Gauzy Ltd. Announces Third Quarter and Nine Months 2024 Results

Delivers Third Quarter Revenue Growth of 24.6% Driven by Broad-Based Strength Across Segments

Announces Ground-Breaking Customer Wins Across All Divisions with Major OEMs

Accelerating Demand, Driving Record Backlog Levels

Narrows Adjusted Net Loss for the Quarter, Continuing Path to Improved Profitability

Reiterates Fourth Quarter 2024 Guidance Range

TEL AVIV, Israel and NEW YORK, Nov. 12, 2024 (GLOBE NEWSWIRE) -- Gauzy Ltd. (Nasdaq: GAUZ) (“Gauzy” or the “Company”), a global leader of vision and light control technologies, today announced financial results for the third quarter and nine months ended September 30, 2024.

Third Quarter 2024 Highlights (Compared to Third Quarter 2023)

• Revenues of $23.3 million increased 24.6% compared to $18.7 million
• Gross margin of 23.9% declined 290 basis points compared to 26.8%
• Net loss of $5.5 million compared to a net loss of $21.3 million
• Non-GAAP Adjusted net loss of $7.8 million compared to an adjusted net loss of $9.8 million
• Total available liquidity of $44.4 million, including cash of $9.4 million and $35.0 million undrawn credit facility at quarter end
  

Nine Months 2024 Highlights (Compared to Third Quarter 2023)

• Revenues of $72.4 million increased 29.2% compared to $56.0 million
• Gross margin of 25.4% increased 100 basis points compared to 24.4%
• Net loss of $41.8 million compared to a net loss of $58.6 million
• Non-GAAP Adjusted net loss of $25.6 million compared to an adjusted net loss of $25.6 million

“Our third quarter revenue was in line with our pre-announced expectations, with strong 24.6% growth reflecting our premier position as a global leader in vision and light control technologies,” commented Eyal Peso, Gauzy Co-Founder and Chief Executive Officer. “Our comprehensive capabilities, spanning from cutting-edge R&D through large-scale manufacturing, continue to drive strong demand across all our segments. We're seeing particularly robust traction in our core markets, from advanced aircraft shading systems to sophisticated transportation safety solutions and energy-efficient architectural applications.”

“To meet this growing demand, we've taken decisive action by adding a second shift at our French production facility,” Mr. Peso continued. “This doubling of shifts represents a strategic advance in our ability to accelerate shipments through the dedicated efforts of our stable and resilient workforce and better position our business for improved profitability. Prior labor constraints and typical third quarter seasonality in Europe resulted in approximately $4 million of deliveries that we anticipate moving into the fourth quarter and early 2025. I’m pleased to say that we have already begun fulfilling such backlog of orders. Accelerating momentum for our innovative solutions continues to build, as reflected in our fourth quarter guidance for a step up in revenue into year-end.”

Mr. Peso concluded, “With Ferrari, one of the most iconic OEMs, with Yutong, the world’s largest bus manufacturer, and Ford on trucks, Gauzy serves some of the biggest and best names in the automotive industry with long-term supply agreements. They see the extraordinary value proposition that integrating our technology into their platforms represents, and their support underpins our strong growth trajectory. We are confident that investors will increasingly appreciate the intrinsic value of Gauzy, the same way that these customers and many others have entrusted us with an important part of their future growth.”

Top Q3 2024 Business Milestones and Accomplishments

• Yutong, the world’s largest bus OEM, increased third quarter orders by 250% year-over-year, positioning Gauzy to extend its global share of buses using its Smart-Vision ADAS
• Signed our largest-to-date Automotive serial production deal to deliver our LCG® Smart Glass into an average of 50,000 cars per year for nine years with a major European OEM
• Gauzy selected by Ferrari to supply its SPD smart glass technology to support the serial production of its first ever 4-seater offering for eight years
• A major international airline contracts Gauzy for cabin shading with LCG® Smart Glass on Boeing 737 MAX fleet
• Selected by one of the largest cruise ship manufacturers to supply new terminal in Miami, Florida with over 11,000 sqft of LCG® Smart Glass Transparent Display Façade
  

Third Quarter 2024 Results

Revenues for the third quarter of $23.3 million increased 24.6% compared to $18.7 million in the prior year quarter, primarily driven by existing and new customer accounts in the Safety Tech and Architecture divisions.

Gross profit for the third quarter of $5.6 million increased 11.5% compared to $5.0 million in the prior year quarter. Gross margin for the third quarter decreased to 23.9% compared to 26.8% in the prior year quarter, primarily due to mix of revenues from products and divisions.

Total operating expenses for the third quarter were $14.3 million, up 3.2% compared to $13.9 million in the prior year quarter, mainly due to increases in payroll and related expenses, director related expenses, professional services and transaction expenses and selling and marketing costs, offset by decreases in materials expenses, subcontractors expenses and rent and maintenance costs. Total operating expenses include research and development, sales and marketing, and general and administrative expenses.

Net loss for the third quarter of $5.5 million compared to $21.3 million in the prior year quarter, mainly due to a decrease in financial expenses.

Non-GAAP Adjusted net loss for the third quarter of $7.8 million compared to $9.8 million in the prior year quarter, with the improvement primarily attributable to the adjustment of other financial expenses, net and non-cash fair value adjustments.

Third Quarter 2024Segment Performance

Safety-Tech DivisionResults

Safety-Tech revenue of $11.2 million in the third quarter increased 68.1% compared to $6.6 million in the prior year quarter on strong demand across the segment’s product lines. Gross profit of $2.1 million in the third quarter increased 39.1% compared to $1.5 million in the prior year quarter. Gross margin of 19.0% in the third quarter compared to 23.0% in the prior year period, primarily attributable to product mix.

Aeronautics Division Results

Aeronautics revenue of $7.8 million in the third quarter decreased 7.6% as compared to $8.4 million in the prior year quarter. Gross profit of $2.6 million in the third quarter decreased 15.2% as compared to $3.1 million in the prior year quarter. Gross margin of 34.0% in the third quarter compared to 36.9% in the prior year period. The decrease in revenue, gross profit and gross margin reflects the shift in expected deliveries from the third quarter to coming quarters.

Architecture DivisionResults

Architecture revenue of $3.8 million in the third quarter increased 21.0% compared to $3.2 million in the prior year quarter, growing worldwide demand. Gross profit of $1.2 million in the third quarter increased 37.2% compared to $0.9 million in the prior year quarter. Gross margin of 31.4% in the third quarter compared to 27.6% in the prior year period, driven primarily by higher revenues, favorable product mix and operating efficiencies.

Automotive DivisionResults

Automotive revenue of $0.5 million in the third quarter increased 12.5% compared to $0.4 million in the prior year quarter. Gross loss of $0.1 million in the third quarter compared to a gross loss of $0.1 million in the prior year quarter.

Balance Sheet, Liquidity and Cash Flow

As of September 30, 2024, the Company had total liquidity of $44.4 million, including $9.4 million of cash and cash equivalents and $35.0 million of available capacity under its undrawn credit line. In June the Company completed its initial public offering, raising approximately $75 million prior to deducting underwriting discounts and other offering expenses, a portion of which was used to pay down debt. At quarter end total debt was $36.9 million, including $9.3 million of short-term receivable financings.

As of September 30, 2024 the Company had basic and diluted shares outstanding of 18,693,362 ordinary shares.

Guidance

The Company is reiterating its expectations for revenue in the fourth quarter 2024 to be in a range of $28 million to $34 million.

Conference Call and Webcast:

Gauzy will host a conference call and webcast to discuss its results for the third quarter and nine months ended September 30, 2024 and other information related to its business at 8:30 a.m. Eastern Daylight Time on Tuesday, November 12, 2024. The webcast of the conference call can be accessed on the “Investors” section of Gauzy’s website at www.investors.gauzy.com. For those unable to access the website, the conference call will be accessible domestically and internationally, by dialing (800) 717-1738 or (646) 307-1865, respectively. Upon dialing in, please request to be connected to the Gauzy earnings conference call. To access the replay of the call, dial (844) 512-2921 (Domestic) or (412) 317-6671 (International) and enter the passcode 1121939.

About Gauzy

Gauzy Ltd. is a fully-integrated light and vision control company, focused on the research, development, manufacturing, and marketing of vision and light control technologies that are developed to support safe, sustainable, comfortable, and agile user experiences across various industries. Headquartered in Tel Aviv, Israel, the company has additional subsidiaries and entities based in Germany, France, the United States, Canada, China, Singapore, and Dubai. Gauzy serves leading brands in over 30 countries through direct fulfillment and a certified and trained distribution channel.

Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking statements contained in this press release include, but are not limited to, statements regarding Gauzy’s strategic and business plans, technology, relationships, objectives and expectations for its business, growth, the impact of trends on and interest in its business, intellectual property, products and its future results, operations and financial performance and condition and may be identified by the use of words such as “may,” “seek,” “will,” “consider,” “likely,” “assume,” “estimate,” “expect,” “anticipate,” “intend,” “believe,” “do not believe,” “aim,” “predict,” “plan,” “project,” “continue,” “potential,” “guidance,” “objective,” “outlook,” “trends,” “future,” “could,” “would,” “should,” “target,” “on track,” or their negatives or variations, and similar terminology and words of similar import, generally involve future or forward-looking statements. In particular, forward-looking statements in this press release include its anticipated revenues for the quarter ended December 31, 2024, as well as its expectations regarding the timing of the delivery of its shipments and the expanded backlog. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements reflect Gauzy’s current views, plans, or expectations with respect to future events and financial performance. They are inherently subject to significant business, economic, competitive, and other risks, uncertainties, and contingencies. Forward-looking statements are based on Gauzy’s current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. For a more detailed description of the risks and uncertainties affecting the Company, reference is made to the Company’s reports filed from time to time with the SEC, including, but not limited to, the risks detailed in the Company’s prospectus (Registration No. 333-278675), dated June 5, 2024 and filed with the SEC. The inclusion of forward-looking statements in this or any other communication should not be considered as a representation by Gauzy or any other person that current plans or expectations will be achieved. Forward-looking statements speak only as of the date on which they are made, and Gauzy undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as otherwise required by law.

NON-GAAP Disclosure

In addition to Gauzy’s financial results reported in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”), this press release and the accompanying tables and related presentation materials may contain one or more of the following Non-GAAP financial measures: Adjusted Net Loss, EBITDA, Adjusted EBITDA, Net Loss Margin and Adjusted EBITDA Margin. Gauzy believes that these measures provide useful information about its operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key measures used by management in its financial and operational decision making. Non-GAAP financial measures have limitations as analytical tools and may not be comparable to companies in other industries or within the same industry with similarly titled measures of performance. In addition, these non-GAAP measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. The presentation of this financial information is not intended to be considered as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliation of these Non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and not rely on any single financial measure to evaluate our business.

Adjusted Net Loss. The Company defines Adjusted Net Loss as Net Loss, adjusting for certain financial expenses, the amortization of intangible assets, certain acquisition and debt raising related costs, non-cash fair value adjustments and expenses related to equity-based compensation and doubtful debts.

EBITDA. The Company defines EBITDA as Net Loss, excluding net financial expense, tax expense and depreciation and amortization.

Adjusted EBITDA. The Company defines Adjusted EBITDA as EBITDA (as defined above) excluding acquisition-related costs, one-time expenses and equity-based compensation expenses.

Net Loss Margin. The Company defines Net Loss Margin as Net Loss divided by revenue.

Adjusted EBITDA Margin. The Company defines Adjusted EBITDA Margin as Adjusted EBITDA (as defined above) for the period divided by revenue for the same period.

For more information on the Non-GAAP financial measures, please see the reconciliation tables provided in this press release. The accompanying reconciliation tables have more details on the U.S. GAAP financial measures that are most directly comparable to Non-GAAP financial measures and the related reconciliations between these financial measures.

Contacts

Media:
Brittany Kleiman Swisa
Gauzy Ltd.
press@gauzy.com

Investors:
Dan Scott, ICR Inc.
ir@gauzy.com