natural conclusion is this is an L4 opportunity, but we've seen some interest on the L2 side as well. L2 is a more cost-competitive market, but there has been a certain amount of interest there too. So we're looking at L4 and L2 potential opportunities.

Got it. In many truck deployments there's a long-range sensor and a short-range sensor. It sounds like you might be able to fulfill both those needs with your product portfolio. Is that right?

Yes. One thing we have going for us is the tunability of the sensor itself—the fact that it's customizable. Customers really like that we can do both long range and short range. On the highway, long range is paramount for braking distance. In urban environments, you need a wider field of view and may only need to look 100 meters down the road. The fact that we can embed multi-scan patterns on the device and toggle between modes is a game changer. I don't think there's anyone in the market that can offer that level of customization today, and that appeals to customers we speak with.

Yes. That's a very exciting capability. To follow up on automotive: do you see LiDAR being consumed as part of driver safety packages, or are customers talking about offering L4 autonomy and offering autonomy as a feature versus safety tools?

It's a mix of both. We're seeing L4 developments, especially in robotaxis, with capital flowing into that space and partnerships forming. We're also seeing OEMs talk about hands-off, eyes-off driving—more in the L3 range. Supply chain resiliency concerns have brought many customers to our door because of risk in their current supply chains; that affects L3 and some L2/ADAS applications where current sensors don't efficiently cover corner conditions. So you'll see all three—L2, L3, and L4—in the mix, with a sweet spot around L3 for eyes-off, hands-off capability.

Great. In defense and specifically drones, weight can be a concern for LiDAR sensors. Can you talk about the weight of your solutions and whether there's a roadmap to make models lighter for defense drone applications?

We're light and fit into the weight envelopes for many defense drones. I don't know if we've published all the specs publicly here, but we are at the low end of the spectrum on weight. Also, the drones that require long-range LiDAR tend to be higher-performance platforms—those that travel at very high speeds, perhaps over 200 miles per hour—rather than small delivery drones. For those high-speed drones you need detection at a kilometer or more, and we're well-suited there. Another topic is drone detection for intervention systems: small inbound drones that you want to detect at long range. Defense primes are interested in that use case precisely because of our long range.

Okay, great. One final question: you previously mentioned a $30 million contract opportunity over a longer period. Was that customer part of the commercial count in Q1, and do you expect them to be part of Q2?

Yes, they are included in the customer count. That particular customer is probably not going to be a meaningful contributor to revenue this year; the revenue is likely further out. Since we made that announcement over a year ago, additional customers have come into the mix and some have moved quickly through POC. We're seeing more near-term opportunities with other customers that are likely to drive revenue potential for this year.

Your next question comes from Richard Shannon of Craig-Hallum.

I jumped on a little late, so I may have missed some of the prepared remarks and hope I don't repeat past questions. One key theme in the press release was engagement on the automotive side, particularly with OEMs reengaging on L4 and L3 road maps. Could you elaborate on those dynamics—how many RFIs, and how quickly do you think they will move to RFQ and later stages?

Let me start with what's driving the increased attention. Two pieces: one is the funding and activity coming into technology providers—some of those companies bring partnerships with players like Uber and that drives interest in Level 4 robotaxis. The second is growing concern over supply chain resilience, which is causing passenger vehicle OEMs to reexamine their suppliers as L3 programs come online. The number of RFIs has definitely increased. We've stopped predicting OEM schedules because they can be unpredictable. We're prepared on the manufacturing side and ready to scale production when required. We'll likely get some heads-up from OEMs, but the timing has been difficult to predict.

To add, a clear differentiator for OEMs is the ability to go behind the windshield. That's an aesthetic and functional value prop: protection, cleanliness and integration into vehicle design. That capability differentiates us for OEMs.

Two other things to note: the activity today includes a lot of data collection, which is a major part of LiDAR integration—training perception models and integrating software—and that has been unpredictable in terms of how long it takes. Second, we've completed major supply chain audits in the last six months, digging into sources of raw materials and intermediate components to ensure our supply chain options and resiliency. We've been very busy on both fronts.

Great detail—thanks. Second, on the customer count: glad to see it move from 16 to 21. Can you elaborate which end markets the incremental five came from, and where the biggest engagement dynamics are filling the early part of the pipeline?

If you do the math, those five new customers are pretty evenly spread across the market segments we mentioned in the prepared remarks.

I would add that defense is a big driver, as Matt mentioned, and we're also seeing engagement in commercial aviation. The unifying factors across customers are high performance: range and resolution, and the ability to tune the scan pattern. Even within defense, customers have different needs and use cases—long range, shorter range, higher frame rate—and the ability to dial the sensor's performance is important. When we talk to customers and investors, we describe our sensor as a performance bucket you can adapt: put performance into longer range, or into higher frame rate depending on the goal. That level of customization is something customers can't get elsewhere.

Okay. Last question on Optus: your press release mentioned Optus is live in an active California intersection. Can you update on Optus maturity, breadth of the engagement pipeline, application sets and geographies?

Optus covers a fair part of our market segments. We've seen a growing number of customers seeking perception, sensing and data analytics as part of their projects. Examples include the traffic intersection deployment in the Bay Area and the POC in Australia for intelligent traffic systems, where we tracked truck flows, delays and parking. Those customers often don't know LiDAR in depth; they just want an end-to-end solution because camera and radar integrators couldn't make it work. We're seeing more of those customers and expect more intersections to come online this year. We've been in the field for almost a year on some projects, and things are maturing. You can expect to see more end-to-end solution deployments in the back half of the year.

One unique aspect in the ITS space, especially for intersections, is addressing the 'dilemma zone'—about 100 meters back from the stop bar. Our range and capabilities allow us to cover that zone, and DOTs have given positive feedback. That's a differentiator nobody else can do right now and a classic case where our performance drives solution wins.

Hearing increasingly that other sensors just couldn't see far enough.

Makes sense. Last quick question: are you still using the same language as the last earnings call about expecting acceleration in the second half of the year?

Yes. We expect an inflection in revenue. We are already seeing more units in the Q2 pipeline, and we think that trend will continue into Q3 and Q4. Overall, we're still guiding to that narrative.

I think it's okay. We can wrap it up if there's nothing else.

That will conclude our question-and-answer session. I will now turn the call back over to Matt Fisch for closing remarks.

Thank you all for your time today and for your continued interest in AEye. We remain focused on executing against our commercial pipeline and converting this momentum into a durable revenue ramp, and we look forward to updating you on our progress next quarter. Thank you.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.