Lidar is becoming an increasingly important building block for physical AI as autonomous vehicles, robots, industrial machines and smart infrastructure need to sense and interpret the real world. Two companies looking to capitalize on this opportunity are Aeva Technologies AEVA and Ouster, Inc. OUST.
Both stocks have delivered gains so far this year, with AEVA up about 22% and OUST up roughly 67%, reflecting growing investor enthusiasm around the LiDAR theme. But only one of them looks like a good investment option. Let’s dig deeper to assess which stock deserves your money.
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The Case for AEVA
Aeva's investment case rests on optionality that extends well beyond automotive lidar. Its FMCW 4D sensing technology has gained validation. Bendix selected Aeva for its next-generation Class 8 truck ADAS system, a platform already deployed across roughly 300,000 North American trucks. Aeva is also integrating with NVIDIA DRIVE Hyperion, continuing Atlas Ultra deliveries to a top-10 European OEM and shipping production-intent sensors to Daimler Truck from its automated Jabil line. These developments suggest its automotive pipeline is gradually moving from prototype work toward production.
Aeva isn't relying on automotive alone. SICK's commercial launch of an Eve-powered industrial sensor, CityOS's expansion and growing defense activity in ground and aerial autonomy give the company additional avenues for revenues as automotive programs take time to ramp.
The biggest wildcard is Optical Connectivity, Aeva's new business applying its silicon-photonics expertise to AI data-center interconnects. The business is backed by a joint development agreement with a hyperscaler, with initial deployment targeted for the second half of 2027 and production ramping in 2028. If the program scales as planned, it could eventually add hundreds of millions of dollars in annual revenues alongside the core lidar business.
The Zacks Consensus Estimate for AEVA’s current and next year’s revenues implies year-over-year growth of 75% and 162%, respectively.
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That said, risks are there. Major automotive programs remain years away from full-scale production, while Aeva continues to burn cash. The company’s last reported quarter’s revenues were just $6.1 million against a $26 million adjusted operating loss and $31.4 million of gross cash use. Manufacturing scale-up, customer qualification, competitive pricing and dependence on external funding remain key execution risks.
The Case for OUST
Ouster's story leans more on near-term execution. The company delivered 14 consecutive quarters of product revenue growth and shipped a record 17,000-plus sensors in the last reported quarter. Its product revenues grew 51% year over year. Its Physical AI positioning spans lidar, cameras, AI compute, and perception software after the StereoLabs acquisition, which brought industrial-grade ZED cameras and immediate cross-selling traction with robotics customers.
The near-term catalyst is Rev8, Ouster's new sensor platform featuring native color lidar and extended range. Early demand has been strong, with multiple million-dollar-plus orders from heavy-equipment, agriculture, and autonomous-vehicle customers, and expanded Benchmark manufacturing capacity above 100,000 units annually.
Smart infrastructure is another differentiator. BlueCity is already live across dozens of intersections in New Jersey, Georgia and Utah, addressing a total market of roughly 300,000 signalized U.S. intersections that remains barely penetrated. Deeper NVIDIA integration across DRIVE and Jetson platforms further cements Ouster's relevance as autonomy moves into more complex, real-world deployments.
The Zacks Consensus Estimate for OUST’s current and next year’s revenues implies year-over-year growth of 31% and 36%, respectively.
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That said, Ouster still needs to turn recent orders into repeat, scaled shipments as Rev8 moves through its production ramp. Any manufacturing delays, supplier issues or weaker-than-expected yields could slow revenue growth. Third-quarter 2026 guidance of $54.5-$57.5 million, versus $55 million for the second quarter, points to limited sequential growth, leaving results sensitive to Rev8 timing and customer adoption.
Our Take
Ouster has the better track record of execution, which is already reflected in its year-to-date stock price movement, leaving less room for upside surprises and more exposure to any Rev8 hiccup. OUST stock currently carries a Zacks Rank #4 (Sell).
At this stage, Aeva offers the more compelling risk-reward balance. Its FMCW technology, automotive validation, commercial-vehicle opportunity, industrial deployments and emerging optical-connectivity business create several potential catalysts that are not yet fully reflected in its commercialization story. Aeva still carries meaningful execution and funding risks, but its higher-growth potential makes it the more attractive investment option.
For investors willing to look past near-term headwinds, it offers more room to run from here. AEVA stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).