Aurora Innovation, Inc. Class A Common Stock 2026 Q3 Earnings Call

Good afternoon, everyone, and welcome to our third quarter 2026 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 8-K filed today with the SEC. On the call with me today are Chris Urmson, Co-founder and CEO, and David Maday, CFO. Chris will provide an update on the progress we have made across the key pillars of our business, and David will recap our third quarter financial results. We will then open the call to Q&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 would like to take this 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-K for the year ended December 31, 2025, and other documents filed with the 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 September 30, 2026. 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 an isolation from, our GAAP results. Information regarding our non-GAAP financial results, including a reconciliation of our historical GAAP to non-GAAP results, may be found in our shareholder letter, which was furnished with our Form 8-K 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 and non-GAAP financial measure. To the extent that forward-looking financial measure is provided, it is 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 will turn the call over to Chris.

Thanks, Stacy. With Aurora Driver powered trucks operating without a person behind the wheel, accelerating production and expanding customer adoption, we have reached an inflection point on our path to commercial scale. We have 20-plus driverless trucks already built and coming into the fleet, and production is accelerating. The production momentum equips us to meet growing customer demand. Following our recent Investor Day, we hosted a partner summit with leaders from over 35 of the largest and most innovative carriers and private fleets. This customer engagement supported another landmark driverless service MOU. Building on an initial Transportation as a Service agreement signed earlier this year, Charger Logistics has selected Aurora to scale their autonomous fleet with a plan to own and operate 500 driverless service trucks. This MOU represents a potential multi-year revenue stream in the hundreds of millions of dollars.

With truck delivery expected in 2027 and 2028, Charger plans to use the Aurora Driver to add capacity on its network and drive higher utilization starting between Dallas and Laredo, one of its busiest freight routes in the Sun Belt. As customers experience the Aurora Driver operating reliably on the road and see the compelling economic benefits firsthand, we are building a strong foundation to expand into larger, long-term commitments. Our scaling plan prioritizes driverless delivery between customer sites to enhance the Aurora Driver's value proposition. In November, the Aurora Driver will be operating directly to sites for several driverless customers, including automated navigation through security checkpoints. Beyond customer sites, a true end-to-end nationwide service requires the Aurora Driver to operate with an existing freight infrastructure, just like conventional trucks. Historically, autonomous trucks have relied on voluntary enhanced pre-trip inspection to bypass weigh stations.

With our weigh station traversal capability, which you can see in the video on page 5 of the slide deck, the Aurora Driver can now autonomously determine if a station is open, navigate to an available scale lane, and adapt to different scale configurations. This capability makes it easier for customers to integrate the Aurora Driver into their networks. As Aurora Driver's capabilities continue to expand, the regulatory landscape increasingly supports scaled deployment. Earlier this month, the Federal Motor Carrier Safety Administration granted Aurora and the industry an important five-year exemption, permitting driverless trucks to use cab-mounted warning beacons in place of traditional manually placed roadside warning devices. By successfully demonstrating that our warning beacon technology would likely achieve a level of safety equivalent to or greater than legacy requirements, Aurora's leadership in working with federal regulators has cleared the way for driverless freight at scale for the industry.

To meet growing customer demand for this critical technology, we are executing a phased manufacturing plan, beginning with upfitting at Roush and initial lineside integration with Volvo while preparing for full OEM industrialization with Volvo and PACCAR. Together with Roush, we are working to establish an annualized production capability of more than 1,000 trucks. You can check out this production facility in the video on page 7 of the slide deck. While our initial ramp volume over the past month was constrained by material availability, component quality, and issues identified during end-of-line testing, our team moved quickly to address these pre-production bottlenecks. With weekly output steadily improving, we now expect to achieve our targeted production rate of 20 trucks per week in early December. Importantly, this is a starting point. Roush has considerable ability to scale production higher through line expansion.

In parallel, our strategic partnership with Volvo continues to advance, driven by deep operational alignment and growing customer demand. Volvo Autonomous Solutions driverless trucks will launch with the Aurora Driver in the first quarter of 2027. This supports their plan to deploy more than 300 driverless trucks in 2027, ahead of full industrial production in 2028. Similarly, our leadership with PACCAR continues to progress, driven by a mutual dedication to safety and rigorous product development. Fleet customers are increasingly focused on operational efficiency and freight reliability to navigate industry challenges. Together, we're working to seamlessly integrate the Aurora Driver onto PACCAR trucks, giving carriers the flexibility they're demanding. To support our manufacturing roadmap and objective to exit 2030 with 30,000-plus trucks on the road, our industry-first hardware as a service partnership with AUMOVIO continues to advance on schedule.

AUMOVIO has initiated design validation for our third-generation commercial hardware kit while finalizing the line concept and production flow at its dedicated facility in New Braunfels, Texas. Initial line bringup remains on track for later this year ahead of planned start of production in the second half of 2027. As we look ahead, we believe the key pieces are all now firmly in place. With verifiable AI proven on public roads, automotive-grade hardware, accelerating manufacturing, and growing commercial demand, Aurora is standing at a true commercial inflection point. As we bring autonomous freight to commercial scale, we're uniquely positioned to make our roads safer, unlock efficiency across the supply chain, and create immense enduring value for the industry and our shareholders. With that, I'll now pass to Dave, who will review our financial results.

Thank you, Chris. Let's review our financial results for which we have provided a summary on page 9 of the slide deck for reference. Third quarter 2026 revenue totaled $3 million across driverless and vehicle operator-supervised commercial loads. The Aurora Driver achieved another record number of commercial miles driven during the quarter. Third quarter operating loss, including stock-based compensation, totaled $257 million. Excluding stock-based compensation of $54 million, R&D totaled $160 million, SG&A was $38 million, and the cost of revenue was $8 million. We used approximately $170 million in operating cash during the third quarter of 2026, and capital expenditures totaled $36 million. This cash spend was within our externally communicated quarterly average target. We expect cash use of approximately $250 million during the fourth quarter of 2026 as we continue to ramp production of our driverless fleet.

We continue to expect our full year 2026 cash spend to be within our previously communicated target range, inclusive of second quarter cash bonus payments, which were funded through our ATM program. During the third quarter, we issued 6 million shares of Class A common stock through our ATM program for net proceeds of $41 million. We used $23 million of these proceeds to fund the tax liability associated with the vesting of employee restricted stock units. In turn, we ended the quarter with a very strong balance sheet, including over $1 billion in cash and short-term investments. Reflecting a production ramp about 6 weeks behind our prior plan, we now expect 2026 revenue of approximately $9 million, which continues to represent substantial year-over-year growth. We anticipate exceeding the 200 driverless truck milestone by the end of February.

Building on this foundation and with a steady state production rate of approximately 20 trucks per week expected by early December, we remain on track to exit 2027 with more than 1,000 driverless trucks in operation. In closing, we are at an extraordinary inflection point with our driverless operations poised for rapid expansion. With that, we will now open the call to Q&A.