Kevin Cassidy: Okay, great. Thanks and congratulations again.
Angus Pacala: Thank you.
Operator: [Operator Instructions] Your next question comes from the line of Shadi Mitwalli with Craig-Hallum. Your line is open.
Shadi Mitwalli: Hey, this is Shadi Mitwalli on for Richard Shannon. Congrats on the side, guys. My first question is on your Q1 guidance. Q1 guidance implies 35% growth year-over-year, which is on the lower end of your full-year guidance of 30% to 50% growth. So, maybe here, what is giving you the confidence that you’ll be able to maintain that 30% plus growth throughout 2024?
Angus Pacala: Yes, thanks for the question. I mean, we really highlighted three strategic priorities for Ouster and the first two are focused on growth. So, those being the software solutions, expanded business, the advancement in our digital lidar hardware, both at OS and DF and the third priority, just executing more generally on the financial framework we’ve laid out. But focusing on the first two, we’ve seen incredible kind of uptake and rapid uptake in the Gemini platform and the Blue City platform. And I have a really kind of positive outlook on how we’re going to be able to expand that line of business more quickly with customers than our traditional lidar hardware business alone. And that’s really because we’re providing the full solution for the first time in the smart — with these software solutions.
Generally, the time from first revenue to kind of meaningful revenue with a customer in something like the automotive or industrial space is because the customer themselves is developing a full software solution on top of the hardware that they’re purchasing. By circumventing that and selling them the complete solution day one, it’s allowed us to build a much faster revenue base for partners that are willing to purchase that complete solution from us. It’s also allowing us to tap completely new markets. So, Gemini is positioned to be sold into the security and crowd analytics space. And the security industry, all told, $32 billion of security systems sold every year globally. So, a massive market with well-established customer base and a clear value proposition from Ouster Gemini to provide the next level of performance from a complete solution.
So, going after big markets, there are new opportunities for Ouster and they’re also sped to adoption by the fact that it’s a complete solution. Something a little different is happening, but on the hardware side itself. But each time we upgrade the OS sensors is an opportunity to remove barriers for a customer to adopt lidar technology. We’re able to provide more features, more performance, more environmental robustness and to a customer that allows them to circumvent some of the challenging scenarios that they might get into. A good example, a mining machine that’s used to operating in a dusty environment with the REV7 sensors, those sensors can pierce through dust in a way that previous generations of lidar can’t. That allows a customer to just remove a whole set of problems from the scope of their entire system design.
So, things like that give us confidence that we’re going to continue on this trajectory of building to the long-term model and hitting within those bounds that we established on revenue growth, 30% to 50%.
Mark Weinswig: And obviously, one key thing is that we had a great year in booking. So, we booked over $140 million. So, when you ask kind of what gives us the confidence that we can continue to grow, we’ve just shown that we’ve been able to see huge interest. And by the way, these are take or pay binding orders that we received from customers.
Shadi Mitwalli: Awesome. That makes sense. And thanks for the color on that.
Operator: Kevin Garrigan with WestPark Capital, your line is open.
Kevin Garrigan: Yes. Hey, good afternoon Angus and Mark and thanks for taking my questions and congrats on the results. I think I asked you this last quarter, but any update on what software revenues were this quarter? Is it too small? Or is it still too small? And any plans to expand software into other end markets?
Angus Pacala: Yes, so we aren’t breaking software revenues out. At this point, we have mentioned that we’ve booked millions of dollars in software-attached business, software-coupled business. That’s the combination of the software solution with the lidar hardware that we’re selling. We put out a pretty fulsome press release in Q3 around the traction that we’ve seen over 300 sites deployed with our software solutions to-date in 2023. And so, I think we’re with the rate of deployment, but we’ll be breaking out software metrics specifically when we feel that they’ve grown to a degree where it’s relevant. And then, I’m sorry, what was the second part of the question?
Kevin Garrigan: Just whether you guys have any plans to expand into other end markets?
Angus Pacala: Yes, I think that there is absolutely an opportunity to bring autonomy solutions into the industrial robotics and automotive markets, potentially in that order. We started with smart infrastructure first because it has some of the largest existing, pre-existing established markets. For instance, the security market, the traffic systems market, and some of the lowest technical challenges to solve because it’s fixed infrastructure versus safety critical moving assets, but that being said, I think that there’s a potential for us to continue to build these software offerings in other businesses. So, stay tuned. I think the Ouster of 5 to 10 years from now will look very different on what kind of software we’re providing than the Ouster of today.
