Innoviz Technologies Q2 Earnings Call Highlights

Key Points

• Record Q2 revenue reached $18.1 million, driven by higher non-recurring engineering revenue tied to customer milestones; gross margin returned to positive territory.
• Innoviz is expanding into defense and homeland security under its Perciz brand, including a $3.5 million initial order for counter-drone and perimeter-security applications. Management expects non-automotive revenue to grow to as much as 10% in 2026 and 20%–30% in 2027.
• Automotive programs with Volkswagen, Daimler Truck, Mobileye and a newly announced top-10 automaker continue advancing. Innoviz raised $30 million in gross proceeds and reiterated its 2026 revenue target of $67 million to $73 million, with funding expected to extend its runway into 2028.

Innoviz Technologies NASDAQ: INVZ reported record second-quarter revenue of $18.1 million as higher recognition of non-recurring engineering, or NRE, revenue tied to customer milestones helped lift results. The lidar developer also said it is expanding into defense and homeland-security applications through its new Perciz brand, citing an initial multimillion-dollar order and a growing customer pipeline.

Chief Executive Officer Omer Keilaf said the company’s automotive-grade lidar technology is being adapted for counter-unmanned aerial systems, perimeter security and unmanned ground vehicles. He said governments in Israel, the U.S., Europe and elsewhere are increasing spending to address emerging security threats, creating what Innoviz views as a multibillion-dollar addressable market.

Defense and Security Expansion

Innoviz said it received its first major defense order, valued at $3.5 million, for several hundred lidar units to be used in counter-UAS and perimeter-security applications. Keilaf said the systems have been installed and are operational in several locations, while the initial program could lead to larger volumes following its first deployment.

The company said six organizations have publicly announced engagements involving Innoviz lidar technology during the past three months. These include Drive Group, Regulus, Givon Defense, Cogniteam, AeroNous and Kela. Keilaf said Innoviz is also in active discussions with dozens of potential customers, including some that have purchased units for testing, development and integration.

According to Keilaf, Drive Group is targeting a $20 million sales opportunity by the end of 2027 through applications including drone localization, border security and critical-infrastructure protection. Innoviz said its defense offering can provide three-dimensional localization for small drones and support intrusion detection at distances of up to 1 kilometer in perimeter-security applications.

Keilaf said the defense business could complement Innoviz’s longer-cycle automotive operations because of shorter sales cycles, significantly higher average selling prices and potential gross-margin improvement. The company expects non-automotive sales to rise from 1% of revenue in 2025 to up to 10% in 2026, and to account for roughly 20% to 30% of revenue in 2027.

In response to an analyst question, Keilaf said booked defense and security business is approximately halfway toward the company’s non-automotive revenue target for 2026. He said management has “high confidence” that Innoviz can meet its goal for the year.

Automotive Programs Continue to Advance

Innoviz said its automotive programs remain on track, including work supporting Volkswagen’s ID. Buzz autonomous vehicle program and Daimler Truck’s Level 4 platform. Keilaf said ID. Buzz vehicles are being tested in Los Angeles, Orlando, Austin, Hamburg, Munich and Oslo with partners including MOIA, Uber and Beep. He added that passengers can already book rides in Hamburg as part of MOIA’s ALIKE project.

Mobileye has announced a robotaxi platform that uses nine Innoviz lidar units per vehicle, Keilaf said. He said the platform represents a potential opportunity of 150,000 units in addition to Innoviz’s existing programs with Mobileye, Volkswagen, Daimler Truck and others.

The company also announced a development project with a top-10 global automaker involving an InnovizTwo lidar-based perception stack powered by NVIDIA hardware. Keilaf said the newly disclosed OEM relationship is focused on Level 3 driving applications, while the automaker is also developing platforms targeting Level 4 autonomy.

He said revenue from the development effort will primarily consist of NRE payments and lidar sales, though Innoviz did not disclose the value of the project. The company expects the engagement to help establish a relationship that could later develop into a series-production program.

Keilaf said Innoviz is participating in multiple OEM selection processes, with decisions expected over the coming quarters. For programs with start of production before 2028, the company is offering InnovizTwo products. For later programs, it is also offering InnovizThree, which it said has a smaller form factor and lower power consumption designed for behind-the-windshield installation.

Financial Position and 2026 Outlook

Chief Financial Officer Eldar Cegla said second-quarter revenue benefited from increased NRE recognition as programs approached start of production. Gross margin returned to positive territory during the quarter, and the company expects full-year gross margin to remain positive, supported by defense shipments, NRE payments and automotive volume production.

• Second-quarter revenue: $18.1 million
• Cash used in operations and capital expenditures: approximately $15.2 million
• Quarter-end cash equivalents, short-term deposits and marketable securities: approximately $48.5 million
• Long-term debt: none
• Gross proceeds from a registered direct offering closed July 29: $30 million

Cegla said the $48.5 million quarter-end balance did not include the additional $30 million in gross offering proceeds. He said the company expects the financing to provide operational runway into 2028 and support commercialization of the Perciz defense and security business.

Innoviz reiterated its 2026 revenue target of $67 million to $73 million, driven by lidar shipments and NRE payments. Management expects the bulk of second-half revenue to arrive in the fourth quarter because of the timing of customer milestones and start-of-production programs. The company also maintained its goal of securing $20 million to $30 million in new NRE payment plans and adding two to three new programs during 2026.

Addressing a sequential decline in research-and-development expense, Cegla said the change was largely technical rather than operational, reflecting the reallocation of costs to cost of goods sold when NRE is recognized. He said the size of the company’s R&D organization was “practically the same” as it had been previously.

About Innoviz Technologies (NASDAQ:INVZ)

Innoviz Technologies Ltd. NASDAQ: INVZ is a developer of high-performance solid-state LiDAR sensors and perception software designed to support advanced driver assistance systems (ADAS) and autonomous driving applications. The company’s core business focuses on providing automotive-grade LiDAR hardware, along with software algorithms that enable accurate 3D mapping, object detection and environmental perception in real time. Innoviz’s technology is tailored for integration into passenger vehicles, commercial fleets and other mobility platforms seeking improved safety and autonomy.

Founded in 2016 and headquartered in Rosh Ha’ayin, Israel, Innoviz has emerged as a key supplier to leading global automakers and Tier 1 suppliers.

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