Shares of Luminar Technologies (LAZR) closed up 6.23% Monday, February 27, added another 0.91% during today’s regular session, and then fell 2.01% in after-hours trading on the company’s announcement of substantial progress toward positive gross margins by the fourth quarter of 2023.
At yesterday’s investor day, the lidar sensor and software company announced that it had acquired lidar-related assets from Seagate Technologies and that its new plant in Mexico is ahead of schedule and expected to come online in the second quarter (instead of in the second half of the year as the company had projected in 2022.)
But from my point of view, the big news is that Luminar announced that its products were being adopted on 20 production vehicles. That’s a big increase from 2020 when the company went public via a SPAC (Special Purpose Acquisition Company) with just a single car model, the Volvo EX90 using its product.
Revenue increased to $11 million in the fourth quarter to a total of $41 million for the full year. The fourth quarter saw a GAAP net loss of $144.8 million, or $0.40 per share. For the full year, the GAAP net loss was $446 million, or $1.25 per share.
Cash including marketable securities stood at $489 million as of December 31, 2022, compared to $792 million as of December 31, 2021. Net cash used in operating activities was $208 million for the full year.
For 2023 the company said it expects revenue growth of at least 100% and to add at least $1 billion to its forward-looking order book in 2023. The company expects to reach positive gross margins by the fourth quarter.
That last is important–keeping to that schedule would indicate that Luminar has the cash to fund the company to cash flow positive.
I can’t move on without at least mentioning the most unusual part of investor day. Luminar said it is working with Swiss Re to launch an insurance program that will calculate the insurance savings for a vehicle equipped with lidar safety technology. The plan is to take the Luminar/Swiss Re data on enhanced vehicle safety to car companies and help underwrite insurance products for vehicles equipped with lidar technology. Not only could that be a source of revenue for Luminar, savings on insurance for lidar-equipped cars could encourage the adoption of lidar technology too. “Auto insurance policies average $1,600 a year,” Autonomous Research analyst Ryan Tunis told Businesswire. That can easily amount to $20,000 over the life of a vehicle or 40% to 50% of the original purchase price. Luminar didn’t include any revenue from this early-stage effort in its projections.
Shares of Lumin were up 79% for 2023 as of the close on February 27. The stock is still down 80% from its all-time high and it dropped 37% in 2022.
Luminar is a member of my Millennial Portfolio on my subscription JubakAM.com site. The position is down 43% since I initiated it on February 14, 2022.
