Despite better than expected financial results, Israeli driver assistance systems and collision avoidance developer Mobileye's(NYSE: MBLY) share was down sharply in pre-trading, probably because of the report that it would halt the provision of its driver automation technology to Tesla Motors in the third quarter.
Mobileye said it would not extend collaboration beyond EyeQ3, the processor currently used in Tesla vehicles to provide image analysis intelligence. In a conference call after the company's second quarter results Mobileye chairman and CTO Amnon Shashua said, "“EyeQ3 shipments will continue for the near future, and maybe for the longer future. We simply decided where we wanted to put our resources for the future of autonomous driving and we decided what we decided.”
Mobileye CFO Ofer Maharshak said that Tesla is not a major customer and that it generates only 2% of revenue.
Earlier this month, Mobileye, Intel and BMW announced plans for a series production of a self-driving by 2021
In its second quarter financial results, Mobileye exceeded the analysts' forecasts for the second quarter, reporting $83.5 million in revenue, 58% more than in the corresponding quarter last year and $6.2 million more than forecast by the analysts. The company reported a non-GAAP net profit of $0.17 per share, $0.02 more than the analysts' forecasts.
Founded by Shashua and CEO Ziv Aviram, Mobileye has developed a technological system that warns drivers of road risks. The system includes chips, software, and cameras. The company's main growth engine consists of systems it is developing that will make it possible to produce a self-driving car.
Mobileye made a $26.9 net GAAP profit in the second quarter, 75% more than in the second quarter of 2015. Non-GAAP profit was $41.2 million, a 74.6% increase. The company's first half revenue grew 63% to $159 million, and its non-GAAP net profit was up 81.9% to $76 million. The company generated $70.2 million from current activities, and it had $540 million in cash at the end the second quarter.
"We are satisfied with our second quarter financial results," Aviram said. "Even more important are our commercial and strategic achievements in the quarter and the first half, which ensured new business activity at all levels of activity."
Mobileye, which held its IPO two years ago, has a $10.8 billion market cap.
Published by Globes [online], Israel business news - www.globes-online.com - on July 26, 2016
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