Luminar earnings: We’ve been ‘meeting or beating every milestone,’ CEO says

Luminar Technologies CEO Austin Russell joins Yahoo Finance Live to discuss company earnings, meeting order demand, expansion plans, improving safety, enabling autonomous capabilities, and the outlook for Luminar Technologies.

Video Transcript

- And we got to go because we got to get to another conversation. Shares of Luminar Technologies right now are down 3.6% after that company reported first-quarter numbers. The auto tech company reporting a wider than expected loss per share of $0.24. Analysts had been looking for a $0.21 loss.

Revenue did beat estimates and backed full-year revenue growth of at least a doubling. Luminar providing updates on business plans for the year, including a new factory in Mexico and expansion of its technical talent team and partnerships with automakers Mercedes-Benz and Polestar.

Joining us now Luminar CEO Austin Russell. Austin, it's good to see you. So we saw those that earnings per share or loss per share, I should say, missed in the quarter. I believe that had to do with some of the costs from the Mexico plant, which I mentioned. Is that going to be the bulk of that happening in this past quarter? How's that going to look for the remainder of the year?

AUSTIN RUSSELL: Yeah, so I think when it comes down to it, just to be clear, that loss was actually totally within our guidance range for what we gave. So maybe we also need to figure out how to better ensure that aligns with what we have. But it's all completely consistent with what we have for the year. We've been meeting every business milestone that we had along the way. And, actually, our growth has been significantly better than expected when it comes to our business, our revenue, our order book, our products, all of it, basically everything along the way.

So I think it's fair to say, though, that there's, obviously, a lot that we have to be able to execute along the year. But we've been effectively meeting or beating every milestone so far from, well, not just the past year, but even so far this quarter.

- Do you see any expense expansion necessary to meet the demand within that order book that you have right now?

AUSTIN RUSSELL: No, actually, quite the opposite when it comes down to it. So I think as we continue to accelerate on the business and be able-- we get the benefits of the economies of scale. And what that means is that the actual cost structure significantly reduces along the way.

From a profitability standpoint, we actually have some pretty clear outlined goals from a product profitability, from a gross margin perspective. This year, core business overall profitability next year, and then everything all in for the entire company and all the future bets that we're making for the following year after that. So that's all been accelerated. We're actually on track to be able to meet all of that.

And even by the end of the year, just as a reference point, we'd expect our costs to be-- our recurring cost to be roughly half at a run rate of where we are today. So that's, like I said, we should-- hopefully we can make it to be not just the company that has the most or more value or contracts than everyone else combined for LiDAR or AV of the public cos, but also certainly the first profitable one, too.

- Let's talk about-- one of the-- we were just showing a full screen that talked about expanding your technical team. And I know you guys just hired some folks from Argo AI, which is a one-time competitor that then ended up closing. What do those folks bring to your team? What do you expect the next phase of the technology or the next phase for Luminar to be on that front?

AUSTIN RUSSELL: Yeah, yeah, so we're definitely continuing to ramp on all fronts there to make that successful. And that's just accelerating the technology roadmap that we've had and product roadmap and capabilities. So everything is in a great place there. We're supporting a lot of additional business.

So even just, for example, this past quarter alone, Mercedes had announced that Luminar is now being put across not just one vehicle model, but across the lineup there, too. Same with Polestar. They've announced that we're being put across the lineup. And for the first time, you actually see these mutlibillion-dollar contract value that has the opportunity to be realized over the coming years here as well.

And this is just, again, continuing to drive growth. But we're leveraging the same core product and capabilities that we've had for improving safety and enabling autonomous capabilities. So that's the beautiful part of the economies of scale as we continue to be able to ramp up with that. And

That's also the reason why when you see from-- as those billions of dollars in contracts materialize into revenue. that's why we've seen this crazy growth of over 100% year-over-year for what we just reported for this quarter. And overall for the year, we said at least 100% growth on revenue for the foreseeable future annually.

- That's big. Austin, this might be a little bit of out of left field, but you guys are very auto focused. Are there other applications for LiDAR in other kinds of businesses that you guys are also exploring? Or are you just laser focused-- forgive the pun-- on autos, and that's where the business is going to be?

AUSTIN RUSSELL: Yeah, so when it comes down to it, there definitely are other adjacent market applications, things they can utilize LiDAR for this. And we work with some of those types of companies. We generally focus on the big ones. For example, Airbus is working with us to be able to start to equip this for their up-next division on helicopters and whatnot, for where you can improve safety on all kinds of vehicles, not just on the ground, but in the air and other things.

But I would say that the way that you become a trillion-dollar company at the end of the day with this is by heavily leveraging and capitalizing on the existing automotive market and industry. And that's what we've been able to do very successfully. So we're working with the majority of the top 10 automakers. So we're going to continue to do that.

And when it comes down to it, I think one thing to look out for that maybe is a flag, if you see anything or any types of companies that are pivoting purely into that, it's not clear how you could be able to build a successful or profitable operation when it comes down to it from that alone. So we're excited to be able to continue to leverage the sheer scale of automotive. And, like I said, very high barrier to entry, but also very high barrier to exit as designed it. And we're proud to be very uniquely selected in position to be able to do exactly that for so many major automakers.

- Austin, are full self-driving claims in market right now as cracked up or as clear or transparent as they need to be? Or is the real thing still waiting to come?

AUSTIN RUSSELL: Yeah, no, so I've been-- long been probably the industry's biggest skeptic around full self-driving capabilities and technology. You've been saying the same thing since 2016 when it comes to that there, too, that there was a lot of things that people were overpromising that we're going to be underdelivering on when it comes to overall autonomous capabilities for full self-driving stuff when you take out the driver.

And that's why, like I said, our business plan along the way in everything that we built the technology around is not around replacing the driver. It's about enhancing the driver. It's about making cars safer. It's about enabling autonomous capabilities on highways. It's about being able to get onto existing production vehicles, not making a driverless robotaxi.

Now, that said, the technology is directly applicable to that as well. And we do work with many of those companies that can do that. But that's a very, very challenging problem.

Of course, the LiDAR makes it actually solvable and words of magnitude better performance and accuracy, et cetera. But, nevertheless, that's still a long time horizon. The thing that is happening today and what's accelerating, I think, even beyond people's wildest dreams and expectations is that we're able to get design on to millions of production vehicles that are, too, that are actually out on the road, that you can actually buy. And that's where you start seeing that ramp up on a global scale with us like crazy, starting with the Volvo EX90. And then throughout all of next year, that's where the crazy ramp continues to happen.

- Austin, we know you got a busy schedule today. We appreciate you taking some of the time here to discuss the earnings with us and the forecast and the guidance here for Luminar. Luminar CEO Austin Russell, thanks so much for the time.

AUSTIN RUSSELL: Thank you.