Earnings call transcript: Aurora Innovation Q2 2025 revenue beats forecast

Aurora Innovation Inc reported its Q2 2025 earnings, showcasing a significant revenue beat with $1,000,000 compared to the expected $503,330. The stock experienced a 3.02% decline during regular trading hours, closing at $5.97, continuing a challenging period that saw a 10.5% decline over the past week according to InvestingPro data. In aftermarket trading, the stock saw a slight further decline, reflecting cautious investor sentiment despite innovative advancements in driverless trucking operations. With a beta of 2.49, the stock’s volatility remains a key consideration for investors.

Key Takeaways

• Aurora Innovation reported a substantial revenue beat in Q2 2025.
• The company launched its first driverless commercial trucking operations.
• Stock price fell by 3.02% in regular trading, with minor aftermarket decline.
• Operating loss of $230 million raised concerns despite revenue success.
• Strong cash reserves expected to fund operations into 2027.

Company Performance

Aurora Innovation demonstrated robust performance in Q2 2025 with a significant revenue beat, driven by advancements in driverless technology. The company launched its first driverless commercial trucking operations, logging over 20,000 safe driverless miles and expanding its fleet to three trucks between Dallas and Houston. Despite these achievements, a substantial operating loss and high R&D expenses presented challenges, impacting investor sentiment.

Financial Highlights

• Revenue: $1,000,000, significantly exceeding forecasts.
• Operating Loss: $230 million, excluding $55 million in stock-based compensation.
• R&D Expenses: $146 million, indicating ongoing investment in innovation.
• Cash and Short-Term Investments: $1.3 billion, providing strong liquidity.

Earnings vs. Forecast

Aurora Innovation’s actual revenue of $1,000,000 far surpassed the forecast of $503,330, marking a significant positive surprise. The earnings per share (EPS) forecast was -0.1195, though the actual EPS was not disclosed. The revenue beat suggests a positive trend, potentially offsetting concerns about profitability.

Market Reaction

Despite the revenue beat, Aurora’s stock fell by 3.02% during regular trading, closing at $5.97. In aftermarket trading, the stock experienced a slight decline of 0.03%, indicating cautious investor sentiment. The stock’s performance within its 52-week range suggests that while investors are optimistic about revenue growth, concerns about profitability and expenses persist.

Outlook & Guidance

Aurora Innovation plans to expand its driverless operations, aiming to validate performance in challenging weather conditions by year-end. The company targets operating day and night across Sunbelt routes and increasing its fleet to 10+ trucks by year-end. Ongoing hardware development with partners Fabrinet and Continental continues, with quarterly cash use projected between $175-185 million.

Executive Commentary

CEO Chris Ermson emphasized, "We’re no longer selling an idea, we’re delivering a real product that will ultimately transform our customers’ businesses." He highlighted Aurora’s unique position as the only company driving trucks at freeway speeds safely and driverlessly, underscoring the transformative potential of their technology.

Risks and Challenges

• High operating losses could impact long-term profitability.
• Substantial R&D expenses may strain financial resources.
• Market adoption of driverless technology remains uncertain.
• Regulatory challenges could affect operational expansion.
• Competition in the autonomous vehicle market is intensifying.

Q&A

During the earnings call, analysts inquired about Aurora’s ongoing partnership with Uber, hardware development, and OEM relationships. The company confirmed its commitment to safety and comprehensive validation, addressing concerns about operational and technological advancements. InvestingPro subscribers can access detailed analysis of Aurora’s financial health, which currently rates as ’FAIR’ with a score of 2.03 out of 5. Analyst targets range from $3.59 to $15.00, reflecting diverse views on the company’s future prospects. For comprehensive insights into Aurora’s valuation and growth potential, explore the full Pro Research Report, available exclusively to InvestingPro subscribers.

Full transcript - Aurora Innovation Inc (AUR) Q2 2025:

Conference Operator: Greetings, and welcome to the Aurora Second Quarter twenty twenty five Business Review Call. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Stacy Fight, Vice President of Investor Relations.

Thank you. You may begin.

Stacy Fight, Vice President of Investor Relations, Aurora: Thanks, Latonya. Good afternoon, everyone, and welcome to our second quarter twenty twenty five business review call. We announced our results earlier this afternoon. Our shareholder letter and a presentation to accompany this call are available on our Investor Relations website at ir.aurora.tech. The shareholder letter was also furnished with our Form eight ks filed today with the SEC.

On the call with me today are Chris Ermson, Co Founder and CEO and David Medei, CFO. Chris will provide an update on the progress we have made across the key pillars of our business and David will recap our second quarter financial results. We’ll then open the call for Q and A. A recording of this conference call will be available on our Investor Relations website at ir.aurora.tech shortly after this call has ended. I’d like to take an opportunity to remind you that during the call, we will be making forward looking statements.

These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed, projected or implied during this call. In particular, those described in our risk factors included in our annual report on Form 10 ks for the year ended 12/31/2024, and other documents filed with SEC as well as the current uncertainty and unpredictability in our business, the markets and economy. Additional information will also be set forth in our quarterly report on Form 10 Q for the quarter ended 06/30/2025. You should not rely on our forward looking statements as predictions of future events. All forward looking statements that we make on this call are based on assumptions and beliefs as of the date hereof, and Aurora disclaims any obligation to update any forward looking statements except as required by law.

Our discussion today may include non GAAP financial measures. These non GAAP measures should be considered in addition to and not as a substitute for or in isolation from our GAAP results. Information regarding our non GAAP financial results, including reconciliation of our historical GAAP to non GAAP results may be found in our shareholder letter, which was furnished with our Form eight ks filed today with the SEC and may also be found on our Investor Relations website. Our discussion today may also include reference to forward looking free cash flow, a non GAAP financial measure. To the extent that this forward looking financial measure is provided, it’s presented on a non GAAP basis without a reconciliation due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation.

With that, I’ll now turn the call over to Chris.

Chris Ermson, Co-Founder and CEO, Aurora: Thanks, Stacy. The second quarter marked a pivotal moment in transportation history. Aurora opened a new chapter with the launch of the first driverless commercial trucking operations on public roads in The U. S. From commercial launch at the April through the June, the Aurora driver already logged more than 20,000 safe driverless miles.

And just last week, we completed the validation and began driverless operation at night, which materially increases utilization potential of our self driving trucks. This unlocks a game changing component of the Aurora driver’s value proposition. This progress propels Aurora and the freight industry into a new era. We’re executing our crawl, walk, run approach to driverless operations, ensuring a seamless product experience that delivers undeniable value to our customers and deepens trust across our stakeholders. We started with one truck and as of earlier this month now have three driverless trucks operating between Dallas and Houston.

During the second quarter, our driverless trucks had already driven the equivalent of more than eight coast to coast trips. Importantly, we’ve maintained nearly 100 on time performance operating courteously with the flow of traffic while upholding our perfect safety record. While we added a front seat observer at the request of a partner given certain prototype parts in their base vehicle, it’s crucial to note that the Aurora driver remains fully responsible for all driving tasks with no interventions needed. This performance continues to prove the advanced capabilities and safety of the Aurora driver. To provide a window into this progress, we’ll be showcasing the Aurora driver in action during this initial phase of our operations via Aurora Driver Live.

You can access the live stream via the link on Page four of our presentation or via the Live tab on our YouTube channel Aurora Driver. There you’ll see our driverless trucks traversing the route between Dallas and Houston, demonstrating the safety, reliability and growing maturity of the Aurora Driver. This special series builds on our commitment to industry leading transparency, offering a first of its kind glimpse into the future of freight transportation. As we continue to prove the promise of the Aurora driver, we’re now focused on increasing customer value to become an essential partner in the freight industry. With validation of Knight driverless operations just three months after launch, we’re now operating driverless trucks day and night.

This more than doubles truck utilization potential. Check out the video on Page seven, which showcases the Aurora driver’s superhuman perception and distinct safety advantage during nighttime operations. With this core capability in place earlier than anticipated, our team is now working to validate driverless operations in more challenging weather conditions by the end of the year. And at that point, we expect the Aurora driver will be capable of handling almost all observed weather conditions in the Sunbelt. In addition, our lane expansion plan remains on track.

We expect to validate driverless operations between Fort Worth and El Paso and further extension of this lane to Phoenix by the end of the year. We opened our terminal in Phoenix in June and now have two customers Werner and Hirschbach piloting autonomous trucking on the Fort Worth Phoenix lane. Notably, Hirschbach is already leveraging our full network to maximize value for its operations with loads traveling from Houston to Dallas to El Paso and on to Phoenix. Self driving trucks have the potential to cut single driver transit time in half on the Fort Worth Phoenix route, a lane that exceeds hours of service limitations for traditional truck drivers. This is a powerful use case that demonstrates how expanding driverless operations can unlock significant value for our freight customers.

We’ve included a case study on Page 10 of the presentation to quantify the significant revenue and profit growth a carrier could generate through the adoption of the Aurora driver on the Fort Worth to Phoenix lane. Also note, our terminal in Phoenix represents an infrastructure light approach with a design that closely resembles how Aurora will integrate with future customer endpoints and optimize for speed to market. This is an important evolution to enable our plan to deliver freight directly to customer endpoints. With the Aurora driver now regularly pulling driverless loads for customers, we’re operating from a fundamentally stronger position. For years, we’ve been building relationships and educating partners about the promise of our technology.

Today, we’re no longer selling an idea, we’re delivering a real product that will ultimately transform our customers’ businesses. We’re seeing qualified leads surge to support our scaling ambitions in 2026 and 2027. We believe this reflects the growing recognition of Aurora’s leadership in autonomous trucking and the urgency our customers feel to integrate safer, more efficient driverless trucks into their operations. Our technology directly addresses structural challenges that plague the freight industry, including an aging workforce, systematic driver shortages, hours of service constraints and rising labor costs, which were recently cited at approximately $1 per mile by the American Transportation Research Institute. By integrating the Aurora driver, carriers and private fleets have the potential to supplement their traditional drivers to haul more freight, boosting revenue and expanding margins.

We believe this will also create new opportunities for their employees to advance in high growth careers. We’re proactively building this future through workforce future workforce through partnerships with organizations like On the Road Garage, a leader in workforce development. Together, we’ve launched an apprenticeship and upskilling initiative designed to prepare technicians for the unique demands of autonomous vehicles. Trainees gain expertise in AV terminal operations, advanced diagnostics, calibration and maintenance of complex systems like LiDAR, radar and redundant vehicle controls. Initiatives like this will create pathways to future ready careers and help support the long term operational demands of autonomous freight.

Rising insurance costs, which have increased 7.5% annually over the last five years present another structural challenge. The prevalence of nuclear verdicts in the freight industry are a key contributor to this trend. The Aurora driver offers a powerful way to de risk operations in this environment. The Aurora driver never gets distracted or fatigued and has superhuman capabilities with a three sixty degree view of its surroundings and unlimited span of attention. Furthermore, the Aurora driver’s rich data can support more accurate fault attribution and accelerate claims resolution.

We believe this will be groundbreaking for an industry grappling with persistently rising insurance costs and will pave the way for safer roads as well as a more resilient cost effective freight network. As we work to unlock these benefits for our customers, we continue to advance the key enablers that will support our path to scale and self funding. On the hardware front, our teams continue to work on our second and third generation commercial hardware kits to support our scaling and profitability ambitions. We expect our second generation kit to drive a step function reduction in our hardware costs, which is a critical milestone on our path to self funding. Following receipt of B samples for testing from our contract manufacturer Fabrinet, we have now completed the first vehicle build with this prototype kit and will begin on road data collection for testing in the coming weeks.

We also continue to make great progress with Continental in our third generation commercial hardware kit that we believe will unlock true scale on the order of tens of thousands of trucks. As they highlighted at the recent Capital Markets Day, Continental is energized by our commercial launch and continues to believe this hardware as a service partnership can generate a high margin multibillion dollar recurring revenue stream for them. They have begun delivering A samples of a hardware of a number of hardware components to support embedded firmware and software development. And earlier this month, the Aurora and Continental teams achieved a key milestone by finalizing the design of the integrated sensor pods and the Aurora driver compute module. We expect to receive our first complete prototype of the Continental generation hardware kit by the end of the year to begin engineering validation testing.

We also continue to make great progress with our OEM partners on purpose built self driving platforms designed for high volume production. We recently received the latest pedigree of Volvo VNL autonomous trucks and integrated the Aurora driver for on road autonomy testing in preparation for driverless operations. We expect to receive 20 of these trucks by the end of the year. And PACCAR recently completed the build of the first prototypes of their scalable autonomy enabled truck platform. These trucks are now undergoing testing at their facilities.

On the regulatory front, earlier this month, U. S. Representative Vince Fong of California introduced the America Drives Act, a landmark piece of legislation to establish a federal framework specifically for self driving trucks. The legislation would provide federal preemption of any state laws requiring a traditional driver in the commercial vehicle. It would also modernize safety protocols by codifying that a flashing cap mounting warning beacon may be used instead of traditional warning devices like reflective triangles for disabled commercial vehicles.

This is consistent with our proposal. We believe this proposed legislation will solidify The United States position as a leader in autonomous technology. We’re encouraged by this momentum and we’ll continue to work with policymakers to help realize the immense safety and economic benefits of autonomous trucking. With an already supportive regulatory backdrop, the combination of the Aurora driver and our partnerships creates a flywheel that delivers value across the entire ecosystem. As you can see on page 13 of the presentation, as our fleet grows, it generates more data, which accelerates capability expansion and drives adoption.

Larger production volumes drive down the cost of self driving hardware increasing profitability and further accelerate adoption. Large fleets cover more of the road network increasing the network benefit they provide thereby driving further adoption. We completed the monumental task of turning the crank for the first time, and that first turn is always the most difficult. The full significance of our commercial launch will become abundantly clear as our progress accelerates. With our powerful, mutually reinforcing flywheels now in motion, we’re confident that the progress we’re making will be difficult to replicate and will translate into significant long term value for the motoring public, customers and our shareholders.

With that, I’ll now pass it to Dave who will review our financial results.

David Medei, CFO, Aurora: Thank you, Chris. Let’s discuss our financial results for which we have provided a summary on page 10 of the slide deck for reference. With the launch of driverless operations during the 2025, we began recognizing revenue, which totaled $1,000,000 across driverless and vehicle operator supervised commercial loads for Hirschbach, Uber Freight, Werner, FedEx, Schneider and Volvo Autonomous Solutions among others. The Aurora driver achieved a record number of commercial miles driven during the quarter. Second quarter twenty twenty five operating loss including stock based compensation totaled $230,000,000 excluding stock based comp of $55,000,000 R and D totaled $146,000,000 SG and A was $25,000,000 and cost of revenue was $5,000,000 We used approximately $144,000,000 in operating cash during the second quarter.

Capital expenditures totaled $7,000,000 This cash spend was meaningfully below our externally communicated target, reflecting continued strong fiscal discipline. During the second quarter, we issued 57,000,000 shares of Class A common stock through our At the Market program for net proceeds of $331,000,000 We used $44,000,000 of the net proceeds to fund the tax liability associated with the vesting of our employees’ restricted stock units during the second quarter. In turn, we ended the second quarter with a very strong balance sheet, including increased liquidity of $1,300,000,000 in cash and short term investments. With this additional capital as well as efficiencies we found in the business and cash preservation decisions we have made, we now expect this liquidity to fund our operations into the 2027. In our continued opportunistic approach to fundraising, we are expanding our at the market program as it has proven to be an effective and efficient mechanism.

The additional capacity can support future fundraising as well as funding of tax liabilities associated with the vesting of our employee RSUs over time. For the remainder of 2025, we continue to expect quarterly cash use of 175,000,000 to $185,000,000 on average. This reflects an increase in capital expenditures and continued development of our new hardware programs as we prepare to scale our business. For the balance of the year, we will continue to focus on expanding our driverless operations as well as key cost reduction levers to support achieving our initial scaling and profitability ambitions. With that, we’ll now open the call to Q and A.

Conference Operator: Thank you. We will now conduct a question and answer session. Our first question comes from George Ionicus, Canaccord Genuity. Please proceed.

George Ionicus, Analyst, Canaccord Genuity: Hi, good afternoon, everyone, thank you for taking my questions. I wanted to ask about the Volvo trucks. In your press release, you said you expect to receive 20 of the trucks by the end of the year. Do you expect to be operating those trucks? And do you expect them to have an observer in them when they launch?

Thank you.

Chris Ermson, Co-Founder and CEO, Aurora: Yes. Thanks, George. So yes, we expect those trucks to be here by the end of the year. We’re going to initially using those for development and bring up. So no, we don’t expect to be operating those without an observer by the end of the year.

We’ll be we’re continuing to work closely with Volvo and we’ll wait for them to be comfortable announcing the timeline for us to launch initially with them driverlessly.

George Ionicus, Analyst, Canaccord Genuity: Thank you. And maybe just as a follow-up on commercial momentum. I mean since your launch a couple of few months ago have you seen additional incoming interest from other commercial partners that may be interested in expanding their service with you or maybe even launching? Thank you.

Chris Ermson, Co-Founder and CEO, Aurora: Yes. It’s actually been really exciting. I talk about it is, we’ve from selling promise and the belief into selling the real thing. And that’s shown up in our sales funnel. We’re having lots of exciting conversations with carriers and fleet operators.

And so we don’t have more we can share today, but the excitement is real and I think people get the transformational impact this can have on their business whether it’s improving the safety of their fleet or improving both the bottom top line bottom line and top line. So yes, I think people get it.

George Ionicus, Analyst, Canaccord Genuity: Thanks.

Conference Operator: The next question comes from Colin Rusch with Oppenheimer. Please proceed.

Colin Rusch, Analyst, Oppenheimer: Thanks so much you guys. Can you talk a little bit about the early returns around the wind and rain performance and how you’re tracking and evolving that functionality and what we can be looking at as you guys continue to work on that part of the business?

Chris Ermson, Co-Founder and CEO, Aurora: Yes. Thanks Colin. I think just candidly, I think if we put you in the truck today driving in the rain, you’d ask us why we haven’t launched it yet, right? The operation and capability of it is very good. It behaves well on the road.

And really it’s about the fact that we just put safety first and foremost that we want to go through the process of really thoroughly validating, refining anything that we identify through that validation process and just having the utmost confidence that when we declare something driverless and operated as such that I’d put my family out on the road and you’d feel comfortable with your family out on the road around it. So it works well today. We’re continuing to work towards the timeframe we’ve laid out by the end of the year. And it’s exciting to see the crank that we’ve talked about this machine for validating and releasing software trending over in the way we’d hoped and continue to be able to do that faster and faster.

Colin Rusch, Analyst, Oppenheimer: Thanks so much. And then looking at the FMCW technology and the manufacturing of it, can you talk a little bit about where you’re at with yields with your manufacturing partners? And how we should think about the potential cadence for cost reduction on that as you guys get closer to a higher volume launch?

Chris Ermson, Co-Founder and CEO, Aurora: Yeah. So as we’ve talked about there’s we can talk about two different dimensions of this. So one is we see significant steps in cost as we move from building and manufacturing and assembling in house to moving to Fabrinet as our contract manufacturer and then moving to the hardware as a service partnership we have with Continental. And each one of those generations is going to drive discrete cost downs. One of the big reasons why we’re so excited about working with Continental for the long term is just they really understand how to deliver automotive quality hardware at scale on time and do that with high quality yields.

And so that process is all moving along well. The working relationship is strong and we feel very good about that. In the specific case of the FMCW LiDAR, we’ve talked in the past about moving from discrete optical components, which is what our systems have today to LiDAR on a chip, which is what we’re bringing up already today. And this is a place where we’ve been investing for the last several years, not just in the design of the optics, but also in the deposition process, the fab process to do this efficiently and effectively. I don’t have yield numbers I can share today, but what I can tell you is that development program is on track and we see that as a meaningful cost down opportunity in the First Light technology.

Colin Rusch, Analyst, Oppenheimer: Great. Thanks so

Andrew Shepherd, Analyst, Cantor Fitzgerald: much guys.

Chris Ermson, Co-Founder and CEO, Aurora: Thanks for the question.

Conference Operator: Our next question comes from Andrew Shepherd with Cantor Fitzgerald. Please proceed.

Andrew Shepherd, Analyst, Cantor Fitzgerald: Hey everyone. Congratulations on the quarter. Thanks so much for taking our questions and congratulations on the first revenues.

Chris Ermson, Co-Founder and CEO, Aurora: Thank you. It’s nice to have at least an R to go with our L. It may not be a P yet.

Andrew Shepherd, Analyst, Cantor Fitzgerald: It’s only going to grow from here.

Chris Ermson, Co-Founder and CEO, Aurora: Exactly right.

Andrew Shepherd, Analyst, Cantor Fitzgerald: Just a quick question on maybe the near term ramp up of trucks in operation. So right, you disclosed today you now have three, I believe trucks in operations. As we get closer to year end and towards the tens of trucks, just curious if you can give us a sense of how you’re thinking about that ramp up in terms of vehicles operational and maybe Q3 and Q4? Any color or direction there will be? Thanks.

Chris Ermson, Co-Founder and CEO, Aurora: Yes. We continue to follow our crawl, walk, run model. And right now, just given the fleet size that we have, we’re balancing the growth of driverless operations with the bandwidth for development and testing that we want to really unlock the capabilities that enable the expansion across the Sunbelt next year. And so as we said, really this year is primarily focused on that capability expansion and unlock, proving out the process for releasing software rapidly as we believe we’re starting to and making sure we’re set up for scale next year. So it’s really going to be driven by how do we maximize the probability of success on that capability expansion point, while continue to build and grow traction with our customers.

Don’t know, Dave, if there’s more you’d add to that.

David Medei, CFO, Aurora: No, I think that’s right. The only other thing I’d say Andres is like we’re going to measure and try to report and think about our success of driving more in terms of mileage than it is in trucks because one of the things that we can do is obviously as we can operate now day and night on driverless, we can take one truck and operate it on multiple runs throughout a day. So for us, we want to build the mileage, we want to build the proof points. And again, 2025 is is all about delivering the technology promise. So for us, success is being able to operate in almost all conditions that you’d see at the Sunbelt and demonstrate that we are able to do that effectively.

Andrew Shepherd, Analyst, Cantor Fitzgerald: Got it. That’s super helpful. I appreciate you both. Super helpful. And maybe just a quick follow-up.

I wanted to go back to the rain and heavy wind preparations, which is encouraging to hear that you feel comfortable enough that the vehicle could already do that today. Without maybe getting too technical, but just curious like what lessons, what differences rain and heavy wind, like what lessons you have learned from that? And ultimately what I’m getting at is this is maybe where the case of LiDAR becomes much more superior than non LiDAR. So just any color there, any lessons learned? I mean, what was that process like?

What is that process like? And any progress that you can share? Thanks.

Chris Ermson, Co-Founder and CEO, Aurora: Yeah. Like I said, it’s not that I just want to be careful. We are not ready to launch in RAIN today. But I think as someone riding in the truck, you would wonder why, right? Because if you got in the truck today, it would behave very similarly to the way that it does in the daylight or at night and that it would be super boring and just kind of drive down the road and work.

As we areas where we expect are probably the kind of the most challenging things to both validate and ensure we’re getting the performance, particularly things like the same places that we’ve talked about in the past with daytime driving. So pedestrians lying in the road, right? It turns out that doesn’t happen very often. In fact, I don’t think I’ve ever seen one in my driving lifetime. But if it does, we want to make sure we handle it well and appropriately.

And that was one of the last capabilities that we were able to get to a go with a daytime and gradually more challenging at night. And then you can imagine with rain, it’s incrementally more challenging again. You’re right that when we operate in more challenging environments, whether it’s in the rain or whether it’s in dust, that having a complementary set of sensors is very powerful, because they can each see through different conditions. They each give different kinds of data. And we believe that’s really an important aspect of building a robust and safe system.

And again, we’re not really interested in building a thing that we can give a demo in. We’re building a technology that ultimately will transform freight and transportation. And that means it needs to work. It needs to be able to turn your back trust it. And that’s where we’re the bar we’re holding to for the drivers releases that we’re putting out today.

Andrew Shepherd, Analyst, Cantor Fitzgerald: Excellent. That’s super helpful. Really appreciate it. Thank you so much. Congrats again.

We’ll pass it on.

Conference Operator: Thank you. Thanks. The next question comes from Ravi Shanker with Morgan Stanley. Please proceed.

Nancy Hess, Analyst, Morgan Stanley: Hi, everyone. Thanks for taking the question. This is Nancy Hess on for Ravi Shanker. It would be helpful to hear about other catalysts set for the third quarter and back half of the year, specifically the timing of that second route and next major milestones on your partnerships with both Volvo and PACCAR.

Chris Ermson, Co-Founder and CEO, Aurora: Yes. And I don’t think we’re going to provide more resolution than we have already. What we’re really pushing for through the end of the year is unlocking the ability so that in 2026, we’re able to rapidly unroll routes across the Sunbelt. And so by the end of the year, we hope to be able to operate in and we intend to be able to operate in day and night in the rain. We intend to unlock Fort Worth to El Paso, El Paso to Phoenix and Fort Worth to Phoenix as routes.

To do that, there’s some discrete capabilities that we know we need. We’ve talked in the past about the custom border patrol station that’s between El Paso and Fort Worth. That’s a thing that we handle autonomously today, but we’ll want to performance for that. And then there’s kind of surprising like little things that are really from learning from our experience with customers. So for example, for those of you who aren’t deeply familiar in the freight space is a thing called a super single tire.

And what that is, is where instead of putting two tires in tandem on an axle, you put one larger one that has various trade offs and economics and fuel efficiency and whatnot. And it turns out that we didn’t really understand prior to launch that for some of our customers that was important. We’d asked them and in fact they’d said, it wasn’t really. But as we’ve been beginning to operate driverlessly, we found out that it actually is more important. And so part of what we’ll be doing in the near future is finalizing the validation for what happens when we’re running super single tires and making sure in the case of a blowout or puncture that we can detect and respond to that appropriately.

And so it’s great to be able to kind of both have a clear roadmap for where we’re going and then because we have vehicles in operation, we’re able to get feedback from them from customers and kind of tune the near term milestones so that we maximally meet the value for them.

Nancy Hess, Analyst, Morgan Stanley: That’s all really helpful. Thank you. And then if I could squeeze in one more question, it’d be helpful if you could give us a little bit of insight into your relationship with Uber post their debt offering against your stake and some of their other autonomous bets. How critical are they to deployment?

Chris Ermson, Co-Founder and CEO, Aurora: Uber has been a great partner and continues to be. And as you know, Dara has been on the board and we continue to have a close working personal relationship. Uber is focused on ride hailing and we’re focused on trucking. And so in the near term, I think the importance there is kind of relatively disconnected. Of course, Freight is one of our pilot customers, a large customers for driverless operations and we continue to work well with them and continue to grow business there.

Over the long term, we see the capability we’ve built to safely operate vehicles on the public roads as something that will ultimately unlock automated passenger vehicles as well. And at some point, we’ll engage in that space. But right now, we’re really focused on delivering the promise of trucking and building that business.

Nancy Hess, Analyst, Morgan Stanley: Okay, great. Thank you so much.

Chris Ermson, Co-Founder and CEO, Aurora: Thanks, Nancy.

Conference Operator: The next question comes from Chris Pearce with Needham. Please proceed.

Chris Pearce, Analyst, Needham: Hey, good afternoon. Thanks for taking the question. Just for clarity, I’m not sure how much of this you can go into, but on the PACCAR earnings call, they talked about the importance of validated production. In your letter and in your comments, you talked about production on their end of prototype parts in the new trucks and you have a lot of media in there about your production with your contract manufacturer and with Continental. How can you I guess I just want to get a sense of what how to think about this relationship?

And is are these surprising to you? Are you pulling forward production? Is this sort of everything’s in line with how you expected as far as your production partners? I just kind of want to

Andrew Shepherd, Analyst, Cantor Fitzgerald: get a sense if you could talk to

Chris Pearce, Analyst, Needham: that relationship and what how you define production?

Chris Ermson, Co-Founder and CEO, Aurora: We well, first let me begin by saying we continue to really value the relationship we have with PACCAR and continue to get a push forward in there. And it’s wonderful to see them moving forward their autonomy enabled truck platform. I think the right way to think about this is there’s a truck and there’s a driver. And we work with our OEM partners to specify and then they go and develop and design the platform, the vehicle itself, the truck. And that has a variety of components in it.

And the vehicles we’re operating today still have some prototype parts from our OEM partners in them. In contrast and in parallel with that, the driver parts that we operate and are building, the parts we develop and build with Fabrinet and we’ll be building with Continental are really around the development process of that driver. And the driver of course works across multiple different OEMs. So today we work with PACCAR and Volvo. In the future of course we hope to work with other OEMs as well.

And so that’s maybe I apologize for the confusion if there is any there, but we’re tracking and supporting our OEM partners as they mature their platforms. And then in parallel, we’re advancing the development of the Aurora driver and bringing that to production with the second generation coming online next year and then working with Continental to bring that third generation online in 2027.

Chris Pearce, Analyst, Needham: Okay, perfect. Thanks for the detail. And then you sort of hit on my next question. You want to work with other OEM partners in the future. How do you see this autonomous trucking developing?

Do you see an OEM having multiple autonomous partners and then the logistics company customer makes a choice? Or do you see how do you see the business developing over time given this industry that’s had a lot of dual sourcing from all sides?

Chris Ermson, Co-Founder and CEO, Aurora: Yes. I think our aspiration is to drive every truck that’s out there. And we’ll continue to advance quickly and rapidly as we can to accomplish that by building the best technology, the best product and providing the best service for customers. That said, it’s a $1,000,000,000,000 market. And everyone’s going to want and hope for another player in the space.

And we look forward to competing with them. Today, Aurora is the only company in the world that can drive trucks on the road at freeway speed and do that safely driverlessly. And we’ll continue to accelerate based on the tools we put in place to validate and release new software. And we’ll welcome the competition when it gets there.

Conference Operator: Okay. Thanks for everything. Next question comes from Doug Dutton with Evercore ISI. Please proceed.

Doug Dutton, Analyst, Evercore ISI: Hey, team. How are you? Congrats on the great quarter. Just wanted to first ask on the ramp from the two trucks to the 10 plus by year end, is the idea that each of those trucks has a dedicated customer, whether there’s customers with two or three or customers with one? Or how is that rollout sort of happening?

Chris Ermson, Co-Founder and CEO, Aurora: Yes. Thanks for the question, Doug. So really, we’re going to I guess the short answer is no. At this point, we don’t really intend to allocate specific truck to a specific customer. We’re going to provide the capability to move goods from A to B for the different customers and we’ll fill that need with truck as appropriate as we move forward.

Doug Dutton, Analyst, Evercore ISI: Okay. Understood. That’s helpful. And then diving deeper just on the math here. If you have two trucks on the road right now per quarter running each day 200 miles we’ll call it.

You got about sixty days. So it’s 12,000 miles per quarter per truck. Is that the type of math that you would start to share in the future or that makes sense to sort of calculate the miles driven in the future?

David Medei, CFO, Aurora: Yes. I think it’s Dave, Doug. Good to hear from you. I think like generally, if you’re talking about an individual lane, that’s right. We kind of think about it a little bit differently.

So if you think about it this way, daytime had like an eight hour restriction and we can’t drive in rain. So you’re able to operate in a certain percentage of time. And for us when the time was available and it wasn’t raining, we do a round trip, which was like 400 miles for a truck. As we unlock nighttime, then you can kind of double that. As you go to longer lanes, you can go even further.

It really is somewhat lane dependent and then your capability dependent. For us, our focus has been on just growing the driverless number of miles each quarter, which we’ll continue to demonstrate and being able to technically operate in almost all of the conditions that are required for the Sunbelt. So being able to exceed hours of service, being able to drive it day and night and in rain and in wind. And I think at that point then we’ll start thinking more about like utilization. But we do expect that our trucks to have higher utilization than kind of the average as soon as we’re able to operate day and night and in rain.

And so we’ll continue to demonstrate that overall. So we do think mileage as opposed to trucks is really the right way to measure this.

Doug Dutton, Analyst, Evercore ISI: Of course. Okay. Thank you for the helpful color there. Just trying to make sense of the model here. Appreciate it guys.

Chris Ermson, Co-Founder and CEO, Aurora: You bet. Thank you.

Conference Operator: The next question comes from Mark Delaney with Goldman Sachs. Please proceed.

Stacy Fight, Vice President of Investor Relations, Aurora0: Hi, team. You have Aman Gupta on for Mark Delaney. Maybe going back to this safety kind of observer in the vehicle, kind of what needs to happen for both Aurora and PACCAR to feel comfortable kind of removing that person? And is there some sort of timeline that you can share on when you guys expect that to happen?

Chris Ermson, Co-Founder and CEO, Aurora: Yes. From Aurora’s perspective, we are comfortable today and that observer is in the vehicle really out of respect and appreciation for our partnership with PACCAR. From PACCAR’s, we’ll let them speak for themselves. But I think what they’ve shared and what I can share is that it’s really about their process and the fact that these trucks have prototype parts in them. And so for them to ultimately bring these trucks to production and operate them driverlessly, we expect that correlate with when they launch their autonomy enabled truck platform.

Stacy Fight, Vice President of Investor Relations, Aurora0: Understood. That’s helpful. And then maybe one on the financial side. One of the slides quoted like a 1.84 per mile for cost with the Aurora system. Is that ballpark a good assumption for revenue?

And then does that kind of change if there’s still the safety observer in the vehicle? Or as ODD continues to expand does that get larger? How should we think about that?

David Medei, CFO, Aurora: Yes. I think so when you’re I think you’re looking at the part which is the carrier perspective example and that was really the focus on being able to drive beyond the hours of service limitation that you normally had. So from a revenue standpoint, we just kind of use the average revenue that was out there. And then from the cost perspective, we used a lot of the ATRI data and then just provided some discounts for what we are able to provide. It’s not a model specifically for our cost.

But like generally speaking, we do expect that we are going to lower the cost of operations for our carriers. We’re going to be able to do that in the near term really based on fuel efficiency. We are getting really better fuel efficiency by driving this autonomous trucks. We will able to do it on driver costs. You think about driver costs, think about like our indicative DAS price range, which we provided before and you look at the current driver costs on average, which are now at roughly $1 per mile, Like there is an opportunity for us to drive the TCO benefit down.

But the other most important thing is it’s the utilization. So it’s the revenue side as well. You’re able to take a truck and generate more revenue on a daily and on an annual basis. So it’s just a way to think about how to predict it. I don’t know that I would go and take those specific numbers and put them into a model because that’s very specific to an individual lane.

Chris Ermson, Co-Founder and CEO, Aurora: And just around the part around the observer on board, right, this both a temporary element and the cost for us in practice minimis, right. We’re running a small number of trucks. It is what it is and it’s just not that big a deal. It has no impact on our roadmap or plans for growth or anything.

Stacy Fight, Vice President of Investor Relations, Aurora0: Understood. Thank you for the color.

Chris Ermson, Co-Founder and CEO, Aurora: Cool.

Conference Operator: The next question comes from Scott Group with Wolfe Research. Please proceed.

Stacy Fight, Vice President of Investor Relations, Aurora1: Hey guys, this is Cole on for Scott. It’s good to see progress with the next generation of hardware in the press release. Is there any way to frame up how we’re progressing relative to your original expectations either from the Fabrinet perspective or the Continental generation?

Chris Ermson, Co-Founder and CEO, Aurora: Yes. I guess at the high order that we haven’t shifted our expectations, right? I think we’ve been fairly consistent about talking about that second generation of hardware coming online in 2026 and the Continental generation, the third generation hardware as a service components coming online in 2027. We’re literally working with these systems on a daily basis. The fact we have the samples from Fabrinet in a truck and we’re in the process of bring up validation there is really exciting and kind of aligned with what we would hope.

And then the partnership with Continental is just moving forward. We’ve got through the norming and forming and we’re solidly into the storming phase of that partnership.

Stacy Fight, Vice President of Investor Relations, Aurora1: Okay. That’s helpful. And maybe just on the prototype trucks that you’ve called out, which hardware generation is going to go into those? And maybe expand on how you see that actually playing out over the next twelve months?

Chris Ermson, Co-Founder and CEO, Aurora: I’m sorry. I don’t know that I followed the question. I apologize.

Stacy Fight, Vice President of Investor Relations, Aurora1: So in the with the prototype trucks that your OEM partners are delivering, is this going to be the Fabrinet hardware going into it? Is it going to be what hardware is actually going to be in those trucks?

Chris Ermson, Co-Founder and CEO, Aurora: Yes. Depending on exactly when and which truck, some of it will be our existing first generation hardware, which we’re using to do kind of bring up a validation interface. Some of it will be with the second generation hardware and some will ultimately have components or kits from the third generation hardware set. It’s really driven by internal engineering execution and need.

Stacy Fight, Vice President of Investor Relations, Aurora1: Okay. Thanks. I’ll turn it back.

Chris Ermson, Co-Founder and CEO, Aurora: Thank you.

Conference Operator: Thank you. Ladies and gentlemen, at this time this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation and have a great day.

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