Nikola (NKLA) 23 Feb 232022 Q4 Earnings call transcript

Good morning. Welcome to the Nikola Corporation's Fourth Quarter and Full-Year 2022 Earnings and Business Update Call. Currently, all participants are in a listen-only mode. We begin today's call with a short video presentation, followed by management's prepared remarks. A brief question-and-answer session will follow the formal prepared remarks. reminder, is a recorded. As Instructions] this being conference [Operator

Dhillon pleasure Investor It my introduce Sandhu is now to from relations.

update XXXX Thank you, Corporation's and are full-year Nikola Financial Chief Brady, Executive Welcome everyone. me Officer; business Michael earnings and Lohscheller, operator, and fourth good quarter morning call. today With Chief Kim to Officer. and

section The distributed of today's the A.M. Eastern X:XX press detailing financial our after along on site, release Web call. found and this our shortly release morning. with The Investor accompanying be Relations business results was slides can Time presentation

future measures. Today's and Today's page end measures results be plans. factors discussions include explained could differ discussions cause statements those about also are deck. from today's QX results of earnings our Actual earnings references to U.S. the at and of reconciled that non-GAAP materially comparable the on also include can stated, forward-looking to GAAP two press release end measures differ These most of and our actual earnings release call today. the to issued expectations the at found and may are we press

date Forward-looking are they of statements the on made. speak as only which

to cautioned put on are reliance not You statements. forward-looking undue

prepared Michael Brady and the we After presentation, video by will remarks, give analysts' conclude questions Kim from their with followed will then Q&A, our shareholders.

begin We video will the now presentation.

Presentation] [Video

than and of Nikola trucks But successfully now a consisting of the energy. only blocks believe Nikola in launch mobility offer more lot and to second-half for commercialization we of of company this just than both to in first trucks launched the fourth company. BEV deliveries are of changes made much zero-emission we more in hydrogen morning, we quarter are is Class Thank the you, and have the everyone. XXXX, With year. business. and X our our of EV the laying mind, track much good integrated Dhillon, commercial truck we a and truck in building goal customers. the just on positive We Yes, the FCEV offering 'XX, that Tre March solution

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second-half With Nikola of hydrogen. the in perfect our we launch XXXX, be believe the for is the Tre will the in the Class we FCEV offtake X segment, FCEV the first and

This in of On the up think BEV substantially. resulted XXXX. of truck number deliveries a in a lower XXXX. side, We well QX we our improved sets for stronger this

we position. several side on made of Kim this will commercial I and but capital the comment wanted changes the our on on liquidity Additionally, to business. touch briefly further,

believe ability to business the we our deployment And demonstrated XXXX. Nikola us. a the strong maintain has capital in hydrogen plan priority business is integrated sufficient continue to scalable truck top access support we capital ecosystem to energy our for a creating and an markets. execute and Building

this building business, energy and have hydrogen which distribution, will HYLA, months. solution customers for milestones announced brand, the few dispensing, integrated of accelerated for have in solutions solutions. and our launch last of supply, hydrogen and in recently energy provide new several the goals the execution our reached We an our key covering We infrastructure

business of HYLA new We for business. this be growing government, representatives attended the believe brand supplier, dynamic to event. scale and expected fleet, this launch will The significant. the platform provide a XXX is energy energy Over media

initiatives, by and per XXXX and be by dispensing During agreements. the Hydrogen Inflation like We with infrastructure includes to stations projects we and Reduction kilogram. IRA, supply hydrogen per production of our day Act, offtake up credits America. regulatory third-party up XX fourth the North to $X.XX tax the will Federal of of develop metric-tons quarter, hydrogen, benefits several partners in to supply supported announced to announced access which intent potential XXX

when low-carbon [ATRIB] like [Ph] certain creating customers energy incentive states, standard, values in the such fuel These create our incentives and tailwinds truck with as LCFS, programs in and Nikola's in combined positive supporting existing programs, California, brand. for HYLA

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up and metric-tons will in metric-tons XXXX, fully of day, production to make Hub, Hydrogen initial process well Since been the X,XXX to fully it the has solid ordering fueling City project X, up the engaged up of and Buckeye, per XXX per Phase XXX when the XX production support in long Phoenix This the continues permitting of days. FCEVs and expand to expect as to the equipment. progress in purchasing completed. as in lead-time to land, Nikola

was of X project Department in to the X, Phase Loan invited process. Additionally, application December Program Energy on participate of announced the Office we

also per at support announced activities which the our to We purchase metric-tons production of Plug Hydrogen equipment Phoenix liquefaction XX Power, will from intent day Hub.

the Overall, progress project. made these this by important actions solid underpin

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in Our expected is our up Terre us Haute, supporting to deployment day, previously investment Wabash XX Valley with in Indiana-based Resources to truck the metric-tons provide per announced Midwest.

is on decision project receive in This XXXX. track a to final is investment expected and later

in Our for truck Crossfield, And for day an sheet, Canada. Alberta, supportive Eastern Energy, market In the sales support Canada for up is Nikola. Canada we our project XXXX, represents of term will Canada Pennsylvania, offtake day, entry in per TC see KeyState trucks important and which to intended our good strategy. with in support and truck important which announced energy. for are XX deployment Nikola, incentives to supply trucks Clinton the metric-tons states Mid-Atlantic metric-tons per to with potential up County, to markets XXX market

These per XXX approximately agreements, others opportunity up day important will which negotiation underpin This deliveries, projects, be offtake X,XXX hydrogen our per to and truck an metric-tons a supply XXXX, by help and goal could of Nikola. trucks for under baseline will for of achieving our fuel generation significant is day. revenue

California. stations servicing additional also a on continued in network, of to total West announcement announcing Long an XX. port the Sacramento, station February to have and in previously dispensing location located addition in the our This Beach, announced station the California, progress four We Ontario, in brings Colton, on

hydrogen announced heavy-duty Coupled major a fixed inch capabilities this year, allow completion step network, XX fill in this first is our with we on time. refuel locations of Fueler. our will fueling pounds trucks kind, with our per Hydrogen a Augmenting dispensing and station refueling with to in square our capacity, Trailer customers FCEVs is Mobile of with XX,XXX back-to-back. forward January flexible XXX the its the efficient our capable It Hydrogen Tube of kilogram

use mobile will released by for have Team. Validation fourth through are and completed commissioning The going commissioning deployed operation fueler Nikola's be mobile in March. and fuelers first Truck is currently The for three

us the Mobile deploy fueling fueling customer permanent infrastructure at complementing will stations strategically to infrastructure. Nikola hydrogen depots solutions and fueling refueling flexibility allow

with or fence refueling is experience what For a behind or a that that similar experience gas, with either the and great refueling their provides them service depot. to customers, natural as diesel to flexibility comes they today this

trucks station. and to and sector in solutions could density, it a supply the Nikola, area permanent two-thirds sold. sustainable to introduced this Nikola the a into are us that our in us transportation areas cost flexibility steady infrastructure assets. limited upwards For shareholder CapEx execution valuable advantage The head reduced energy a scaled gives capacity zero-emission FCEVs also refuel of and potentially Mobile believe fueling customer the help truck start goals value. competitive more portfolio geographic create will provides match of be and as the of of gives We growing with by

over accumulating X,XXX X,XXX quarter, and alpha fourth pilot respectively. FCEV the Walmart we In with TTSI testing completed miles successfully and

Beta of management FCEVs. and As are have development, from today, From systems. based of incorporate and on and The beta the the of testing input. and improvements completed beta winter build fuel improved have alphas, customer commissioning validation. water of a alphas we Tre trucks trucks our number and we exhaust testing undergoing cell XX the testing,

beta improved also performance, of the the efficiency We range, and vehicles.

and XXXX, team will the We customer and are deliveries production we active is on of are commercial Ahead fleet additional We pilot the with in of secure customers refinement. begin first commissioned, include validation remain in series as the which for looking track trucks enhancements Once is deliver deposits testing captured to first to now second-half building as gammas testing. the talks FCEVs well further year. QX this XX engineering gamma in our FCEVs.

on XX Resources XXXX. in first we the project Bros fourth announced Class of This be January bus from the XXXX. with can from FCEV in and that Tre December to The Board customer and IRA. first Approval the purchase receive intensive XX, voucher to truck an commitment FCEVs for announced Plug in credit to of a purchase $XX,XXX hybrid February Power $XXX,XXX of FCEVs tax X incentive a quarter FCEV received the On FCEV for Biagi will federal XX to being will Plug addition means And we up on zero-emission delivered the up California FCEV the Xrd, eligible XX, that California Air potential in initiatives. QX

apart immense to competition. will cell a have FCEV made long from We set year. electric will customers serve fuel and conjunction our program. truck fuel haul with the be by in business begin for the Nikola delivering progress We later energy medium served vehicles. our have believe applications duty excited in best-in-class believe to program we We believe And and cell FCEV are to heavy this our trucks future

Moving utilized the to changes quarter program; additional trucks delivering numbers inventory the to while to do customer our service vehicles our product before as before lower BEV feedback. to in at and Nikola as in This we dealer fourth customers. our trucks facility. make delivery address delivery on resulted access Tre as worked chose We and soon to improve dealer end centers Coolidge to we have manufacturing this possible to we

the of our post implemented our enhancement second software major production battery we update changes to and management software. improvements include eAxle and Some bearing

improvements. update following Our for us was second improvement a the and software provided significant

the of cameras, useable XX Increasing kilowatt reduced Bluetooths minutes. truck in charging enable app allowing in charge battery range, management power and low-voltage XX and rear the power to mobile of Introduction XXX consumption, enhancement. capacity increased giving improved miles low-voltage XX% resulting up capability front of

worked We to BEV of partners depots. with deployment charging at have charging and infrastructure the customer dealers, diligently also customers, accelerate

charging depots. requiring We We utilities requiring power; XXX two, amps dual to expanded permanent skid fleets with work one, currently a of for are amps; solutions interim Charging single three, three their capacity as power creative install and amps. Nikola ChargePoint XXX have Mobile ChargePoint requiring E-skid Trailer XXX they at options; innovating

strengthen team. Another commercial step our we sales is to have taken and

at extensive brings further actions experience. first transport hiring to the has Since executive and relationships years the nine with dealers trucking company, holding additional And the was roles fleets the over joining Mack. in expanded previously have commercial Bruce additional and we with and and Navistar, He of reps team, space; deep heavy Kenworth, One Nikola. sales Kurtt. experience XX medium hire to of duty Volvo,

on to customers challenges. infrastructure including related the Two and refine and are and our solving of feedback. our and reduced strategy already initiated zero-emission to educating vehicles, are the maintenance cost customer strategy, things benefits We and generation lead refining of improve dealers fuel products

both and power should conversions. better duty into customers translate BEV of These We and leads capacity. from have customer conversation speedier Tre qualified for defined better cycle target available qualified search the perspectives

egress truck. additional to fourth, air tires; the drivers sliding product and lasting trucks, make and the About entry product fish improvement, of plan we easier to new two, to including; our and out make get and enhancement the adjustment wheel; tanks the the changing traction for axels; location updating in it between three, one, to longer of safer

customers QX As well inventory, part our appropriate deliverable element in We months inventory this. to as This dealer to of three allow XXX will in it inventory, enough the Bringing stages is with having customers. the XXX our inventory. delaer we think to address number. trucks is sales right Sufficient in roughly dealers of of think, necessarily business, this to as strategy, process. Nikola early is key trucks our We ended potential is and to for inventory. a inventory in trucks demonstrate have

November Regarding purchase Solutions. Tre order Tre pilots, BEV the X, we BEVs of on from announced customers and XXX Zeem's

pilot this and undergoing to year. are We program will Zeem, them a with currently trucks we delivering begin

Tre [Ph], WattEV] PlusDrive remarks February System the miles. quarter, braking During internally accumulating XX, PlusDrive we with steering, augment electric customer features, system, we with FCEV. And will on the Safety BEV, and demos controls XX,XXX our conclude and Enhanced announced over selected and [Saya the vehicle existing Tre from also including continued on fourth for ZF Nikola and Nikola-based to BEV software. XXX% pilot develop Plus electronic Walmart,

incorporating trucks first of to of line XXXX. the the Nikola end expect by assembly PlusDrive We the begin

remains important market an Nikola. for Europe

with and beginning We development In are spec Currently, business partners zero shortly X/X in work beta beginning continue Iveco the QX, QX, to our trucks, in building Tre BEV We start to of EU and to production on zero-emission the thereafter. deliveries with continent. energy trucks. build look gamma testing our as continued. E.ON we we plan trucks

We deliver EU XXXX. spec QX are in of track on the FCEV to Tre

XX, we last the with an Nikola opened jointly beta truck, the communicated we when for LOI book to As year FCEVs. January announced Joule unveiled GP reservations. we and Iveco order On European XXX

E.ON, energy further previously our of and energy to Germany's are We business. one sales announced European on We the companies. pleased had progress truck with also leading announce collaboration

collaboration the We and which continue by make to we good of with finalizing E.ON, our execute to progress QX. expect agreement, previously-announced venture are end on the joint

in over letter making and in been real see in for The for are We with the Tre order that next potentially and signed Europe. of GP XXX our its good and Iveco, Along the of partners the vehicles announce a with the logistics also a conversion sales, in hydrogen position Group few to trucks energy FCEVs. of based LOI and adoption intent also company, years. partnerships Group, previously-announced with Germany Richter pleased in expand trucks Europe in Joule Richter E.ON, an XX building to work to we Nikola fleets January, XXX its momentum transport a initial of truck has progressing system. by with continue others of place us

battery in Cypress, we and which under of one includes model Now, The Romeo. both modules, facility same the Arizona. to in Coolidge, Coolidge, cell module Phase manufacturing we expected producing progress roof. quality and bring be the update the FCEV manufacturing made and packs, enable will improve move X fuel an increased the line battery integration build-out power in production assembly assembly FCEV power significant is assembling Tre XX, Coolidge cost pack we give of January transition This On expansion line. In announced area. automation, completion impact module the on additional will of from on new model and will throughput, Bosch capable Upon on to battery will battery of our California, the BEV Phase facility X, the of reductions. pack

will be to year. up XX,XXX Assembly capacity nameplate per units

on to production Coolidge the quarter, module install power as prepare assembly slowdown cell rate the line, the second pack same battery fuel we the and and of in assembly, we accommodate module, production will the and FCEV During lines.

XXXX of conclusion, and Nikola. In learning, was for the growth year

XXXX. the We they now customers, we zero-emissions. are opportunities transition need fleets mobility on to providing well-positioned to excited in to their solution capitalize integrated serve And are fully to

it hand to I over the With cover that, now to will Kim numbers.

good spending coming our and with in to remained we continue We committed and XXXX, XXXX. to our disciplined in to intend In Michael, managing expense Thanks, cash disbursements, being morning. guidance. favorable

our into jump results. Let's XXXX

For the our for The million. to Tre expense full-year produced guidance $XXX.X for we stock full-year $XXX.X $XX.X million, delivered million, revenue BEVs, in of was operating and XXXX, revenue $XXX.X of dealers previously-provided loss totaled came at gross favorable the XXX of XXX $XXX.X cost of million, inclusive expense. to compensation million

full-year and non-GAAP million, in expansion, and have adjusted XXXX and was on $XX.X among and $XXX.X on of million, of $XXX.X loss remained spending regulatory cash. million, Net full-year hydrogen negative million, Coolidge We acquisition predominantly Phoenix. compensation management Phoenix Hub, million, EBITDA other the for disciplined the a million, of expansion our in basis, items, came $XX.X Hydrogen matters tooling, EBITDA $XXX.X HQ land adjusted in supplier excludes at stock-based totaled for our $XXX.X Romeo and infrastructure equipment, legal and for CapEx cost spend managing facility

to on closed results; of the merger in Nikola's began operations after our consolidating Moving October. result into Romeo's we QX

last the delivered chargers During revenue we of unfavorable program adjustment deliveries. million includes XX generating revenues an quarter XX produced associated with a year, three dealers, months BEVs, and third to of dealer $X.X the of rebate Tre million. relating and trucks to XXX $X.X This

cost $XXX,XXX for million, On $XX.X of generating average selling for $XX.X Tre a the of QX. quarter a approximately was revenue was price the compared approximately BEV loss adjustment, basis, per this Excluding the as gross truck. million, the to consolidated

costs, of over including lower deliveries, merger. of and associated one-time including number revenue, to volume Romeo delivered and of spread increased expenses cost, gross with higher inventory percentage trucks freights inclusion a Tre smaller loss a overhead BEV a overhead the due As significantly and fixed expenses of

labor, related the materials quarter. million Tre in and have of July, at during facility adjustments the and for to million duties. inventory products freighting charging receipts total, to Freight dramatically $X.X and a receipts of revenue. our Of million remaining sold X% the million $X.X BEVs, of bill quarter, from Fixed includes inventory-related and $X.X overhead, improved was in the depreciation, is non-cash which costs down Coolidge costs cost duty the to for to related percentage came of at and of The million is related inventory as in in inventory receipts $XX.X December. manufacturing $XX.X XX% break Let's expenses. the

revenues as Romeo's non-GAAP from of battery million our which write-downs expenses since including million operate totaled compensation. inventory in $X expenses are fourth million; no our remaining adjustments, to into pack no million totaled loss totaled to SG&A for and Also, operations. third-parties is to per was $XX.X on to Coolidge longer QX Cypress $X.XX, and totaled pack plant, negative of $X.X products million. basic The and included a a on was diluted. which $XXX.X we cost $XX.X freighting, decline quarter $XXX.X million, inventory Romeo non-GAAP Of manufacturing share R&D diluted, stock-based $X.XX longer are absolute in be excess related loss the million this, integrate for negative Net $XX.X will $XX.X in a net basic basis, including will basis stock-based expect operations. and costs significantly compensation. as we GAAP QX, merchant and supplier. labor, related overhead, sold million

$XXX.X capital, Turning to cash. million in remaining. Access the to Nikola in of approximately the form restricted additional sheet, including million we the comes available of which, quarter balance ATM, $XXX to cash, ended with

$XXX.X credit $XXX.X of sell, we right and excess $XX have approximately million liquidity. of remaining, line equity of total us convertible to with million million Assuming providing the notes

we convertible and Accounts million. business sustain which, sufficient earlier, our in receivable in putting mentioned the us $XX notes have convertible a May, of including in E-Lock, notes, $XXX notes, we our million capital and August, of approximately ATM an and to $XX.X additional the markets, were our into execute existing $XXX successfully provide million million in capital will XXXX. several million objectives XXXX, of agreement funds sale convertible sources received December. agreements Accessing an ATM, operations, of in for executed in with $XXX place As Michael in

facilities We receivable are capital the working institutions to with of in dealers. thus, dealers, plant to financing our provide working accounts reducing with form flow

in year, At million in This in the the includes we end $X.X in work-in-process, materials million of $XX.X approximately raw $XX.X inventory. million and finished service parts. and held goods inventory, $XXX.X million

supplier As million, CapEx the our we for facility turns Coolidge was gear, manufacturing approximately mobile fourth production in expansion, our commercial predominantly $XX.X quarter accelerate. hydrogen equipment, spend and tooling. to part functions expect kick totaled and hydrogen inventory on to fuelers,

of inflation, in slower-than-expected adjusted know, rising you headwinds to laid or interest X% debt macro difficult we the and workforce we approximately related to rates, As November, FTEs XXX as up adoption rate. our

with working and are productivity greater reduce bam We hard and discipline. costs focus our improve to

XX Our Romeo. including of was employees headcount December as XXX employees, X,XXX of

QX work to semi-trucks rate to variety outlook; earnings a significant faced on be slower we still these take soon. much challenges that This Moving don't we customers. the call, to will will acknowledged to the some believe of together electric nascent, due by charging potential very them. the need XXXX our time. all adoption will of is challenges infrastructure than end battery abated address And in and our including anticipated issues, stakeholders We anytime

to would Consistent expectations are Tre in with to and XXX have achieved plan what Tre cell We XXX our our XXXX. produce BEVs, We Tre bam XXX electric Tre minimizing late-QX, and XXX savings plan the BEVs, XXX for cost be stated, in this Tre volume we XXX pointed to out electric we beginning also cash, better XXXX. losses to fuel reduced we Tre BEVs, deliver preserving off BEVs XXX in vehicles. until delivering year, that to XXX and fewer vehicles cell previously and fuel

for gross XX%. anticipate XX% guidance margins will the XXXX Our $XXX revenue be to negative million. million $XXX full-year is We to

gross of cost we realize saving towards We as margins improve the our the to transaction. from Romeo benefits end substantially year expect the

excluding truck we cells can We battery the by modules XXX,XXX pack per December, anticipated costs, by Tre and approximately lower on XXXX. BEVs

close, pack per the price longer before associated Romeo temporary is delivery transaction truck the increase, incentives realized already no effect. XX,XXX savings in with have close post as in We material

XX,XXX packing to junction from material process additional We expect an and achieve to manufacturing savings by switching to closure, boxes casting. in battery machined billet

and Additionally, pack to battery implementing line by modules automation. and battery production transitioning Coolidge,

We in-house expect module bringing provides with believe battery pack overhead $XX,XXX us reduce labor cost roughly per long-term and value. vehicle. and to by We manufacturing strategic

in to $XXX which million to million million, stock-based in include compensation. includes $XXX SG&A $XX which million full-year are $XXX XXXX $XX expenses compensation. million, in stock-based for Estimated $XXX the R&D Estimated million is

Coolidge, planned compensation. in Our OpEx mainly XXXX below area level. and assembly XXXX tooling focused expansion of level, module the line, assembly range anticipate vehicles, stock-based planned cell million completion on X hydrogen electric the and XXXX infrastructure. for We XX% in the approximately excluding for the million, line, $XX spending of CapEx approximately power is fuel is to fuel capital be below $XXX module, cell XXXX expenditures to assembly million battery Phase the $XXX pack

We full fuel in EV, QX, production the started are XXXX. running speed cell at Tre to meet

electric the pre-sell cell volume Tre requiring vehicle, a down to is payment. of including goal Our modest fuel production

negative for full-year employees. margins outstanding shares of XXX.X BEVs approximate to of XX XXX% headcount total to generate XXX.X to to approximate our decline We million average to deliver X,XXX $XX.X approximately weighted million, expect XX to for slightly QX, we outstanding the gross to to shares ending In expect revenues XXX%. We Tre million. anticipate $XX.X million, and and

XXXX. as gross production, in volume expect to Romeo margins we improve cost and scale savings QX, We substantially realize from

QX in million $X.X compensation. for $XX of million, in to is stock range million $XX the including R&D estimated Our

validation electric be due to completion beta commencement heavier expenses. in vehicle compensation supply quarter $XX of million to assembly approximately the EV launch. million QX, anticipate cell somewhat are in be $XX.X FCEV gamma including of tooling in range expenses of $XX fuel EV fuel build, activities. related the support the first the and CapEx line R&D SG&A cell fuel FCEV million principally build, to million, the will will the We in to $XX stock-based that the cell equipment and

to we the million. XXX.X expect outstanding the million and for QX, the shares approximate quarter outstanding shares weighted XXX.X to be approximately total In average

we the Regarding our adoption momentum vehicles, albeit the longer-term period of are still we and see slowly. outlook, in zero-emission building, early can

adoption and fueling Act model. cell we However, EV approach to boost of as expect to pick up business a Inflation start pace significant fuel Nikola's the Reduction the XXXX anticipate and and to XXXX, integrated providing

a of in are uncertainty. there a nascent We so industry, is lot

and To X.X% sales business of to line of XXXX, EV, XXXX But truck Tre to X Energy truck and increases achieving only hydrogen of in Class for in truck have Then sale are of greater units. we able units solutions X,XXX and adoption to approximately assuming we new ACT capture Research's executes U.S. on XXX,XXX production share fueling of zero-emissions long-term numbers, anticipate our approximately Tre X,XXX would to to our volume some total our thoughts preliminary fuel on cell X,XXX thinking, we X,XXX sight BEV targets. X,XXX units. X,XXX deliveries a

cannot to metric-tons is customers. is and we're estimate done, we'll provide selling we this Again, demand, to But approximately that there hydrogen Energy any of potentially supply adequate a per lower addition, business is to Nikola lots be could able revenue to to access carbon $XXX in In million day develop $XXX generate million XXX we successfully if roughly for. and we hydrogen what there. and that and third-party get lot work assurance of of FCEV striving this, our

Our necessary have achieve our to EBITDA as believe to in milestones capital. margin breakeven is achievable XXXX. is planned, achieved, develops we business gross business XXXX and positive continue our We profit where in are outlook access our current to to a and positive plan if

glide executing laser-focused to our are We path profitability. on

hand now for Michael back will closing I it remarks. to

Thank you, Kim.

monitor our steps XXXX, in done XXXX. and forward us positive and that to our progress you will have on accountable. we impacts success in to taken our As have set and suggest the business for hold closely past, we investors we up milestones provided for We pay attention us milestones. have In make track

June; FCEVs a QX, are decision battery by at XXX gamma early for of follows. each station investment the XXXX; Tre to final $XXX,XXX deliver in Phoenix milestones XXX build achieve Tre for savings packs second-half deliver XXX in by announce QX; cost BEV the for by QX; XX realize of approximately XXXX XXX BEVs XXXX. by Our Hydrogen dealers the Tre least FCEVs Complete to Hub partners two refueling XXXX; to in modules and

our up wraps prepared This remarks.

We will which use the open Operator, line. the our take analysts' shareholders. remainder please our we to questions will of after the retail time covering questions, from some address

[Operator proceed. you. Douglas Our Dutton first Evercore is Please question with Thank from ISI. Instructions]

Yes, good here. and Nice update Dhillon. morning, Michael, Kim,

some of can you for next maybe steps about concept So, but sounds XXXX? what first or talk questions bigger several first, XXXX demand [Ph] and time like of you the like FCEV does progressing the into other larger And see for these over [Bud] customer, how as salable a look you, are AnheuserBusch two customers. what continued for for, Walmart, detail It a spoken look proof pilot FCEVs the a with trajectory for of customers? like

Michael Good morning, Okay. you. Thank Douglas; here.

call, So, let's truck. milestones. good talk cell first of mentioned about I the is good fuel of all, achieving the truck is the mean, the as on development I the in development shape,

starting And Busch And where XX. as then obviously, first now, The with and is see outlook for terms demos we example the important really think Biagi Anheuser I in Nikola. how another we see will of is of also is Brothers see 'XX. which 'XX, do them. that going Those customers, year. will cell we into you we certain the fuel gave 'XX, we first Now the trucks one big this deliveries in in have, agreements are And know, well. importantly,

the XX%. truck. years. quarter The will step that step I by the fuel in the Kim very when obviously, be very new so important then, demos. a important. thing, a mentioned percentages, could improve coming think, mean numbers we fuel And we launch point, obvious And is in think see obviously, have your new cell in is the first good deliveries cell for 'XX, that feedback potential this about But brand, truck. it customers critically received of good is this from course, we terms fourth I And I will feedback of to to the up the for Nikola. When

'XX year, 'XX. and deliveries first then I are a So, we into and think path good on improving of this

appreciate helpful. that it's answer, Okay,

FCEV end tell the builds by XX committed Finally, you who I QX. team. partners of just gamma see XX are on to? FCEVs the these us preliminary goal production, that Can are the Thanks, is gamma

do validation. a for we first I gamma use mean, all, what so of Yes, lot is, we the

is the we bring We point to the of so really add truck third did. marketing and are main we cell present like in are in in the quarter. that Also then we trucks the validation, And is this fuel the couple the so truck great very in Orlando shape, the develop I'd have from and to BEV which market. mean, many to also our start second that shows, is, learned now was things is we because helpful shape better I in truck we we trucks, next the make the much we is we sure overall, This to obviously, gamma another bring BEV. our because like first can certain certain where truck. deliveries But have purpose the weeks

a we out that. beta lots finalized milestone mean learnings is the important of for And have that fact very the I the us. XX, truck, have we of

as into the for truck trucks but truck early Now gamma, validation, that also shows we the have so marketing as customers, which also possible can as certain get to certain we possible. many to people as bring

Michael. Thanks,

Research proceed. Our with Kauffman Vertical Please next question Jeff Partners. is from

announced on your if area? curious started into I any Is such I a stake was fueling got this what view on were And that from that I And your hydrogen affect right. And vehicle you British just opportunity, fueling been that on do it on for you has ago, This curious, it fuel week of focused in acquisition? your go about very BP just then the I'm bringing Does what taking commercial thank Thank stations a well. a all know in that concept is read for XXXX. and had large and of direction. or to this, this different in Midwest so much. what going start think two And America. in fueling the plan XQ as going to in in XXX centers California, you to TA acquired locations? TravelCenters happened thoughts is an you had a BP centers clarity couple Petroleum where program that

question. great Jeff,

have they and has at fuel it means more BP this majors that going TA, who with partnership. our the this fact hydrogen our of perspective. TA, you've our serious about actually energy our acquired wonderful from oil the distribution, is acquired about the understand that fact have first, of our becoming the comes future got TA forward, and folks accelerate nothing actually think we familiar is So, It strengthen will TA; very news they're with that really BP and believe hydrogen from they you and When that now. relationship with will relationship terms in majority changed. team of And

Okay.

cell current on 'XX start cell much plan on how as capacity meet plans build you needs the the your you to curious, to XXXX? the going guess Just toward the on to and of trucks say, I XX need market we in, being kind to these first vehicles XX fuel based fuel bring this to of months in as road fueling are board, XXXX,

So, on day. X.X based sell, have terms for our the we'll number only as you needs per view in tons is trucks know, we that about modest of of that XXXX,

our ready we that procured will that And from trailers we And launch we so, behind so what meet already have access whatever the we where sense fence, for we customers. hydrogen. can the believe demand for existing third makes based them exactly can party. know fuel have mobile our on And we we market

So, that's feel something we covered. already that very that we have comfortable

will X,XXX 'XX trucks; to more fuel me needs to per cell What by day fuel believe 'XX, have 'XX. you sell you million about you'll cells? those capability, gave ramp for tons start you be as and X.X So, support do for the

on what based anticipate we XXXX, For we to looking are sell.

Jeff, around feel Now, once in at very we XX truck what we'll question, based meeting level, think while terms a disclosed do have tons we we on per again, what those And of numbers. your high to XX anticipate in need sales, day. comfortable we we not have already contracted,

Those Well, thank wonderful. questions. you. were Okay, my

Bill Peterson is question next J.P. with Our Please Morgan. proceed. from

of all the like good trying have is are of next the in prepared for cycles, you by and geographies] to of hands first should My customers you things is, my maybe number And constraints that [Ph], remarks. [technical the great hi, end questions, the how do on feel of how for targeting, any? for [indiscernible] the trucks And that question mentioned? in get [indiscernible] always, just disclosure the given thanks equation years a exiting fleets' Yes, trucks if customer as this And of the these part [duty few charging XXXX, you and difficulty] and, taking how areas are in year? about hands in over the presentation really any morning. we other think

Thanks Yes, question. the thanks, for Bill.

XX have right? of we trucks talked overall, about let a we the what And So, the So, of the look chain overall worked of in inventory Nikola in development. trucks We mean, I back I think I all, truck, the provide also XXXX, development to the at at first supply end-customers, the well close number. terms worked operation. issues. me of through little first customer bit color if now, to come is production;

We'll truck. going inventory down these inventory people to to need fair it's this forward, have because, think we experience days which say helpful have at the also moment. that I in bring to obviously, also sufficient is our

brand, a new I it's mean, new truck. a it's

the have in we better. trucks, people more the So, our

in higher deliveries a dealers customers, of terms during we year. terms to right, will In there, to guidance the to number XXX, see of the the retail XXX we gave

I I of truck is we And the will ramping as measures people quarter truck, our customers also dealer done need bring then to improve more think to we better. see and into The progress we first have the a then, now; in this experience. And have lot up. sales second management much and mean, that. we more highlighted, again, we we experience have much this.

a in those operation. of will terms hands' trucks bringing we see So, into gradual improvement there customer

And as we and a trucks new And also the customer improve later also feedback. so some that's us then, made take not company a endorsement because to purposely at why now obviously, is for their important. stage, of decision the the

forward going of see is couple we So, how this I that next think the that quarters.

more thanks for different the prior bit on hydrogen color. a the Okay, I ones. that infrastructure, little second guess, and question than

XX associated You guess stations the stations of Arizona re-fuelers. meantime, about XXXX, Nikola's what's contribution? In the -- mobile talked you multipart then what's then again, Nikola? Phoenix and the [indiscernible] the have rollout by in expense and I [indiscernible] the additional question then is sorry XXXX. about you're for look looking And at the for hub, but question, when you at then expected

you I then, the lion's of but talked prior discussions, [indiscernible] now you in bill. partners talk or the BTE other Can pricing you about share But you think [indiscernible]. about the maybe

as trying a about so, the understand to think more the the [indiscernible] And few as in, for infrastructures if about issues overall, and stations hub this well year, you years?

will to next to refueling as In the well in me is announcement as in stations. see will to of started have strategy network. and for of in refueling additional That we XX What a respect as out XXXX couple hydrogen So, to how see network your you have what means terms XXXX, that are hydrogen months, think by as lots stated we have stations. as of well looking I iterate, to be to XXXX, three have company it refueling we are comes network. let when we well, you us is our efficient. our especially build to lay Bill, we components with kind are that, What stated hub months, approximately hubs there going But, refueling have ecosystem, capital questions. is to partners asset-light for our is out

California, in let's $X.XX in our at said $X.XX. what credit to and sudden, credit think LCFS a hydrogen, What launch California California, Plug, potential by add our will for XXXX, you as ton we of market. a Arizona, about more in there at, means Then, going We around to coverage offtake well hub California $X.XX agreements $X.XX we others when we'll about, from of when that be you're as tax direct $X.XX, and is anticipate, say, for production provide least will to talk able that be to XXXX, all XXX day. we our you're to These that coming is per complete up network. XX what or have stations well here. see with that likely California for incentives. of that as is with have And is by and announce are

based believe we what So, meet can very very, costs, even our make actually excited are And still that's about. on we actually and we or margins. diesel, production attractive improve, parity with

FID ownership, have to early And a already talked at take and so, about means FFI, our has XX% when we'll that letter will FFI Arizona ownership. quarter. is go we Nikola third have of announced least XX% we think hub, that by with intent we we that said about What

form contributed to that We have for that paid that have already Arizona will be land of to electrolyzers XX% in of that contributed well been have the our already as we hub. purchase portion as delivered

we'll Arizona we Nikola at what hub, offtaker to those molecules dispense from control in be interested our we're either has an to commitment those to that opportunity principal or So, about, partnership And is ultimately, is we and ultimately, will the been that meaning of talked do own we What locations having have other will equity it and the important sell move already outright will with in, is parties substantially that paid. some down portion that of though we Nikola, to conversations. in are jumping molecules, parties.

have And model. business a so, we very think compelling we

ultimately for fuel better go accelerate we control we fast trucks, charging those we for potentially BEVs. something opportunity start this can our and available, cell of production into much believe and and an having infrastructure orchestrate fuel we permanent there is cell truck, is and As than can to delivering because best, fuel by

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As you loan is know, from DOE loan important guarantee.

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the comments. for Thanks

next Company. Our Osborne is Cowen & question [Operator from with Jeff Instructions] Please proceed.

Thank you.

Great ones, quick two? to to of want down two side, margin I or the as or sense. side take year battery anticipating commentary next the understand for a pricing Or, on see on the we you pricing you positive. for on to Just or should assume the folks 'XX come Kim, lot are gross was $XXX,XXX $XXX,XXX seeing about give other just market? enter wondering being I the the makes reduction

question. great Jeff, Well,

when comes that As early you say know, an it stage, especially BEV. still is to market I would

$XXX-$XXX. I could in think more that we budget, We suspect when to bit ASP we what terms comes our be is to conservative of we shown but closer are actually XXXX, while realize it higher. our have will for

number? strokes I And you you that give is it. what thousand a Like of there deliveries? the reaching gross the get think stroke XXXX? is to in said Got broad of sort breakeven sort And any that you in can how teens? parameters few around then, broad mid are then, EBITDA margins on

modest, we have from terms is think for numbers When be out indicated not I of volume possible would XXXX, given increase could XXXX. to what significant. really by say about haven't FCEV we the XXXX believe We we XXXX. Obviously, in

you XXXX guidance to is you more significant. XXXX. again our terms outlook for see jump XXXX, the once year that for as not can versus for of that this is from in big jump see think And I BEV

have ultimately rate more we So, as as think it go adoption we second to we realistic being able And very confidence when into and comes are be for will to BEV. I now of cell we can fuel But cell our able side. faster vehicle better third having available on and accelerate electric fuel think may fueling be for adoption we because to quarter. we likely truck, control

to in second it gets think be And will to margin EBITDA about as that's profit XXXX, Michael think first like electric R&D And alluded most gross as the positive. we margin we EBITDA more when is and cell guess the to generate key. And by BEV. from breakeven volume as step SG&A. cover positive, when look of vehicle. XX% XX% fuel step I be that going we'll to coming XXXX, But our getting then, and well So, the gross more FCEV

that's driver And with very complement business key to and energy a that I a profitable -- think

correct. that's It's profitable business, a very

Perfect. Thank you.

proceed. is Shlisky question next from with D.A. Our Davidson. Please Mike

hi, good guidance and when quarter, of in in get BEV battery run question. you rate with of under for the happening and XQ kind thanks for an the my first rate for have run Yes, The the morning, control? is deliveries XQ taking the rest fourth of cost got you that situation kind the appropriate

Mike, But the mean particular going your now question. on that good I continue side for you in Thanks, lot a the in I point, done on have and this mean will and see results obviously will right? Very QX also product commercial very also clear, side. so, improvement we But QX. will so to QX QX. see in better do we measures be better QX in of forward, we

a obviously we again, management we there in experienced So, measures quarter now. the in Dealer are few third truck, because improvements BEV see So, rate so fuel we lot are have people working. those, is place the of And second focus and all have on fourth while in truck then the the quarter just the cell you place. right? on to a launch of in taken will run highlight the many

case through. have way, our the dealers a all By coming was which improvements now are year. Product something a not license, last

of make more a states terms conversion other infrastructure, drive will coming people we also through we lot while us of the successful of up And retail can a think truck, topic of more on stay with all And our I time. this sales. the going period for some be infrastructure incentives. will to progress the are in

improvements So, and second well. third you will the quarter in see as

us next follow-up, or And discussions former as they sounds fourth the then anticipating on them? if second didn't think impacted you with well? asked lack Romeo It quarter kind Romeo Romeo a They you years, going a forward. are my six seem and company the valid discussions update batteries. can sounds the comments, contract? for a customer, Are have for you. the hoping five, then in their and secondly, like them by either come to like that also to that of have having hear with kind Lion am And over of any eventually payment you a they have party cash situation numbers they it contract give with Great. how batteries the valid I has they I of exit are batteries contract. Thank curious obtaining

And to going understand with has the agreement So, breached. over details terms been Romeo. they filing respect in are respect because with without we believe we their We disagree. that arbitration to certain in Mike, of purchase that provisions

our purchase know you has as that. Lion through that -- Romeo purchase to So, to build actually even Romeo, before modules. battery own and we But always are of to working they their pack communicated intend

go and late In volume. actually packs that to that into actually modules they expand their and they have fact, production continue to on QX December XX, intend starting their in Canada. produced And announced first -- XXXX, of they QX in production XXXX

was So, understanding. that always the

work there. to will any don't believe there able this. We And will so, be be we through we long-term believe consequences

pack we have when that we they not to our you there always that alluded, to have it in disagreement made we intend entitled acquisition of to. announced of respect terms substantial Romeo party do And and are in be business. at other the With battery view time are clear merchant the

to As But there were now related product of disagreements those all you the right will with packs. product many are should concerned. address to not we packs. And some or this claims of we once be to those respect We again, believe issues. know able that of what's of are understanding

you color, along. that I now Thank pass appreciate will so much. I Kim.

proceed. Our is Bank. Winnie Deutsche with Please final from question Dong

a much the QX? in. And quick is cost are wondering I or that so primarily reduction of with give to in the battery where something the follow-up benefit year? sense squeezing was in $XXXk you for Is throughout not you tracking thanks less steady And I have well. is just a for packs? more can saving me us Hi, as

have for stated in we we think believe I $XXX,XXX what modules of question, we can actually cost great terms is and approximately Winnie, packs. take that

time already have into additional and of We facility we Coolidge some savings or that, late at come will then, achieved third in about labor early once integrate QX. our QX a through

of be through of will QX. then late second-half enclosures savings happen this third bill material year, likely with those So, quarter the savings towards will and ultimately and

already We transition have we call, sample we have, quotes numbers have expecting, be what we as validation save will there volume be Obviously we kind be terms required, machined packs of on the the what but casting. that in we in to able received the will are that of cost billet casting. based and from know to will we that we the

XXXX? And how doing earlier, team what the us apologies percentage That's to you. delivered been do it was for up give double midpoint on sort now, Thanks. you some in the you visibility it Thank customers? missed better of than a anticipate maybe is you then -- and of Tre customer customer demand and sense helpful. commercial then, in hands? the dealers more ultimately you outlook So, have units, I to to of very if ending know, for can examples it. that BEVs, is Got XXX your of what And -- maybe than what engage what

than I are first people. I very also all, we We the people, we nine first we place. side, what sales also mean, in commercial of experienced truck point. many great on mean, doing differently, hired all, more more people of have Yes, have now

we Additionally steering very regional good have now.

time-consuming is We thing. because It's with for training and also sometimes zero-emission mobility our selling lot everybody. the a new did dealers also customers, of more

the many offers on have place. We in more infrastructure

need the our many And and the to to financial have our in key, have customers experience are more this. enthusiastic that's we the see products truck, very drivers about place. We because experiencing truck, need the customers truck,

of flavor doing. are that's we what a So,

it, down. what think a to good also year, we said, of will truck. of guidance because in we of progress will that will quarter. and have that the level terms about believe I are third are the for will have that we the more, of end the go come to sure level to we customer, the second it inventory, just And retail go inventory, and to basically actually first see repeat launch actually customers, on And very more cell now given fourth to want I laser-focused we In quarter fuel we we what to the invoicing the need quarter because now is the make dealers the to I of this. all reduce have percentage

some improvements the of in third and see So, second the expect to quarter year.

I over Thank like the call to would you. now back shareholder hand to Dhillon for questions.

Operator. you, Thank

development comes continue operations from XXXX? Nikola adequate Ali Kim? asks, question Ali. into sustain to Our cash and does have first

to adequate fund our access question. operations believe in for capital XXXX. We Ali, we your to maintain thanks business

approximately cash XX, R&D, to sales, XXXX, including million The of access approximately million. December expenditures. was SG&A, of $XXX compensation, spend As truck net our implies in XXXX, and in of loss from midpoint total gross capital our stock $XXX.X guidance capital

we can believe demonstrated to have we We access in capital continue can so that and to markets, do XXXX.

Kim. you, Thank

Energy you X.X would the second process? X at or Has the Nikola this asks, indication one? is given not, like comes Phase where Michael, acceptance since the billion of in invited you loan government Bernard. from regarding question Department any of Nikola take The Bernard to the process?

question. Sure. Bernard, for thanks your

submission The loan the office when and We on with Energy multiple completing a we completing Phase has Phase program requirements steps, will fully process in of the been engaged cannot have made. decision months. predict Department We be for anticipate the coming X. the for X

We will feedback, Loan we'll you our Office, responding continue and progress. and update working of are closely with and Department share their Energy to to of all shareholders the able when we Program course

earnings call our everybody you, joining today. for Thank

side of this the on the improvements cell on year is what the are we much will make again, We to want important accomplish This about and we will path. year. reiterate very excited energy the XXXX, during I happen of about launch the year excited in of of fuel and which year, the will the business. the truck, this opportunities second-half are we

Nikola my company. in As I is truck said the first comment, than more much

wonderful joining, have you that, for Bye-bye. With thank everybody. a and day,

today's Thank you. This conference. will conclude

You may you disconnect your lines for at this time. thank And your participation.