Greetings. Welcome to the Mobileye Q4 2022 business update. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I'll now turn the conference over to your host, Dan Galves. You may begin. Hello, everyone, and welcome to Mobileye's fourth quarter and full year earnings conference call for the periods ending December 31st, 2022. As a matter of formality, please note that today's discussion contains forward-looking statements based on the business environment as we currently see it. Such statements involve risks and uncertainties. Please refer to the accompanying press release, which includes additional information on the specific risk factors that could cause actual results to differ materially. Additionally, on this call, we will refer to both GAAP and non-GAAP figures. A reconciliation of GAAP to non-GAAP financial measures is provided in our posted earnings release. Joining us on the call today are Professor Amnon Shashua, Mobileye's CEO and President, and Anat Heller, Mobileye's CFO. Thanks, and now I'll turn the call over to Amnon. Thank you, Dan. Hello, everyone, and thank you for joining our earning call. 2022 was a really important year for Mobileye. We executed a successful IPO at a time when this was only possible for very unique companies. I see many benefits to being public again, but most important is we have already seen a big increase in visibility of Mobileye from our customers and partners, driven by more focus and attention by the broader media and analysts. This drives incremental business opportunities by amplifying attention on our advanced solutions, we think this plays into the incremental momentum we are experiencing. Financial results in 2022 were clearly very good. Revenue grew up by 35%, adjusted operating profit grew by 25%, and we generated almost $550 million of operating cash flow. More important than those headlines is that the source of our growth started to shift from pure volume to a combination of volume and higher content per vehicle. Our advanced products carry much higher price per vehicle than our historical products, and we saw clear evidence of that in 2022, where one-third of our revenue growth came from higher ASPs. In terms of future business generation, 2022 was a record year. Just in that year alone, we generated new business representing $6.7 billion of estimated future revenue at about $105 per unit on a content per car blended basis. This is about 3.5x our actual revenue in 2022 and double our current ASP. Overall, we estimate that our current book of business represents over $17 billion of total future revenue through 2030. As long as our new business wins continue to outpace our actual shipments in a particular year, this number will continue to grow. Also, to be clear, this number excludes our consumer AV and mobility as a service backlog. Beyond the high level numbers, we saw positive business trends across all business lines. The front-facing camera, single chip, ADAS business continues to run like a machine. We grew revenue with every one of our top 10 customers in 2022 and continue to win significant new business in this segment. A key development in 2022 is that many large volume ADAS platforms now have a variant that includes cloud-enhanced ADAS through our REM map. This volume will drive higher ASP and recurring revenue from the maintenance of the map. We also saw a very significant uptick in interest and secured volume in our Mobileye SuperVision product in all regions from both traditional and start-up OEMs, really across the board. There are many reasons for the increased traction. There is a big difference between a development product and a launched product. Launching Mobileye SuperVision with Zeekr in China was a major catalyst in driving interest from other OEMs. A program like Mobileye SuperVision is a major commitment from an OEM in time and capital. Offering a solution that is already in production means that the investment will result in a valuable product with high probability. This is very important in the current environment. Number two, we now have the ability to demonstrate the full feature set of Mobileye SuperVision anywhere, not just in Israel. Our REM maps now cover nearly all roads in the U.S. and Europe. As a result, we have been able to execute long-distance expeditions with carmakers, customers covering thousands of miles in both U.S. and Europe with little human intervention. This ability to show that the technology truly works everywhere has been critical in moving discussions to the decision phase. Mobileye's EyeQ Kit software development tool is another important development. The ability for an OEM to take Mobileye's truly differentiated assets like surround computer vision, REM mapping, and our decision-making software as is, but then customize the consumer-facing part of the system with their own software, is something we couldn't offer until recently. It has served as a catalyst for strategic partnership discussions for SuperVision and beyond with many of our OEM customers, particularly ones that began their own software development at the earliest. In the meantime, the competitive environment among OEMs has ramped up with Chinese automakers and Tesla benefiting from surround camera-based systems, both in profit and technology prestige. This is creating an overall sense of urgency among other OEMs to invest in wide operational design domain, eyes on, hands off the system that have high probability of success in terms of performance and validation. We expect SuperVision to be a very large growth driver in 2023 and beyond, and shared our expected volume forecast in our CES presentation, which is available at our IR website. This product also serves as a launch point for our eyes-off consumer AD product, Chauffeur. Because SuperVision operates across a very broad operational design domain, it makes the transition to a series of eyes-off ODDs an incremental and modular step instead of a series of moonshots. In other words, all the heavy lifting of describing the environment in great detail, the driving policy required to maneuver the car in any traffic scenario, and the requirement for high-definition maps covering all types of roads are all done in the SuperVision system. From here, adding redundancies to the perception system to take eyes on to eyes off becomes incremental work. The successful productization of SuperVision with Zeekr and this concept of modularity to eyes off has created a lot more interest from our customers to develop consumer AD products. Essentially, every SuperVision discussion we're having now is also including scope for a follow on Chauffeur eyes off program. We saw recent evidence in this with a premium European OEM, which kicked off a SuperVision program in Q4. During discussions, the scope of the program expanded to include a Chauffeur program that will launch in 2026 timeframe. The Chauffeur portion of this program alone represents an expected $1.5 billion opportunity through 2030. On mobility as a service, our plan continues to develop relationships on the supply and demand side, and then use our self-driving system to enable supply and demand to come together into a scalable business. We have many relationships on the demand side with transportation network companies and public transit operators. We also have engagements with three vehicle builders, which are developing purpose-built vehicle platforms that integrate our Mobileye Drive self-driving system. We expect to generate our first revenue in this business in 2023, and our supply side relationships have orders for self-driving systems that total an estimated $3.5 billion of future revenue through 2028. Overall, 2022 was the year where traction for SuperVision really accelerated, and this led to an increased interest from OEMs for eyes-off systems as well. Continuing the productization process of these solutions and supporting testing and launch, of course, requires resources. This is why our OpEx growth in 2022 was unusually high, and it will be again in 2023. This growth is supporting areas like growth in terms of teams to support SuperVision launches with OEMs, radar and lidar productization, and expansion of mobility as a service validation and testing site and development work of our next generations of EyeQ chips. I would note that approximately 70% of our R&D expenses is related to products that are either just beginning to generate revenue like SuperVision or are still pre-revenue like Mobileye Chauffeur, Mobileye Drive and the active sensor array product. Thank you. I now turn it over to Anat to go through the results. Thank you, Amnon. Thanks for joining the call, everyone. Before I begin, please be aware that all my comments on profitability will refer to non-GAAP measurements. The primary exclusion in Mobileye's non-GAAP numbers is amortization of intangible assets, which is mainly related to Intel's acquisition of Mobileye in 2017. We also exclude stock-based compensation and IPO-related expenses. Starting with a few words about the full year. Revenue growth of 35% year-over-year in 2022 continues our consistent track record of top line growth. Compared to 2018, our revenue is up 170%. Global production is down 13%. As Amnon mentioned, our advanced portfolio made a meaningful impact on average system price, which rose to $53 in 2022, up from $47 in 2021. That alone drove about 13 points of revenue growth in 2022. The increase in average system price was mainly driven by SuperVision as well as, to a lesser extent, the rise in chip costs which we passed along to our customers. The addition of SuperVision to our product mix led to a certain decrease in gross margin as we deploy a full system solution which contains higher hardware content. More importantly, SuperVision generates much higher gross profit per unit than our core EyeQ product. As a result, EyeQ and SuperVision combined gross profit per unit rose by 9% in 2022. Turning to Q4, revenue grew 59% year-over-year. Our EyeQ-related revenue was up 48% with the SuperVision product driving most of the remainder of the growth, despite being less than 1% of our overall volume. Q4 operating margin was 38%, up from 34% in prior year. This was above our guidance expectation due to a better than expected revenue growth, but also due to about $14 million of R&D expenses that we expected in Q4 but shifted to 2023. Turning to 2023 guidance. We are pleased that the midpoint of our guidance remains in line with internal expectations at the time of our October IPO, despite overall macro assumptions for 2023 coming down since then. On the revenue side, I'll give you a sense of our assumptions. Focusing on the high end, we are assuming EyeQ volume that is somewhat below the commitment that we've received from our customers for 2023. We want to remain conservative and acknowledge that the macro uncertainty remains elevated. That volume level corresponds to about 1% global production growth, 4-5 points of ADAS adoption growth, which is somewhat lower than the prior few years, and consistent market share. On the SuperVision side, we are assuming a bit more than 100% growth versus 2022, which was about 96,000 units. Demand is higher than this, but we are still experiencing some supply chain constraints in one particular component of the ECU. On the positive side, we have commitment forms from our suppliers at the level we are forecasting, including a second half run rate that supports our 2024 forecast as well. In terms of quarterly cadence, historically, our revenue has ramped up over the course of the year. This year is expected to be even more pronounced with around 41% of revenue expected in the first half of the year. On both the EyeQ and SuperVision businesses, volume and revenue are expected to be lower in Q1 2023 versus Q4 2022. This appears to be general conservatism on the part of our customers, as well as some impact from elevated purchases ahead of the EyeQ price increase that went into effect on January first. On SuperVision, the lower volume in Q1 and Q2 versus Q4 2022 is related to the key ECU component mentioned earlier. On the average system price side, we expect Q1 and Q2 to be a bit lower than Q4 due to the SuperVision constraints, but we expect to exit 2023 in the low $60, which is an excellent trajectory. On the operating income side, there's a few things to point out. Gross profit per unit will increase again year over year, but the percentage gross margin is expected to be down due to the higher mix of SuperVision revenue mentioned above. On the OpEx side, as Amnon mentioned, we will continue to invest heavily in our high ROI advanced portfolio, which is only beginning to impact our results. We estimate operating expenses to grow in the low 30% range in 2023 versus 35% growth in 2022. OpEx growth rate are expected to moderate in 2024, which combined with operating leverage, is expected to lead to higher operating margin during that year, also consistent with our internal expectation at the time of the IPO. Before taking your questions, I just wanted to thank my team and many others at Mobileye for supporting what is a pretty accelerated earnings timeline for a newly public company. Thank you. We will now take your questions. At this time, we'll be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using your ISP speaker equipment, it may be necessary to pick up your handset before pressing the star key. One moment please while we poll for questions. Our first question comes from the line of Itay Michaeli with Citi. Please proceed with your question. Great, thanks. Hello, everybody. Just two questions, one financial and one on SuperVision. On the financial, maybe for Amnon, hoping you can maybe talk about what you're expecting for gross margins, just in the kind of core ADAS and enhanced ADAS business in 2023. On SuperVision, hoping you could talk about what portion of customer engagements there are perhaps looking at a camera-only solution for SuperVision, as well as what you're seeing for the SuperVision light offering versus the full ODD SuperVision offering. Thank you. Oh, yeah. On the EyeQ side, we are seeing consistent growth margin through 2023. On the SuperVision side, we're seeing approximately 35% for this year. I'll add a bit more that with the Mobileye SuperVision that there are two drivers to increase our gross margin there. One is efficiency of production. We're creating a new version, an Evo version, which with the lower cost to increase our margin. Second is the customer bundles. The launch of the Mobileye SuperVision in China, at the moment, it's highways. The urban and arterial roads will be unlocked during 2023, that would also increase our revenue per content per car, and of course, naturally will increase the gross margin. We are targeting reaching between 50%-60% the gross margin of the Mobileye SuperVision, kind of in the long run. In terms of your second part of the question about camera-only, Mobileye SuperVision is a camera-only, plus a front-facing radar. For example, on the Zeekr vehicle, there's a front-facing radar as well. Although we can satisfy all the functionality without the radar, but having a front-facing radar adds another element of redundancy which can improve the MTBF of the system. In terms of SuperVision and Lite, this is a product offering which has been done very recently, so we don't yet have a traction for it. All the traction that we have, and is growing, is for the full SuperVision with two EyeQ, EyeQ6 and the full camera suite. Perfect. That's all very helpful. Thank you. Thanks, Itay. Our next question comes from the line of Mark Delaney with Goldman Sachs. Please proceed with your question. Yes, thank you very much for taking the question. With respect to the opportunity for Mobileye with some of your more advanced solutions like SuperVision, can you elaborate a bit more on the breadth and depth of the discussions you're having with OEMs to use those products relative to, say, 90 or 180 days ago? If you're seeing that traction improve with just a few programs in OEMs or if perhaps it's broader based. As we said, we have now, you know, SuperVision design went into six car makers, nine brands. The scope is expanding towards Chauffeur with the eyes off the system. Additional SuperVision traction we expect to come out in the second half of the year. Okay. One more. We have customers that we haven't named yet. I think, yeah, the additional traction in the second half would be ones outside of those 6 OEMs. That's very helpful. Thanks. One more from me, please, if I could. The company said it's the supply chain limits, including for SuperVision, and you call that an ECU component. Could you elaborate a bit more on the steps that Mobileye and your supply chain partners are taking to alleviate that and your visibility in potentially having that supply chain constraint alleviated in the intermediate to longer term? Thank you. We have an issue with 1 component in the SuperVision motherboard. This is why we have out of the full volume of the SuperVision, it's really tilted over the second half of the year rather than the first half of the year. It's 1 component from a particular supplier, we are confident that in the second half of the year, that, you know, that constraint will be alleviated and we can deliver the rest of the volume. Yeah. Maybe if I could just add a couple more words on this. In 2022, we delivered every ECU we could possibly produce. In the fourth quarter, it was a little bit more than we had expected to be able to access. We have, you know, so much additional demand in 2023 that, you know, in order to satisfy that, the supplier really needed to sort of take down the production for a period of time in order to install more capacity so we could get to, you know, much higher levels. Just to reiterate what Anat said, in the second half, we have commitments to be at a run rate that would satisfy not only the 2023 demand, but also get us to a capacity where we could satisfy 2024 as well. Thank you, Mark. All right. Next question, please. Our next question comes from the line of Joshua Buchalter with Cowen and Company. Please proceed with your question. Hey, guys. Thanks for taking my question, and congrats on the results. I guess I wanted to ask first about the premium European automaker that you announced for SuperVision. Any way you can give us sort of a, I don't know, a scope versus what you're currently doing with Zeekr and Geely? In particular, how much does moving to, it sounds like hands-off, eyes-off with that program, how much can that be a material needle mover, the potential for that program? Thank you. With respect to eyes-off, we announced with the Zeekr, we streamlined the hardware. At the time when we announced it was with 6 EyeQ5 chips. We are now streamlining it to one piece of hardware called TH663, so 3 EyeQ6. That will be in the 2025 timeframe. We have additional OEM with an eyes-off and an additional one, this European, which is not yet named, for a 2026 timeframe. There's a potential additional one, which I believe that could be announced in the second half of the year for an eyes-off system based on the 3 EyeQ6. Thanks. Appreciate the color. I wanted to ask about your R&D and OpEx spending. You know, it was helpful color giving the 70% number on forthcoming products, but you have a lot of irons on the fire. I was wondering if you could rank order, you know, where your spending priorities, which ones are the ones that you're particularly focused and excited about between, let's say, MaaS, consumer AVs, but even, you know, bringing your own internal lidar and radar to market, as well as just broader software adoption like mapping. Thank you. You know, our expenses is very diverse, and you mentioned a number of them, right? We have a expense on active sensors, the radar, lidar. There we are working on productization middle of the 2024 timeframe, both of the radars and the lidars. This is ongoing. We have expense on mapping, on the REM mapping. This is mostly compute. The head count is not much increasing. It's really the compute that is increasing based on more and more programs that require mapping. We have expense in R&D as we go forward from SuperVision to Chauffeur to Drive, which is the mobility as a service. That's another source of expense. We have expense on SuperVision to support those 6 car makers. This is very diverse. It's hardware, just like as a Tier 1. It is, you know, software, not algorithmic software, but more infrastructure software. There's a lot going on there to support 6 car makers with the SuperVision all coming around the same timeframe, starting from 2024 till 2026. This creates also a need for investment. Our investments are very diverse. We think that, you know, last year, 2022, we made a jump on investments. This year, another jump. It will taper off from 2024 forward. I'd just say, you know, the last thing I'd say on that is it's all supporting the portfolio that we've talked about for the last few months, with so much value and additional content per vehicle. Got it. Thank you. Thanks, Josh. Our next question comes from the line of Chris McNally with Evercore ISI. Please proceed with your question. Thanks so much, team. Quick one on just the numbers and one on orders. Just on the timing for gross profit progression in 2023, it looks like you're gonna be down something like 400 basis points, and I think you've explained that that's the STMicroelectronics increase on the chip side. Could you just help us through, does that pass through happen as early as Q1? Q2 obviously doesn't matter for gross profit dollars, but just for the gross profit margin, could you just help us on the timing? The timing is from January 1st. We are passing over this cost that we that was increased. At the beginning of the year, we're passing it over to our customers without additional margin. This is the reason for a slight decrease in our margin for EyeQ. Yeah. The second thing that we mentioned in the prepared remarks was, you know, SuperVision becoming a bigger mix of our revenue, you know, has a kind of a mathematical effect on the percentage margin. You know, gross profit per unit is much higher, but gross margin is lower. That'll be a bigger effect in the second half because the volume of SuperVision is Exactly ... significantly higher in the second half. Great. Then on the Chauffeur win, obviously, congrats if it's, you know, the scaled OEM that a lot of us think that's a huge, huge deal. Can you talk a little bit about just the timing of some of these SuperVision walks into Chauffeur? I mean, if you're talking about launches in SuperVision in 25, what's a typical sort of conversation around that transitioning to Chauffeur? Is it 27? Is it 28? Then any idea of, you know, are we starting with level three and then working up to level four? 'Cause it's obviously such an important sort of part of the later half of the decade. Just curious, you know, when these programs may launch. Yeah. In our taxonomy, there's no difference between level three and level four. It's an eyes off or eyes on system. This is what I spoke about at the CES. An eyes off system with OEMs, except Zeekr that starts in 2025, the rest of the OEMs are starting in 2026. We have quite a nice traction. As I said, 3 OEMs and the fourth one should be closed second half of this year for eyes off systems for 2026. Yeah, because SuperVision. And, and just- Because SuperVision really serves as the baseline, you know, the timing gap between a SuperVision launch and a Chauffeur launch doesn't have to be, you know, a significant number of years. That's great. Just to confirm, in the prepared remarks, you said that most of your Mobileye SuperVision conversations you're having discussion of this walk to Mobileye Chauffeur? Yes, yes. It's not most, all. Every customer that bought in into a SuperVision, we have a meaningful and deep discussion about expanding to Chauffeur. Thanks so much. Thanks, Chris. Our next question comes from the line of Antoine Chkaiban with New Street Research. Please proceed with your question. Hi. Thank you for taking my question. Maybe a quick one first. I was wondering where you stand on deploying the key mapping-based features via the OTA update to Zeekr users in China, and what features that will unlock exactly what additional features we should expect in upcoming updates as well. In China with Zeekr, about three months ago, we OTAed Highway Assist. Recently we OTAed to leading a customer, the full SuperVision limited to highways. This is including the REM maps as part of it. We believe that in the next month or two months we'll be able to do the OTA for the entire fleet with the full REM, with full REM capability of SuperVision for highways. Throughout 2023, together with Zeekr as our map coverage will increase, we'll start unlocking additional road types like arterial and urban. Okay, thank you. Maybe as a follow-up, a broader follow-up. I think one important differentiating factor that Mobileye has is that you offer an end-to-end solution, while your main competitor today offers really like a reference platform. Can you help us better understand how in practice the integration work differs when you kick off a development project versus when your main competitor does? I am assuming that in the case of the other offering out there is still some significant development work that needs to get done by the OEMs themselves. Anything you can tell us on how things typically happen in practice would be very helpful. Mobileye in, into SuperVision is offering an end-to-end system. The Zeekr is an end-to-end system. All the other SuperVision launches that I talked about, the six brand, the six OEMs, nine brands is still an end-to-end system. Vertical handle of an end-to-end system, I think is crucial because you're talking about perception. You're talking about integrating with a map. You know, the map is built together with the teams that are building the perception. If you try to separate the map from perception to two different suppliers, you get into a sea of issues. Either it'll be over-engineered or it'll be under-engineered. Cost-wise, it could be crazy. The fact that, you know, the same team is integrating both the sensing, both the perception, and the way the map is being built and served is crucial. You have driving policy. The driving policy is also integrated with the perception, right? Again, if you try to separate that into a supplier doing the driving policy and another supplier doing the perception, you end up with an over-engineered system, and then some places it will be under-engineered. Be too conservative, too slow. I think in such a complex, such a complex system, an end-to-end where everything is done by one supplier has a lot of advantages, and has also not only performance advantages, but also cost advantages. Everything under one house, under one chip is, it offers incredible cost advantages. We are not shy from, you know, cooperating in other ways. For example, there are OEMs that would like to take control of the driving policy where Mobileye provides only the perception, and we're open to that. This is why we offer the EyeQ Kit, which is enables the OEM or a supplier to write code onto our chip on top of our software, whether it is fusion with other sensors, whether it's a driving policy, we don't resist that. Having an end-to-end system, you know, can be much more efficient than breaking it down to different suppliers. Super helpful. Thank you. Thank you, Antoine. That's all I have. Next question, please. Our next question comes from the line of the Vijay Rakesh with Mizuho. Please proceed with your question. Hi guys, great quarter and guide year. Just a quick question on the, on SuperVision, just to go back to that. In terms of the six OEMs, outside of Geely and Zeekr, can you give us some idea of, as they ramp in the second half, and you talked about significantly higher SuperVision volume there, what kind of volumes are you looking at the OEMs outside of the, of the two, Geely and Zeekr, for the other OEMs? Yeah, but did we say the numbers of the volume? No. We said, we did not reveal the actual volume, but I think... What did we reveal there? Anat, can you explain? Yeah. Well, did we... we've said that we said that will more than double volume in 2023. For the overall only. For the overall volume. Yeah. The first half will be much weaker than the second half. Yeah. We're not revealing specifics quarterly. You know, we talked about revenue being about 40-41% in the first half versus the second half. That's a combination of EyeQ and SuperVision. Yeah, the second half ramp up of SuperVision is significant because of the new capacity that's coming online. overall 2020 SuperVision will be more than double of, 2022. more than 100% year-on-year growth. Got it. As you have these OEMs accelerating to 2024, we should probably expect, you know, and you talked about kind of building capacity for that, we should expect that site to kind of grow pretty nicely into 2024 as well, right? Yeah. 2024, there will be additional OEMs. It's not only Zeekr. Zeekr. It's not currently Zeekr 001. That's one brand. There's another brand of Zeekr coming to launch throughout end of 2023, beginning of 2024. There are additional Geely OEMs that are kicking in in 2024. 2025. We're talking about OEMs outside of the Geely, outside of the Geely Group. Got it. Just quickly on the I know in 2023 you have on the EyeQ side, you have Toyota ramping. Can you talk to what drove the win, how you were able to, kind of, you know, displace incumbent? What really drove that win? Maybe that'd help all of us. Thanks. Win with which? With Toyota. With Toyota. That was a design win of 2 years ago. I don't think we displaced anyone. It was a bid, and we won the bid. The program is ongoing. It hasn't launched yet. Got it. Thank you. Thank you, Vijay. Our next question comes from the line of Adam Jonas with Morgan Stanley. Please proceed with your question. Hey, everybody. Was wondering if you could give a little bit of guide on CapEx. Where is it going, even directionally in 2023? I'm curious if operating cash flow can keep pace with growth and operating profit, or does that kinda lag as well given some of the ex-expenses? We expect CapEx to be similar to the investment in 2022. Mm-hmm. Our new campus is planned to be completed during the second quarter. The additional investment require complete for completion is about $60 million. The remaining CapEx investment relates to storage data centers and computer equipment and such. Thanks, Anat. Just a follow-up, could you help quantify the shifted engineering expenses that shifted from 4Q into 2023, either in margin or dollar terms? And the same, I guess, if you could, if it's possible to quantify the pull forward of volume ahead of the price increase, but mainly the engineering expense is something I would hope you could just help quantify for bridging purposes. Thanks, Anat. Yeah. It's about $14 million that shifted from this year. One point. One four. Fourteen. 14. Yes. No, to be clear. To be clear, from this year to next year. It's mostly about the NRE expenses, but it's not a very significant number, you know, out of the total OpEx in 2023. Thank you. Thanks, Adam. Our next question comes from the line of Samik Chatterjee with JPMorgan. Please proceed with your question. Yep. Hi. Thanks for taking my questions. I guess for the first one, I was just wondering if you can talk about what you're seeing on the enhanced ADAS solutions, particularly in terms of being able to upsell customers when it comes to sort of basic ADAS and layering in REM. On that, how much of you talked about the ASP increase you're expecting for 2023, but how much of that is going to be driven by being able to sort of sell enhanced ADAS solutions related to the basic ADAS? How are you seeing OEMs adopt it at this point? Is it really more of a high-end sort of adoption, or are they looking to move a bit more down market? I have a quick follow-up. Thank you. Well, beyond Volkswagen that launched a year ago with the Travel Assist 2.5, we have now two additional OEMs with big programs with cloud-enhanced ADAS. It's ramping up. I believe at the end of the day, every car maker with a front-facing camera would include also as an option, maybe a higher trim option, an enhanced ADAS because it doesn't add any hardware to the mix. It's just a software update. It makes a lot of sense. by increasing, significantly increasing the ADAS capability by having the data from the cloud about where the lane marks are, the drivable path, location of traffic lights, association of traffic lights with drivable paths, all of this creates new opportunities for enhancing, driving assist at quite a reasonable cost of, you know, a few tens of dollars per car per year, something like that. Okay, got it. For the follow-up, we get a lot of questions about sort of how to think about performance in the recession and if the macro was to get worse. I know you talked about sort of haircutting some of the OEM demand that you're seeing in terms of volumes. How are you sort of thinking about the likelihood of pushouts, particularly if programs are planned towards the end of the year, pushing out timelines in terms of launches or adoption of certain programs? Also, how would you sort of flex your OpEx in the scenario that macro does end up being a bit worse? Thank you. Yeah. I mean, this is Dan. You know, obviously, we're susceptible to swings in global production a bit. You know, as you've seen, you know, in the past years, you know, we're growing so much faster than overall production that it's not as big of an impact to us as probably to others. You know, we, you know, acknowledge, you know, kind of the risks around production. That's why we set our forecast to basically flat to 1% global production growth, even though, you know, set our volume forecast below the orders and commitments we've gotten from our customers. We're definitely not hearing about any kind of, like, pushout of programs or anything like that. Also, you know, we have the driver of adoption growth that, you know, wouldn't impact us too much as well. Not hearing, just to be clear, not hearing anything about that. You know, overall, like, we've, you know, done well in all kinds of environments over the last 10 years. Yeah, that's. In terms of flexing operating expenses, I don't think we would. You know, I think that our business is built, you know, for the long term to drive content per vehicle growth, to drive new solutions, you know, for the next 10 years plus. I don't think we would pull back on operating expenses. Got it. Thank you. Thanks for the question. Thanks, Sameek. All right, next question comes from the line of Luke Junk with Baird. Please proceed with your question. Morning. Thanks for taking the questions. First, wanted to ask, we've talked about Mobileye SuperVision quite a bit, cloud enhanced ADAS as well. I'm wondering about EyeQ Kit, if we could discuss the evolution of those conversations with customers, how that's developed over the past 6-plus months, let's say. Could it or has it been intersecting with Mobileye SuperVision at all with these customers? Yes, indeed. All the advanced systems, Chauffeur and SuperVision, EyeQ Kit comes as a critical component, especially when you talk about the Chauffeur. Some of the SuperVision programs include also EyeQ Kit, some do not. EyeQ Kit is becoming a major component in our discussions of advanced systems. Advanced system is something beyond the SuperVision and beyond. Thank you for that. For my follow-up, I just want to ask a question on near-term expectations. In light of the component issue that you cited with SuperVision, which sounds like it's just timing and timing of expenses, are there any additional guardrails we should be keeping in mind when it comes to near term, especially first quarter expectations? Thank you. Can you repeat the question, Luke? Sorry about that. Sorry about that. The question is in terms of the first quarter on the financial side of things. You know, clearly wanna be looking at timing around SuperVision and component availability, OpEx timing as well around R&D. Just wondering if there's any additional guardrails or things that would be specific to the first quarter we should be keeping in mind, beyond just the revenue weighting first half versus second half, let's say. Thank you. Yeah. I mean, I think we, you know, we covered that, you know, we think Q1 revenue will be below Q4. You know, we're not gonna get more specific than that and kinda, you know, talked about the reasons. I mean, every year we have more revenue in the back half versus the first half. We do think it's gonna be a little bit more pronounced this year, you know, because of the constraints on SuperVision supply in the first half, as well as, you know, we do think that there was, you know, some additional buying of EyeQs before the price increase, which I think is natural. We don't think it was major, but, you know, that's our read of why Q1's a little bit below Q4. Hopefully that gives you enough information. Thanks, Tyler. Thanks, Luke. Our next question comes from the line of Rajvindra Gill with Needham & Company. Please proceed with your question. Yeah, thank you. Congratulations on great results. A question on the ASPs. You mentioned that, you know, a third of your revenue growth last year came from higher ASP growth. This appears to be a very strong kind of investment thesis as your ASPs kinda move higher. How do we think about the balance between kinda unit growth versus ASP growth as you kinda ramp up more of the SuperVision products? I mean, I think, you wanna take it? Again, there's a big difference between ASP of EyeQ and SuperVision. When you're going with the volume of SuperVision, you don't need to grow a lot in order to produce these or generate these really high revenue. There's a big difference there, and we think that as we go, you know, further with a higher SuperVision in the mix, you'll see this ASP continue to grow. Exactly. I mean, I think we have, you know, a lot of visibility on content per vehicle growth. You know, the design wins that we achieved in 2022 came in at, you know, $105 per unit on a blended basis, right? That's a mix of, you know, base EyeQ, you know, cloud-enhanced ADAS, SuperVision. You know, SuperVision was definitely the biggest contributor to the year-over-year growth in ASP that we saw in Q4, even though it was like 0.5% of the volume. Like we said in the prepared remarks, we see a trajectory to the low 60s in the back half of 2023, you know, still with really one, you know, customer, plus, you know, an additional, you know, Geely brand in the back half. It's a very powerful driver and, you know, the fact that Mobileye Chauffeur is becoming a bigger part of the discussions, you know, with OEMs, you know, brings even more potential upside in the future. It takes time to play out, like everything in this business, but, you know, we're feeling really good about the content per vehicle trajectory. I appreciate that. For my follow-up, a lot of the questions we receive from investors is trying to analyze the evolving competitive landscape with, you know, very large semiconductor suppliers, as well as some niche competitors that are developing certain types of computer vision applications. I'm wondering, as you are increasing the content, you know, per vehicle, as you're adding and kinda upgrading and upselling your customers to higher levels of autonomy. You know, how do you currently see the competition and how do you know, foresee it evolving as OEMs kind of adopt higher levels of autonomy? Thank you. I think, Robert, when you go to, you know, those high level of the complexity of systems, the semiconductor is really a small part of the mix. Now, you have so much on top of the semiconductor. You have the perception software, the driving policy software, the control of the car software, the mapping, the integration of all of them together. It is way beyond the semiconductor business. Even when you talk about the basic ADAS, which is the front-facing camera with a chip behind it, you know, the optimization and the economy of the scales over the last decade of this particular product, you know, makes it very, very unlikely to a newcomer to gain market share. It's highly optimized. The validation is very, very expensive. Requires hundreds of petabytes of data to properly validate. If you don't have any disrupting new idea there, being able to take market share in that particular highly optimized business is very unlikely, right? Unless the incumbent for some reason stops to deliver, and I don't see us stopping to deliver. The really big gain in terms of market share is on the complex systems, SuperVision and beyond. I think there, Mobileye is clearly at a very leading position. You know, a SuperVision type of a product, I don't see anything outside of the Tesla FSD that even comes close to it. We are having a very strong traction for it, more and more car makers, more brands. Chauffeur is another step-up. This is where the competitive game is going to be, not on the low-end ADAS. There it's way beyond a semiconductor business. Thank you, Rajeev. Appreciate that. Thank you. Our next question comes from the line of John Murphy with Bank of America. Please proceed with your question. Hi, guys. Just two quick ones. First, if you could just discuss exactly what went on with the January price hike so we can understand why folks may have pre-bought in front of that, just to understand how big that is. The second one, Amnon, as you're making this progress with supervision as far as book business and discussions, are the customers just kind of throwing up their hands and saying, "Listen, we just can't do this ourselves or these other partners, so we're just kind of handing the keys and becoming exclusive with you," or are they sort of parallel processing other systems? How is that developing? I don't think the story is so dramatic as throwing in the keys, right? You know, OEMs do what makes the most sense. They want to deliver a product. They want to deliver a competitive product. They need to compete with other OEMs. They need to provide value to the customers. They see what Mobileye is doing. I think the launch of the ZEEKR SuperVision created a kind of a significant moment because it's one thing to show a development system, another thing is to show a production system doing something very impressive. It's not that, you know, OEMs decided to throw in the towel. It's simply a natural evolution of a competitive landscape. You need to be able to deliver brands with the best technology and use the suppliers for it. The EyeQ Kit allows the car maker. I think the EyeQ Kit was a very important moment here. It allows the car makers not to completely treat our system as a black box, but to add to it their own software and to create further differentiation. Trying to simply replicate what Mobileye has been doing, I personally, I don't think it makes sense, really. Because I know the amount of investment that's being done, and this kind of investment cannot be done just through money. There's a time factor for it, a significant time factor for it. I think that the Zeekr launch created, kind of a reality check in many of our OEM partners. About, the EyeQ cost. Yeah. In terms of the EyeQ cost, we're talking about. $1-$2 of an increase. $1-$2. It's not a significant impact in terms of buying ahead, you know, before this price increase. Thank you very much. Thanks, John. This has to be our last question. Shamali. No problem. Our last question comes from the line of Steve Fox with Fox Advisors. Please proceed with your question. Hi. Good morning, thanks for squeezing me in. 2 questions, if I could. First of all, at CES, the conversation around your radar innovations were pretty interesting. I was wondering, beyond just the technology roadmap, what else is gonna drive your ability to start disrupting in that product space? I guess you're talking about, you know, going to market in 2024 to try and win new business. Secondly, as you sort of right-size for the volumes needed on the Mobileye SuperVision by the end of this year with your manufacturing partner, is that when we should start thinking about gross margins and Mobileye SuperVision improving, or do we need more volumes beyond like end of calendar 23 to start seeing that improvement? Thank you. Okay. I'll start with the second half of your question. The gross margin in terms of the cost of production is not volume dependent. We simply did another spin of the hardware with better optimized components so that would reduce our cost. Another part of increasing our gross margin of SuperVision is higher bundles. Once the bundles, once, you know, software bundles will include beyond highway, that will increase our gross margin. Right. Was this first half? The radar. The radar. It's important to mention that our motivation for building those radars is not just to enter into a new market place. Was to create a very streamlined eyes-off system where you don't need a 360-degree awareness from lidars because that is expensive. We want to limit the lidar only for front-facing and the remaining 360 to be handled by imaging radars. Those imaging radars that we are developing are really cutting edge in terms of, you know, 48 by 48 channels, 100 DB of sensitivity. They can create an end-to-end autonomous driving experience as another layer of redundancy. That would considerably reduce the cost of an eyes-off system. I'm talking about an eyes off with full capability, full ODD. Great. That's very helpful. Thank you so much. Thank you. Thanks, Steven. Thanks everyone for joining our first earnings call as a public company. We will see you next quarter. Thank you. Thank you. Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.