Hello, and welcome to ALSTER's first quarter 2026 earnings conference call. All lines have been placed on mute to prevent any background noise. After today's presentation and remarks, there will be an opportunity to ask questions. If you would like to ask a question during this time, simply press star, followed by the numbers 11 on your telephone keypad. If you would like to withdraw your question, press star 11 again. The call today is being recorded, and a replay of the call will be available on the Astor Investor Relations website an hour after the completion of this call. I would like to now turn the conference over to Chen Young, Senior Vice President of Strategic, Finance, and Treasurer. Please go ahead.

Thank you, Operator, and good afternoon, everyone. Thank you for joining our first quarter 2026 earnings call. Today on the call, we have Chief Executive Officer, Angus Pakala, and Chief Financial Officer, Ken Gianella. As a reminder, after the market closed today, OUSTER issued its financial news release, which was also furnished on a Form 8K and is posted in the Investor Relations section of the OUSTER website. Today's conference call will be available for webcast replay in the Investor Relations section of our website. I want to remind everyone that on this call, we will make certain forward-looking statements These include all statements about our competitive position, product advantages, and growth opportunities, anticipated industry trends, our business and strategic priorities, our operating expense targets, the impact of our recent acquisition, the development and expansion of our products, our products' capabilities and performance, and our revenue guidance for the second quarter of 2026 and long-term financial targets. Actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause actual results and trends to differ materially from those contained in or implied by these forward-looking statements are set forth in the first quarter 2026 financial results release and in the quarterly and annual reports we file with the Securities and Exchange Commission. Any forward-looking statements that we make on this call are based on assumptions as of today and, other than as may be required by law, OUSTER assumes no obligation to update any forward-looking statements which speak only as of their respective dates. In today's conference call, we will discuss both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures discussed today is included in the financial results release. I would now like to turn the call over to Angus.

Hello, everyone, and thank you for joining us today. Over the last four months, we have seen the culmination of over 10 years of Alistair innovation, strategy, and execution. In February, we acquired Stereo Labs, a pioneer in AI camera vision and perception solutions, creating a world-leading sensing and perception company for physical AI. We are already seeing the strategic rationale transform into operational reality with a resoundingly positive customer response. And just yesterday, we launched Rev8, the world's first native color LIDAR and a paradigm shift in AI perception. To perceive the world in full context requires a combination of structure and color, and Rev8 is the first sensor to unify both. With native color across our entire product portfolio of cameras and LIDARs, we have further strengthened Outer as the foundational sensing and perception platform for physical AI as we provide unified products and solutions that accelerate customer innovation and unlock new applications that sense, think, act, and learn in the physical world. Now turning to an update of our Q1 2026 results. Outdoor had a strong start to the year, achieving our 13th straight quarter of product revenue growth with over 12,600 LIDAR and cameras shipped, reflecting robust demand for our expanded product portfolio. With $49 million in revenue, we achieved another record product revenue quarter on a strong 43% gross margin, overcoming headwinds from a continuing, constrained supply chain environment. We ended the quarter with adjusted EBITDA loss of $7 million and cash, cash equivalents, and restricted cash and short-term investments of $175 million. Our LiDAR business grew approximately 44% year-over-year with strong contributions from our industrial vertical where we secured several large deals to power industrial automation. We significantly expanded our long-term relationship with a large European industrial company for port automation. In another key win, supported by our NDAA compliance centers, we secured a deal with an autonomous earth-moving company to retrofit heavy equipment to support a project with the U.S. Department of Defense. Ouster's smart infrastructure solutions business continues to validate our end-to-end system strategy. We saw continued momentum from our expanded ITS distributor network as we won contracts to deploy Alistair Blue City across the United States, securing large million-dollar deals to provide next-generation traffic actuation systems in Arizona, Michigan, and the Northeast U.S. We were also proud to announce the expansion of Alistair Blue City with the Georgia Department of Transportation to modernize the region's traffic infrastructure. The turnkey Alistair Blue City traffic management solution will be deployed at more than 30 intersections across the greater Atlanta area in preparation for the FIFA World Cup and beyond. Blue City is bringing physical AI to smart cities around the world with over 700 contracted site deployments across intersections, mid-blocks, and highways, reinforcing OUCER's position as a leading solution for transportation departments seeking to transition from legacy traffic solutions into dynamic, digitally integrated, 3D LIDAR-powered traffic management solutions for actuation and analytics. We also saw strength from Master Gemini in the quarter, recognizing millions of dollars of revenue from a significant customer renewal. Leveraging our unified platform and proprietary deep learning perception model trained on over 4 million labeled objects, Gemini empowers our customers to operate more efficiently and safely at over 550 sites around the world. In the months since the acquisition, Stereo Labs has already proven to be a perfect complement. We're seeing benefits of our unified platforms through the ability to immediately help customers combine multiple modalities of sensors and AI compute, easing the friction of combining disparate technologies and accelerating our customers' go-to-market efforts. The rapid integration and commercial success of our expanded camera vision portfolio provided tailwinds during the quarter, and business momentum exceeded our initial expectations. We are seeing strong demand from companies building foundational AI models and advanced robotics platforms, and leading companies around the world are relying on our expanded product portfolio to train, scale, and deploy the next generation of autonomous delivery, advanced manipulation, and precision agriculture. We continue to see large opportunities for Stereolabs to augment Ouster's perception roadmap to meet physical AI's increasing demand for sophisticated multi-sensor fusion. By merging our proprietary AI models with Stereolabs' neural depth capabilities, We are delivering the specialized perception logic and application-specific software required to revolutionize safety and efficiency across the global supply chain. Continuing the momentum and our leadership in cameras for physical AI, we released the Stereolab ZX Nano, which is shipping this month. This product sets a new standard for wrist-mount stereo vision, delivering 2.3 megapixels RGB with neural depth, zero-copy capture data pipeline, and ruggedized GMSL2 connectivity in a 40% smaller form factor. Like all StereoLabs cameras, the ZX Nano comes with a purpose-trained neural depth model, specifically tuned for its capabilities, and further highlighting Elster's deep vertical integration from hardware to software. Engineered for robotic manipulation and high-throughput data collection, we are helping robotics teams scale imitation and reinforcement learning for manipulation tasks. Leveraging StereoLab's industry-leading image quality and end-to-end capture latency, our customers can now overcome critical bottlenecks by capturing high-resolution RGB and stereo camera depth images at up to 120 frames per second for training data and manipulation learning. And now, turning to yesterday's highly anticipated product announcement, I'm truly excited to introduce Rev8, the world's first native color LiDAR sensors powered by next-generation L4 ouster silicon. We are redefining the meaning of LiDAR itself with native color sensing implemented directly on the silicon. By fusing color and 3D data through physics and leveraging Fujifilm color science, our patented native color technology unlocks megapixel resolution and stunning image quality with ultra-low latency and perfect spatial-temporal alignment. We work with industry-leading camera experts to ensure Rev8 delivers uncompromising industrial-grade imaging. Delivering an exceptional 48-bit color depth and 116 dB of dynamic range, Ouster's native color data maintains performance in lighting extremes from 1 lux to 2 million lux. We live in a world where a machine's capacity to perceive is constrained by the capability of its sensors. Rev8 is built to generate the petabytes of rich, native-colored 3D information necessary to build the next generation of physical AI systems and train new world models. Now, for the first time, a single LiDAR sensor can understand road signs, interpret brake lights, or simply capture the richness of planet Earth in survey-grade colorized maps. Featuring radically upgraded OS0, OS1, and OSDome sensors and the new flagship 256-channel OS1 Max, Rev8 delivers industry-leading resolution, range, and reliability designed for functional safety, affordability, and scale. Rev8 represents the culmination of years of research and development, innovative design, and rigorous testing. It is the most advanced family of LiDAR Alster has ever developed and sets a new standard in sensing. All of this is a testament to Alster's digital-first approach, which starts with our proprietary system-on-chip. Rev8 is powered by our breakthrough L4 Alster silicon, with up to 256 channels of resolution honed over years of development by our in-house silicon design team. The L4 architecture features both the 128-channel L4 and the 256-channel L4 Max, each embedded with Fujifilm color science resulting in exquisite color data and hardware-enabled high dynamic range. The L4 boasts 42.9 Gigamax of processing power, detection of up to 20 trillion photons per second, a 40 kilohertz measurement rate with picosecond timing precision, and is capable of processing up to 10.4 million points per second and 22.4 gigabits per second of data bandwidth off-chip. And we've paired it with a completely redesigned light engine featuring all new custom VIXEL arrays and our most advanced driver topology ever. Enhanced by picosecond timing precision, this architecture delivers unprecedented levels of range, resolution, and accuracy across the entire Rev-8 OS family. The cornerstone of the new Rev-8 family is the flagship OS-1 Max, a sensor without compromise. With double the resolution of the Rev-7 OS-2 and a quarter of the size, the OS-1 Max packs an incredible amount of capability into a small, ruggedized form factor. The OS-1 Max provides best-in-class performance with 256 channels of high-definition sensing up to 500 meters in all directions with a 45-degree vertical field of view. No other 360-degree spinning LiDAR comes close. Purpose built for high-speed autonomy, smart infrastructure, and heavy industrial applications, the OS-1 Max is capable of resolving the smallest objects at long range. And like all Rev8 sensors, the OS1 Max offers exceptional native color imaging. But we didn't stop there. We set out to build the safest family of 3D liner sensors ever created. This took years of rigorous engineering work, testing, and design validation. The result, Rev8 is life-saving technology made right, ruggedized for the real world with automotive-grade reliability that can withstand the harshest production environments. Ouster now offers a set of products to break into the multibillion-dollar market for industrial safety sensors long dominated by legacy players by replacing outdated 2D laser scanners and cameras with high-resolution 3D native color lidars. Every sensor is auto-grade, cyber-secure, and designed for ACIL-B, SIL-2, and PLD functional safety certifications, ensuring continuous uptime and industry-leading reliability. Importantly, this is a platform built to scale. Rev8 was designed for low-cost, high-volume production deployments to support mass market adoption. With a planned 10-year production life, Rev8 sensors provide the long-term program stability and scalability required for global commercial rollouts. With Rev8, we're delivering the safest, most feature-rich, secure, and reliable family of 3D LiDAR sensors we have ever built, and we hit the ground running. Earlier today, we announced the integration of our new Rev8 family across the NVIDIA Jetson platform, bringing native color LiDAR to the NVIDIA robotics ecosystem for the first time. With dedicated support for Rev8 across NVIDIA Jetpack, Isaac Sim, and Jetson AGX, Oren, and Thor, we're ensuring rich, high-fidelity 3D digital LiDAR data is fully harnessed by NVIDIA's accelerated computing and development tools. This builds on years of integration support for previous OS sensor generations, as well as StereoLab's own integrations across the entire ZET portfolio. Together, we are providing the essential building blocks for physical AI, enabling machines to sense, think, and act in the real world with more speed and precision than ever before. Rev8 is shipping today and is being adopted by some of the world's most innovative companies. This is a testament to our close collaboration with key customers over years to ensure Rev8 met their program needs. We're already seeing early traction with dozens of technology leaders across the industrial, robotics, automotive, and smart infrastructure markets intending to adopt Rev8 OS sensors. including Google, Volvo Autonomous Solutions, Lieber, Epiroc, Field AI, FlyAbility, Skydio, Plus AI, CompStellis, Bedrock, Caspore, Third Wave Automation, Burroughs, Seagrid, Gecko Robotics, Pratt Miller, AAM Intelligent Machines, Syngen, Freefly Systems, ATI Robotics, and Swarm Farm, among others. Clearly, there is overwhelming customer pull for Rev8, and this gives us confidence in an incredibly strong back half of the year. We spent years developing these groundbreaking capabilities, and I am thrilled to finally introduce Rev. 8 to the world. With that, let me now turn the call over to Ken, who will provide more context on our first quarter financial results.

Thank you, Angus, and hello, everyone. As you heard, our excitement over the acquisition of SterioLabs and our new product launches look to keep the momentum we built in 2025, continuing into 2026. In the first quarter, we are pleased with our continued progress against both our financial and operational goals, which are the cornerstones of our path to profitability. Our results demonstrate the resilience of our operating model and the disciplined financial management across the business as we continue to execute within our long-term financial framework. Turning to the first quarter financial performance, operating results were strong with revenue of $49 million, which included approximately seven weeks of contribution from Stereo Labs. This represents an increase of 49% compared with the first quarter last year. We shipped over 12,600 sensors, which included over 8,300 LIDAR, a new quarterly record, and over 4,300 camera sensors. Royalty revenue in Q1 was not material. As I mentioned in our March call, this year we expect total royalty revenue in 2026 to be less than $5 million. The majority of this amount will be recognized in the back half of this year. Smart Infrastructure Vertical was the largest contributor to first quarter revenue, followed by industrial. GAP gross margin was 43%, up 200 basis points from the same quarter last year. GAP operating expenses were $40 million, an increase of 7% from the first quarter last year. The increase was primarily due to the addition of Stereo Lab's operating expenses, including $2.3 million of acquisition in integration-related charges in Q1. We continue to anticipate year-over-year operating expenses to be higher 5% to 8% with the acquisition of StereoLabs. However, we continue to focus on our path to profitability and will remain diligent in managing our operating expense profile. Excluding the acquisition and integration expense of StereoLabs, our adjusted EBITDA in Q1 was negative $7 million. dollars, compared with negative eight million dollars in the first quarter last year. Ulster remains one of the industry's strongest balance sheets ending the quarter with cash, cash equivalents, restricted cash, and short-term investments of a hundred and seventy-five million dollars in no debt. The strength of our balance sheet gives us the strategic and financial flexibility to operate our business and gives confidence to our customers who rely on Elster as a key physical AI partner on their long-term autonomy journey. Now, turning to guidance. For the second quarter of 2026, we expect to achieve total revenue in the range of $49.5 million to $52.5 million. dollars. Beyond the revenue outlook for Q2, I want to reiterate the long-term financial framework I discussed last quarter, which includes revenue growth of 30% to 50%, GAAP gross margins of 35% to 40%, and GAAP operating expense growth of 5% to 8% from our 2025 levels. With our acquisition of StereoLabs, the release of Rev8, our smart infrastructure solutions, and our investment in foundational AI models, Alistair has one of the broadest range of perception and sensing products in the market. We remain confident that our innovation and go-to-market strategy will continue to bring us closer to positive operating free cash flow and profitability. I'll now turn the call back to Angus for his closing remarks.

Thanks, Ken. To close out, we are off to a great start executing against our 2026 strategic priorities, revolutionizing our LIDAR, camera, and AI compute products, extending our leadership in physical AI solutions, and executing towards profitability. We kicked off the year with strong momentum, delivering our 13th consecutive quarter of product revenue growth. We're executing on our strategy to provide physical AI's first unified sensing and perception platform, and I'm excited by the transformative products we're bringing to market this year as we work to solve our customers' most complex challenges. Rev8 is redefining the meaning of LiDAR with fundamentally new capabilities that empower our customers to simplify their perception stacks, better train next-generation world models, and scale their production deployments. On the heels of a successful first quarter, Ouster is better positioned than ever as the foundational end-to-end sensing and perception platform for physical AI. With that, I'd like to open up the call for Q&A.

Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. First question comes from the line of Colin Rush of Oppenheimer & Co. Your line is now open.

Thanks so much, guys, and congratulations on getting Rev. 8 out. I guess I have a two-part question to start with that introduction. Obviously, you've been working very closely with a lot of customers, and I'm curious about two things. One, how many of them have been waiting for this product to move into series production with some of their products given some of the range and the functional safety pieces to this? And then the second part is really about which new applications are you seeing as material opportunities for you guys to move into given the functionality improvements that you're seeing with this next-generation product?

Hey, Colin, thanks for the question. So while we don't pre-announce, you know, we held on to the Rev 8 announcement until it was ready to ship this quarter, behind the scenes, we work incredibly closely with a set of key customers for more than a year to make sure that Rev8 met their needs, both their current needs and future needs to expand business with us over time. So it's no surprise that we had a really compelling list of over 20 customers that I announced, and I'm going to spare reading through them again. But it's Expands the gamut of existing customers doing things that they've always done, but doing them much more capably with a colorized point cloud to all new applications. So a great example of that would be high-altitude drone surveying. The OS1 Max is the perfect sensor for simplifying a drone payload. And we have a great interested customer, Skydio, who is very interested in the OS1 Max and gave some great comments about how the combination of payload into a single platform makes it a game changer for their type of surveying application, where weight is at a premium and quality of weight is at a premium. So we absolutely have new applications with the OS1 Max for things like that, for high-speed applications and driving on the highway or heavy machinery where you need to see small things at long range. And then obviously the multi-billion dollar opportunity for functionally safe devices is brand new area for us to expand in our customer base and start to finally capture some of that significant value with these sensors. But if you step back long term, I expect the vast majority of our customer base to adopt Rev8 over time and to be operating with native color LIDAR data. I think the entire industry is going through a paradigm shift with this, and we're going to end up on the other side with native color, Rev8, LIDARs across the vast majority of customers.

Super helpful. Thank you for that. I guess the second question is really, now that you've got a fairly rapidly evolving portfolio of offerings, including the edge compute, I guess I'm curious about a couple of things. One, how we should be thinking about mix on a go-forward basis. And then secondly, how much leverage are you getting from that edge compute capability in Premise, given some of the escalating data transfer expenses that we're starting to see for things like intersections where it can be upwards of $800,000 or $1 million of expense just to transfer data back to a data center if you're transferring all of that. Just curious how you're seeing that play out as well.

Yeah, sure. So, in terms of the product portfolio, that's ever-expanding. I mean, I also want to highlight we released the ZX Nano during the quarter, which is a big deal, and also a brand-new use case in these risk-mounted robotic manipulation. So, on the question of mix going forward, we haven't split out exactly how we see that long-term unit basis or revenue basis, but we expect both of our businesses to grow very significantly. And obviously, we had an incredibly strong quarter with 44% year-over-year growth for LiDAR-only business. And overall, we were up significantly year-over-year, especially with the StereoLabs acquisition. So we expect to have very significant and strong growth across all of our product lines over time. And to the question around edge compute, I do expect that to start to contribute more to our overall business. Right now, I mean, we're really fresh off of acquiring Stereo Labs. The compute was something that had good traction and still has good traction with their customer base. We're going to invest more into the compute line that they started. But I can't say that it's having a significant impact on the Alistair customers at this point. We're still getting our feet under us on exactly how to position that compute lineup with the other customers. But I do think it will be a big opportunity for ASTAR going forward. Fantastic. Thanks, guys.

Thank you. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. One moment while we wait for our next question. Thank you. Our next question comes from the line of Kevin Cassidy of frozen black securities.

Your line is now open Thanks taking my question and congratulations on watching rev 8 and continuing this high growth So maybe along those lines that you know questions around rev 8 and you touched on it slightly. I think Would rev 7 continue to go in production and you know what what's the Transition look like for for the two different LIDARs?

Yeah, great question. So we're fully committed to continuing to produce and support REV7 for established customer base. I mean, REV7 has been out for three years now, and we have a lot of customers that have fully qualified and are in active production with the REV7 lineup, and it's a great set of products. I mean, they really established Ouster as a performance, technology, and reliability leader in the LIDAR space, and we don't want to change any of that. So while Rev. 8 is designed to be a seamless upgrade for any customer that wants to, we want to make sure that customers that have qualified Rev. 7 can continue to operate their businesses with it. So we're being customer-friendly here and making sure that it's their choice when they transition oh great okay and yeah I remember when Rev 7 came out it was a it was an inflection point for you especially on ASP increases with a similar ASPs between Rev 7 and Rev 8 or maybe even talk about the manufacturing and the gross margins between the two yeah that's a that's another great question about so Rev 8 was designed to be more affordable than Rev 7 and more scalable than Rev 7 we want to make sure that we're enabling our customers to continue to scale and to bring this technology to the broader physical AI ecosystem so the Rev 7 was a different scenario where we were introducing a fundamentally new capability and ASPs went up here it will be a little bit more of a mix because we have vastly more customers in production and we can't disrupt the economics of their production so yes we have new products that are incredible like the OS 1 max that probably will command premium ASPs in certain domains but we also want to make sure that a customer that wants to upgrade to rev 8 can do so without having a significant economic disruption or commercial disruption to the end business that they've created around a Rev. 7 product. And just going back again, highlighting Rev. 8 was built to be more scalable and more affordable than Rev. 7.

Great. Okay. Sounds like a good strategy. Thank you.

Thank you. One moment for our next question. Thank you. Our next question comes from the line of Andres Shepard of Cantor Fitzgerald. Your line is now open.

Hey, guys. This is a nod on for Andres. Congrats on the quarter, and thanks for taking our questions. It's really great to see an update on the customer interest as in maybe what type of opportunities there.

So Rev8 is a big deal when it comes to the automotive world because Rev8 is an autograde sensor. They're designed for functional safety. So the ASIL-B functional safety spec in automotive is incredibly important whether it's LIDAR going into a consumer car or into a robo-taxi or robo-truck. So at Rev8, the OS1 Max, the OS0, purpose designed to be ideal sensors for that market. I'm expecting some pretty significant things there just because it's the first time that we'll have a full suite of lidars that blankets, you know, you can outrig an entire car and ouster digital IDRs and and be a one-stop shop so and and we obviously we worked in the background with a number of customers many which I couldn't name around the revs the rev 8 spec for the automotive domain but yeah so so a lot of things to come there I think that just highlighting the long-range high resolution aspect of the OS 1 max and combining that with the colorized point Clouds is pretty game-changing in the automotive domain, where advanced AI algorithms go hand-in-hand with the kind of flexible physical AI progress that's been made in the ADAS sector. So we think these are really good sensors for that domain, and I can't wait to get them in customers' hands.

I guess maybe a question for Ken. As we think about the gross margins and the EBITDA, what's the most important remaining step?

Well, I think, number one, the continued innovation that we've been doing is a great stepping stone to showing how our long-term model, the consistency that we've brought over the last three years, it's just another proof point of us as a company, Elster, continuing to hit those proof points year after year after year. And that long-term model, the 30% to 50% growth, you know, obviously with the acquisition it was high, but, you know, even with XX acquisition, 44% growth year on year, that's just the proof point of our underlying innovation continuing to that long-term model. You know, if you do the math on that and you look at our gross margins, even staying, you know, we had another strong tailwind that we overcame some economic challenges and constraints in the quarter for a strong gap gross margin quarter. That 35% to 40% coupled with the growth rate and our discipline on the OPEX, you know, the innovation we've done with little to no OPEX growth, you know, that 5% to 8% with Stereolabs and the $2.3 million acquisition in the Q1, that combined together shows that we're on a strong path for, you know, somewhere within 27, starting to hit that profitability. So the model is holding true. We're going to continue to execute towards that. It's a very important milestone for us to get to that. But, you know, this innovation is key to unlocking that continued long-term growth.

Thank you.

One moment for our next question. Thank you. Our next question comes from the line of Richard Shannon of Cray Column. Your line is now open.

Well, hi, guys. Thanks for getting me entered in the queue here. Apologies. I just jumped on the call. I got like four or five earnings here tonight. I have no idea if this question was asked, but I want to ask it anyway, which is the new Rev8 product is quite interesting in many ways. A lot of performance improvements here, but the interesting one here is the ability to do color. I'm curious, Angus, if you can tell us a little bit more about that, how you did that. is I assume this is something in the detector wondering if this is in technology that's exclusive inherent to ouster or are you the first one to try to implement this just any ideas that help to help us understand how you're doing this and then maybe going to follow on what applications do you expect to be adopting that first absolutely thanks Richard so I mean the rev 8 native color point clouds are a genuine world-first invention this is a really significant milestone for the LIDAR industry in general and it's a first-of-its-kind technology no question so the the core innovation happens at

the silicon level and this just goes back to ouster inventing digital LIDAR and we've continued to innovate at the silicon architecture level now by fusing in silicon color and LIDAR data so that customers don't have to think about this and getting an absolutely incredible result for the end customer. So absolutely, this is a world first direct innovation, basically the result of 10 years of pushing on silicon innovation at Ouster and building it into the L4 and L4 Max chips. In terms of the applications, I mean, the most, the clearest opportunity here is simply more context to train the next generation of physical AI models. The world truly cannot be described with just 3D information or just color. It really is a combination of those two attributes that allows you to both sense the position of a street sign and read what it's saying, or sense the location of a car and knowing that it's just slammed on its brakes with brake lights. So training AI models with a colorized point cloud data set is the final frontier that so many of our customers have been trying to reach. It's literally, they call it the holy grail. I've heard that many times from our customer base. This is the holy grail, colorized point clouds, unified and trained into new AI algorithms. So that's the most obvious use case, and that just gives better, safer, more capable AI systems. There's also one in 3D surveying. So almost all surveying applications require a combination of structure and color or texture to assess the quality and status of a bridge, right? If a bridge is degrading, you want to know that it's structurally sagging, but you also want to see that the concrete has cracked. And so color and LiDAR data give you that. So there are obvious applications with a customer set that really span every single customer use case. It's hard to identify any customer that won't benefit from this, which is why I said I think every customer effectively will adopt a REV-8 colorized capability eventually. So, again, this just comes back to 10 years pushing silicon innovation into our products, and this is the end result.

Yeah, and Richard, I just want to point out to the last piece of it. You know, this is over almost a dozen patents just on the RGB colorization alone, and then the underlying Rev8 technology building not just from the Rev7, but it's almost 200 patents underneath supporting the Rev8.

So, you know, that technology and effort that we've put in to bring out there is also covered with, you know, real innovation with those patents for the company. okay that's helpful perspective and one one quick follow-up again on this topic here as you add in color to applications or previously using LIDAR what do we think about the the the upsides and and in value and price that you're able to charge these sorts of things thank you well that I think that that did that goes back to another question that was asked around ASPs and how this filters down into costs and value capture.

And this here really depends on the application. We always try to price our products to enable our customers' commercial application. It's one of the key strategies that we've done really well with, maintaining strong gross margins, but also working with customers to make sure that the pricing works for their business at scale. And so I'm giving you an unsatisfying answer. Rev8, the technology and getting color into our customers' hands, the pricing depends on the customer application. We do want to make sure that customers don't have prices and impediment to adopting an incredible capability that actually enables their long-term viability as a company. So I think the key takeaway is Rev8 is a drop-in compatible replacement. for Rev. 7, so the adoption can be quick and seamless to getting that value, and that's a huge benefit to these customers.

Okay, great perspective. I will jump on the line, guys.

Thank you. This concludes the question and answer session. I would now like to turn it back to Angus for closing remarks.

Well, I want to thank everyone for joining the call and really want to thank the Ouster team for the push that they made to get Rev. 8 out. This is a paradigm shift for the industry. We have incredible customer demand for the Rev8 product. And I can't wait to continue to update everyone that joined the call for the rest of the year on Rev8's adoption through the year. Thank you all.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.