The opportunities for lidar technology are still growing, sending some beaten-up shares higher.
Thursday evening, lidar maker
Ouster
(ticker: OUST) reported a loss of $18 million in earnings before interest, taxes, deprecation, and amortization, or Ebitda, from sales of $22 million in the third quarter. Wall Street was looking for a loss of $19 million from sales of $21 million.
Sales grew 15% compared with the second quarter. For the fourth quarter, Ouster expects to generate about $24 million in sales, in line with analyst projections.
That proved plenty enough for investors. Shares were up 14% in after-hours trading Thursday.
Lidar, essentially laser-based radar, is used in cars and other industrial applications to help machines “see.” Ouster focuses more on lidar for industrial and infrastructure applications than other companies that focus more on automotive applications.
The stock move should be a relief for investors. Through Thursday, Ouster stock is down about 63% over the past 12 months. The
S&P 500
and
Nasdaq Composite,
meanwhile, have gained 10% and 22%, respectively.
The results come a day after
Innoviz Technologies
(INVZ) reported better-than-expected sales of $3.5 million in the third quarter. Analysts were looking for $3 million. A year ago, third-quarter sales were less than $1 million.
Innoviz shares rose almost 11% in response. That stock is down 61% over the past 12 months.
Higher interest rates and a slowing economy have sapped enthusiasm for smaller start-ups that don’t generate earnings. Companies like lidar makers. Shares of
Luminar Technologies
(LAZR), one of the most valuable lidar franchises, are down about 59% over the past 12 months. Luminar’s stock sank 15% on Thursday on worse-than-expected earnings and a guidance cut.
The more difficult operating environment is one reason Ouster and Velodyne merged in February. That deal has yielded material cost savings. In the third quarter of 2022, Velodyne spent some $32 million in operating expenses. Ouster spent about $47 million. That’s roughly $79 million combined. Operating expenses for the combined companies amounted to roughly $58 million in the quarter, some $21 million lower.
Ouster management says cost savings could eventually amount to about $30 million a quarter.
The company ended the quarter with about $202 million in cash on its books. The company used some $30 million to build its business in the third quarter.
Gross profit margins came in at about 13%. Management wants them to be 35% to 40% in about 18 months.
Write to Al Root at allen.root@dowjones.com
Read the full article here
