QuantumScape Corporation Class A Common Stock J.P. Morgan Automotive Conference

Terrific. Good morning to those in the room. Thank you, Bill, for hosting us here at the conference. QuantumScape is the leader in solid-state lithium-metal battery development. Solid-state lithium-metal is a type of chemistry beyond lithium-ion that carries advantages in everything that customers would care about. It is called solid-state lithium-metal because the solid-state part, a thin ceramic separator, sits between the two active materials in the battery. Lithium-metal because when you charge the device, lithium is stored in a pure metal form, as opposed to lithium-ion, which is a conventional batteries today. The ion part of lithium-ion speaks to a host material that is all around it.

Because it is stored in a pure metal format, it is the elimination of that host material that leads to all the advantages of our battery chemistry: smaller and lighter, faster charging, better safety performance, lower cost at maturity, and scale. Where we are as a company, we have been in a development and commercialization of this new chemistry. We announced our first product in 2024 at the automotive A-sample type product range, the QSE-5. That is an 800 Wh/L cell with more than 300 Wh/kg, charges in about 12 minutes from 10%-80% with improved safety performance, which is better than anything on multiple dimensions you would find in the market today. We have historically focused and continue to focus on the electric vehicles.

We have had a long-standing partnership with Volkswagen, where we have a collaboration and licensing agreement up to 85 GWh of scale in the licensing agreement. We are in the collaboration phase. We are getting paid to do development and sampling and demos on their behalf. We have a team from VW PowerCo working alongside us on the pilot line that we just started up. We work with four of the top 10 OEMs in the world. VW is named. Honda, they named themself in June. We can talk about that a little bit more. With the start of our highly automated pilot line, the Eagle Line in February. We have additional sampling capacity, and we announced two new customer verticals, one in data centers and one in advanced solutions.

And it was from that vertical that we sampled to a U.S. defense prime that we talked about in the last earnings call. The other thing I might highlight, a capital light business model. We get cash two ways. One is we get paid in the current moment from partners and ecosystem players who are paying for sampling demos, custom development. And we are setting up the foundation for much larger economic opportunity, which would be licensing upon successful transfer of the technology to their factories. So, cash in two forms, and we avoid gigawatt hour scale type CapEx. You asked about some things that are maybe underappreciated and non-intuitive. We have done $40 million in cumulative customer billings to date. That is worth highlighting. We did $19.5 million last year. We are already above that, I think around $21.8 million this year.

The advantage we have in the chemistry is pretty fundamental. Very proud of that technology platform, the patents and trade secrets on it. And that is strongly counterpositioned. To try to replicate that, you would have to start a new company, even if you navigate all the patents and trade secrets, and then the growing customer and partner ecosystem. That is a nice teaser from there.

Yeah. Great question. Just a little less than a year ago, we, together with our partners, VW, PowerCo, and Audi, were one of the highlights of the Munich Auto Show, where we powered a Ducati V21L race bike across the stage. That was our first vehicle demo for the company. And then just a quarter or two later, started up a very highly automated pilot line in our Eagle Line. That is important. Arguably one of our most important focus areas as a company because all commercial roads go through that. Industrializing that for the next level of scale in terms of process and equipment design and supply chain development is critical for all paths of commercialization. It provides higher sampling volumes for Volkswagen, for Honda, for these two other top 10 global OEMs, and for these new verticals.

And then finally, for the tech transfer itself, when we have partners and customers on site, that is the line from which we can teach from and design the future.

Yeah. There is a saying that goes around Silicon Valley, and our Chairman of our Board, Dennis Segers, and the CEO, Siva Sivaram, talk about a lot. You do not really know what you have until you build a million of it. As you get higher volumes, you get statistical confidence intervals around failure modes, and it really hones in the SMVA also we will repeat, systematic, methodical, iterative. We are in that mode of once you have established a baseline with volume, the way you come down a cost curve, the way you drive quality, the way you improve operational metrics is just to produce a lot of parts, identify common causes you want to eliminate, and you eliminate them, you root cause them, control them, and you move on. That is the wheel of improvement. That really requires and is best supported by automation because you are able to do that.

Things are done in a very repeatable way, and you get nice part counts, and you get nice signal. That was a big deal for all the reasons that I mentioned its importance. It is a really important stepping stone for the company. One of the things I would highlight in the capital-light model is we're working with arguably the world's number one and number two suppliers of ceramics in that of Corning and Murata, to have them produce a GWh scale, our separator, to supply two different cell manufacturers like a VW PowerCo. We think that's the best of both worlds. We know our material system, we know the processes, we know the equipment design to this level of scale.

Of course, your Cornings and Muratas know how to have a lot of experience taking the technologies down that kind of cost curve as you reach new orders of magnitude. That's capital efficient, kind of a bullseye on our capital-light model.