Mobileye Global Inc. Class A Common Stock Evercore's 9th Annual ADAS, AV & AI Forum

All right. Welcome everyone back. Chris McNally, Head of Global Auto and Mobility, Evercore ISI. With me, good friend, longtime friend, Dan Galves, Chief Communications Officer at Mobileye. Dan, you always do a great job of setting the stage, so why don't I kick it over to you for just a little overview of where things sit now with Mobileye, and we'll come back. We'll have a little chat.

Thanks a lot, Chris. Yeah, it's always great to support this awesome conference. Tons of great companies here and great investors. So understand that there's a lot of questions around Mobileye right now. Many of the SuperVision partnerships that we thought were lined up didn't really materialize, at least on the first round. That's not new, but it's just recognizing that. And some of our recent announcements and transactions probably brought more questions than answers. But if you dig deeper, there are a lot of reasons to be optimistic. The core ADAS business gained a lot of strength this year. We'll grow volume approximately 10%, based on our July guidance, up from our original expectation of 4% growth. Within that 10%, it's basically 3% related to China exports, 3% related to safety stock increases that happened in Q1, and 4% growth with our top 10 customers.

That last number is, I consider it very impressive because it compares against these OEMs' global production growth of -5% this year. So in a typical year, we would think that we would grow maybe 4%, 5%, 6% faster than our top 10 customers, including things like China exports. This year, we've grown nine points faster than the top 10 customers, even excluding this China export growth. So I think that's really strong performance. We're also clearly winning in the ADAS segment that's going to grow the fastest over the next several years, and that's the highway hands-free level 2+ segment. True point-to-point, hands-free systems like Tesla FSD get all the PR, but the real volume over the next several years will be for less ambitious but much less costly systems.

These are also popular with consumers and will represent the fastest-growing segment in ADAS over the next few years, according to S&P Global Mobility. About 18% CAGR over the next two or three years. We're winning this segment. As for the point-to-point system, similar to Tesla FSD, again, that's what gets all the PR and what OEMs want to highlight at Analyst Days, but there's still only one real system on the roads of North America and Europe, and that's FSD. And that will be the case for the next couple of years, except for our SuperVision system with Porsche, which launches next year and creates a really strong proof point for the market, we believe. We haven't won the first round on point-to-point, and that's disappointing to us and our investors.

But until there are more systems on the road and we get the opportunity to show Porsche vehicles with SuperVision at production scale, nothing's really decided. On robotaxi, our partnerships are making progress. We now have closed user group testing with the ID. Buzz through MOIA in Hamburg and Orlando. The L.A. test fleet is expanding. Our other partner, HOLON, just announced that they will be the production AV partner for Deutsche Bahn, which is running a broad initiative to integrate AVs into the public transit system in multiple German regions. The underlying dynamics and tremendous potential of the robotaxi business has really firmed up over the last couple of years, but we still consider it really the first inning. Our technology has progressed to the point where we have high confidence in deploying a scalable driverless system very soon.

This led us to initiate our own vertically integrated robotaxi platform and service, and we're making progress there. The opportunity to define everything about the service, from the sensor stack to the customer experience, to iterate software faster, to have control of costs and pricing, to have control of when and where we can demonstrate the technology, it's the right path, and we look forward to disclosing more on progress soon.

Excellent. Dan, why don't we start with the basic building blocks, right? So on the ADAS update, we're running on, I think, always in absolute units, right? Like 39 million units for almost like the last four to six quarters.

It was better, that 9 to 9.5 million per quarter that we always talk about. We have the China exports, which has been surprisingly positive, but can you talk about some of the other dynamics that have, in this very stale, sluggish production environment, what is starting to push that number higher?

Yeah. I think that, obviously, having the domestic Chinese market weak, where we have relatively low share with our customers there, has pushed the China OEMs to get more aggressive on export units, where we have better market share, particularly with Chery and Geely. I think what's been interesting is this is not all Europe.

Yeah Western Europe is a small piece of this.

So it's markets like Russia and Brazil and Malaysia, Australia. These are markets where we don't have strong business.

That has low ADAS penetration. So I would say that this export growth is incremental volume for us. What we think is also happening is that them bringing vehicles into these markets where ADAS penetration is low.

It's stimulating. is kind of shaming Yep the legacy OEMs into standardizing ADAS into these markets.

The data bears it out, about 1 million, 1.5 million units of sort of emerging market ADAS adoption growth this year. According to S&P Global Mobility, we think that that is going to be revised higher. I think that this benefit continues into next year because the ADAS penetration in these markets is low. I think that is probably, we also have market share gains within GM, with VW, with Honda. I think the bigger factor is this kind of emerging market growth.