Innoviz Technologies (INVZ) TD Cowen's 54th Annual Technology, Media & Telecom Conference summary

Industry trends and technology evolution

• Lidar technology is gaining momentum in both automotive and non-automotive sectors, driven by the need for advanced perception in Physical AI systems that interact with the real world in real time.

• The automotive lidar market has matured, with clearer understanding of sensor requirements for safe autonomous driving and a robust ecosystem involving major players like Mobileye and NVIDIA.

• Non-automotive applications for lidar are expanding rapidly, including smart cities, infrastructure, construction, drones, humanoids, and especially security and defense.

• Security and defense sectors show the greatest urgency and market potential for lidar, with a total addressable market estimated at $10 billion or more by 2030.

• Lidar offers significant advantages over cameras and radars in challenging environments, such as perimeter security and drone detection, due to its high resolution and resilience.

Business model, partnerships, and market approach

• In automotive, high volumes drive revenue but also intense price pressure, with lidars sold at hundreds of dollars per unit.

• Security and defense markets allow for higher average selling prices (ASPs) and better margins, with units sold at thousands of dollars and shorter sales cycles due to urgent demand.

• The company operates as a Tier 2 or Tier 3 supplier in non-automotive sectors, providing lidar hardware and supporting software, while partnering with firms like Cogniteam for perception software.

• Software is sold as an add-on to hardware, contributing to recurring revenue streams through services and maintenance.

• The competitive landscape in automotive lidar has consolidated to just a few players, while automotive-grade lidar offers a strong competitive edge in security and defense.

Automotive market developments and product innovation

• European OEMs, especially German brands, are standardizing Level 3 autonomous features, while American and Asian OEMs are accelerating their efforts to catch up.

• Level 4 commercial applications, such as robotaxis and shuttles, are gaining traction globally, with new entrants and established OEMs investing in these platforms.

• The cost and maturity of lidar and supporting ecosystems are enabling broader adoption, with Level 3 features expected to move from high-end to mid-range vehicles over time.

• The InnovizThree product is designed for behind-the-windshield integration, offering a 35% cost reduction over its predecessor and strong positive feedback from OEMs.

• By 2030, projections indicate annual lidar unit sales could reach hundreds of thousands, potentially exceeding 500,000 units, contingent on program wins.