Arbe Robotics Expands AI Radar Push as It Targets Defense, Drones and Robotaxis

Key Points

• Arbe Robotics is expanding beyond automotive radar into defense, drone detection, security, industrial robotics, marine navigation and other physical-AI applications, where its high-resolution radar can operate in poor weather and low-light conditions.
• The company has begun producing complete radar systems itself for lower-volume nonautomotive programs, while continuing to supply chipsets to automotive partners. It cites opportunities including U.S. robotaxis, Chinese autonomous delivery vans, an Army off-road logistics program and radar capable of detecting small drones beyond 500 meters.
• Arbe expects robotaxi adoption to scale around 2028–2029 and forecasts $4 million–$6 million in current-year revenue with adjusted EBITDA losses of $28 million–$30 million. Management says its $42 million cash balance should fund operations to breakeven in 2028, despite projected quarterly cash burn below $7 million and $6 million.

Arbe Robotics NASDAQ: ARBE is expanding commercialization of its ultra-high-resolution radar technology beyond automotive applications, targeting physical AI, autonomous vehicles, defense, security, drones and marine markets, President and Co-Founder Kobi Marenko said during an Equity Sustainability presentation.

Marenko said the company’s radar systems are designed to provide environmental perception in weather and lighting conditions that can limit cameras, including rain, fog, snow and nighttime conditions. He said radar also provides velocity information and can detect objects at long range, capabilities he described as important for autonomous movement by vehicles, robots and drones.

“Physical AI needs reliable real-world perception,” Marenko said. “We are the sensor for that that can work in any weather, any lighting conditions.”

Technology and Business Model

Arbe produces radar semiconductor chipsets, including radio-frequency transmitter and receiver components and a proprietary processor. Marenko said the company’s processor can handle substantially more radar channels and points than competing systems, creating a dense point cloud that can be combined with camera data and AI software.

For automotive customers, Arbe sells chipsets to Tier 1 suppliers, including Magna in Western markets and HiRain in China. For non-automotive applications, the company is manufacturing complete radar units itself. Marenko said the decision reflected slower-than-expected timing for automotive adoption and the limited interest of Tier 1 suppliers in lower-volume non-automotive programs.

“The automotive will take longer than expected, and in order to survive, we must produce the radar by ourselves,” Marenko said. He added that Tier 1 suppliers typically work at volumes in the millions, while certain defense and industrial opportunities may involve thousands or tens of thousands of units.

Arbe began shipping full radar systems from its own production line by the end of the second quarter, according to Marenko. He said automotive chipsets sell for approximately $80 in high-volume production, with gross margins above 50%, while full radar systems for other applications sell for roughly $1,000 per unit at lower volumes.

Automotive, Defense and Civilian Opportunities

Marenko identified automotive, defense and homeland security, and civilian or industrial uses as Arbe’s three primary verticals. The company has radar-equipped robotaxis operating in the U.S., an autonomous delivery-van program in China, and a European autonomous-truck program, he said.

In the U.S. robotaxi program, Marenko said approximately 100 vehicles are driving with Arbe radars to collect data and support improvements in the customer’s algorithms and software stack. He did not identify the customer.

In China, Arbe has begun shipping chips for a program with HiRain, and Marenko said HiRain is expected to begin shipping radars for autonomous delivery vehicles by the end of the quarter. The program is expected to begin with small self-driving delivery vans and could later expand into higher-end robotaxi applications, he said.

Arbe also cited defense applications including drone detection, perimeter security and autonomous military logistics vehicles. Marenko said the company, alongside Forterra, won a U.S. Army contract involving autonomous supply-chain trucks operating off-road. He said Arbe’s radar can detect small drones at distances of more than 500 meters.

Other cited applications include traffic management, delivery robots and autonomous yachts. Marenko said Arbe won a contract with a yacht manufacturer to support autonomous navigation back to port while detecting swimmers.

Autonomy Timeline and Financial Outlook

While autonomous-driving development has taken longer than many anticipated, Marenko said recent advances in AI models and computing capabilities could support broader deployment over time. However, he said he expects robotaxis to begin scaling around 2028 and 2029, while adoption by traditional passenger-vehicle original equipment manufacturers may take longer.

He said OEMs are likely to be more conservative than robotaxi and mobility-service providers because of liability concerns associated with autonomous driving.

Arbe said it moved from development into production by the end of last year and began generating revenue early this year. Marenko said revenue has increased by more than 50% quarter over quarter since then, though he did not provide revenue figures for individual quarters.

• Full-year revenue guidance: approximately $4 million to $6 million.
• Adjusted EBITDA guidance: negative $28 million to negative $30 million.
• Cash balance: $42 million as of the end of the quarter discussed.
• Expected cash burn: less than $7 million in the third quarter and less than $6 million in the fourth quarter.

Marenko said the company believes its cash position can support operations until it reaches breakeven in 2028. He said Arbe is targeting about $10 million in revenue next year and then approximately $25 million to $30 million in the following year, based on existing customer programs and potential additional defense customers. The company is seeking to add one or two defense customers by the end of the year, which Marenko said could contribute to revenue in the second half of next year and more significantly in 2028.

Arbe has about 120 employees, primarily based at its research and development center in Israel, with sales and support operations in Germany, China and the U.S. Its manufacturing partner is GlobalFoundries under a long-term strategic manufacturing agreement, Marenko said.

About Arbe Robotics (NASDAQ:ARBE)

Arbe Robotics Ltd. is a technology company specializing in high-resolution 4D imaging radar solutions for the automotive industry. The company's radar platform is designed to enhance advanced driver-assistance systems (ADAS) and support the development of autonomous vehicles by providing detailed object detection, precise range and velocity measurements, and accurate environmental mapping under diverse driving conditions.

Founded in 2015 and headquartered in Tel Aviv, Israel, Arbe Robotics has developed its own semiconductor chipset and accompanying software stack.

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