Mobileye Global Inc. — FY2023 Form 10-K
Reporting period: Fiscal year ended December 30, 2023 (52 weeks); comparison is with the year ended December 31, 2022. This annual filing does not provide a clear standalone Q4 income statement or Q4-specific financial results. Figures are in U.S. dollars unless noted.
Business context
Mobileye develops advanced driver-assistance systems (ADAS) and autonomous-driving technology. Substantially all revenue currently comes from commercially deployed ADAS, primarily EyeQ system-on-chips sold through automotive Tier 1 suppliers. At year-end, its technology was deployed in approximately 170 million vehicles; it worked with more than 50 OEMs and shipped approximately 37.4 million EyeQ and SuperVision systems in 2023. Intel retained approximately 88.3% of common shares and 98.7% of voting power.
Financial performance and liquidity
| Metric | FY2023 | FY2022 |
|---|---|---|
| Revenue | $2.079 billion | $1.869 billion |
| Gross profit / margin | $1.047 billion / 50% | $922 million / 49% |
| Operating income (loss) / margin | ($33 million) / (2%) | ($37 million) / (2%) |
| Net income (loss) | ($27 million) | ($82 million) |
| Adjusted net income (non-GAAP) | $659 million | $605 million |
| Adjusted operating income / margin (non-GAAP) | $693 million / 33% | $685 million / 37% |
| Adjusted gross margin (non-GAAP) | 70% | 75% |
| Operating cash flow | $394 million | $546 million |
| Capital expenditures | $98 million | $111 million |
| Cash and cash equivalents at year-end | $1.212 billion | $1.024 billion |
| Total liabilities | $653 million | $647 million |
Cash, cash equivalents and restricted cash totaled $1.226 billion at year-end. Mobileye reported no remaining balance on the Intel Dividend Note; the filing identifies no material borrowings. Operating cash flow fell by $152 million, mainly due to inventory rebuilding. Inventories increased to $391 million from $113 million. The reported GAAP net loss reflects, among other items, $474 million of acquired-intangible amortization and $252 million of share-based compensation; adjusted measures exclude specified items and are not GAAP results.
Material changes versus FY2022
- Revenue increased 11%, primarily on 11% higher EyeQ volume; EyeQ average selling price was approximately unchanged. EyeQ sales represented about 89% of revenue in both years.
- Gross margin rose one percentage point to 50%, helped by lower acquired-intangible amortization as a share of revenue. Adjusted gross margin declined five points to 70%, reflecting higher EyeQ costs passed through to customers on a zero-margin basis.
- Research and development expense increased 13% to $889 million; general and administrative expense increased 46% to $73 million, partly due to share-based compensation and public-company costs.
- Net loss narrowed by $55 million. Adjusted net income increased $54 million, while adjusted operating margin fell from 37% to 33%.
- Customer inventory accumulated during the supply-chain disruption and lower-than-expected OEM production became a key demand factor. Tier 1 customers accounted for 30%, 24% and 14% of revenue, respectively; eight OEMs represented 73% of revenue through Tier 1 customers.
Outlook, risks and unusual items
- Management expected Tier 1 customers to use most excess inventory in Q1 2024 and orders to normalize over the rest of 2024; it cautioned that this outcome was not guaranteed. The filing gives no clear numerical full-year 2024 revenue or earnings guidance.
- Management expected near-term R&D expense to rise and adjusted gross and operating margins to decline as the company develops and sells more full systems with greater third-party hardware content. It expected 2024 capital expenditures to be slightly above FY2023.
- Israel-based operations face geopolitical and workforce risk: approximately 10.5% of employees had been called to reserve duty as of January 31, 2024. The company said its operations and financial results had not been negatively affected to date.
- Supply risk remains concentrated: STMicroelectronics is the sole EyeQ supplier, and TSMC manufactures the chips as a subcontractor. Other risks include OEM and Tier 1 concentration, vehicle-production cycles, pricing pressure, competition, evolving AV regulation, data privacy and cybersecurity, and dependence on Intel-related agreements and technology licenses.
- Mobileye and Intel were negotiating an amendment to the LiDAR Product Collaboration Agreement after Mobileye chose to pursue different lidar technology; final terms remained subject to negotiation.
- Two lawsuits were disclosed in January 2024: a securities class action alleging misstatements concerning customer excess inventory and a patent infringement action. The company said it would defend both; no provision was recorded for the securities case.
- The independent auditor reported effective internal control over financial reporting and a clean opinion on the financial statements. Goodwill totaled $10.895 billion; no impairment was recorded, including after a quantitative assessment of the $111 million Moovit-related reporting unit goodwill.
Important facts for investors to verify
- How quickly customers work through excess inventory and whether orders normalize after Q1 2024 as management expected.
- Whether OEM production, design-win launches and SuperVision growth support revenue while EyeQ remains approximately 89% of sales.
- Whether margin and cash-flow pressure from system mix, R&D spending and inventory rebuilding develops as described.
- Exposure to the three largest Tier 1 customers, China (31% of revenue by shipment destination), and Intel’s voting control and related-party arrangements.
- Progress and final terms of the Intel lidar amendment, and any material developments in the disclosed litigation or Israel-related operating conditions.