Innoviz at TD Cowen Conference: LiDAR Growth and Challenges

On Wednesday, 28 May 2025, Innoviz Technologies (NASDAQ:INVZ) presented its strategic outlook at TD Cowen’s 53rd Annual Technology, Media & Telecom Conference 2025. The company highlighted its strong position in the LiDAR market, focusing on technological advancements and growth strategies in both automotive and non-automotive sectors. While optimistic about the future, Innoviz acknowledged challenges in cost reduction and market competition.

Key Takeaways

• Innoviz is expanding its LiDAR technology in Level 3 and Level 4 autonomous driving applications.
• Strong partnerships with Mobileye and NVIDIA are crucial for growth.
• The Chinese market’s progress in autonomous driving could influence global adoption.
• Innoviz is targeting new program wins and production readiness in the short term.
• Non-automotive applications present a promising growth avenue.

Operational Updates

Innoviz emphasized its commitment to continuous innovation and cost management. The company is focusing on maturing its production line and achieving Standard Operating Procedure (SOP) readiness. Collaborations with industry leaders like Mobileye are expected to enhance Innoviz’s market position.

• Production is being ramped up with Fabrinet, utilizing proprietary processes and machinery.
• The company aims to secure price points, quality, and capacity through controlled processes.
• Innoviz III development aims to improve performance and affordability.

Future Outlook

Innoviz is optimistic about LiDAR technology’s increasing penetration in consumer and commercial applications. The company projects significant growth in LiDAR volumes by 2027, with Level 4 commercial applications launching next year.

• Level 3 consumer applications are expected to gain traction by 2027.
• By 2029-2030, commercial Level 4 applications will be abundant, though consumer Level 4 penetration will remain low.
• Innoviz aims to reduce Bill of Materials (BOM) costs by 70% and improve performance by a factor of 30 from Innoviz I to Innoviz II.

Industry Overview

The LiDAR market is maturing, with high-end OEMs already deploying advanced solutions. However, automaker sourcing has slowed due to economic factors and the focus on electric vehicles (EVs).

• By 2026, commercial applications like shuttles and robotaxis will begin global deployment.
• The Chinese market’s advancements are prompting global OEMs to adopt new technologies.
• Innoviz’s technology maturity and production capabilities position it well against competitors.

Q&A Highlights

During the Q&A session, Innoviz reiterated its strategic goals and industry insights. The company plans to win additional programs and complete its qualification process to be SOP ready.

• Innoviz is targeting 1-3 new program wins in the short term.
• The company is leveraging its automotive-grade LiDAR technology for smart city and industrial applications.
• Collaborations with Mobileye and NVIDIA are seen as pivotal for future revenue growth.

In conclusion, Innoviz Technologies is poised for growth in the LiDAR market, driven by strategic partnerships and technological advancements. For further details, readers are encouraged to refer to the full conference call transcript.

Full transcript - TD Cowen ’s 53rd Annual Technology, Media & Telecom Conference 2025:

Adele, Unidentified role, Innoviz: Problem well and what does it take in order to reach autonomous features. And I think today the industry is approaching it with a much more mature attitude. It understands what kind of technology, what kinds of specs do you need in order to reach these kinds of features. And the industry is much more focused on getting them in the right way, on timelines that are reasonable with the right technologies. So I’m very optimistic that we are now at the maturity stage rather than the hype state, and getting to, in the very few next years, to these solution rolled out.

There are some already high end solution with high end OEMs, but I believe it will be more and more abundant, more and more common to have these kinds of features.

Unidentified speaker, Unidentified role: Perfect. So how should investors frame the opportunity today, maybe in terms of LiDAR penetration of light vehicles over the next five years? Is LiDAR now exclusive outside of China to L3, L4? And if you are an automaker who is looking to adopt LiDAR on an L3 or L4 program, from what you’re seeing, how what is the penetration of that in five years terms of here’s how many L3, L4 vehicles I want to sell out of my total?

Adele, Unidentified role, Innoviz: Yes. So for Innovus, there are two main segments that we are seeing maturing very quickly. One is for consumer applications, which I think will be spearheaded by a level three application. Level four, maybe at very high end vehicles, level three, more abundant. And level four for commercial applications, which we actually see maturing also very fast because they use a different business model.

So if I look ahead a few years from now, at least on the Innovus perspective, ’twenty six, we will see the first commercial application like shuttles, robotaxis and so on, buses that will start launching and we’ll see actual solutions, actual brands, OEMs deploying fleets all over the world, Europe, U. S, obviously, Level three, I believe, is coming at also quite fast. I think ’twenty seven will be a more meaningful year for Level three for consumer applications. And if we are looking to the end of this decade, 02/1930, I think at least the predictions are something in the 10% penetration at level three. I think level four for consumer application, still very low.

But I think that level four for commercial application will be quite abundant already by 02/1930, like robotaxis, we have already way more driving in California. I believe it will happen faster and faster. Uber announced lately they are working they are adopting the ID bus from Volkswagen, which we are on. Lyft, we heard made some statements. So we see the momentum.

Unidentified speaker, Unidentified role: Perfect. A couple more industry questions. And you mentioned this as well in the beginning. The automakers have been slow to source. Years ago, there was a thought that we’d have a lot more penetration by now.

It sounds like it’s still coming with L3, L4. What was it that led us to the slowdown in automaker sourcing? And how are you feeling about the next twelve months from the pace of potential new business awards for yourselves and just the broader industry?

Adele, Unidentified role, Innoviz: So I think regarding the automakers and the OEM, I think that in general speaking, the industry faced some slowdowns in general because of EVs, because of the economy, the polarization in China and the rest of the world. So there were different forces on the industry that maybe slowed it a little bit down. In addition to that, again, there was some kind of a backlash of all these programs that have failed and the OEMs regrouping and trying to understand what is the right approach towards these issues. Because at the end of the day, Level three is still features that are sought after. The industry is always after new features, always after safety.

And if we are looking and they are looking over their shoulders and see what the Chinese are doing like a crystal ball, what will happen in a year or two, then all understand they have to run fast, adopt new technologies. So I think there was a slowdown. And going forward for the next, let’s say, a year or so, I do believe and it is guided also in that respect that there will be additional programs announced, additional wins, because we believe the industry is going to this direction and understanding that in order to have a car, let’s say, in ’twenty seven or ’twenty eight, you have to have the decision as early as possible in the next few months. Terrific. So we had the slowdown, and now it seems like pipelines are filling up.

Unidentified speaker, Unidentified role: You’re more optimistic about decisions in the next twelve months, which is good to hear. How’s the competitive environment today? Years ago, you walked through CES, there were just dozens of LiDAR companies. Obviously, there’s a sort of industry in China and outside of China. Talk about what you’re seeing today in the competitive environment globally for the company.

Adele, Unidentified role, Innoviz: Yes. So usually, well, when we went public, I think there were more than eight companies, lighter companies, all telling the same stories and all trying to pitch for the same programs and so on and so forth. I think today, it’s more clear because, A, you need to meet certain specs. You need to at the end of the day, again, it’s technology. You have to have the right solution for the right problem.

And I guess today, Innoviz has proven, because it’s won so many programs with very meaningful customers that bring our LiDAS to a level of maturity that is well fitted for the industry. So at least in my perspective, on one hand, China is out of the game, at least outside of China. We see some U. S.-based names that are less relevant because the technology either was left behind or still not mature enough. So I think Innoviz is sort of a sweet point.

We have the technology. It’s mature enough. We are ramping up our production line. The cost structure is at the right price point for the industry in order to adopt it, definitely for Level three, not only for high end vehicles, but also for the midrange. So I think we are in good position in more than one aspect: technology, maturity, cost, production, all of this come into place.

That’s great. Maybe we can talk a little bit more about that as well. What was it that led to your technology kind of leadership and some of

Unidentified speaker, Unidentified role: the wins that you’ve announced? Maybe talk about the price points you’re currently offering on the units as well and kind of what was it that led to this consolidation? Were you still here and still kind of winning business and looking to win more business?

Adele, Unidentified role, Innoviz: Yes, I think we always listen very careful to the industry and didn’t take shortcuts. We understood that this is a long term game. In order to serve this industry, you need to listen very careful, a, what they need in terms of the technology and specs. But then you need to work in the way that the industry is working, qualifications, meeting their standards, ramping up production in a way that the industry can accept it. So we bring not only the technology, we bring a lot of experience of how to run an automotive program.

We became a Tier one, so we took a lot of responsibilities. And at the end of the day, the industry wants you, a, to bring the technology, then reduce the risk. The risk management factor is very important, specifically when you are dealing with a functional, safe or mission critical component. And then you need to meet the price point and you need to show maturity and production capacity. Think Innoviz is meeting all of these criteria and is able to serve the industry.

So it’s a multitude of factors that come into play. And I believe because Innoviz took the very hard way, the long way, it’s now reaching its fruition. Terrific. One question

Unidentified speaker, Unidentified role: we often get is where do you stand and how do you work with the likes of NVIDIA, maybe on the Hyperion platform, Mobilize? Talk about your relationships with those companies, how you go to market and ultimately, the technology and platforms come together?

Adele, Unidentified role, Innoviz: Yes. So there are a few leading platforms for the industry. Mobileye obviously is one of them, Nvidia is another, some others. And it’s very important in this ecosystem to have these kinds of collaborations. So with Mobileye, we have a very tight collaboration because we have already won a few programs together.

We’re working together. And the integration is already deep in the process. The process is already very mature. And today, when we are competing on programs, we can offer our compatibility not only in terms of we have the right technology, but the compatibility to other players, the ecosystem, the platform. So very close relationship with Mobileye, both for Level four, the commercial application on the drive platform and Level three for the chauffeur.

And with NVIDIA, hopefully, obviously we are collaborating. NVIDIA is offering their Hyperion platform, which is basic it’s not a closed platform, but it’s a platform that they are trying to bring a solution to the market. We have this platform and we have this suite of sensors. It’s working well. And basically, today, I would say that NVIDIA, in many cases, advises as a reference design Innovus LiDAR.

So again, because of the collaboration, because of the recognition that Innovus is in the right spot, in the right maturity level and pricing and so on and so forth, to be the right partner for integration. The reason we don’t have a project with NVIDIA because they simply didn’t win anything. Hopefully this will be resolved in the next maybe few months, within a year, once hopefully NVIDIA wins something and hopefully we can win with them together a project.

Unidentified speaker, Unidentified role: Terrific. So maybe framing the company’s growth over the next few years, we could maybe do it by vertical and start with Robotaxi. How big of an opportunity can Robotaxi be for you? Maybe review the content and if you can, the pricing and how you see volume both for customers and the industry progressing two, three, four years? Yes.

So we have the consumer applications.

Adele, Unidentified role, Innoviz: Obviously, the consumer market is very big. You sell between 90,000,000 to 100,000,000 cars per year. Obviously, in commercial application, that is not the case. The numbers are much lower. So in terms of vehicle, but the content per vehicle is different.

In Level three, we are selling one LiDAR per vehicle. And if and obviously, you need the volumes and you have the volumes through the volumes of the industry. In level four, the commercial application, we are selling nine LIDARs per vehicle, which roughly translates to, let’s say, a few thousands of dollars per vehicle, while in Level three, it’s a few hundreds of dollars per vehicle. Here you have few thousands of dollars per vehicle because of the number of LiDARs. We are selling the long range LiDAR and the short range LiDAR.

And this eventually translates into doubling our opportunities. So Innoviz was very focused on the Level three application, the consumer application. But once we were integrated into the DRIVE platform of Mobileye, we have doubled the opportunity because we need at least we heard numbers that range between few tens of thousands of vehicles to 100 thousands of vehicle per year until 02/1930. So for Innoviz, it means hundreds of millions of dollars in revenues if that materializes. And if, for instance, Mobilize able to sell these kinds of numbers, it’s very meaningful for Innoviz.

So we shifted, I guess, added this segment as well to our offering because it simply is meaningful in terms of business, doubling the business.

Unidentified speaker, Unidentified role: Terrific. And on the robotaxi application, and then we’ll move to consumer. Do you also sell some software? Is that an opportunity as well or?

Adele, Unidentified role, Innoviz: So yes. So basically, we have a software stack. It starts with very basic software that is dealing more with the LiDAR output, what we call the point cloud. This is the output of a LiDAR. And many like imaging processing processes that you are doing on the point cloud, cleaning artifacts and so on and so forth, to very sophisticated AI object detection and classification, standard perception software that you see.

So we are offering all this stack. Usually when you’re working with a partner like Mobileye, Mobileye excels in this perception software. So we are usually selling not all of our stack, but only some of our stack, the more low level point cloud related software in order to allow Mobileye more efficient perception software outcome or output. In cases that we are working on Level three programs, then we can sell the whole stack. It depends what the needs of the OEMs.

But we come with our whole the whole stack and sell any slice that is required for the specific program. That’s great. And shifting into the passenger vehicles, obviously, as you mentioned, a much bigger market. Maybe just review your key customers and the timing of some of the big launches for the

Unidentified speaker, Unidentified role: company that have, of course, been announced in the next couple of years.

Adele, Unidentified role, Innoviz: Yes. So the Level four application, the commercial application are actually going to launch sooner next year. Testing vehicles will already deployed this year. Next year, we will be ready for SOP startup protection. So you will see already vehicles deployed as of the probably the second half of twenty twenty six.

Level three application are targeted as of ’twenty seven and beyond. So it’s a bit later. And at least in terms of ramp, so we are expecting to be SOP ready early next year and start seeing meaningful volume during the year towards the end the second half of the year. And ’27, we expect to be a significant growth years in terms of volumes of lighter that are being sold. Terrific.

And when you look

Unidentified speaker, Unidentified role: at the start up production of your current pipeline, the RFIs, RFQs that you’re looking to win, what years are those roughly falling? Is it can you still make 2027 for new programs? Or are things now more in the 2028 time frame?

Adele, Unidentified role, Innoviz: So it depends on the platform it depends on the setup. So ’twenty seven is very challenging already. So if you take a decision now, ’twenty seven is very challenging. So I would say ’twenty eight and onwards. Why do I think that still some programs will be able to meet 27% is depending on the platform that they are adopting.

If they are adopting a platform that is already mature and the feature already exists, like using chauffeur and the chauffeur was already tested and you don’t ask anything exotic from the platform, then it might be already in ’twenty seven. But roughly speaking, it’s challenging. ’twenty eight is more reasonable for programs that are being announced now or being sourced now.

Unidentified speaker, Unidentified role: Terrific. And as automakers begin to, let’s say, presumably source again in the next months or twelve months, could there be like a domino effect where there is a big program, maybe a surprise program where suddenly other automakers feel kind of the stress and rush to get this technology on the road in 2028, for example? Or do you think it’s still going to be mostly kind of slow and steady the next couple of years as automakers make decisions?

Adele, Unidentified role, Innoviz: So it’s hard to tell because it has to do with not only with the fact that everybody is looking for such features. I think the strongest catalyst is actually China. I think the industry is understand that if it doesn’t want to stay behind and it wants to still be able to compete in this game, they have to innovate, They have to introduce new features. They can’t stand behind. China is pushing very hard for autonomous features.

China as a country is still not Level three, but many programs at least are working, developing, heading to this direction. So I believe don’t know what exactly will be the ramp, but I think the industry is pushing now very hard towards autonomous features.

Unidentified speaker, Unidentified role: Great. And then maybe shifting to the third vertical, which is non auto. I think you talked about this, too, on the Q1 call. What are you pursuing there? How big could that be for the company?

And maybe talk about some of the investments you have to make to kind of get there.

Adele, Unidentified role, Innoviz: So the nice thing about this, it’s a vertical. The non auto are application that already exists. So we are not the only LiDAR company. There are some LiDAR companies that are playing outside the automotive space and decided to focus there. And there are many applications that are relevant from smart city, security application, people monitoring, industrial applications.

So the need for LiDARs already exists. Basically, I would argue that everywhere you have a camera, you might want to use a three d camera, which is a LiDAR, and might be very relevant to application. And there are already programs out there that are seeking to use LiDAR technology. It so happens that Innoviz has an automotive grade LiDAR at a very high performing on one hand and cost effective on the other hand. And it’s very simple to get to log into these kinds of applications.

They are the integrators that are already working on these programs and simply are doing the sourcing. So the effort from Innovus side is minimal. Yes, you need to have some tools in order to enable the integration. But other than that, the LiDAR exists, the capacity is ramping up, and it makes a lot of sense providing our LiDARs to applications that are being rolled as we speak and are being pushed as we speak by these kinds of channels like integrators or projects that already exist, and we just need to tap into it.

Unidentified speaker, Unidentified role: How about trucking? There’s been some momentum there. Is that something you’re pursuing as well over the next couple

Adele, Unidentified role, Innoviz: Tracking is always part of the programs that we have and compete on. Pipe of our pipeline is tracking solutions. Have, to some extent, need more LiDARs because the vehicle is larger and longer and you have more dead spots and you need more than one sort of LiDAR, you need ultra long LiDAR, long range LiDAR, short range LiDAR, mid range LiDAR. And I think we cover well at least from the long range to the mid to short range LIDAS, we cover it very well. And I think we have very relevant solutions also for trucks.

Perfect. Let’s talk about technology.

Unidentified speaker, Unidentified role: So I think you mentioned on the last call, I think it was developing the Innovus three line of course, you’re currently on the two. What can you tell

Adele, Unidentified role, Innoviz: us about the Innovus three? So I think the justification of Innovus’ existence is always to bring the next generation, always to innovate, always to progress. So there is a lot to be done in the LiDARs, at least in our architecture in order to improve performance. So we are always seeking to improve performance on one hand, but on the other hand to see to it that the price and the cost goes down. So we did it when we moved from the Innovis one, the first generation product to the Innovis two.

We reduced the BOM cost by 70% by and improving the performance by a factor of 30, three-zero. And this trend should continue in Innovus III. Better performance in terms of range, resolution, to some extent field of view, better optics, better electronics. And on the other hand, see to it that the cost structure gets improved in order to serve a wider car range for the industry. So not only again, not only the high end of the mid range, but slowly going down to more popular models.

Unidentified speaker, Unidentified role: So is Innovus three targeted to potentially penetrate like L2 plus applications? Or is it more of like still L3, L4, but perhaps to your point, a bit of a higher take rate or attach rate on vehicle price points?

Adele, Unidentified role, Innoviz: Eventually, yeah. Level two or Level two plus doesn’t necessarily require a LiDAR, but I guess if the price point is relevant, it might serve also level two plus, let’s call it. I believe at the end of the day, in order to have level three more abundant in cars, in order to cover the whole range of the 90,000,000 cars that are being sold every year, you need to have a solution that is more cost effective. At the end of the day, the consumer is paying for it. There is a limited amount of money that he’s willing to pay for these features, even though he’s looking for these features.

And I believe that Innovus III can serve a wider range of these vehicles. Terrific.

Unidentified speaker, Unidentified role: So maybe just to kind of back up and kind of summarize, what are your goals in the next six to eight months for the company? What would be kind of a successful outcome for the company?

Adele, Unidentified role, Innoviz: I would say two main goals: a, to win more programs that we again, we have a rich pipeline. And the whole point is winning and bringing in more and more programs as we did last year. We do want to see additional wins up until the end of the year. And we reiterated our guidance in our last earnings, bringing one to three additional programs. So this is one.

The second one is more internal is to have the production line mature and having good units come out of this production line, complete the qualification process in order to be SOP ready. So these are the two: more clients, more capacity.

Unidentified speaker, Unidentified role: Let me talk about the second goal actually a little bit more. Maybe walk us through what it takes, right? You often we often talk about technology and lighter architecture, but ultimately, there’s so much as a Tier one it takes to actually bring something into auto production. Can talk about what you’re working on there, Nat?

Adele, Unidentified role, Innoviz: Yes. So the one of our secret product is actually the production line because we designed the process. We designed some of the machinery, obviously not the standard processes. The SMT electronics, this is all standard. You don’t need anything for that.

But for the optics and the mechanics, need to design machines that will assemble the lighter. And then you need to have the testers to test each lighter. Again, we need to meet automotive grade standards. You have to have special testers and test each LIDAR to meet. So this is something that we have done internally for our on our NPI line and have made this processes and special machinery and testers ready.

And once we got to a maturity level we felt comfortable with, we migrated the line into Fabrinet and it’s now being ramped up. And hopefully in the next very few months, we will see units come first units come out of this line. So this is very important to control in order to eventually reach the capacity, but also the price point, because having an effective, efficient process with the right yields eventually will secure the price point that you offered your clients and promised your clients in the right quality, obviously.

Unidentified speaker, Unidentified role: That’s very important. We’re just about out of time. So Adele, thank you so much. Great conversation. Learned lot as always.

And thank you, everybody, for being here and participating. Thank you. Thank you very much.

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