Embark Technology, Inc.

Embark did not report revenue or EPS on this call. Cash and cash equivalents were $191 million as of September 30, 2022. Free cash flow spend was $29.4 million in Q3 versus $24.7 million in the prior quarter, and year-to-date free cash flow spend was $74.1 million. Management reaffirmed full-year 2022 free cash flow spend guidance of $100 million to $115 million, which it said implies a current run-rate of around $27 million per quarter. The company also ended the quarter with 317 full-time employees.

Alex Rodrigues framed the quarter as proof that Embark is executing against the milestones it laid out at the start of the year and is building a product that can be handed to a carrier customer, not just demonstrated in-house. He emphasized safety, the experience of the Truck Teams, and the hiring of a new Head of Systems Engineering & Safety as part of a stronger safety organization. His tone was confident and forward-looking, repeatedly stressing that the company is simplifying the problem and preparing for commercialization in 2024.

Richard Hawwa focused on liquidity discipline and run-rate spend. He said the company had $191 million in cash and cash equivalents, Q3 free cash flow spend of $29.4 million, and year-to-date spend of $74.1 million, while reaffirming the $100 million to $115 million full-year guidance. He explained the quarter-over-quarter increase mainly by timing of cash payments, including about $5 million of annual prepayments, plus costs from moving employees into the new headquarters. He also reiterated that the company’s asset-lite model and prior spending reductions had extended runway and supported commercialization plans.

Analysts pressed management on how to think about cash burn into 2023 and the path to 2024 revenue. Embark said it has not given 2023 guidance, but pointed to the current around-$27 million quarterly run-rate as a useful baseline, with some timing-driven lumpiness expected. Questions also focused on the truck transfer program and when Embark would begin charging for technology; management said TTP is a limited vehicle program focused mainly on testing and learning, while driver-out commercialization is expected in 2024. On the coverage map, Embark said the nine transfer-point sites are mainly for future customer planning today, and management noted carriers are increasingly asking about adding private sites.