SES AI Corporation (SES) Q2 2024 Earnings Call Transcript
In the latest earnings call for the second quarter of 2024, SES AI showcased its strategic pivot towards AI-driven battery technologies, particularly in the areas of lithium metal batteries for electric vehicles (EVs), urban air mobility (UAM), and drones. The call, led by Kyle Pilkington, Chief Legal Officer, Qichao Hu, Chairman & Chief Executive Officer, and Jing Nealis, CFO, provided a comprehensive overview of SES AI's progress in integrating AI into its operations, focusing on manufacturing, safety, and scientific research.
A Strategic Shift towards Next-Gen Battery Technologies
SES AI's strategic move towards next-gen battery technologies was a focal point of the call. Qichao Hu emphasized the need for a paradigm shift in the battery industry, particularly in the face of incumbent battery players dominating the global market. SES AI's approach involves overcoming three key hurdles at commercial scale: quality, safety, and future material development. By leveraging its leadership in lithium metal and integrating AI into its operations, SES AI aims to revolutionize the battery industry.
AI for Manufacturing: Accelerating Commercialization
AI for manufacturing was a significant topic, with Qichao Hu highlighting the potential of AI in accelerating commercialization timelines by 10x. By using machine learning to define and fine-tune quality specifications based on manufacturing process data, SES AI can enhance manufacturing quality and optimize cell design. With the company producing over 1,000 cells per month and over 1,000 quality checkpoints per cell, the potential for AI to revolutionize battery manufacturing is evident.
AI for Safety: Enhancing Predictive Capabilities
AI for safety was another area of focus, with Qichao Hu discussing the company's efforts in pre-training a large language model with cell cycling data to predict battery remaining useful life and incidents. The ability to predict incidents 10-30 cycles earlier than traditional models is a game-changer, potentially preventing costly recalls and ensuring near 100% safety in the field.
AI for Science: Accelerating Material Discovery
Qichao Hu also highlighted SES AI's AI for science initiatives, particularly the Molecular Universe project, which aims to crowdsource computing resources to map the properties of small molecules. The goal is to accelerate material discovery for any battery problem, not just lithium metal, but also for lithium ion batteries and other applications. With the ability to find molecules that perform better than those discovered by human scientists in the past, SES AI is poised to lead the way in battery material research.
Financial Overview and Future Outlook
Jing Nealis provided an overview of SES AI's financial results for the second quarter, highlighting a focus on capital efficiency and attracting top talent. With a strong balance sheet, SES AI is well-positioned to navigate the challenges and opportunities ahead, particularly in the areas of AI for manufacturing and safety. The company's updated full-year 2024 guidance reflects a strategic focus on these areas, with a revised cash usage range of $100 million to $120 million.
Looking Ahead
The earnings call concluded with a forward-looking perspective, emphasizing SES AI's commitment to driving transformative change in the battery industry. With a focus on capital efficiency, attracting top talent, and leading the AI transformation of the battery industry, SES AI is well-positioned to capitalize on the opportunities presented by AI-driven battery technologies. The company's strategic pivot towards next-gen battery technologies, particularly in the areas of EVs, UAM, and drones, is a testament to its vision and ambition.
In conclusion, SES AI's Q2 2024 earnings call underscored the company's strategic shift towards AI-driven battery technologies and its commitment to revolutionizing the industry. With a focus on manufacturing, safety, and scientific research, SES AI is poised to lead the way in the development and commercialization of next-gen battery technologies, leveraging the power of AI to accelerate innovation and drive transformative change.