Robust offering of Ouster and Velodyne products
to serve current and prospective customers
Innovative digital lidar technology roadmap and
new software solutions to catalyze growth
Strengthened financial position with over $315
million in combined cash and expected annualized cost savings in
excess of $75 million1
Ouster (NYSE: OUST), a leading provider of high-resolution
digital lidar, and Velodyne, a global player in lidar sensors and
solutions, announced the successful completion of their merger of
equals, effective February 10, 2023. The combined company will keep
the name Ouster and continue to trade on New York Stock Exchange
under the ticker “OUST.”
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The merger creates a lidar powerhouse with over 850 customers
spanning the automotive, industrial, robotics, and smart
infrastructure industries supported by a robust product portfolio
of innovative hardware and software solutions in addition to
top-tier engineering and commercial teams. Following integration,
the combined Ouster expects to retain approximately 350 employees
with its headquarters in San Francisco and key offices across the
Americas, Europe, and Asia-Pacific. The merger is expected to drive
significant cost synergies and value creation for the combined
company and its stakeholders.
Key Strengths of the Combined
Company:
- Robust product portfolio to serve current and prospective
customers, including Ouster OS and DF series sensors, Velodyne
Lidar sensors, and Ouster Gemini and Bluecity software;
- Expanded partner ecosystem and distribution channels to
accelerate market penetration;
- Innovative digital lidar roadmap and software strategy to drive
product adoption and new high-margin revenue streams;
- Extensive intellectual property portfolio with 173 granted and
504 pending patents, backed by over 20 years of combined experience
in lidar technology innovation;
- Strong financial position with a combined cash balance of over
$315 million as of December 31, 2022; and
- On track to exceed previously projected annualized operating
expenditure synergies of $75 million, compared to standalone cost
structures as of September 30, 2022, within 9 months.
“We’re thrilled to have completed the merger with Velodyne so
quickly, further boosting our financial position and our ability to
accelerate lidar adoption,” said Angus Pacala, CEO of Ouster.
“Together, we have an even stronger team backed by a healthy
balance sheet, new channel partners, and a wide selection of
positive-margin products to serve a diverse set of customers and
win more deals than ever before. We expect our innovative digital
lidar roadmap, amplified by exciting new software solutions, to
further expand our serviceable market and catalyze growth across
the business.”
Ouster will provide a comprehensive update on its integration
plans, including its product offering, technology roadmap,
manufacturing and operations footprint, commercial strategy, and
additional synergies across the business, on its fourth quarter
2022 earnings call.
Leadership and
Governance
Ouster’s executive leadership team is comprised of:
- Angus Pacala, Chief Executive Officer
- Mark Frichtl, Chief Technology Officer
- Mark Weinswig, Chief Financial Officer
- Darien Spencer, Chief Operations Officer
- Nate Dickerman, President of Field Operations
- Megan Chung, General Counsel
Ouster’s eight-member Board of Directors is comprised of:
- Dr. Ted Tewksbury, Executive Chairman
- Angus Pacala, Chief Executive Officer
- Susan Heystee, Lead Independent Director
- Virginia Boulet
- Ernest Maddock
- Karin Radstrom
- Kristin Slanina
- Riaz Valani
“The combined Ouster is stronger than ever, led by an esteemed
executive leadership team and Board with deep company, industry,
and financial expertise,” said Dr. Ted Tewksbury, Executive Chair
of Ouster’s Board of Directors. “Ouster is well positioned as a
global leader in lidar backed by the talent, products, and
technology roadmap to make performant and affordable lidar
solutions pervasive, while accelerating time to profitability and
enhancing value for stockholders.”
Transaction Details
Velodyne shares ceased trading on the NASDAQ after market close
on February 10, 2023, and each Velodyne share was exchanged for
0.8204 shares of Ouster common stock.
Barclays served as financial advisor and Latham & Watkins
LLP served as legal advisor to Ouster. BofA Securities, Inc. served
as financial advisor and Skadden, Arps, Slate, Meagher & Flom
LLP served as legal advisor to Velodyne.
Fourth Quarter and Fiscal Year 2022
Earnings
Ouster expects to report its financial results for the fiscal
year and fourth quarter ended December 31, 2022 after the market
closes on Thursday, March 23, 2023 and will host a conference call
that day at 5:00 p.m. ET to discuss its results.
As previously announced, Ouster achieved its fiscal year 2022
guidance of $40 to $55 million in revenue and 25% to 30% in gross
margins. Additionally, Velodyne exceeded its fourth quarter 2022
guidance of $13 million and $15 million in billings2 and $12 to $14
million in revenue.
Financial Disclosure
Advisory
Ouster reports its financial results in accordance with U.S.
generally accepted accounting principles. All financial data in
this press release is preliminary and represents the most current
information available to Ouster’s management, as financial closing
procedures for the year and fourth quarter ended December 31, 2022
are not yet complete. Actual results may differ materially from
these estimates as a result of the completion of normal year-end
accounting procedures and adjustments, including the execution of
Ouster’s internal control over financial reporting, the completion
of the audit of Ouster’s and Velodyne’s financial statements for
the year ended December 31, 2022 and the subsequent occurrence or
identification of events prior to the formal issuance of the fourth
quarter and annual financial results.
About Ouster
Ouster (NYSE: OUST) is a leading global provider of
high-resolution scanning and solid-state digital lidar sensors,
Velodyne Lidar sensors, and software solutions for the automotive,
industrial, robotics, and smart infrastructure industries. Ouster
is on a mission to build a safer and more sustainable future by
offering affordable, high-performance sensors that drive mass
adoption across a wide variety of applications. With a global team
and high-volume manufacturing, Ouster supports over 850 customers
in over 50 countries. Ouster is headquartered in San Francisco, CA
with offices in the Americas, Europe, Asia-Pacific, and the Middle
East. For more information, visit www.ouster.com, or connect with
us on Twitter or LinkedIn.
Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. We intend such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements contained
in Section 27A of the Securities Act of 1933, as amended (the
“Securities Act”) and Section 21E of the Securities Exchange Act of
1934, as amended (the “Exchange Act”). Such statements are based
upon current plans, estimates and expectations of management that
are subject to various risks and uncertainties that could cause
actual results to differ materially from such statements. The
inclusion of forward-looking statements should not be regarded as a
representation that such plans, estimates and expectations will be
achieved. Words such as “anticipate,” “expect,” “project,”
“intend,” “believe,” “may,” “will,” “should,” “plan,” “could,”
“may,” “continue,” “target,” “contemplate,” “estimate,” “forecast,”
“guidance,” “predict,” “possible,” “potential,” “pursue,” “likely,”
and similar expressions are intended to identify forward-looking
statements, though not all forward-looking statements use these
words or expressions. All statements, other than historical facts,
including statements regarding Ouster’s anticipated cash position
and cost savings; anticipated customer base, expected number of
employees, and anticipated strengths and benefits of the combined
company, are forward-looking statements.
All forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially
from those that we expected, including but not limited to risks
related to Ouster’s limited operating history and history of
losses; the negotiating power and product standards of its
customers; fluctuations in its operating results; supply chain
constraints and challenges; cancellation or postponement of
contracts or unsuccessful implementations; the ability of its
digital lidar technology roadmap and new software solutions to
catalyze growth; the adoption of its products and the growth of the
lidar market generally; the merger may involve unexpected costs or
liabilities; the effect of the merger on the ability of Ouster to
retain and hire key personnel and maintain relationships with
customers, suppliers and others with whom Ouster does business, or
on Ouster’s operating results and business generally; challenges
with the integration of the combined company; the outcome of any
legal proceedings related to the merger; Ouster’s ability to grow
its sales and marketing organization; substantial research and
development costs needed to develop and commercialize new products;
the competitive environment in which Ouster operates; selection of
Ouster’s products for inclusion in target markets; Ouster’s future
capital needs and ability to secure additional capital on favorable
terms or at all; its ability to use tax attributes; Ouster’s
dependence on key third party suppliers, in particular Benchmark
Electronics, Inc., and manufacturers; Ouster’s ability to maintain
inventory and the risk of inventory write-downs; inaccurate
forecasts of market growth; Ouster’s ability to manage growth; the
creditworthiness of Ouster’s customers; risks related to
acquisitions; risks related to international operations; risks of
product delivery problems or defects; costs associated with product
warranties; Ouster’s ability to maintain competitive average
selling prices or high sales volumes or reduce product costs;
conditions in its customers’ industries; Ouster’s ability to
recruit and retain key personnel; Ouster’s use of professional
employer organizations; Ouster’s ability to adequately protect and
enforce its intellectual property rights; Ouster’s ability to
effectively respond to evolving regulations and standards; risks
related to operating as a public company; risks related to the
COVID-19 pandemic; risks related to certain of Ouster’s warrants
being accounted for as liabilities; and other important factors
discussed in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2021, as updated by the Company’s most recent
Quarterly Report on Form 10-Q and as may be further updated from
time to time in the Company’s other filings with the SEC. Readers
are urged to consider these factors carefully and in the totality
of circumstances when evaluating these forward-looking statements,
and not to place undue reliance on any of them. Any such
forward-looking statements represent management’s reasonable
estimates and beliefs as of the date of this press release. While
Ouster may elect to update such forward-looking statements at some
point in the future, it disclaims any obligation to do so, other
than as may be required by law, even if subsequent events cause its
views to change.
1 Cash balance includes, cash, cash equivalents, restricted cash
and short-term investments as of December 31, 2022; expected
annualized cost savings in excess of $75 million are based on
standalone cost structures as of September 30, 2022.
2 Billings represents the dollar value of products and services
provided during the current period and invoiced to the customer.
Velodyne management used this metric to track commercial growth,
establish performance targets and make budgetary and operating
decisions. Billings excludes the effect of the contra revenue
recognized in connection with the Amazon warrants.
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version on businesswire.com: https://www.businesswire.com/news/home/20230213005229/en/
For Investors Sarah Ewing investors@ouster.io
For Media Heather Shapiro press@ouster.io
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