MicroVision, Inc. (MVIS) Earnings Call Transcript & Summary

[Audio Gap] second quarter 2026 financial and operating results. [Operator Instructions] As a reminder, this event is being recorded. I would now like to turn the conference call over to Drew Markham. Please go ahead.

Thank you, Jenny. Good afternoon. I'm here today with our Chief Executive Officer, Glen DeVos; and our Interim Chief Financial Officer, Steve Hrynewich. Following their prepared remarks, we will open the call to questions. Please note that some of the information you will hear in today's discussion will include forward-looking statements, including, but not limited to, strategic plans and execution progress, expectations regarding customer engagement and product deliveries, product applications and use cases, market opportunities, cash flow forecast, liquidity and financing activities, availability of funds and access to capital, expected near-term and future revenue, operating expenses and cash usage as well as statements containing words like believe, expect, plan and other similar expressions. These statements are not guarantees of future performance. Actual results could differ materially from the future results implied or expressed in the forward-looking statements. We encourage you to review our SEC filings, including our most recently filed Form 10-K and quarterly reports on Form 10-Q. These filings describe risk factors that could cause our actual results to differ materially from those implied or expressed in our forward-looking statements. All forward-looking statements are made as of the date of this call, and except as required by law, we undertake no obligation to update this information. In addition, we will present certain financial measures on this call that will be considered non-GAAP under the SEC's Regulation G. For reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure as well as for all the financial data presented on this call, please refer to the information included in our press release and in our Form 8-K dated and submitted to the SEC today, both of which can be found on our corporate website at ir.microvision.com under the SEC Filings tab. This conference call will be available for audio replay on the Investor Relations section of our website at www.microvision.com. Now I would like to turn the call over to Glen DeVos, our Chief Executive Officer. Glen?

Thank you, Drew, and good afternoon, everyone. Welcome to MicroVision's Second Quarter 2026 Earnings Call. Earlier this year, we introduced Lidar 2.0, the next chapter in MicroVision's evolution. It marked a deliberate shift from a hardware-first company proving out technology for automotive to a lidar-based perception company with solutions designed to offer value to customers across multiple industries and use cases. I want to share with you the tremendous progress we have made during the second quarter and how we have positioned MicroVision to now accelerate our revenue growth. The shift isn't a slogan, it's operational, and it's fundamentally changing how we work with customers, productize our offerings and achieve meaningful commercial momentum. And most importantly, I want to share with you that it's working. MicroVision today is more vertically integrated, aligned and commercially active than at any point in our history. We are building traction simultaneously across our core markets in industrial, security and defense and automotive as well as adjacent markets like robotics and AI. This is driven by the breadth of our product portfolio and our design to cost engineering philosophy and underpinned by our open software framework. Today's call will cover a number of areas. First, an update on our Lidar 2.0 strategy and how it fuels our revenue forecast. Second, a walk-through of our commercial momentum, delving into the announcements and customer milestones of the past quarter and providing more context on the launch of MicroVision Semiconductor. Third, our product portfolio and road map, sharing the status of our nearest-term catalysts, the MOVIA Air and MOVIA Air Plus launch and the MOVIA S industrial launch. Fourth, the strong leadership additions we've made this quarter to deepen our bench and then a bit about our financing strategy before diving into our financials. So let's get into it. So I'll start with Lidar 2.0 and where we are with that strategy. Lidar 2.0 encapsulates what we believe it takes to win in this market across a diversity of industries, the right performance at the right price, using software-enabled perception to lower system costs and support for multiple verticals with our industry-leading portfolio, all delivered with the operational discipline that customer requires from long-term suppliers. One of the strongest validation points for MicroVision's execution this year has been how quickly the company stabilized and commercialized the acquired Luminar business. When MicroVision acquired Luminar's lidar business, it inherited far more than the IRIS and HALO product lines, the acquisition including inventory, engineering talent, customer contracts and active commercial programs. The real challenge was ensuring those customers continue receiving products and support without disruption. Within roughly 1 quarter of closing that acquisition, we had successfully integrated the Luminar engineering teams, consolidated manufacturing operations to improve efficiency, resumed shipping existing IRIS inventory, maintain customer relationships while pursuing new opportunities and reduced operating expenses through streamlined operations. This has been a significant operational achievement. Perhaps the biggest accomplishment is that existing IRIS customers continue to be served with our broader product portfolio. Rather than forcing customers through a redesign or a platform migration, MicroVision preserved their investment while expanding the future road map. Instead of being a stand-alone product, IRIS now sits with our broader perception platforms, MOVIA for short-range, IRIS for long-range applications, HALO is the next-generation evolution of long-range sensing, FMCW technology from Scantinel and perception software across the entire portfolio. This allows MicroVision to deliver the best sensor for each application instead of trying to fit every customer into a single product or technology. This diversified portfolio is now a key strength and a significant differentiator for MicroVision. And this is why we have confidence in our revenue guide for the current year with significant growth expected in 2027, building on a solid recurring revenue foundation. We continue to see expanding customer engagements across all products and end markets with a significant increase in near-term booking opportunities. As I stated earlier, the efforts in Q1 and Q2 are delivering on MicroVision's revenue growth plans. Let's talk about momentum building in the recent announcements. So turning to our recent commercial momentum, we are making great progress, as I stated. We continue to be successful in converting Luminar customer accounts into MicroVision development agreements and purchase orders. This is exactly what we planned for with the Luminar acquisition. Additionally, we see strong increase and increased customer engagements with MOVIA S as we prepare for our October launch. Let me share some examples. On April 14, we launched our global partner and reseller program, establishing reseller integrator relationships across Japan, North America, Europe, Korea and Singapore, targeting industrial, defense and mobility customers. That includes a partnership with one of Japan's largest, most established technology resellers covering automotive, heavy industry, mining, agriculture, rail safety and marine and offshore use cases. On June 10, we signed a long-term development agreement with a leading construction and mining equipment OEM to integrate 2 IRIS lidar sensors per off-highway truck into their next-generation autonomous hauling solution, with future potential to add HALO to that platform as well. On June 16, we delivered IRIS sensor shipments, LAKE FUSION Technologies as they and Timberline Aerospace expand their collaboration on situational awareness solutions. And on June 29, we delivered MOVIA sensors to a leading AI company and hyperscaler for evaluation across robotics, autonomous systems and next-generation AI applications, a strong proof point that our diversification beyond automotive is real, not just aspirational. On July 1, we appointed IDI Laser as our premier partner for industrial, defense and security markets across Southeast Asia, extending our reseller footprint beyond the initial 5 country base we had announced in April. On July 6, we engaged with J.A. Green & Company to accelerate our U.S. defense market strategy and strategic partnerships, a deliberate investment in the defense and security channel specifically. And on July 14, we formalized MicroVision Semiconductor, Inc. It's another key unlock in this strategy and MicroVision Semiconductor, which we introduced to the market last month and which I'll cover in more detail in a moment, it's owning that custom ASIC and mixed-signal design. It brings it in-house rather than outsourcing it and it's how we protect both the cost curve and the integration advantage that Lidar 2.0 depends on. On July 15, James Byun joined us as MicroVision's first Chief Commercial Officer, which I'll also cover in more detail shortly. In another example of the acceleration of our traction, just last week, we received an order from a prime contractor supplying autonomous UGVs or unmanned ground vehicles to the military, highlighting the importance of IRIS' 1550-nanometer technology, which is invisible to night vision goggles as the customer phases out the use of 905-nanometer sensors. We also received an order for IRIS sensors from a key defense and aerospace contractor for use in unmanned aircraft applications. And earlier this week, we unveiled MOVIA Air and MOVIA Air Plus, autonomous aerial systems represent one of the fastest-growing opportunities for perception technology. As drones evolve from remote controlled platforms to fully autonomous systems, they need more than imagery. They need the ability to understand and react to the world around them in real time. And this is exactly what MOVIA Air delivers with its ability to combine lidar and camera sensing to build and transmit high-definition 3D maps in real time to UGVs, demand centers or to other airborne assets. More importantly, it demonstrates the scalability of our business model. The same core technologies we've developed for automotive and industrial applications can now be deployed across aerospace, defense, logistics and security. Every new vertical expands our opportunity to monetize the investments we've already made in our lidar and perception platform. MOVIA Air is more than just a new product launch. It is another proof point that our technology platform scales across industries, applications and autonomy use cases, and that's exactly what our Lidar 2.0 strategy is designed to achieve. We're also encouraged by the early market response. Before the official launch, we've delivered units and are in active development with a major industrial drone delivery company and a provider of advanced resource exploration. And the MOVIA Air product family is being evaluated by an additional 9 prelaunch partners across industrial defense and autonomous aerial applications. These programs reinforce what we've been hearing from customers that the market is increasingly looking beyond just simply raw sensor performance and towards complete perception solutions that can enable real-time decision-making in demanding environments. Next week, we'll publicly demonstrate MOVIA Air Plus at JIFX, that's the Joint Interagency Field Experimentation research program run by the Naval Postgraduate School. This is where the Navy tests new defense and security technologies. Customers will see live perception and autonomous navigation capabilities, obstacle avoidance and real-time 3D mapping operating in realistic field conditions. We're incredibly excited about this and happy to be working with some outstanding partners in making that happen. We also plan to host our third product webinar later in August to provide our customers and partners with a deeper technical look at the platform and discuss how we're extending our perception capabilities into the rapidly growing aerial autonomy market. Here's what I want you to take away. We now have simultaneous traction across industrial, off-highway, defense and security, drone and helicopter, robotics and AI, and automotive. That breadth is what derisks this story relative to a single end market. If one vertical sales cycle flips, we are not dependent or affected by that. And just as importantly, we are seeing repeat orders and expanded scope with existing customers. That's the more durable signal. Anyone can announce a pilot or predevelopment activities. What matters is whether that pilot turns into a second order and a bigger one or a long-term supply agreement. And some of you have questions about why we can't name customer wins? And I would just reiterate my previous comments. When we're able to announce the customer name, we will. When they request that we do not for purposes of confidentiality or competition, we always respect that and name the industry or category only. Now let me talk briefly about product portfolio and road map. Our industry-leading product portfolio encompassing short, long and ultra-long range coverage across multiple architectures and wavelength approaches is the key to supporting multiple use cases across our end markets, industrial, defense, automotive and beyond. Let me walk you through where we are with each product and where it stands and how they fit together and how they will continue to evolve over time. For short-range sensing, MOVIA L offers a power-efficient solid-state design with sensing and perception running on board. It's easy to deploy, making MOVIA L ideal for use cases like warehouses, mining vehicles and agriculture. In October, we will launch MOVIA S, our next-generation short-range sensor platform. MOVIA S is smaller, more cost effective, more energy efficient, delivering high-performance perception in an ultracompact design. We already have more than 25 active customer engagements and evaluations ongoing. And to be clear, this is where customers have our samples, we're in active quoting and in some cases, doing development. MOVIA S will be a game changer for the industry with applications across all segments as we see strong interest from the robotaxi, the industrial and the defense OEMs. For long-range sensing, IRIS offers high-performance sensing engineered to enable advanced safety at high speeds up to 280 meters. IRIS is a robust and proven sensor that we're shipping to active commercial customers today in industrial, defense and automotive. HALO represents MicroVision's next generation of long-range sensors. It will provide longer-range sensing with greater precision in a design that is roughly 1/3 the size of IRIS. Stated another way, HALO was 68% smaller by volume than IRIS. Bringing this level of performance into such a compact form factor will unlock new use cases not possible today. And this is really important. HALO system design is fully compatible with IRIS. So existing IRIS customers can transition seamlessly to the next-generation product without needing to go through a massive reengineering or recertification or revalidation of their solution. It's truly a seamless transition. For aerial applications, MOVIA Air and MOVIA Air Plus are especially designed for drones and other lightweight use cases. MOVIA Air was developed to meet the strict criteria for size, weight, cost and power required to make drone-based ISR missions viable. And finally, for ultra-long-range sensing of 500 to 1,500 meters, our FMCW lidar on chip solutions will provide advanced optical sensing that measures both distance and instantaneous velocity simultaneously. Now all of these sensors are underpinned by our open software framework, which enables our customers to fully use advanced perception and software features and development tool chain in a seamless fashion with their development environment. Now while we are excited about our current products and upcoming launches, MicroVision Semiconductor Inc. and Scantinel are preparing for our next generation of products where we leverage our in-house semiconductor and photonics capability to deliver lidar on a chip. We talked about how silicon up integration and chip scale packaging are keys to further cost reduce lidar while increasing performance. And this is exactly what Scantinel and MSI are developing for us with our next A-sample to be available by Q2 of 2027. Now we'll be showcasing more about Scantinel at IAA in Hanover next month. And while that will focus on commercial vehicle and industrial markets, the underlying photonics technology has applications across multiple end markets, including high-speed data transmission serving global communication networks, cloud infrastructure and data centers. These efforts demonstrate our continued expansion of the product portfolio and reflect a clear road map for sustained growth with additional capabilities planned to address evolving customer needs across all of the end markets that we serve. Now I'll talk about the product portfolio, but I also want to address the reverse stock split directly, along with our broader capital markets activity. It goes without saying that our NASDAQ listing is an important asset, and it is vital that we maintain and protect the continued listing of our stock. With our stock price now in a stronger position and delisting really no longer casting a shadow on our work, we can focus on continuing to intensify our engagement with customers and accelerate commercial momentum across our target markets. Our post-split stock price and the increase in authorized shares puts us in a much better position to ensure that our operations and business objectives are sufficiently financed and that we have flexible options to address the company's capital requirements. The key point is we need the capital structure, financial capacity and fiscal discipline that support our strategic plan and enable us to focus on delivering commercial wins. Now finally, let me talk about the team. For Lidar 2.0, we have talked about the right product portfolio at the right price and with the right people to make our vision a reality. Building out the commercial and technical leadership to match this strategy has been a priority, and we made some key appointments this past quarter. On July 20, James Byun joined us as MicroVision's Chief Commercial Officer, a newly created role leading our global commercial organization. James brings more than 20 years of experience scaling commercial organizations in automotive, mobility and technology with previous roles as Managing Director of Global Business Development at Aeva, as Chief Commercial Officer at Innovusion, at Greystone as Executive Vice President and President of the Global Automotive Group and in the senior automotive relationship roles at SiriusXM. Having a dedicated commercial leader at this level who has successfully run similar playbook in prior roles reflects how seriously we're taking the commercially driven feature of Lidar 2.0. I'm also pleased to welcome Cara Klaer as our new Head of Marketing and Communications. Cara brings nearly 2 decades of experience leading marketing, communications, brand strategy across the automotive technology, retail, manufacturing and health care industries. At MicroVision, Cara will lead our integrated marketing and communications strategy. Her experience helping organizations communicate through periods of growth and transformation will be instrumental as we sharpen the MicroVision narrative, bringing new products and capabilities to market and communicate the continued evolution of our growth and business. And I'm also very pleased to note that we are making very good progress on our CFO search and expect to provide an update very soon. In addition to these leadership appointments, during this quarter, we formed a dedicated semiconductor organization, MicroVision Semiconductor. We welcome this team, formerly known as Black Forest Engineering, which we acquired from Luminar. The team brings more than 30 years of semiconductor expertise and track record over 300 custom mixed-signal IC designs across automotive, industrial, defense, aerospace and scientific markets. And it expands our capability into custom ASIC development, mixed signal ICs, photonic sensing and advanced imaging, including manufacturing relationships with foundry partners like Tower Semiconductor, TSMC and X-FAB. MicroVision Semiconductor is the mechanism by which MicroVision now owns chip-level design rather than depending on outside suppliers for it. It is direct structural support for the cost of integration goals at the center of Lidar 2.0. But this isn't just about supporting the MicroVision road map. The team is available for commercial engagement and customization for external customers as well and has a strong track record in delivering that. So how should investors grade us this quarter? Well, before I hand it over to Steve, I want to be explicit about what we think you should hold us accountable to. Rather than leave that for interpretation, here's the list we're grading ourselves against. The first, commercial traction, growth in our customers and prospect pipeline. Beyond the 100 we cited across 3 verticals in our Q1 call in conversation and conversion and evaluation into repeat orders, and expanding scope with existing customers. Again, #1 commercial traction and growth. The second is the program build-out, participation in our reseller and partner programs and geographic expansion beyond our initial footprint in Japan, North America, Europe, Korea and Singapore. These programs are vitally important as they provide an outstanding channel for our products to reach a broad market. The third is product execution, staying on track for introducing MOVIA Air to the market and for the MOVIA S industrial launch set for October '26. These launches and these deliverables are key to making sure our products are right at meet the timing of the market. Cost and margin discipline, for example, raising our guidance to 40% to 45% for the year. This reflects the excellent work done by the team to manage our product costs and pricing and is a top focus for us. Balance sheet strength, stabilizing our compliance profile and strengthening market position evaluated against the financing flexibility that I laid out earlier to ensure we have the capital resources and liquidity needed to support our strategic plan. Organizational build proving that the addition of our new Chief Commercial Officer and MicroVision Semiconductor team show up in visible commercial and product outcomes, not just simply headcount. And then finally, transparency. Sharing what we can with you as soon as we can so that you can be aware of how hard the team is working to demonstrate the progress against our vision and our outcomes. That's a scorecard. I'd ask you to hold us to it. I'm now going to hand it over to Steve to share our second quarter results and where our full year guidance stands today.

Thank you, Glen. As Glen just shared, we have made significant strides in the second quarter with substantial commercial momentum across our core markets, expansion of our product portfolio with a clear road map for sustained growth, increased bench strength with key leadership appointments, and with the completion of the 1-for-15 reverse stock split, more flexible options to raise capital to support our operating needs. Our focus remains on strategic commercial execution and disciplined financial management of the company. Now let me talk about our financial results. Revenue for the second quarter was $1.5 million, a $1.3 million increase versus the same period last year. The primary driver of our second quarter revenue was product sales with a predominant portion accounted for by our long-range IRIS sensor and a smaller portion from our short-range MOVIA L sensor and approximately 15% from engineering services related to our semiconductor business. Of our 3 target sectors, industrial and security and defense were the primary drivers of our second quarter revenue. For the first 6 months of this year, revenue totaled $2.4 million, a $1.7 million increase as compared with the first 6 months of 2025. Approximately 75% of our first half 2026 revenue was driven by the expansion of our product portfolio that resulted from our strategic acquisitions earlier this year. In addition, the majority of our first half revenue came from the industrial and security and defense sectors. These revenue drivers and sector allocation support our confidence that our Lidar 2.0 strategy and focus on diversification for multiple verticals remain the key to winning in this market and growing our top line. Turning to gross margin. Second quarter performance was 44%, a significant increase from a gross margin loss in the second quarter of last year. On a year-to-date basis, gross margin sits at 42% as compared with a gross margin loss in the same period last year. The expansion of our gross margin reflects favorable product mix driven by sales from the IRIS inventory that we acquired in the first quarter this year and efficiencies within our supply chain. Turning to cash usage. Our cash used in operations plus capital expenditures was $19.5 million for the second quarter and $36 million for the first 6 months of this year. Adjusting out acquisition-related costs and restructuring charges, our cash usage was $17.4 million in the second quarter and $33.8 million for the first half of the year. Cash usage increased sequentially from the first quarter to the second quarter this year, in large part due to nonrecurring cash payments related to the post-acquisition consolidation of our engineering and operations organizations, including a significant workforce reduction in our Redmond location. When compared sequentially to the prior year, after adjusting for acquisition-related costs and restructuring charges, cash usage for the second quarter increased $4.5 million and for the first half of the year increased by $6.7 million. The main contributors to these increases are the operating expenses and product development activities related to the acquisitions of our aerial systems team in the fourth quarter last year and Scantinel and Luminar Technologies in the first quarter this year. Having completed most of the integration of our recent acquisitions and actions to consolidate operations and teams by the end of the second quarter this year, coupled with anticipated second half 2026 revenue growth, we expect to see a declining cash burn from operations through the remainder of this year. At the end of the quarter, our balance sheet reflected $27.2 million in cash, cash equivalents and investment securities. In addition, we have access to approximately $41.2 million available under the current ATM facility, subject to market conditions and applicable limitations. Our existing convertible notes currently require us to maintain minimum cash liquidity of the lesser of $17.5 million or 100% -- 10% of the outstanding balance of the notes. Turning now to our 2026 full year guidance. For revenue, we are reiterating our guidance of $10 million to $15 million with the bulk of expected revenue coming in the second half of the year, driven by our expanding commercial traction, existing inventories of long- and short-range sensors and planned production launch of our short-range MOVIA S sensor for industrial applications in October. For gross margin, as Glen mentioned, we are raising our guidance from 35% to 40% to 40% to 45%, driven by our improvements achieved in our supply arrangements and stronger mix of product sales. For cash burn from operations plus capital expenditures, we are maintaining our guidance of approximately $60 million this year with second half improvements expected to come from revenue growth, favorable supply agreements, as previously mentioned, and reduced operating expenses as a result of the consolidation actions we took in the first half of this year. As we progress into the second half of the year, our focus from a financial perspective is clear. Expand and convert our commercial pipeline to enduring revenue, build a healthy and sustainable gross margin profile, efficiently manage cash with discipline while funding the programs that are most closely aligned with customer demand and commercialization and astutely raise capital to support our business needs as we continue to execute our Lidar 2.0 strategy. Let me now pass it back to Glen for closing remarks.

Thanks, Steve. As we close today's call, I'd leave you with these overarching thoughts. 6 months ago, we introduced Lidar 2.0 as a framework where we believe this company needs to go. Today, you're seeing what that strategy looks like in execution. We've integrated major acquisitions while continuing to support customers without disruption. We've expanded our portfolio from automotive into industrial, security and defense and robotics, AI and now autonomous aerial systems. We strengthened our commercial organization, brought semiconductor expertise in-house, improved our cost structure and continue to build a broader and more resilient pipeline. Perhaps most importantly, we're seeing customers respond to that strategy. They're increasingly looking for complete perception solutions, not simply sensors, and that's exactly where MicroVision is poised to lead. Our ability to pair purpose-built hardware with perception software, custom silicon and an open architecture gives customers the flexibility they need while allowing us to participate in significantly larger market opportunities. Now we know there is still work ahead. Commercial programs take time to mature, evaluations need to become production programs. Purchase orders need to become recurring revenue. Our job is now straightforward, execute, convert opportunities into customers, expand those relationships, drive revenue growth and continue delivering against the scorecard we've shared with you today. I believe that MicroVision is a fundamentally different company than it was even a year ago. We have a broader technology portfolio, we have stronger commercial capabilities, we have a healthier operating model and many more opportunities than at any point in our history. The foundation we've built gives us confidence in where we're headed, and we're excited about delivering in the second half of '26 as we prepare for growth of '27 and beyond. I'd like to thank our employees around the world for their commitment and execution through an incredibly busy first half of the year. I'd also like to thank our customers, partners and shareholders for your continued confidence and support. We're looking forward to updating you again next quarter as we continue executing our strategy. Operator, we'll now open the line for questions.

[Operator Instructions] Our first question is coming from Casey Ryan of AmerX.

I wanted to focus in on the upgrade on the gross margin guidance. That's pretty rapid from what was a good gross margin number last quarter. Tell me how much room you think there is sort of structurally in sort of a long-term steady state? I think, obviously, 40%, 45% is very good. And as you work through that, but is 45% kind of the ceiling? Or do you see some sort of like long-term range being somewhat higher than that current guidance?

Sure. Casey, good to hear from you. And I'll start and Steve, you can add. Long-term, I would expect us to be really between that 40% and 50% gross margin and depending a little bit on the product and the end market. If it's a product where there's more software content, so you're talking about products that would be delivered with not just the point cloud, but perception and features on top or products in more into the security and defense area, specifically defense, you're going to see that gross margin kind of move to the upper end of the range. If it's more of a simply a sensor that's delivering a point cloud or histograms and we don't have that added value or added content, in particular, added non-hardware specific content, then you're going to see it, I think, drift closer to the lower end of that range. But for us, we think with these products and with the software content we have, kind of that upper boundary is probably around 50%, the bottom boundary around 40%.

Casey, I was just going to add to that. Casey, I think one of the things that you've heard with regards to our strategy is about design to cost. Within our product development space, we continue to look at cost reductions to get our BOM cost down as low as we can. Over the last little while, we've had some good negotiations with our supply base to get our cost base down, as just mentioned. That's why we elevated our guidance. So I expect we will continue to see that as we progress into the future to get to those margins that Glen just mentioned.

Yes. Okay. Terrific. Terrific. So sort of the second question, sort of on the OpEx line. And like I suspect there are some noncash items here in sort of the SG&A and R&D lines you put out. But sort of this $24 million to $25 million range compares to kind of about maybe, say, $12 million, $13 million last year. Do you guys expect OpEx to be steady state around this mid-20s? Is that sort of something to expect? Or do you think now that you've gone through all this integration work in Q2, that OpEx line might start to bend lower or trend lower going forward?

Yes. Let me just add to that, Casey. So yes, we clearly see our OpEx deteriorating over the next 6 months. It's very clear. All the consolidation actions that we took, as I mentioned, with regards to our Redmond consolidation, we will start to see that cost reduction come down as we progress throughout this year. We had a number of restructuring costs related to the acquisitions. A lot of that cost took place in the first half of the year. There will be a little bit come in Q3 as we kind of finish a couple of things, but we will not see that stuff happening in the future on a run rate basis.

Just to be clear, Steve, when he says OpEx deteriorating, that's a good thing. It means...

Yes. Absolutely. It's like kind of like losing weight. I would love to be also deteriorating a little bit. So Glen, you talked a lot at the top about aerial opportunities. And one of the things we see across the industry is there's a lot of sort of detection and defense of sort of aerial things, but it sounds like your opportunities can include being onboard, and it might be tied to some of the advantages of the product in terms of weight and functionality. But I wanted to see if you could expand and say, yes, a lot of it's -- or tell us if it's primarily for defense and detection or if it is actually sort of onboard with things that are airborne basically?

Yes. So for defense, there's 3 areas that we look at. One is detection, so longer-range detection, and certainly, that's where Scantinel plays a role. So that's on the detection side. But nearer-term, really, the big opportunities appear to be both onboard the drones. So if you think about drones in the different categories, Group 1 and 2 being kind of the sub 55-pound drones, lighter weight drones, typically copters. And then above that, the Group 3 drones, which tend to be fixed wing. The onboard perception and payloads on those drones is where we see the immediate opportunity, both in terms of defense, but also in commercial applications like for everything from power line inspection to wind turbine blade inspection to terrain mapping and other types of kind of reconnaissance activities in commercial. But in defense, though, it's very clear that onboard applications, and that's what we're going to be demonstrating at JIFX next week. That's where the immediate pull is and across those segments. In parallel to that is the ground base that we talked about, autonomous vehicles on the ground that need -- that want lidar sensors on those vehicles as well. But for the aerial, it's onboard the airframe.

Yes. That's pretty exciting because I feel like you're the only one talking about being onboard really that I've listened to so far, so.

Yes. One of the things I'd add is this is where for us as a U.S. and a German company that can make short-range wide field of view, lightweight lidar, lightweight and low-power lidar that has a wide field of view, can see a tremendous amount from 30 to 50 feet off the ground. We can do that. And as a U.S. and German company, we're uniquely positioned to do that. And that's a big pull. That is really a strong pull for that in the MOVIA Air products.

Right. Okay. And then last question. I feel like we get early sort of across the industry, this feels like we're trending towards, I guess, selling sensors together or working together, lidar and camera makers, lidar and radar. And are you seeing sort of an ecosystem or potential to partner with other sensor categories to sort of provide, I guess, a fuller solution to certain people? Or is that something customers are asking for? Or are people still focused solely on just when they talk to you only the lidar sensor piece of that?

It really varies a little bit by end market and then also by the specific customer. And what I mean by that is if we're talking about Defense, our payloads are lidar and camera. So and we can also integrate radar. So it is multimodal, and we do that integration in the payload. So we manage all of that, combine those, basically fuse that and then provide 3-dimensional maps with vision, with camera overlays. If you're talking about Automotive, Automotive is very much, by and large, a multimodal architecture where the system architects break apart those modalities and then they're responsible for sensor fusion. So in that case, robotaxi would come to us to talk about lidar. They already have a vision solution. They already have a radar solution. So it's a lidar-specific solution they're looking for. So depending on the application, you get a mix. And fortunately, we can do both. But for automotive and it's typically lidar pure play for defense, it's both. In industrial, it's a complete mix. We've seen both just lidar only as well as combined systems.

Okay. It's really a very good quarter and really good progress through the year so far. So thanks for the update, and we look forward to more to come in the second half.

I will now turn this call back over to Steve Hrynewich for reading questions submitted by shareholders. Thank you.

Thank you, operator. The first question is, why is MicroVision confident in its 2026 revenue guidance of $10 million to $15 million?

Steve, maybe why don't you start and then I can add in.

Well, I think as we progress throughout the year, as you saw, our $2.4 million for this year, for the first half of the year, a lot of progress coming in the second half of the year with all of the customer engagements that we've been engaging in. We've got all of our inventory coming so we can get those sensors reworked to get those out to the customers. So I think with that long list of customers, we have that list all down by customer. We expect us to hit this range, $10 million to $15 million this year. Anything else, Glen?

Yes. The thing I would add is if you think about how, when we acquired Luminar and then we spent the first quarter really kind of restarting those relationships and reengaging in those POs. And then over the course of Q2, significantly expanded that. So we have -- I think it's about half of those 30 customers now back on board that we're either shipping to or will be shipping to. And that involves kind of restarting up the supply chain for IRIS. And that supply chain had been suspended in many cases due to the bankruptcy and what had been happening before the acquisition. So this is kind of behind the scenes. We don't talk a lot about, but the team has done a really, really amazing job of restarting those relationships with those suppliers, those key suppliers for the product that we need to be able to fulfill those POs. And so as we're putting that plan together and getting those suppliers back on board, the revenue range just reflects the fact that we still have some work to do there and the timing of that isn't fully nailed down. So we'll deliver as much as we can. We're confident in the range. Where we land exactly will depend on what we're able to do with the supply base and how many products we can ship. So it's more of a timing issue as opposed to a revenue issue because it will either happen in Q3, Q4 of this year or Q1 or Q2 of next year. So it's really a matter of timing.