Xos, Inc. (NASDAQ:XOS) Q4 2023 Earnings Call Transcript

Dakota Semler: Yes, those cash burn numbers are what we delivered in the second half of 2023. And we anticipate that with our continued delivery of 2023 and 2024 model year vehicles, our margin profiles will continue to improve, thereby reducing that number. We also anticipate that we can continue to deliver more units, which will also continue to reduce that number in the year to come. And I think when we’re looking at inventory turns, in terms of getting older inventory off the balance sheet, we anticipate that our inventory turns will continue to anticipate necessitating less working capital to build a larger amount of vehicles. So that’s to address your first question. And then what was the — can you clarify the second question just one more time for me?

Steven Wahrhaftig: Yes. So you mentioned a little bit about the deliveries for the coming year would be a little more back half weighted. Is it going to be similar to what we saw in 2023? And if not, how should we expect to be modeling this out?

Dakota Semler: We do anticipate that it will be back half weighted, and there’s a variety of factors that are more industry factors that drive seasonality in some of the markets such as our parcel delivery customers. They generally, in Q1 and Q4, don’t take a lot of deliveries. And the reason for that being Q4 is obviously the busiest season where volumes for them can go upwards of 100% of their baseline volume. So delivering to those customers at that time period is very difficult. And then in Q1, we see a lot of that carryover volume from package returns and shipment returns. The deliveries in Q1 and Q4 tend to be slow for parcel delivery, which represents a substantial portion of our overall vehicle deliveries. So that’s where they concentrate amongst Q2 and Q3, generally.

And then in terms of our other powertrain customers and some of our uniform rental or vocational customers, they generally take delivery at the — in the second half of the year, either during the summer period or in Q4, some of which for our smaller fleets is to take advantage of some of the accelerated depreciation, tax treatment of acquiring new equipment such as Section 179, some of which just has to do with the end of their fiscal years and the timing of their budget cycles. But to reaffirm what definitely does mean we do have a back half weighted 2024 as well.

Steven Wahrhaftig: Thank you.

Dakota Semler: Thank you.

Operator: And that concludes our question-and-answer session. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.