storage sub-sector, one that I co-cover with my colleague, Mark Schuter. So I have Raj Talluri, who's CEO of Enovix. I know many of you are already familiar, but yeah, Raj comes, you know, with an impressive industry background, having worked at Qualcomm. I think, actually, Raj, you and I crossed paths when I was at Acuity Brands, and you were over at Qualcomm, and then you went to Micron. So Raj has a ton of experience in the handset industry, developing the chips that enable a lot of the phones today. And, you know, maybe to put words in your mouth, Raj, you kind of, if I understand it, you know, in our discussions, saw an opportunity where the energy density or the battery was going to fall short of what the - you know, to continue to allow the handsets to deliver what they needed to deliver. And that was really the deciding moment to kind of come to Enovix. And before I get into, you know, stock, et cetera, maybe if you just want to frame a little background on, you know, Enovix, and you've been here for eighteen months, and maybe a good place would be, like, what have you... You know, what's the experience been? What's kind of gone better than expected? What's surprised you to the negative over that eighteen months? And then I'll frame sort of the stock in a minute here. Yeah, absolutely. Thank you, and thank you, Jed, and thank you all for the listeners who are come listening in. Yeah, I, as you were saying, you know, I spent, you know, sixteen years at TI, nine years at Qualcomm, and five years at Micron. Almost, you know, thirty years in the industry, mainly working on smartphones and other consumer electronic devices, making processors, you know, memories, NAND devices, DRAMs, and so on. Over that period of time, you know, made a lot of advance- you know, we made a lot of progress as an industry in the chips that actually power the smartphones. You know, from multi-core processors to graphics engines to, you know, DSPs and so on. And the DRAMs and NANDs have tremendously grown in performance and storage capability. But one thing I realized towards the later part of my career was that, the battery hasn't kept up, while all these processors and memories are delivering the performance. In fact, it's not kept up, and almost to the point where it's throttling the performance of the processors and the memories and the displays. So the users are not really getting what they paid for because they're not able to use the chips to the full performance capability, otherwise the battery would die very fast. So I thought a good opportunity for me is to work on improving the battery. And Enovix is a company that I came across. Very exciting technology. They, we make batteries where we are able to replace the graphite in the anode with 100% active silicon. That gives us the ability to, you know, deliver much higher energy density than a traditional graphite battery. And that's the exciting part. A lot of interest from our customers on that product, and we are in the early stages of actually just beginning to build the factories and getting the ramp ready. We've made some samples, and the customers like the samples we gave. That's kind of where we are. And as you're saying, I think I've been here, like, eighteen months now. I started January last year. Been a very exciting journey. You know, a lot of changes. You know, I was able to bring in a strong leadership team and people I worked with before. We built a brand-new factory in Malaysia. We can talk about that in a little bit. Very excited by the new factory we built. We were able to build an R&D center in India to work on battery technology and kind of refocus the roadmap of the products to really go after places where the increase in energy density really matters to the end product. You know, these are places like smartphones that have a big display, that are starved for the battery life, and so on. So, and we were also able to acquire a company to get our own capability to make our own electrodes by doing the coating, you know, in Korea. So been an exciting eighteen months. Couldn't be more pleased with where the company is now. Probably in the best strategic position it's ever been. Great. So, I guess housekeeping, we don't have the live Q&A function. I have received a bunch of questions from a lot of people that are on the call, so we'll try and get to them. I thought, you know, maybe the most logical way to frame a lot of the questions, and particularly the pressure on the stock. You know, I just came from Penang and was pleasantly surprised by what you guys have been able to do in a short period of time. But if I kind of break it down into maybe three sections, first is the technology. Either the market doesn't believe in the technology, so I want to dig into sort of, you know, the technology and more on the energy density and the silicon aspect and your ability to deliver, because Penang's really critical to that. Or second point is kind of your ability to execute on delivering that technology, and within a window of opportunity. You know, there's a lot of companies that have great technologies, but if they can't deliver within the timeframe, right? Then it doesn't really matter. So, you know, want to unpack some of those milestones, including yields, et cetera. And then lastly, you know, resources, your ability to kind of tie one and two together. So maybe just starting with the first, if you will, on the technology and maybe the difference between. There is some consternation around, you know, adoption of EX-1M versus EX-2M. Maybe just talk about Penang, and then the ramp of the materials and some of those milestones. I know there's a lot there, but that might be a good place. Yeah to start. Yeah, absolutely. Absolutely. Yeah, so basically, you know, what I realized after I came on board is that what the customers, the cell phone customers really wanted was a much larger battery. We were making small batteries in Fremont. They needed a battery that's much bigger, and they wanted this battery to go to eight hundred to a thousand cycles. That's how many number of times you can charge the battery, right? And they also wanted the ability to fast charge. You know, they wanted to charge for, like, twenty minutes and, you know, get to quite reasonable amount of charge. They can, you know, go on about their daily lives because the batteries are running out of charge very quickly because of all the applications in the phone. We had a technology that produced very good energy density, very competitive compared to what's in the market, but we had to improve on this fast charge capability and also on the cycle life. So we started this technology node, I will use that word, called EX-1M, where we are working on improving the energy density, improving the fast charge capability, and also improving the cycles. And that's the first technology that EX-1 was our previous technology, which was probably more aimed at wearable, smaller, five hundred cycles, and so on. And that technology, we got some cells out here in Fremont to see that you know, we find the right chemistry that can do those things. And we were quite pleased with the cells we got, so we actually, you know, shut down our Fremont facility and, you know, meanwhile, our Malaysia facility was coming up nicely. So that's where we migrated the technology to, and that's where we are now making the first EX-1M cells. We have a line called the Agility Line, and that's the line that can make different size batteries, so we are able to exercise that line to actually make these EX-1M batteries. And we are on track to actually, you know, as I mentioned on the last call, to deliver those samples to customers in this quarter, so which is September tenth, today, I guess, September twelfth. So by end of this month, we're on track to do that. I'm pretty pleased to say that things are going well there. Then we have the next node of the technology, which is the EX-2M, which improves on the energy density capability because we're now able to change the material that's used inside. The exact same machines, the exact same factory. We make some optimizations to electrolyte, we make some optimizations to the cathode, and so on, and we are able to get higher energy density. We built a few EX-1-2M, that's the technology we call cells here in Fremont, before we shut the factory down. But to prove to ourselves that we can get that higher energy density, which is, you know, 20%-30% higher than the phones that are shipping in the market today. that we expect to get the first samples towards the end of this year. The EX-1M is what we'll be sampling to our customers, and we hope to get that to production, you know, next year. You know, the battery industry typically takes between nine and 12 months from the time you get the samples to the time it goes to production, so we're looking at phones in latter part of the year. And- Now, there's a few IoT devices that could launch sooner, but the phones will take much longer. Yeah, I was gonna just say that, so having been in the clean rooms in the fab in Malaysia, the Agility Line is located right next to the high volume line. So the materials that you're sampling, it's really a very similar process, just higher volume and it's you know lower cost is a function of running that higher volume and the materials through that. Is that appropriate, or? That's right. So the kernels of the machines are actually the same between the Agility Line and the high-volume line. It's just that they run, the machine runs faster- Mm ... and we have conveyances that make it go through faster. So hopefully, you know, the customers will like what we gave them from the Agility Line. And then, what happens typically in this journey is when they test these cells, they give us requirements of a size of the battery that they would like to, for us to make. These are custom dimensions. And, you know, Penang factory opening was a great success. You know, you were there, and many of the other analysts were there. We had over thirty customers come through the line and saw the factory tour. The Malaysian government was there. Huge success, a lot of excitement. In fact, one of the cell phone customers that came, you know, visited us were pretty excited by it. They were saying they've never seen a factory like this built up so quickly. You know, in less than a year, we got it up there, and you know, I've also been saying that because of the demands of the market, people want higher and higher milliamp hours or higher energy density in the phones. Pleasantly surprised to see now we've got a requirement from customers who visited the factory for a seven thousand milliamp hour battery for launch next year. I mean, just think about that. It used to be, like, three, four, five, and that's because the applications are demanding more and more energy. Mm. But they want to do it the same size, so the phone doesn't become bigger, and that's where the advantage we have. We are able to deliver that kind of capacity in a smaller form factor, and that is super exciting. And I think that'll only keep going up. And as you know, that's a nice tailwind for us because the more milliamp hours we deliver, the higher the ASP and the more the value we bring in. So, Raj, maybe tie that back to the recent Apple launch of the 16, right? Apple, you know, is offering a lot more features and functionality in the phone. The battery, I think, went up by. Was it 5% or 15%? Wasn't a tremendous increase. So, you know, thoughts on being four-wall constrained in the. You know, you saw it on the Pro or Max Pro. They're increasing the size. Maybe that's a function of trying to get more power in the battery, I'm not sure. Just your thoughts on that announcement and how it relates to your overall thesis here in the, you know, with the energy density. Yeah, I mean, I think the biggest thing is, you know, you can see, not just Apple, we saw Samsung do this, we saw many of the Asian smartphones do it. You know, they're integrating, basically the AI functionality into the phone, right? I mean, you're able to speak now and rewrite your messages properly. You can just say it, and writes it, formats it differently. And, you know, just the whole generative AI is integrated into every aspect of the phone. That's what people are trying to do. That just takes a lot of battery, and that's why people are having to put bigger batteries in phones. And the other thing is, you know, we're all used to using, you know, this generative AI stuff by operating it in the cloud, but people don't wanna do that because people want the searches and messages they write to be personal and private. So you have to do this on the edge, on the device, which basically draws a lot of lot of energy, and that's why you see everybody putting a bigger and better battery, and that's kinda what we're seeing even with the Apple launch, that the demands on the processing are so high that you have to put more and more energy density. And the problem is, you just can't make the battery size bigger and bigger because there's no more space to put in. So that's why I think, technology like what we provide, where in the same space, we are able to replace the material, like graphite with silicon, gives us the opportunity to produce, you know, much better battery. So, Raj, if I'm an investor, and as an analyst, what are the key milestones that the people should be looking at with respect to the technology? You know, is this a function of MOUs that you're gonna be announcing? Is it a function of, you know, is it just looking at the results? Like, what are the proper milestones to be looking at to set expectations over the next year or so to make sure that you're on track or ahead, or behind? Yeah, I mean, I, you know, I think the milestones come in, in, I would say, couple of different ways. You know, one is manufacturing milestones. I mean, one of the questions that's always been asked about this company is, can we manufacture this technology at scale, right? So, you know, for your viewers, the way we do this is, we have to first build the machines like with through our suppliers. These are custom machines, and as you saw in Penang, and the machines make the batteries. So because we make the batteries differently from the traditional battery manufacturers, that we actually slice the anodes and cathodes into really thin strips and stack them, one of the questions that's asked many times is, "Can these guys make them? Can they make them, you know, at volume, at scale, you know, with the right yields, and so on?" So I think that is a milestone that people are interested. So we gave kind of a way to track that by things like FAT, SAT, which is factory acceptance and site acceptance, and which basically means we test the machines to make sure they are performing at the right yields and the right throughput before we accept them from the vendor, which is what we call factory acceptance, and we've done that for our machines. And then the next big milestone is site acceptance, where we have to put all these machines together and produce them in our factory at the right yield and the right throughput. So those are milestones that we will continue to communicate through the year. I think that's one. And the second milestone is, you know, our ability to sample the batteries to the key customers, right? I mean, I think ultimately, once you get the factory, we gotta make the batteries and give it to the customers, and we will continue to communicate that. And the third one is, agreements we get with customers. I mean, you know, I know many investors would like for me to announce who the customer is and, you know, say the name publicly, but, you know, early-stage company like us, who's trying to get into a market, the customers already have an incumbent player that they're using. It's very rare for them to actually say, "We are using this battery" way before, and that comes much closer to production, which is how it's typically been. But you know, but we are able to announce that we've got an agreement with them. We're able to say that it's a joint development agreement. There's a timeline in which we'll get there. We had announced one with the smartphone OEM. We announced one with an AR/VR headset OEM, and so on. You know, we are super close now to announcing another smartphone OEM agreement, and any time now that we are in the middle of discussing that. So I think those are all milestones that actually give people confidence that we are actually going in the right direction. Of course, the ultimate milestone is we got the purchase order, and we got phones in the market, but that typically takes just, like, you know, just a month or two before production. Got it. You know, maybe just to go back to the first milestone in terms of any update on yields at Agility and, you know, what gives you the confidence that you'll be able to transition from Agility to high volume? Right ... at, you know, yields that would allow a cost basis so that you can continue on the, you know, adding those customers? Absolutely. So, you know, when we built batteries in Fremont, you know, when I first came on board, our yields were very low, and we worked on that pretty hard. And when we shut the Fremont factory down, we've gotten the yields up quite high, and, you know, not high enough for high-volume manufacturing, but high enough to know that this is a manufacturable process. You know, we got it up to, like, 60+% cumulative yields. And at that time, we felt, "Okay, we know, we know that this is doable." And then, when we did the FAT acceptance, we made sure that each machine was producing at the 90+% yield, which is our FAT acceptance criteria. We had mentioned that when we put all of them together, you know, the yields will start from where we left off in Fremont, and they steadily get higher. By end of this year, we expect to get our Agility Line yields to 90+%. I think that is something that should give a lot of confidence to the investors that we are on the right track. Since the Agility Line equipment is pretty much the same as the high-volume equipment, just runs it much faster. It's really a question of translating those yields into higher throughput. We have some more time. We have more time to get the high-volume line into its full capability, because, like I said, the production is going to be later part of next year, so we do have time to work on that. Our focus is mainly on getting the Agility Line to produce the right kind of batteries now so we can sample the customers. Now, I was just there, in the high volume, two of the three lines at the time were actually running. Yep. You know, any update? Is the third, I think it was the second of the three, is that running? And you know, that would seem to be slightly ahead of schedule, given the fact that you're you know, you would still be doing any kind of qualification, and everything's running off of Agility right now. Yeah, it's doing well. We like the progress. We like where it is. In fact, we are going to make one of the large cells, which is a five-plus milliamp hour cell, on the high-volume line this year, just to prove out that we can scale. Because the current cell we are making is a 3.4 ampere kind of thing, cell, a milliamp hour cell, but a 3,400 milliamp hour. But we're going to make a five amp hour cell, five-point-plus amp hour cell, a bigger cell, on the high-volume line to prove that out, before the end of the year, and that'll be another nice milestone, because that shows that we can make larger cells, and we can make them on the HVM line. Got it. And now, on high volume, you're gonna ramp the first line that you talked about next year. But then you have the ability to add two or three more lines on top of that one. Any update on timeline, or is that more customer-dependent? Oh, I guess my dogs wanted to chime in on that one, too, so sorry. But any update on... You know, is that, if you have a slew of customers that come in, does that accelerate that timeframe in terms of pulling in line two through four, or are those pretty much set at this stage? What we did, as you saw, is we built a factory that's got the space and the facilities, you know, facilitated to run up to four lines. We built it assuming that, you know, we will need to get up to there. We only purchased one line right now. Again, the line is made up of, you know, multiple zones, so zone one being the laser, zone two being, you know, the stacking and constraint, and zone three being E-Fill and pouching, and then, the zone four being where we form the battery. We do have the ability to add to any of those zones, you know, independently to scale it up. We don't have to buy an entire new line. Doesn't mean we have to buy it all at once. So we do have some flexibility there, you know, depending upon how we want to manage our throughput. But the most important thing to me is we need to, you know, kind of de-risk the technology, both with customer qualification and proving out the line is running at high speed. And that's when, you know, we'll feel confident to add more lines. But we are working with our suppliers right now to make sure that we get the lead time right, and so on. But again, I think we will manage that, you know, in line with the customer qualifications and in line with the demand so that we're building, you know, just, you know, correctly matched to it. Got it. So that, I mean, that's a good segue into the third point, you know, that I think framing from a stock perspective, resources, which you touched on a little bit here. You know, you wound down Fremont, and that's reduced your cash burn. Do you have the capital to ramp line one without any additional capital? Or, you know, talk about resources that you have and what that means with respect to ramping these lines, and what's available to you. Yeah. We have the cash to completely pay for line one and go through well into 2026, so we've done that. We did a convert last year, and then also we, you know, we got our burn rate down quite significantly from where it was. And ramping in Malaysia, ramping in R&D in India helped with that. So that gives us the runway. And again, as the line gets qualified, as we get customers get qualified, we clearly have the ability to, you know, get financing from multiple sources for that lines. You know, like we've been talking to the Malaysian government. You know, they're interested. We've been talking to some customers, you know, if they're interested in that. And then, of course, you know, we'll be opportunistic on the capital markets. You know, again, at last quarter, I showed a slide on the line economics. You know, they're actually, as we reduce our cost of our lines, you know, the payback can be, like, as much as one year, so in which case there's lots of other options open up for, like, debt financing and things like that. Not so concerned about it. We actually do have the runway right now to produce the batteries and get the customers to qual. But to be clear, you can prove out the technology, with the runway that you have before- Yes ... you would need to scale it beyond that. I think that's an important point. Absolutely. Absolutely. We're totally financed to prove out the technology. Any update to any of the financial milestones? Or, is that still, you know, largely a function of the agility to high bandwidth or high volume ramp, or any thoughts? I'm just curious if the... if there's any that you wanted to update at this point. Not a lot on the financial side. I mean, I think we do have some revenue coming in through the acquisition we made, the Routejade company, which does coating, but also they sell graphite batteries that we are able to now find nice markets for that. That's actually been a nice tailwind for us. And, you know, being a North American battery supplier really helps us there. We get some revenue from NRE payments from customers, some revenue from samples, and so on. But as we start ramping is when I think the financial stuff will really come in. Raj, just, I guess this maybe more technology related. Critics of Enovix would maybe push back and say, "Hey, this is a David versus Goliath." If you look at the rest of the battery market, you're competing against much larger, better capitalized companies. How do you compete? How do you prevail and, you know, become the David in this metaphor here, and go against those that might be willing to actually take much lower margins? ATL comes to mind. Yeah, I mean, look, I mean, this is not a us versus them kind of story. I think, you know, if you look at the history of consumer electronics, and more importantly, the history of smartphones, and I've been associated for, like, 25 years, there's a lot of new technology that comes into that market all the time from new innovative companies. You know, fingerprint sensors, you know, just came in from, you know, someplace, right? And, you can see, like, things like stabilization in the cameras, things like, noise-canceling microphones, things like better displays, so new technology gets introduced all the time from innovative companies, in these markets, because ultimately, a new technology that provides, a consumer value is what the OEMs want. If you're able to produce a battery that's much higher energy density and meets all the other requirements, it's a great thing, and I think, you know, the customers want that because they can deliver that value to their customers. And, again, the market is so big. I mean, you know, 1,200 million smartphones shipped a year, 250 million PCs. Each PC takes, like, three batteries. And, you know, if you just look at a 5% market share for a small company like us, you're looking at, you know, 100 million batteries. So there's plenty of opportunity and plenty of market for multiple people. So it really is not about David versus Goliath as much as, you know, there's such a big market, we need more innovation for everybody to partake so that you can make the products better, you know. Got it. Raj, I wanna ask you a sensitive and somewhat personal question. But 10b5, you know, some mixed feelings around 10b5. So I'm wondering if you could just update on thought process in terms of, you know, have you been selling stock? Any plans to do that? If you could just update. That is a question that we do get from time to time here. Yeah, sure. You know, I lived in San Diego for a long time, and my home's actually in San Diego, but since I joined Enovix, I moved the family here, and we wanted to purchase a home in the Bay Area. It's pretty expensive here, the interest rates being high, so I needed some liquidity, so I was planning to use the 10b5 for that. But since then, I've changed my mind. I've actually canceled the 10b5 plan, so. That's canceled? I've not sold any stock. Totally committed to Enovix, and I'm here for the long haul. Great. You know, I could go on, you know, in more detail on the technology. But I just, I know we're bumping up against the five o'clock hour here. You know, in summary, it sounds like. You know, it sounds like from Agility, you're getting close to another customer announcement, and then, really, it's about ramping high volume as you go through the FAT and the SAT qualification. Any other milestone updates that you wanna highlight? It sounds like you have the cash in order to hit that runway, at least for proving out the technology. You've canceled your 10b5. Any other thoughts or something that I'm missing here? No. I mean, I think we covered a lot of ground, and I hope this is useful to the listeners. You know, I think the one thing I'll say is the main thing I was pleasantly surprised by is how fast the size and the milliampere-hours of the battery are moving. I thought the 7,000 will come, like, in 2026 timeframe. Now, I see people asking for a battery like that even in 2025 timeframe, which is really, really interesting. I always suspected that, you know, the performance of the phones is being throttled, you know, by the battery, but, you know, didn't realize that it's moving so fast that we needed to produce even bigger, which is a great, great thing for us. Also we are finding that in many other markets. I mean, they are, we are a headset market. I think that's actually another really exciting market. I've seen some prototypes of waveguide optics produce really, really nice-looking glasses. I think that's another area where, you know, the processors are on all the time, unlike a phone. The memory is on all the time. The display is on all the time. So there, it's even more important to have a high-performance battery, and we are finding some nice opportunities there. You know, very exciting times. I, you know, like I said, couldn't be, couldn't be more excited about where the company is and where the technology is. And, you know, people are impatient for me to announce customers, people are impatient for me to get the revenue up. But, you know, I gotta tell you this, batteries are something that you gotta test, you gotta make sure they're safe, and you gotta cut any corners because you don't want them, you know, in your phone without proper testing, which you carry on you all the time. So that's why people are super careful, and our customers are super careful, and we are super careful. But, you know, we'll make them, and make them steadily and make them at high quality for next year's ramp. Raj, I'm one minute over, but I think we got it in the time, so thank you very much. For all those on, which I know a lot of you, there's a lot of you there, we appreciate it, and thank you for the time, Raj, and thank you for the update. Yeah. Thank you, Jed. Really a pleasure talking to you. Bye-bye.