Joby Aviation Stock

Greetings, and welcome to the Joby Aviation Second Quarter 2026 Financial Results. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Teresa Thuruthiyil, Head of Investor Relations. Thank you. You may begin.

Thank you. Good afternoon and evening, everyone. Thank you for joining us for Joby Aviation's Second Quarter 2026 Financial Results Conference Call. My name is Teresa Thuruthiyil, and I'm Joby's Head of Investor Relations. We will begin today with prepared comments from JoeBen Bevirt, Founder and Chief Executive Officer; and Rodrigo Brumana, Chief Financial Officer. For the Q&A portion of today's call, we will also be joined by our Executive Chairman, Paul Sciarra.

Please note that our discussion today will include statements regarding future events and financial performance as well as statements of belief, expectation and intent. These forward-looking statements are based on management's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a more detailed discussion of these risks and uncertainties, please refer to our filings with the SEC and the safe harbor disclaimer contained in today's shareholder letter.

The forward-looking statements included in this call are made only as of the date of this call, and the company does not assume any obligation to update or revise them. Also during the call, we'll refer both to GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in our Q2 2026 shareholder letter, which you can find on our Investor Relations website, along with a replay of this call.

With all of that said, I'll turn the call over to JoeBen.

Thank you, Teresa, and thank you everyone for joining us today. It's an incredibly exciting time to be part of our industry. After many years of hard work designing, building, testing and flying our aircraft across thousands of flights and tens of thousands of miles, we're now at the point where we're preparing for commercial service.

I'm pleased to confirm that next month, we intend to complete our first eIPP flights in Texas. The White House-backed eIPP program has the potential to significantly accelerate our path to commercial service, and we're grateful to the FAA for their continued partnership as we look ahead to these flights. The flights in Texas will be the first of many that bring Joby together with state and local bodies as well as the FAA to prove out the value and operational maturity of our technology.

Over the course of a week, we'll be flying routes across the Dallas-Fort Worth area that lay the groundwork for future commercial operations. These Vertical Takeoff and Landing flights will demonstrate how our aircraft can transform travel across a major metropolitan area.

Over time, and with extensive involvement and oversight from the FAA, we expect flights under the eIPP program to progress from those with only a pilot on board to those carrying nonpaying passengers and eventually paying passengers. And in preparation for those flights, I'm pleased to confirm that we continue to target carrying our first passengers this year.

As we look ahead to commercializing our service, I've never been more excited about the potential for vertical lift. We see that potential demonstrated every day through our Blade business as customers choose to pay for journeys that give them meaningful time back. We acquired Blade just about a year ago with strong conviction in their team, their product and the opportunity presented by the network they've developed across the U.S. and the South of France.

Over the past year, that conviction has only strengthened. The business continues to grow quarter-on-quarter, so much so that the core constraint we're facing on many routes is now aircraft availability rather than passenger demand. The number of seats sold in Q2 was up over 50% from the same time last year, marking Blade's best-performing Q2 on record in that respect.

This quarter also saw the highest number of new flyers going to and from New York City airports since 2023, while route expansions contributed to more than 40% year-on-year growth in Hamptons revenue. We also saw positive impact from a number of key events around the world, including the World Cup and the U.S. Open here in the U.S. as well as the Monaco Grand Prix, where we sold roughly 4,500 seats to or from the race. The last quarter was so strong, in fact, that today, I'm pleased to confirm that we are raising our full year revenue guidance after Blade's revenue grew 32% year-on-year in the first half.

Looking ahead, we're drawing on Joby's existing relationship with Uber to drive increased demand. This is in addition to a new partnership between Blade and Visa signed during the quarter, which gives Visa Infinite consumer and business cardholders access to a premium suite of benefits on Blade's Signature Airport service in New York.

Vertical Takeoff and Landing has been our North Star at Joby since day 1, and our experience integrating Blade over the past year has only reinforced how central it is to the customer experience.

Flying between airports is something aviation has done successfully for a long time. The real opportunity comes from taking customers from where they begin their journeys to where they want to go, saving them the time and friction of traveling to an airport. Blade's experience with the New York to Hamptons service brings this point to life. Customers can book a conventional fixed wing aircraft from Teterboro to Montauk today for roughly 1/3 of the price of a helicopter flight from Manhattan, and yet utilization of the helicopter service remains significantly higher.

That tells us just how much customers value the time savings and convenience of beginning their journey in the city and avoiding the airport altogether. Being able to take off vertically is a fundamental part of what drives Blade's success today, and we believe the opportunity becomes even greater with the introduction of the Joby aircraft, which is quieter, less expensive to operate and designed specifically for journeys like these.

In July, I had the opportunity to experience this convenience for myself, flying to and from the Farnborough Air Show. Despite being one of the world's largest air shows, everyone still arrives by road or rail, on journeys that can take up to 2 hours. We ran our Blade service there for the first time, connecting Central London to Farnborough Airport in just 18 minutes, selling out seats on several days and underscoring the value of vertical lift in the U.K. market.

While we were at Farnborough, we signed a multi-year definitive agreement with Virgin Atlantic that builds on that opportunity and sets out a path for us to launch service across the U.K. with a particular focus on London and Manchester. We also held more than 150 meetings with regulators and stakeholders from markets around the globe, including a veritable alphabet soup of regulators that included the DfT and the CAA from the U.K., EASA from Europe, GACA and the GCAA from the Middle East, the U.S. DOT and the FAA as well as ANAC from Brazil, to name just a few.

And there was one common thread amongst all these meetings. They are just as excited about vertical lift as we are and are watching Joby's progress closely. They're seeing the positive ripple effects of the eIPP program, and they're asking how they can unlock the same level of momentum we're seeing in markets like the U.S. and the UAE.

As well as seeing great support on the regulatory side in those markets, we're also making incredible progress with infrastructure. Earlier this week, we announced a strategic partnership with Atoms, the industrial AI infrastructure company founded by Travis Kalanick. Travis co-founded Uber in 2009, the same year that I founded Joby. And since our first jam session in 2015, the one that seeded Uber Elevate, he's been all in on electric flight. He's one of the most dynamic founders of this generation with a rare ability to see the whole system and turn ambitious ideas into real industries.

Together, we're working on doing just that again with a joint understanding that the next revolution in transportation requires not only new vehicles, but also new infrastructure. Our shared vision goes beyond air taxis. With the rollout of autonomous vehicles gaining significant momentum, we see an opportunity to create a new class of mobility hub designed from the outset to support both technologies.

These hubs will combine takeoff and landing and charging for electric aircraft with charging and depot services for autonomous vehicles, sharing fixed costs, creating stronger operating economics, delivering seamless journeys for our customers and even greater value for the communities in which we'll operate. The Atoms team is world-class with deep expertise across acquisition, financing, development, electrification and permitting. And after 8 years of working in stealth, recently raised $1.7 billion with lead investment from a16z to support their growth.

Our own aviation experts will now work alongside the Atoms team to identify and develop the best sites for our network. We'll be focusing initially on Florida, New York and Texas, the same markets where we're preparing to launch early operations under the eIPP program, as well as here in California.

In addition to our own progress on infrastructure, we continue to see accelerating momentum and investment by states and airports here in the U.S., infrastructure partners across the industry and countries around the world. Florida enacted legislation, allowing the state to fund certain vertiport projects at up to 100%, committing millions of dollars to activate new sites all over the state.

We're excited that Orlando is already moving forward with developing a vertiport in the central terminal area of one of the country's busiest commercial airports. In Dubai, at the Marina, the second of 4 vertiports being built by our partners, is nearly complete. And we continue to see meaningful progress on infrastructure in markets like Japan, the wider UAE, Korea and Australia.

To make the most of this momentum, we still have to deliver our part, the aircraft and the service, and I'm pleased to report excellent progress there, too. We now have 5 of our electric air taxis in the air, including our first FAA conforming aircraft. And we have 12 more aircraft in various stages of the production process, including 2 set for delivery this year.

As we've said before, manufacturing is hard. Anyone who has tried to do it at scale will tell you that, and building conforming aircraft represents a step change in complexity. We are putting in the hard miles now so that we're ready to make the most of all of the opportunities I've just described.

Over the last quarter, we've worked tirelessly to remove bottlenecks and improve processes. And during the first 6 months of this year, as just one example, we reduced the nonconformance rate in our manufacturing processes by nearly 40%. This represents excellent progress as we move from R&D builds to low rate production.

During the quarter, we also took a significant step forward in our relationship with Toyota, forming a joint venture that lays the groundwork for high-volume commercial production, helping to significantly reduce the risk of one of the greatest challenges ahead of us. We're incredibly grateful to have had Toyota, the world's largest automaker, at our side for more than 7 years, leaning into that challenge and working with us to bring the best of automotive manufacturing to aviation.

We'll share more about our plans for the strategic alliance in due course, but I'm pleased to say that a senior Toyota manufacturing leader is set to join our Marina team shortly as we continue to work ever more closely together. By investing together in the people, facilities and systems required for production, we will create a more capital-efficient path to scale and a manufacturing system designed from the outset to deliver exceptional quality and consistency at volume.

I'd like to end where I started, with the eIPP program. As I've said, the program promises to be an important opportunity to accelerate commercialization and a critical part of that will be the safe and effective integration of our aircraft into the national airspace. In April, we announced a partnership with ASI focused on this work. And I'd like to congratulate ASI on being recently selected by the FAA to provide the central software infrastructure for managing traffic across the U.S. national airspace system.

ASI is effectively building an operating system for airspace, the invisible infrastructure that will allow us to scale access to our skies. It's an honor to be partnered with them, and we look forward to collaborating on airspace integration as part of our eIPP work. It's incredibly exciting to see all of these pieces coming together, and I hope everything we've shared today gives you a real sense of just how close we are and how ready we are for commercialization.

We're building the infrastructure, we're building the aircraft, we're building the customer base and we're building our operational experience. And on top of it all, we just had our strongest quarter yet in terms of progress on the fifth and final stage of type certification.

Taken together, everything I've described today is how we will unlock the third dimension of mobility and turn electric vertical flight from an extraordinary technology into an everyday reality, giving people their time back and fundamentally changing the way we move. And with that, I'll hand it over to Rodrigo.

Thank you, JoeBen, and good evening everyone. As JoeBen said in the beginning of the call, the revenue raise is a big part of today's story and Blade is a big part of the reason. The way Blade delivered is exactly what's giving us the confidence to increase guidance.

On a more personal note, it was great to see many of you at Farnborough last month. What struck me there was the energy in the room wasn't just talk. It was a response to real execution, progress on certification, on manufacturing and on building the commercial foundation for the eIPP. What I would like to do now is put numbers to that progress and walk you through how we're deploying capital against it with the usual discipline.

Let me start with the second quarter financial results. We ended the second quarter with approximately $2.3 billion in cash, cash equivalents and short-term investments. Our Q2 use of cash, cash equivalents and short-term investments totaled approximately $202 million compared to $195 million in the first quarter, which included the net cash impact of our Ohio facility purchase. Excluding that onetime Ohio investment, our first half 2026 use of cash was $365 million, which is within our guidance range of $340 million to $370 million. Additional detail is available in our Q2 shareholder letter.

Total property and equipment investment in the quarter was approximately $29 million compared to $78 million last quarter. With the Ohio purchase behind us, CapEx declined sequentially, though it remains elevated versus prior years as we build out manufacturing capacity. Revenue for Q2 was $39 million, primarily from Blade passenger business and up $14 million from the prior quarter.

Blade delivered a standout quarter, supported by the seasonal summer ramp, favorable weather and elevated demand around major events. We are pleased with that momentum. It exceeded our expectations, and it's reflected in the raised guidance we'll walk you through shortly.

Total operating expenses for Q2 were $300 million compared to $258 million in Q1. The $42 million increase was primarily driven by $23 million of continued investment to support certification, manufacturing ramp and commercial readiness, $11 million in costs related to increasing revenue and $8 million in other expenses.

On a GAAP basis, we reported a Q2 net loss of $245 million compared to $110 million in the prior quarter. Most of that increase was related to a $108 million noncash unfavorable change in the fair value of warrants and earn-out shares. The rest was a $27 million increase in loss from operations. Keep in mind that fair value revaluation is driven primarily by changes in our share price and can introduce meaningful noncash volatility from quarter-to-quarter.

Adjusted EBITDA, a non-GAAP metric that we reconcile to net income in our shareholder letter was a loss of $197 million in Q2 compared to a loss of $179 million in Q1. The $19 million change quarter-over-quarter reflects the revenue and expense dynamics I just described.

Stepping back for a moment, the mix of our spending is shifting to preparation for commercial operations as well as aircraft production. In the first half, capital expenditures were $107 million, including $62 million for Ohio and $15 million for Hollister, where we have invested in expanded flight test capabilities. We expect capital spending to run below the first half pace in the back half, though still elevated relative to prior years as we keep investing in manufacturing and commercial infrastructure. And we will continue to size that spend to respective milestones.

As we advance our U.S. go-to-market through eIPP, we are investing in the foundation required to carry passengers: Part 135 operations, maintenance and training and the systems that turn an aircraft into a running service. It is an exciting time. We see the eIPP as complementary to certification, a parallel path to build, improve the commercial side of the business, while certification continues on its own track. We are expanding as we hit milestones, not before.

On manufacturing, our joint venture with Toyota lets our teams work side by side to scale production. It also let us share the investment required to build that capability, leveraging Toyota's decades of production expertise. As we finalize the remaining supply agreements, we continue to expect Toyota's $250 million direct investment in Joby to close later this year or early next.

Now on to our guidance. Our approach to capital remains disciplined and milestone driven. As we move through the back half of the year, we are managing spend to optimize for certification progress, production ramp and increasingly commercial readiness through the eIPP.

For the second half of 2026, we expect to use $385 million to $415 million in cash, primarily to support certification, manufacturing, eIPP and commercialization. This step-up from the first half reflects deliberate investment in commercial readiness as we scale into operations. And as always, we can stage a portion of that spend to match our progress, keeping our usual capital discipline.

On revenue, given Blade's continued strength and healthy demand for air mobility, we are raising our full year guidance to a range of $115 million to $125 million from a prior $105 million to $115 million range, with $63 million in revenue already recognized in the first half and Blade typically peaking in the third quarter, we feel good about delivering on this increased range. Thank you for your continued support. And operator, please open the call for questions.

[Operator Instructions] Our first question comes from the line of Andres Sheppard with Cantor Fitzgerald.

Congratulations on the quarter and all the great progress, and it was great to see everyone at the Farnborough Air Show a few weeks ago. First question, I guess I have is just coming back to the eIPP. So again, a lot of great progress here and initial flights in September and first passengers in 2026, very exciting.

I guess my question here, maybe for you, JoeBen, is how are you thinking about utilizing your current fleet across these projects and including maybe your aircraft in production? Like how do you expect, I guess, to deploy these across the different projects? And then maybe secondly, and I realize this might be a bit early, but do we have a sense of revenue-generating opportunities that may come from the eIPP?

Thank you, Andres. It was wonderful to see you in Farnborough. I'll take the first part of that and then pass it to Rodrigo. The eIPP is really a spectacular opportunity that's been provided to us, and we're really excited about it, really excited about beginning that in Texas with our existing fleet and expanding that over the months to come and out into 2027 as we bring more and more aircraft online.

As I mentioned in my prepared remarks, we have our first conforming aircraft flying, and we have 12 more that are in production. That's an increase of 4 additional aircraft this quarter into our production queue. And the reason we're leaning so hard into manufacturing is the incredible opportunity that we see in front of us, both with eIPP and, as Rodrigo spoke about, with the incredible performance of the Blade division. With that, I'll hand it to Rodrigo.

Yes. Thanks, JoeBen, and good to see you, Andres, in Farnborough. Look, it's premature to provide forward guidance on the numbers today. But the reason we're so excited about this program is because it's giving us the opportunity to monetize every single aircraft that comes off our production for the foreseeable future. So think about the eIPP markets alone. So we're talking about Texas, Florida, New York, that alone could absorb the whole production for quite some time. And let's not forget about California, our backyard here.

So #1, we want to maximize that opportunity, and that's why we're so focused on production growth. And we started that not yesterday. We started much earlier than that. And don't forget, we intended to start passenger operations in Dubai as well, that will be on top. And I think Blade is showing us that vertical lift, what it can do. We saw a record quarter, and you were actually to experience that benefit while you're there in the U.K.

Wonderful. That's very helpful. Really appreciate that color. Maybe just as a quick follow-up, JoeBen, maybe a bit of an unconventional question. But at the Farnborough Air Show, you highlighted hydrogen as an exciting kind of new propulsion system. And so I guess my question there is maybe can you elaborate on that? How material is that to the story? I know it's maybe not talked about enough, but that was a bit differentiated. So just curious on how you're thinking about that and maybe some potential opportunities there that you're considering.

Thank you so much, Andres. So hydrogen has been something we began pulling the thread on back 6-plus years ago. Just to set the context, hydrogen has 3x the specific energy of jet fuel. And with our fuel cell systems, we can convert that chemical energy into propulsion about twice as efficiently as a small turbine converts jet fuel into propulsion. And as a result, you can do really game-changing things with aircraft design.

If you think about this in the context of a long-haul aircraft, take an A320 versus an A350. So the A350 flies twice as far with twice as many passengers, it weighs 4x as much. It takes off with more weight in jet fuel than weight in passengers. And that aircraft also costs 4x as much. So it costs twice as much per passenger, weighs twice as much per passenger. And that's all down to the fuel being very, very heavy. And so if you have a lighter weight fuel, you can do really game-changing things with aircraft design.

We think this is the biggest disruption in aviation since the invention of the turbine engine back in the 1930s. And we think that by being one of the world leaders, if not the world leader, we're going to see really significant upside over the years to come.

Our next question comes from the line of Savi Syth with Raymond James.

Just on Blade perhaps, I was kind of curious what you're seeing given the kind of the fuel increase here and still relying on fuel. Just what you're seeing in terms of kind of pass-through and kind of the ability for demand to kind of absorb that? And any high-level thoughts on margins this year versus maybe the potential there as kind of if you might pull back?

Savi, I think your question, and this is Rodrigo here, about the demand. Look, #1, if I look at Blade itself, the acquisition has been a home run. You saw that in the quarters here. We just did -- had the highest number of seats sold in Q2 in our history. And most importantly, the highest numbers of new flyers from NYC in New York since 2023. What that's telling you is the demand for vertical lift is very high.

So Blade has been a home run acquisition for us. We are lapping the first year pretty soon, and they have reaccelerated their growth. That's coming from the focus from the management in the high demand that we have for the service. And it's been a very valuable infrastructure that we acquired. So if you think about what we did here, we acquired an already built infrastructure, a loyal and growing customer base that loves the benefits of vertical lift, and a decade of know-how. So we put this all together, this is a very growing demand for us.

Look, now in terms of the -- I guess, your question is more like for the operating costs, I would say flight margin has improved, and you're not seeing a direct impact that will be flowing through the bottom line. Right now, we are running a business that is not consuming cash and in fact, it is contributing on the growth. And also, I think the team is doing a pretty good job in terms of selling the capacity that is available to the demand that's quite high.

That's helpful. I appreciate that. And maybe if I could briefly follow up on Andres' question on the eIPP side. Just on the aircraft that you plan to use, is that the certification conforming aircraft that you plan to use in those flight tests? Or are you able to kind of use some of the prior generation aircraft as well as you kind of progress through that flying?

Thank you so much, Savi. We're going to use a mix of different aircraft, both aircraft from our existing fleet as well as producing as many aircraft as we possibly can off of our company conforming production line.

[Operator Instructions] Our next question comes from the line of James Kirby with JPMorgan.

I just wanted to ask on the scale and ramp, JoeBen. And I appreciate the color you answered in the previous question on the 4 incremental in development aircraft quarter-over-quarter. Is that the right cadence to think of for the back half of the year? I think you mentioned 2 are expected to be delivered later this year. So is the right way to think about that, that you expect to end the year with 7 aircrafts flying?

Yes. Thank you so much. We are, as I mentioned, ramping our manufacturing as aggressively as we can. We've been making really phenomenal progress on the nonconformance rate, which translates directly into improvements in efficiency and improvements in output. And so we are going to continue to add new aircraft into the build -- the front end of the build queue because there is a lag between when we start a build and when the aircraft comes out the back end. As I mentioned, we're targeting at least 2 aircraft to come off the line over the back half of the year and hoping to over deliver.

Got it. That's really helpful. And then for my second question, just in light of recent industry announcements on the defense side, maybe just want to give you a chance to really just clarify, and I know you've been asked on almost every call on the end markets for defense. But maybe just where the defense fits into the Joby ecosystem and particularly where you prioritize it with the eIPP obviously ramping in the coming months?

Yes. Thanks a lot for the question. This is Paul. Obviously, there's been a lot of conversation across the industry around hybrid VTOL for defense. And we have been working on this category for going on 2 years and not just working on it, but actually demonstrating improved range, improved capability in conjunction with moving to a hybrid platform on real aircraft that are flying. And we think that puts us in a really strong position to take advantage of the opportunities that we see before us across multiple different customers across the DoW.

Now look, the mission types for vertical lift vehicles for those customer sets are really wide. There are areas in strike, areas in ISR, areas in infil and exfil, particularly for passenger carrying versions that I think are all super exciting for the core capabilities that we're demonstrating. And I think one of the things that you're seeing more broadly in defense is that it used to be that spec sort of delivered on capabilities.

But actually, the reverse is largely true now, or at least there's an interplay between the 2. And it's demonstrating capabilities that allow you to shape the specifications that the customer wants. So that's why we've been doing the work and why we think we're going to be well positioned to take full opportunity of all of those defense customer use cases.

Our next question comes from the line of Amit Dayal with H.C. Wainwright.

With respect to the eIPP program that's about to start for you guys, are there any aspects of running the eIPP program that could give you certification credits? Or should we think of these as separate efforts with no overlap?

Yes. Thank you so much. We do see the potential for there being -- the potential to accelerate our overall certification program on the back of a lot of the flight testing and experience that we gained through the eIPP program. Just as a recap, we're working very closely with the FAA as well as local municipalities as we conduct our flights and operations under the eIPP program. And that close coordination, we think, has the potential to pay dividends.

And then my follow-up, I guess, is around the Atoms partnership. Should we assume this partnership implies that you could be shouldering some of the CapEx that goes into developing the vertiports? I just wanted to see if this potentially adds some additional burden on your balance sheet or if that is not a correct assumption?

Thanks for the question. So it is a co-investment vehicle, and both parties are going to contribute capital. But most importantly, when it comes to the way in which it's structured is that Atoms has built up a number of financing relationships over a long period of time, given their work in real estate development and operation for many, many years now. So we get to be the beneficiary of a lot of the relationships and the credibility that they've already sort of built out.

JB already mentioned sort of in the outset how we're going to sort of lean on the Atoms team for site identification, procurement and in turn, sort of build-out and operations. And that in turn means that we have a smaller share of the lift for all of the sites that we develop. But I think the most important thing really is the opportunity to kind of help to define a brand-new asset class.

With 2 important new modes of transportation entering U.S. cities over this year and the coming years, that is autonomous vehicles on the ground and eVTOL aircraft in the air. We're going to need this sort of new infrastructure. And I think if we can go out and demonstrate its viability in conjunction with the smart folks over at Atoms, we really can define this new asset class that us and others continue to develop in more markets and a greater scale over time.

Understood. Just can I maybe just ask one question on the 2 aircrafts that you are planning to deliver this year, who are those going to? If you can share any color on that?

So as I mentioned at the outset, we have far more demand for aircraft than we have the production or we're able to produce at the moment. And so we're ramping production. We've not specifically decided the destinations for those 2 aircraft. Dubai and the UAE remain very high on our priority list. But we will make strategic decisions as those aircraft come off the line.

Our next question comes from the line of Austin Moeller with Canaccord Genuity.

So of the conforming aircraft that are currently in the assembly phase, do we have any timetable on when some of those are going to come off the line? I know one of them is already in ground testing, but when those would come off the line and start conducting flight tests because our thinking should be that it's 12 months from when TIA flight testing starts to cert, correct?

Thanks, Austin. So just to kind of recap it for folks, we have -- the first step is doing the work on Stage 5. And as we reported, is the final stage of certification. We reported record progress on Stage 5 this quarter. So really thrilled with the work the team is doing there. That is about running the component level testing, the system level testing and writing those test reports, making great progress on that.

The second piece is preparing the flight test plans that first Joby pilots will get in and fly on those aircraft. And then it is about -- the third stool -- leg of the stool is we need to expand the flight envelope on that first conforming aircraft. We've done that work already on our prior series of aircraft, which are, for all intents, very similar to our FAA conforming aircraft. And so we're, in a sense, repeating those exercises.

The other element that we're now working on in parallel is this work on the eIPP. And we see that as an incredible opportunity, but also an additional burden on the team. And so we think that it has the potential -- in the short term, it's additional effort. But as I said earlier, it has the potential to accelerate our overall certification program. But the short term may be some extra load.

Okay. And can you comment on the incremental $250 million equity investment that's expected from Toyota? Does that go to you now? Or would that go within the JV?

Austin, Rodrigo here, and I look forward to seeing you in the conference next week. Short answer is it's coming and it's going to go directly to Joby Inc. Should expect that by the end of the year or early next year.

Our next question comes from the line of Chris Pierce with Needham & Company.

I just want to -- can you help me sort of level set what to expect in September and through the rest of the year in Texas? Like should this look like the Electric Skies event? Should this look like ONEflight? Or could this be high -- not high frequency, but an aircraft there flying on a semi-regular basis? And are these passengers kind of one-off type passengers? Are they able to book through the Joby app or the Uber app? Like I just want to kind of know what we should be looking for at the start and how it progresses?

Yes. Thank you. Just as a recap, this is staged. So it will begin with Joby pilots on board and then progress to passengers, and then further on down the road, paying passengers. And so that's the progression you should expect. With the flight -- specifically the flights in Texas, we're planning that over a course of a week. And we plan to do a number of flights that allow us to really get comfortable operating in the Dallas-Fort Worth airspace. We see this as a tremendous opportunity and Texas is a really, really exciting market for us and for the industry as a whole.

Okay. Perfect. That make sense. So we shouldn't expect -- that's fine. I get it. Okay. Perfect. And then on the talk about ramping production. I guess, how should we think about when you might churn Ohio on, when investors might be able to have boots on the ground, and sort of really see the higher tempo production as you move beyond sort of the cadence you laid out in 2027, the cadence you've laid out towards the end of this year?

Yes. Thank you. So the ramp in Ohio for the components we're manufacturing there has already gotten going, and the team is doing a spectacular job of producing conforming components out of that facility. And we are also ramping at our facilities in San Carlos and in Marina. We expect to continue to ramp each of those facilities in parallel as we increase our manufacturing volume over the quarters to come. So if you're interested in seeing our manufacturing operations, we would love to have you. We think we're doing a really remarkable job, and it's really fun to come see.

Okay. And then just flipping back to Austin -- to Andres' question. I believe you talked about -- sorry if this came up on the call, but Dubai, you're still anticipating passenger flight there this year? Or that's sort of -- because of the conflict that's sort of not lower priority, but just that's a lower likelihood event? Or has anything changed in that regard?

So our partners there are as leaned in as ever, the RTA and the GCA (sic) [ GCAA ] as well as our infrastructure partners. The first vertiport is done. The second one is close to completion. The third is progressing well. And that is really significant because the degree to which the government there is leaned in on making this new mode of transportation a reality. I was over there about a month ago, and it is -- we think that Dubai, the UAE and the region as a whole is a really remarkable and exciting opportunity, and we can't wait to get back to flying there. As a reminder, we have an aircraft over there, and we're really -- we can't wait to get going.

Our next question comes from the line of Kristine Liwag with Morgan Stanley.

By the way, it was great to fly Blade at Farnborough last month. Our roughly 15-hour flights certainly beat -- 15-minute flight, excuse me, beat the 2-hour drive back to Central London. So I guess pivoting to Blade then, can you provide an update in terms of how you're viewing that business strategically? Specifically, how much of Blade's current operations are focused on retaining and servicing the existing customer base versus potentially expanding that customer base ahead of the Joby eVTOL aircraft certification? And how do you think about balancing that near-term operating discipline versus accelerating Blade as a demand generation platform?

Thanks a lot, Kristine. This is Paul. So I mean, as you saw from the numbers and as you saw from the guide, we're feeling really good about the existing Blade footprint and really the demand signal that we're getting from those core markets. The principal issue that we've had in terms of scaling it beyond that existing demand is aircraft availability, which is obviously something that we hope to solve with a better, quieter aircraft in relatively short order.

Blade has had tons of opportunity to sort of potentially expand its overall footprint, and we're evaluating those on a pretty regular basis. Obviously, some of that work is happening in the eIPP markets that will be Joby launch sites as well. So we're kind of taking each of them in turn and evaluating the core merits about whether or not it makes sense to do or not.

But as I said, in terms of the core of the business, we couldn't be more pleased with both the signal that we are getting directly from customers, the operational experience that Rob and the broader team sort of bring, given their work on this for years and years. And finally, the insight on the kinds of journeys, not just airport to airport, but airport to non-airport that really make this whole thing work.

Perfect, thank you. And thank you to all the analysts who asked questions today. Earlier this week, we invited members of our community to submit questions as well. And I think we have time for at least one of those now. The first question actually is about modernizing ATC. The question is, will Joby have any involvement with ASI's FAA contract to modernize the air traffic control system? Paul?

Yes. So we started our partnership with ASI earlier this year, and we were very excited that they were selected by the FAA for one important component of the broader ATC modernization, the sort of smart program. We will be working with ASI in short order to essentially trial their tools in the existing airspace, both with Blade operations and with Joby eVTOL operations. We see it as a very important sandbox with a small number of aircraft and a limited geography to essentially prove out the additional performance that we can bring in terms of flight frequency from sort of key locations. And that's really the role that we're going to play in conjunction with ASI on that effort.

But look, more broadly, when you think about the ATC modernization and there are other pieces of that, that are coming, including [ caps ] ground infrastructure, all of it is really in service, I think, of allowing us to increase the frequency of both existing and future operations beyond what is possible in existing ATC. So it has very real benefit, revenue benefit and profitability benefit for Joby over time.

And then even more importantly, it's really the steppingstone for fully autonomous commercial operation, which we're progressing well with our Superpilot autonomy stack that we acquired via the Xwing acquisition. So the ATC modernization is an opportunity to both increase the revenue opportunity of current and future piloted operations, and then over time, really expand the scope and scale of autonomous operations, which are both super exciting for the long-term business.

Great. Thank you. Thank you everyone for joining us today. We greatly appreciate your support. We'll talk to you soon. Operator, please go ahead.

Thank you. And this does conclude today's conference, and you may disconnect your lines at this time. We thank you for your participation.

Greetings, and welcome to Joby Aviation's First Quarter 2026 Financial Results Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Teresa Thuruthiyil. Please go ahead.

Thank you. Good afternoon and evening, everyone. Thank you for joining us for Joby Aviation's first quarter 2026 financial results conference call. I'm Teresa Thuruthiyil, Joby's Head of Investor Relations. We will begin today with prepared comments from JoeBen Bevirt, Founder and Chief Executive Officer; and Rodrigo Brumana, Chief Financial Officer. For the Q&A portion of today's call, we will also be joined by our Executive Chairman, Paul Sciarra.

Please note that our discussion today will include statements regarding future events and financial performance as well as statements of belief, expectation and intent. These forward-looking statements are based on management's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a more detailed discussion of these risks and uncertainties, please refer to our filings with the SEC and the safe harbor disclaimer contained in today's shareholder letter.

The forward-looking statements included in this call are made only as of the date of this call. And the company does not assume any obligation to update or revise them. Also during the call, we will refer both to GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in our Q1 2026 shareholder letter, which you can find on our Investor Relations website, along with a replay of this call.

With all of that said, it's my pleasure to turn the call over to JoeBen.

Thank you, Teresa, and thank you, everyone, for joining us today. It's been less than 10 weeks since we last spoke. But despite the short window, I'm pleased to report that it's been another exceptional quarter of progress across all core areas of Joby's business. Perhaps the biggest news of the quarter was the selection of states that will participate in the White House-backed eIPP program. This program paves the way for us to bring our aircraft and service directly to U.S. communities this year ahead of FAA type certification. And to speak frankly, we were awarded this dream slate of opportunities.

We were selected as part of 5 applications covering 11 states, including Texas, New York and Florida. Each of the selected programs is now in the process of finalizing an OTA agreement with the FAA and the Department of Transportation. These agreements are flexible R&D contracting mechanisms that enable faster and less restrictive collaboration than traditional federal contracts. They will define the scope, roles and time lines for what happens next, but our work has already begun.

In New York, we're progressing with the installation of Joby charging infrastructure at both Eastside heliports. And the Port Authority of New York and New Jersey recently released a solicitation for a vertiport on the LaGuardia Airport Terminal C parking garage roof. In Texas, we've secured our MRO facility to support operations in the region. And in Florida, we've been working with Orlando International Airport on the development of a dedicated vertiport for air taxis.

In other states like North Carolina, Utah, we're planning how to begin autonomous cargo flights using our Superpilot technology. Importantly, we're also already showing that we have the technical and operational maturity required to participate in the program.

Alongside flying our first FAA conforming aircraft for TIA this quarter, we conducted a series of demonstration flights in the Bay Area and New York. During those flights, we landed at 2 major international airports, Oakland and JFK. We flew to 3 Manhattan heliports. We operated within Class B airspace, which surrounds our nation's busiest airports. And we demonstrated our ability to charge in a range of different environments.

The New York flights, in particular, took our demonstrations to the next level by connecting JFK with the Wall Street Heliport, the West 30th Street Heliport and the East 34th Street Heliport. We not only demonstrated real-life use cases flown by our Blade customers today. We also completed the first ever flight of an eVTOL aircraft between an international airport and a downtown Heliport.

And as they say, if you can make it in New York, you can make it anywhere. Whether it's flying past the Statute of Liberty or the Golden Gate Bridge, these flights demonstrated without question that we have the aircraft, the team, the tools and the experience required to make the most of the eIPP program. But that maturity hasn't come overnight.

Our first transition flight with this design was way back in 2017. The success you are seeing today is the culmination of years of careful work in developing, testing and producing mature VTOL-capable aircraft. And that maturity will be key to delivering real VTOL passenger operations as part of the eIPP program.

But to do that, you also need infrastructure. And I'm pleased to report we're making excellent progress on that front, too. Our New York demos highlighted the incredible value of the landing sites and lounges we gained access to as part of our Blade acquisition, which includes America's 3 busiest heliports.

In L.A., we announced a partnership with the Ruben Brothers to bring a vertiport to the iconic towers at Century Plaza. In the Bay Area, we announced a partnership with the SAP Center to develop a vertiport in a key San Jose location. And in Dubai, we celebrated the completion of the first ever purpose-built commercial vertiport located right next to Dubai International Airport. It will serve as the operational hub for our services in the region.

These are the first of multiple infrastructure developments and partnerships you'll be hearing about as our recent demonstration flights and eIPP opportunities accelerate conversations with partners around the world.

Over the last few years, we have set ourselves apart. Thanks to the maturity of our aircraft design and our progress through certification. But as we scale production to meet the demands of our early markets and the eIPP program, it's clear that our head start on manufacturing will be equally important.

The experience we are already building in certifiable production processes, production efficiency, supply chain optimization and inventory management are all going to be just as important as the technical and certification lead we've built over the last few years.

By producing more aircraft, we'll be able to serve more markets and more customers, enabling us to access progressively lower unit costs ahead of our peers. To put our ramp into context, we are adding a third shift to our composites layup team and our automated fiber placement team. We're training batches of new technicians each month. And our composites team is already producing 2.5x the volume of parts it was producing this time last year.

But it's not just about volume. It's also about quality and to some extent, speed. We aren't building prototype parts anymore. We're building conforming parts for a conforming aircraft. And we're seeing incredible results as we ramp production.

As we move from producing composite parts for our first conforming aircraft to our fifth conforming aircraft, we have the time required to produce parts while simultaneously improving quality. Today, we're producing parts for our ninth conforming aircraft. And we continue to do all of this with Toyota at our side.

We're embedding the knowledge and experience of the Toyota production system as we go, including practices such as Gemba Walks, where you observe work directly on the factory floor and Obeya rooms that centralize project information to accelerate decision-making and foster collaboration. This kind of day-to-day collaboration and knowledge sharing is invaluable as we ramp production. And we're incredibly fortunate to be learning directly from such an experienced automaker.

On certification, we remain focused on the fifth and final stage of the type certification process and are making strong progress. During the quarter, we successfully completed our SR3 audit with the FAA, a milestone years in the making. The audit reviewed our aircraft design and safety requirements, test results and development standards and confirmed that the test results we are producing meet the FAA's expectations for the final phase of certification.

This achievement, along with so much of what we've discussed today, is testament to the incredible work our teams have done over the last 5 years. And I'd like to take this opportunity to thank Didier for his remarkable contributions. He will be with us through early July and will continue to support us as an adviser after that. As we look ahead, we are promoting a number of our leaders to optimize our organizational efficiency and velocity.

Looking more broadly across our product platform. We also completed full transition flights with our turbine electric VTOL aircraft during the quarter, including a 148-mile flight at our max takeoff weight of 2,400 kilograms. As a reminder, this aircraft is built on our standard electric S4 platform and introduces a gas turbine for increased range and payload.

Achieving transition is one of the hardest technical challenge faced in the development of this technology. But by using our existing platform, our own core technologies and our experienced team, we've been able to deliver it in record time. That allowed us to demonstrate its maneuverability and endurance to the U.S. Army last month alongside our partner, L3Harris.

There are live contract opportunities in this space today with clear capability gaps and strong demand for this type of system. That same operational experience and aircraft maturity is key to the partnership we announced with ASI or Air Space Intelligence last month. ASI has quietly built a reputation as a true leader in airspace modernization with their high fidelity 4D modeling and AI tools. And they are 1 of 3 companies currently competing to provide the software foundation for the FAA's brand-new air traffic control system.

While our aircraft was designed to operate comfortably within the current system, we have always believed there are better ways to deliver higher volume eVTOL operations. And we are very excited about the ongoing work to modernize air traffic control led by Secretary Duffy.

Alongside ASI, we plan to run real-life demonstrations of how scaled operations can be safely integrated into complex and high-traffic airspace later this year. This work is also an important step towards fully autonomous eVTOL operations.

With our Superpilot stack, we already have the technology to do this. What's been missing is an airspace management system that allows for fully digital deconfliction of the airspace. Our work with ASI should help pave the way for this important next step. And if it's successful, it should mean safer, lower-cost aerial transportation for eVTOL and every other aircraft that uses U.S. airspace.

We closed out the first quarter with a very strong balance sheet, incredible progress across all areas of our business and the clearest path we've ever had to beginning passenger operations. With our recent New York and San Francisco demos behind us and the eIPP program ahead of us, communities across America aren't just reading about the future of flight or hearing about it on calls like these anymore. They're seeing it in the skies above their own cities.

And as I said to our team, when we rang the opening bell at the New York Stock Exchange last week, just half a mile from where our aircraft landed an hour later. We are quite literally ringing in the next golden age of flight.

Rodrigo, over to you.

Thank you, JoeBen, and good evening, everyone. As JoeBen just described, Q1 was a quarter of steady progress. Last week in New York, I had the privilege of meeting many of you in person, including investors and analysts joining this call today. Together, we witnessed something remarkable. Successful flight demonstrations connecting Wall Street in Midtown to JFK in minutes, real aircraft flying real routes, all made possible through our Blade infrastructure in partnership with the FAA, local government and key infrastructure partners. It was a glimpse of the future. And I could not be more excited to be a part of this team.

The moments like that don't happen by accident. They are the result of years of deliberate investment and disciplined execution. And from a finance perspective, my job is to ensure that continues by funding certification, scaling manufacturing and supporting commercial launch, while preserving the financial flexibility to execute. What you saw in New York last week and in the Bay Area the month before is the combination of deliberate investment and disciplined execution, producing tangible progress in the market.

Now let me walk you through our first quarter financial results in more detail. We entered 2026 with a strong momentum on the balance sheet. We ended the first quarter with approximately $2.5 billion in cash, cash equivalents and short-term investments, including $1.3 billion in net proceeds raised during the quarter from our equity and convertible offerings and warrants exercised by Delta Airlines.

Our Q1 use of cash, cash equivalents and short-term investments, excluding net proceeds from Q1 capital raises, totaled approximately $195 million. This includes $32 million of net purchase cost for our new Ohio manufacturing facility after financing. The gross purchase price was $62 million. And we financed roughly half of that at attractive terms, bringing the net cash impact for the quarter to $32 million. Excluding that onetime purchase, consistent with how we communicated our first half guidance, Q1 cash use was $163 million compared to $157 million in Q4. Additional detail is available in our Q1 shareholder letter.

Total property and equipment investment in the quarter was approximately $78 million. Of that, $62 million reflects the gross Ohio purchase with the remaining $16 million supporting facility build-out, tooling and production equipment for our manufacturing ramp. Overall, Q1 spend is in line with our first half 2026 guidance of $340 million to $370 million, excluding the onetime Ohio purchase exactly as previewed and we remain on track within that range.

Step back for a moment, the capital deployment you see this quarter reflects the choice to lead, not to follow. We are running a multiyear manufacturing ramp, an active type certification program, a global operations build-out and integration of Blade, all in parallel. Few companies in our industry are in a position to execute all 4 at once. We can because of years of foundational investment. And we can do it sustainably because of the strength of our balance sheet.

On a GAAP basis, we reported a Q1 net loss of $110 million, a $12 million improvement compared to the $122 million net loss in Q4. The sequential improvement was driven by a $33 million noncash favorable change in the fair value of warrants and earn-out shares and $4 million in higher interest income, partially offset by a $27 million increase in loss from operations. As a reminder, the fair value revaluation of warrants and earn-out shares is driven primarily by changes in our share price and can introduce meaningful noncash volatility from quarter-to-quarter.

Revenue for Q1 was $24 million, which was mostly Blade. Compared to Q4, revenue decreased $7 million, reflecting the absence of the onetime revenue we recognized in Q4 for the flight demonstrations in Japan. Blade performance in Q1 was strong. And we are now heading into the seasonal ramp with Q2 typically building as weather improves to a Q3 peak. Service levels and customer demand remained consistent. And Q1 puts us on a solid trajectory for our full year revenue guidance of $105 million to $115 million.

Total operating expenses for Q1 were $258 million compared to $238 million in Q4. The $20 million increase was primarily driven by continued investment to support certification, manufacturing ramp and commercial readiness. Adjusted EBITDA, a non-GAAP metric that we reconcile to net income in our shareholder letter was a loss of $179 million in Q1 compared to a loss of $154 million in Q4. The $24 million sequential change reflects the revenue and expense dynamics I just described.

Taken together, the capital deployed in Q1 reflects deliberate investment in the capabilities that set Joby apart, advancing certification, scaling manufacturing in California and Ohio and building the foundation for commercial launch. Q1 was a quarter of steady execution. And as the flights in New York and in the Bay Area demonstrated, our progress is increasingly visible, not just on the certification pathway, but in the skies above our largest cities. We have the balance sheet to leave and the discipline to do it well.

Thank you for your continued support. And Operator, please open the call for questions.

[Operator Instructions] The first question we have is from Kristine Liwag of Morgan Stanley.

JoeBen, Paul, Rodrigo, Teresa, it was really inspiring to see the Joby aircraft land in front of me my own eyes at the West 30th Street vertiport last week. So thank you for that. I guess with the very visible progress of Joby with eIPP, can you talk about what kind of conversations you're having with incremental customers? Because as you guys touched on your prepared remarks, the future is here. All the years of hard work that you've had is really coming to fruition and you have these capabilities occurring now.

And so as these kind of firm up in what people could see the true mission of this, can you talk about those customer conversations? And how quickly do you think those potential orders could materialize?

Thank you, Kristine. So first, I think the experience for folks in New York was really indicative. And the excitement was really indicative of the progress that we're making and the opportunities ahead of us. There are so many customers who are really excited about beginning to use our service.

I think the next element of that, I think you're referring to is sales of aircraft. And as Paul has talked about a number of times before, that's certainly a lever that we can choose to pull as we desire. There is a huge amount of demand from many international markets. And we may dial that depending upon the market.

And then I think the third area where we're really seeing momentum and opportunity to capitalize on the demonstrations we've been doing and the momentum around eIPP is around infrastructure. And I think that the -- really accelerating those infrastructure conversations and getting more and more takeoff and landing locations built out is a strong opportunity.

And then I would just -- back to your question about aircraft sales. I might turn it over to Paul to touch on the opportunities on the defense side.

Sure. Thanks for the question, Kristine. Yes, I mean, as we've talked about, we've got a pretty deep pool of sort of potential aircraft sales opportunities outside of the U.S. I mean we've talked specifically about Saudi Arabia, also about Japan with our partnership there. So all of those folks are really looking for the same things that we were able to demonstrate in New York, which is an aircraft that is mature. That can sort of meet the mission. And that is essentially supported by both maintenance and pilot training to make those aircraft sort of useful in their markets. So I think the work that we did in New York is certainly positive for the momentum that we're seeing on the sales side of things.

The next question we have is from James Kirby of JPMorgan.

Just for the eIPP, how are you thinking about sequencing the initial aircraft for the program by both location and operation? Is a decision tree that is based off potential revenue opportunity or maybe where infrastructure is already in place? Or is there a regulatory angle to that? Just kind of initial thoughts. I know it's early, just on how you're looking to scale the eIPP.

Thanks so much, James. So I think it's both of those elements. It's about infrastructure. And you have some states that are really moving very rapidly at deploying additional infrastructure and that's -- we're thrilled about that. And then there's also opportunities like in New York, where we already have existing infrastructure and an existing customer base and being able to bring the acoustic signature, the really remarkable acoustic signature of our aircraft to places that are currently quite impacted by helicopter noise, we think, is a massive opportunity. So we do see substantial demand across these eIPP markets. And we're very excited to be ramping our manufacturing as aggressively as we can to deliver on that opportunity.

The next question we have is from Andres Sheppard of Cantor Fitzgerald.

Congratulations on all the great progress. And I echo those thoughts earlier. It was very exciting to see the aircraft in a natural environment. JoeBen, I guess my question, just to build from the last one is around the eIPP. Curious to get your vision on kind of how you see the program starting and kind of ramping up from there.

We know, obviously, it will run for 3 years. We know it will start this summer. We know some of the projects have been selected. There might be a few additional ones. But what we don't know exactly, I guess, is kind of how the program will start. Is it going to be each project at the same time, multiple aircrafts at the same time or kind of rotating. So just curious on kind of how you see the program starting and kind of ramping up and really developing and maturing over these 3 years.

I think our -- the best crystal ball we've got at the moment is that we'll be signing or that agreements will start being signed in Q3. And that as we move into the back half of the year, we'll start to do operations. I would expect operations both for our eVTOL aircraft as well as for our autonomous platforms. And on the eVTOL side, we are, as I mentioned before, ramping manufacturing as aggressively as we can to be able to field as many aircraft into the eIPP markets as we can as we look into the back half of this year and the first half of next year. We'd really like to get those fleets in New York, Florida and Texas built out.

[Operator Instructions] The next question we have is from Savi Syth of Raymond James.

I know you started flying the first kind of conforming aircraft. I was just curious when you think you'll start kind of full credit testing of the aircraft and what things need to transpire to get there?

Thank you so much, Savi. So we are thrilled to have that aircraft in the air. And just as a reminder, this was a monumental lift to build this aircraft with FAA DERs and [ VARs ] intimately involved in the process. Having that aircraft in the air is absolutely fantastic. That's one piece.

The second piece is we need all of the conforming test articles to have been built and then tested and then many of those test reports written and submitted. So those are 2 parallel work streams that we're working on. The next step for the FAA -- or for our first conforming aircraft is for Joby pilots to begin doing testing. And in parallel to that, to get FAA pilots into the simulator and get them trained up.

So really, you can think of 3 parallel work streams. One is the components and parts getting tested. Two is Joby pilots flying the conforming aircraft and doing all the test points in advance of the FAA pilots doing them. And then third is the FAA pilots getting trained in the simulator.

The next question we have is from Chris Pierce of Needham & Company.

Just looking back to the eIPP and production. I mean it seems like the partners in the states are moving as fast as one could hope. I just want to get a sense of are there any bottlenecks you could potentially see on your side, manufacturing, raw materials, production, even pilots that you need to have at the ready in these locations? I just want to kind of get a sense of what you're doing to kind of head off all potential bottlenecks to get as many aircraft out there as possible.

Yes. Thank you so much, Chris. Great question. And I'd like to echo your shout out to the states and the FAA and the DOT for the absolutely phenomenal work that they're doing on this program. We are working very hard on all 3 elements that you mentioned: one, supply chain; two, ramping manufacturing; and three, we made a very early investment in our flight simulator and having that installed now and preparing that for beginning to train the FAA pilots is really speaks to the Joby team and the incredible foresight.

As a reminder, we built that in partnership with CAE. So CAE is the world leader in flight simulators. Joby develops all the flight dynamics and the flight controls that run on that. And CAE provided the hardware. It was an amazing partnership. And we're so excited to start training pilots in it.

[Operator Instructions] The next question we have is from Austin Moeller of Canaccord Genuity.

So just my first question here. What is the status of the production activity time line in Ohio? And do you plan to add shifts there over time as well?

Thanks so much, Austin. The ramp of the team in Ohio is going really, really well. As a reminder, folks, we're doing propeller blade manufacturing there. And we're really pleased with the bring up of that facility. That was the first facility that we purchased in Ohio. We're adding additional components and systems that we're starting to build in that first facility.

In addition, as a reminder, we bought an additional 730,000 square foot facility across the street. And that facility is beginning to get the build-out and preparing that facility for our -- beginning to put production processes into that facility. So it's 2 parallel work streams. One, building the workforce and adding more and more capabilities for our team in Ohio. And the second is building out that larger facility. So really, really pleased with the momentum and the maturity that we're seeing out of the team in Ohio.

The next question we have is from Amit Dayal of H.C. Wainwright.

Congrats on all the progress and good to see the flights starting to take place now. With respect to passenger flights, you've indicated potentially this could take place by the end of this year. I think earlier expectations of these might materialize in the Middle East. But with the situation over there, do you think these flights potentially take place here in the U.S.?

Thank you so much, Amit. So it is very exciting for us to now have 2 shots on goal for passenger flights this year, both in Dubai and as well as in our different eIPP markets. And so I think that's looking very strong that we'll see passenger flights later this year. And for me, this is a dream come true. This is something I've been waiting for, for a really, really long time.

At this time, I'll be handing the call over to Teresa. Thank you, Teresa. Please go ahead.

Thank you, Irene, and thanks to all the analysts who asked questions today. Earlier this week, we invited members of our Reddit community to submit questions. We received a bunch of different questions about eIPP, future stops on our Electric Skies tour and conforming aircraft. So let's jump into a couple of them.

First question asks, how far along are the other FAA conforming aircraft that are in production? How many are in production? What does the timeline look like for FAA pilot testing? JoeBen, do you want to give us a summary of that one?

Yes. So first, in terms of the number in production, as I said in my prepared remarks, we now have parts for 9 aircraft that are beginning to be built. And we have 5 aircraft that we will be using for TIA flight testing. And all of those are progressing well through our manufacturing operation. So this is indicative of the manufacturing ramp.

As I said, we have spooled up our third shift for our composites operation and really seeing great momentum. And just to like put a fine point on it. We are ramping as fast as we can, but with the focus on quality. We really want to drive MCRs, which are nonconformances to 0. We want to be making as many of our parts with 0 defects as we possibly can.

The name of the game in aviation manufacturing is making parts with incredible consistency and quality. And it's incredible to have the Toyota team that has a deep expertise and ethos steeped in quality. The Toyota production system is known around the world for the incredible quality and efficiency that it drives in the manufacturing processes and having Toyota shoulder to shoulder with us has been absolutely phenomenal.

JoeBen, thank you. The next question is about eIPP and the question asked. The purpose of eIPP is for AAM companies, cities and regulators to garner useful information earlier in the development process than would have been previously possible. Can you share any useful information Joby or regulators have learned from Joby's New York City and SSA area tours, including any unexpected public reactions?

Yes, thanks. So the key pieces this really showcased and built on the deep relationships that we've built, whether that's with the EDC and the Port Authority in New York, whether that's with the FAA and the DOT. And the Joby team just knocked it out of the park.

The operations went flawlessly. And we are so grateful for -- I'm so grateful for the Joby team and for the relationships that we've built and the maturity of our processes and with the regulators. I think the thing that stood out for me the most, and I think was really remarkable about the flights was people getting to hear our aircraft for the first time and specifically not hear our aircraft when it flies by overhead.

New York has large numbers of helicopters operating. And the difference in the acoustic profile between a helicopter where you can hear it from a long way away. And our aircraft where it can fly directly overhead and you can't even hear it in a city like New York is really exciting.

And we can't wait to bring our aircraft to New York, to Florida, to Texas. And we're so grateful for the DOT and the FAA for the remarkable work that they've done on the eIPP and very grateful for the states and their incredible execution on this program.

Yes, it really was joy to have the community so involved in these flights that we did last week in New York City. Thank you, everyone, for joining us today. We greatly appreciate your support. Operator, over to you.

Thank you. This concludes today's conference. And thank you for joining us. You may now disconnect your lines.

Greetings, and welcome to the Joby Aviation Fourth Quarter and Fiscal Year 2025 Financial Results Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Teresa Thuruthiyil, Head of Investor Relations. Teresa, please go ahead.

Thank you. Good afternoon and evening, everyone. Thank you for joining us for Joby Aviation's Fourth Quarter and Fiscal Year 2025 Financial Results Conference Call. I'm Teresa Thuruthiyil, Joby's Head of Investor Relations. We will begin today with prepared comments from JoeBen Bevirt, Founder and Chief Executive Officer; and Rodrigo Brumana, Chief Financial Officer.

For the Q&A portion of today's call, we'll also be joined by our Executive Chairman, Paul Sciarra, and Blade's CEO, Rob Wiesenthal. Please note that our discussion today will include statements regarding future events and financial performance as well as statements of belief, expectation and intent.

These forward-looking statements are based on management's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a more detailed discussion of these risks and uncertainties, please refer to our filings with the SEC and the safe harbor disclaimer contained in today's shareholder letter.

The forward-looking statements included in this call are made only as of the date of this call, and the company does not assume any obligation to update or revise them. Also during the call, we'll refer both to GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in our Q4 2025 shareholder letter, which you can find on our Investor Relations website, along with a replay of this call. With all of that said, it is my pleasure to turn the call over to JoeBen.

Thank you, Teresa, and thank you, everyone, for joining us today. 2026 will mark a key inflection point for Joby. After a year full of rigorous full transition flight testing and meaningful progress across every part of our business, we've begun to shift our focus from how and when we'll go to market to how many aircraft we can produce and where to deploy them.

We are seeing unprecedented demand for what we are building, and we continue to benefit from remarkable support from governments, real estate developers and infrastructure partners around the world. We plan to carry our first passengers this year in the UAE as part of our 6-year exclusive access to the Dubai market. And here in the U.S., we expect the government's eIPP program to provide us with the opportunity to demonstrate our service in several locations also this year.

Supporting that ambition, I'm pleased to confirm that the first FAA conforming aircraft is now ready to fly, and we have all of the aircraft we intend to use for TIA testing in production. Reaching this point is the result of years of for credit testing at both the equipment and system levels and is proof that our rigorous approach to design and certification is paying off.

On certification, more generally, we continue to make excellent progress, posting a record 18-point increase on the FAA side of the Stage 4 of certification. This progress is evidence of both the FAA's commitment to certifying eVTOL aircraft and the maturity of our design. It sets us up to focus on the fifth and final stage of the type certification process as we look ahead to FAA pilots flying our aircraft later this year.

And as we build momentum towards market entry, demand for our aircraft and our service has never been higher. Just this quarter, we completed a demo flight alongside Toyota at Mount Fuji and confirmed our participation in an Nomura-led real estate consortium that's working to bring air taxis to Tokyo.

We signed an MOU with Red Sea Global and The Helicopter Company, a PIF-backed local operator to establish a test stone for pre-commercial operations in Saudi Arabia. We signed a letter of intent to sell aircraft and services valued at up to $250 million to Kazakhstan.

And in Dubai, we completed our first point-to-point flight and announced the first 4 nodes in our initial network with 2 of those vertiports nearing completion at Dubai International Airport and the American University of Dubai.

At home in the U.S., we signed an agreement with Metropolis to develop 25 Vertiport sites, and we partnered with communities nationwide to support applications for the eVTOL Integrated Pilot Program, or eIPP, championed by the White House. This program has the potential to materially accelerate the commercialization of advanced air mobility in the U.S. and has already created tremendous interest across the country, including in key markets like Ohio, Florida and Texas.

Next week, we are expecting the DOT to choose at least 5 locations where mature aircraft designs like ours will be able to launch operations this year, helping make eVTOL real for the American public. The program is expected to allow commercial cargo and medical services as well as passenger operations, which could also be delivered commercially in due course.

The eIPP program could not be a better time for Joby as we fly our conforming aircraft and enter the final stage of certification. It's also one of the key reasons that we've decided to scale manufacturing now so that we're ready to serve the incredible demand ahead.

In January, we signed an agreement to purchase a 728,000 square foot production facility in Dayton, Ohio. This facility will complement our recent growth in California and will support our plans to again double production to 4 aircraft per month in 2027. Dayton was home to the world's first aircraft factory, and we're proud to carry that legacy forward as we build the next generation of aircraft just down the road from Wright-Patterson Air Force Base, famous for its commitment to aerospace innovation.

Over the last 6 months, we've raised nearly $1.8 billion, which combined with our existing cash balance, gives us the capital we need to deliver on our plans for scaling production. And I'm pleased to say we enjoyed the support of investors, old and new, including continued support from long-term shareholders like Baillie Gifford as well as funds and accounts managed by Counterpoint Global at Morgan Stanley Investment Management for which we're deeply grateful.

Their conviction in what we're achieving was matched by many of our other key partners during the quarter. With Delta Airlines, we met a key warrant milestone on the road to commercialization, after which they exercised the first tranche of their warrants as part of our deepening partnership. And just this morning, in Dubai, we debuted the Joby Uber in-app experience, showcasing how riders will be able to seamlessly book a Joby air taxi using the Uber app, building on last year's announcement that our Blade service will also be integrated into the Uber platform.

Meanwhile, we continue to plan for a strategic manufacturing alliance with Toyota as we look ahead to scaling production. With the expansion of our California facilities, we redesigned our assembly footprint and production processes to align with Toyota production system principles.

Through a nearly 50% reduction in the movement of people and parts, we're streamlining our composite materials production flows, improving efficiency and positioning our system for scalable growth. This quarter, we also flew our turbine electric autonomous VTOL aircraft for the first time, just 3 months after we announced the concept alongside a new partnership with L3Harris.

This demonstrator builds on our fully electric air taxi platform and integrates a hybrid turbine powertrain alongside our Superpilot autonomy stack. Getting the aircraft airborne in such a short period of time is testament to the vertical integration that sits at the heart of Joby, and we look forward to taking part in operational demonstrations with government customers planned for this year.

With all of this progress, 2026 promises to be a very special year for Joby and for our wider sector. America has been a world leader in aerospace innovation since the Wright Brothers' first flight. And in this, our 250th year, we have the opportunity to once again set the pace and the standard for the world.

The U.S. government continues to lean in with bipartisan Aviation Innovation and Global Competitiveness Act helping ensure the FAA applies the critical certification and integration resources needed to bring advanced air mobility to market. The U.S. has also taken bold steps to modernize and accelerate upgrades to the nation's air traffic control system.

While we've designed the Joby aircraft to integrate seamlessly into today's airspace, these improvements will help ensure the system is ready for us to scale our service. A couple of weeks ago, we demonstrated the potential of advanced air mobility in our home market with an aircraft bearing the logo of America 250, we flew from our base in Marina across the Monterey Bay, past our headquarters in Santa Cruz to land back where it all began for Joby in the Santa Cruz Mountains.

That's a journey that I personally drive on a regular basis and which takes at least an hour longer and often much more on the ground. That simple demonstration was a powerful reminder of how quickly advanced air mobility can make a meaningful difference in people's everyday lives, and we look forward to completing similar flights in other cities across America this year as part of the eIPP program.

Much like the early aviation pioneers who traveled from town to town showcasing the promise of flight, we'll be bringing advanced air mobility directly to communities across the country. By conducting flight demonstrations in early markets, engaging local leaders and giving residents a firsthand look at our aircraft, we aim to build excitement, deepen understanding and lay the groundwork for our future service.

Before I hand it over to Rodrigo, I'd like to thank the incredible Joby team and our new Blade team members for a remarkable 2025. And as we look ahead to welcoming FAA pilots to fly our aircraft, carrying our first passengers and scaling our manufacturing, I'm confident that 2026 will be another landmark year for Joby.

Thank you, JoeBen, and good evening, everyone. Q4 capped a year of substantial technical progress, and we entered 2026 with a stronger balance sheet and a clear capital framework. My focus is simple: fund certification, scale manufacturing and support commercial launch while securing our financial runway and preserving flexibility.

As JoeBen said, Joby is at an inflection point in its 18-year history and committed to changing the way people move around. Given the maturity of our program, government support, global demand for our technology and our plans to ramp manufacturing, we took the opportunity to strengthen our balance sheet during the fourth quarter and after. We raised approximately $1.8 billion in net proceeds across Q4 and Q1, and we have positioned the company with the capital required to drive the next phase of execution and scale.

This additional capital bolsters our balance sheet, giving us additional flexibility to advance certification, manufacturing ramp and commercial readiness without being reactive to short-term market conditions. At the same time, we will continue to allocate capital deliberately. Balance sheet strength does not eliminate discipline, it reinforces it.

Now I'll present our fourth quarter and full year financial results in more detail. We ended the fourth quarter of 2025 with cash, cash equivalents and short-term investments totaling $1.4 billion, including $586 million raised through the quarter, reflecting net proceeds from our equity offering and ATM sales. After the quarter ended, we completed a financing that provided net proceeds of approximately $1.2 billion, further strengthening our cash reserves and positioning us well as we enter 2026.

The fundraising attracted both existing shareholders such as Baillie Gifford and Morgan Stanley Investment Management and new shareholders with several institutions committing capital across both the equity and the convertible offerings.

Our Q4 use of cash, cash equivalents and short-term investments totaled $157 million compared to $147 million in Q3. The $10 million increase was primarily driven by continued investment in certification and manufacturing readiness, including higher program spend to support TIA-related activity, market development activities, along with normal working capital movements and timing of supplier payments.

Included in the quarter was approximately $40 million of property and equipment investment, reflecting facility build-out, tooling and production equipment as well as a $3 million investment in our first fully conforming FAA qualified flight simulator developed in partnership with CAE. The simulator is a mandatory component of certification in Part 135 approval.

And because aircraft cannot be sold without an improved pilot training solution, it is directly tied to our ability to generate future revenue. Importantly, FAA qualified simulators take years to develop and require deep aircraft data integration. We begun this work in 2022 to ensure the time of delivery would be aligned with our entry into service time line.

We plan to add a second full motion simulator later this year as we expand the Joby Flight Academy and build a strong pipeline of pilots to support high-volume commercial operations. This is a great example of how we are deploying capital thoughtfully, holistically and with a long-term perspective.

For the full year 2025, use of cash, cash equivalents and short-term investments totaled $539 million, which was within our full year guidance, a testament to our capital deployment discipline. The use of cash in 2025 includes the impact of the Blade acquisition and integration costs.

On a GAAP basis, we reported a Q4 net loss of $122 million, a $280 million improvement compared to $401 million net loss in Q3. The quarter-over-quarter improvement was largely driven by $302 million related to a favorable noncash warrant and earn-out revaluation, partially offset by $25 million in higher loss of operations and the netting of miscellaneous items.

As a reminder, the fair value revaluation of warrants and earn-out shares is driven primarily by changes in our share price and can introduce significant noncash volatility each quarter.

Revenue for the fourth quarter was $31 million, an $8 million increase from Q3, mostly driven by recognizing a full quarter of Blade revenue. The Blade portion of Q4 revenue was $21 million and other revenue was $10 million, reflecting a onetime nonrecurring revenue of about $8 million pertaining to our demonstration flights in Japan for the Toyota event in December.

Total operating expenses for the fourth quarter, which include Blade, were $238 million compared to $204 million in Q3. The $34 million quarter-over-quarter increase was primarily driven by higher certification manufacturing spend, continued staffing to support program milestones and a full quarter of Blade operating expenses.

Adjusted EBITDA, a non-GAAP metric that we reconcile to net income in our shareholder letter, was a loss of $154 million in the fourth quarter compared to a loss of $133 million in the third quarter or a $21 million increase in loss on a quarter-over-quarter basis. The sequential change reflects the revenue and expense dynamics I described before.

As we move into 2026, our approach to capital is disciplined and milestone driven. We are managing our spending to optimize for certification progress, production ramp and commercial readiness. With our full year 2025 results complete, we are updating how we guide cash usage. For 2026, we will guide on a half year basis, which better reflects where we are with the program. We are transitioning from early-stage production into repeatable manufacturing.

As we move up the production S-curve, investment decisions increasingly depend on rank performance, supplier readiness, tooling deployment and operational sequencing. We see this as a natural and positive phase of scale.

For the first half of 2026, we expect to use $340 million to $370 million in cash, excluding approximately $33 million for onetime purchase of the Ohio building we plan to use for manufacturing. The majority of first half cash usage supports core S4 certification and manufacturing readiness.

A smaller portion represents investments that can be sequenced based on milestone progress and commercialization timing. Our recent fundraising enhanced our cash position to execute this plan at pace. As JoeBen stated, we have many timely opportunities this year, including carrying our first passengers in Dubai and opportunities to begin commercialization in the United States in up to 5 states as part of the eIPP program.

As certification progresses, production ramps and commercialization accelerates, we have the flexibility to stage levels of spend while maintaining capital discipline. Following our acquisition of Blade's passenger business last year, we are now providing full year revenue guidance.

For 2026, we expect total revenue in the range of $105 million to $150 million with the vast majority generated by Blade. The Blade passenger business has operated seamlessly since closing with consistent service levels and customer demand. 2026 will remain a year of testing, learning and continued integration into Joby's broader commercial strategy.

As a reminder, the Blade passenger business is highly seasonal with revenue typically peaking in the third quarter during the summer months. We are focused on maintaining operational consistency as we prepare over time to expand the service to incorporate electric air taxis. As we enter 2026, our priorities are clear: advance certification, scale manufacturing responsibly, prepare for commercial launch, deploy capital deliberately.

We believe this approach allows Joby to continue to lead the market with both speed and discipline. Thank you for your continued support. Operator, please open the call for questions.

[Operator Instructions] Our first question is coming from Andres Sheppard from Cantor Fitzgerald.

This is Anand on for Andres. Regarding your revenue guidance for this year, I was wondering, can you give us a sense of how this is comprised? Is this almost all from Blade? And should we expect some seasonality around quarters?

Yes. Thanks for the question. Yes, mostly Blade, like I said in the prepared remarks. And in terms of seasonality, it will peak during the summer months, particularly in Q3. One way to think about it, when you look at historically, Q2 plus Q3 together will be typically around 60% to 65% of the revenue mix.

Got it. And secondly, you're guiding cash use of about $355 million at the midpoint for the first half, and I realize you're not guiding for the year, but I'm wondering if you can help share how we should think about the second half since you're ramping up production? Should we expect a higher cash burn in the second half?

Well, we're transitioning from a prototype manufacturing into a repeatable scaled production. That's primarily the reason that we are guiding. Let me elaborate. We are entering a production S-curve and productivity improves with each unit we produce. But we are very early in that ramp and forecasting the exact slope is challenging and less precise.

Because of that, we do have visibility into the first half, so we're providing a high integrity first half baseline instead of a full year with early stage and less precise assumptions. As we progress and accumulate serial production data, we'll gain greater precision on the second half, and we will update later in the year as we get the ramp developed.

Our next question is coming from Chris Pierce from Needham & Company.

There seems to be this idea out there that the S4 could may be underwhelmed from a passenger or luggage payload perspective. I just kind of wanted to give you a chance to kind of comment around that.

And when you take your test flights, are you putting extra weight in there to confirm sort of the payload that the aircraft can carry? Or is it kind of coming from a mathematical equation at this time? And then how does Bags VIP fit into this equation as well?

Thanks, Chris. This is JoeBen. So the -- we're really pleased with the way the aircraft has come together. Again, the aircraft that we are preparing to fly is the first aircraft that -- in the eVTOL category that has been built and is preparing for TIA flight tests. And we think this is a monster milestone both for Joby and for the industry.

In terms of the capabilities, we've designed this aircraft for service around the metropolitan cities that we're hoping to serve, operating it, for example, layered into the Blade service. And we are very excited about its ability to serve that market.

And in terms of the payload of the aircraft, that is something that we expect to -- we designed the aircraft for a pilot and for passengers, and that's our target. It may take us a bit of time to evolve into that, but we are very pleased with the performance and very excited about beginning the TIA flight test.

Okay. On the eIPP commentary that you gave, I just want to understand, is there a chance for passenger flight in the U.S.? Or is that something investors shouldn't be looking for? Or is that sort of up in the air based on what you hear back in the next couple of weeks from the FAA?

We've been hearing very positive inclinations on that. Again, that may phase in over time. But we see the eIPP as a massive opportunity, and we're very, very excited to be hearing more news very shortly on that from the FAA.

[Operator Instructions] Our next question is coming from Kristine Liwag from Morgan Stanley.

This is Jason on for Kristine tonight. So Joby has been working closely with the FAA on air traffic control to be able to support higher volume in the airspace once we see eVTOLs receive FAA certification.

Can you discuss your role in helping to solve this issue with the FAA and maybe provide some context on what's been solved already versus what work remains in progress?

Thanks a lot, Jason. This is Paul. I'll pick this one up. Look, we are very excited about the now sort of bipartisan effort to modernize the way that air traffic control is managed. As you know, there was $12.5 billion that's been allocated as a sort of first tranche against that. And look, I think the majority of that is going to go to shoring up the existing system that we have.

But the push that we've been making alongside others in the industry is to ensure that there is an opportunity for some of that money to go to next-gen air traffic control, essentially a system that would start with computers deconflicting the airspace and then the human steps in only if there's some sort of issue that's going on.

We think that has huge implications for commercial aviation across the U.S. I mean, we really do think that we should treat our airspace as a national asset and maximizing its utility should be the name of the game. If we can bring down separations, that will increase safety, increase volume for both us and everyone else that's operating that airspace.

And we do think that eVTOL has an important role to play. This is a category that is going to be operating from nontraditional airports where you don't have to worry about legacy equipage because there's not a big existing fleet.

So therefore, we think it's the perfect test ground for some of these new air traffic control concepts. And we've been working with partners across the industry, including some of the folks that have been sort of tasked with the overall ATC modernization effort to work on the right sort of approach on that front.

Now look, we think there's tons of runway with the existing aircraft, train pilots and seat using the existing airspace. But if we have an opportunity to help push the ball forward on a better air traffic control system, we absolutely want to be a part of that.

Our next question is coming from Austin Moeller from Canaccord Genuity.

So just my first question here. I guess you're expecting to fly the first conforming aircraft shortly. I know there were 5 others still in different phases of construction. So I'd love an update on what phases of assembly those are all in.

Austin, thank you for the question. This is JoeBen again. Really pleased with the momentum that the manufacturing team is building. You're going to -- you can expect to see those -- the cadence of those coming off the line with increasing regularity over the next few quarters.

But really, really pleased to see the maturity of the manufacturing line and the maturity of the conforming processes improving each and every day, and huge shout out to the team, so proud of the work that they've done and the work they're doing and also a shout out to all the DERs and DARs who have been doing phenomenal work and also to the Toyota team members who are working shoulder to shoulder alongside of us, both here and abroad.

Okay. And as we think about the FAA pilot starting 4 credit tests later this year, how should we be thinking about the FAA accepting the remaining 3% of the means of compliance? Would that happen around the same time period as that? How should we think about the cadence there?

I think those elements are decoupled. But I think the really key element to highlight and something that maybe we don't spend as much time on is how vitally important all of the component and system level ground testing is. So in parallel to building the conforming aircraft for flight test, which gets a lot of attention, the team and the vertical integration that we've built on our testing process is a real superpower that we have, and the team has just been knocking it out of the park.

So this is on the manufacturing side and on the testing side, manufacturing, building conforming test articles. And these test articles are frequently substantially harder to build than the flight articles because they have designed-in defects that have to get very prescriptively built that are different than the normal manufacturing flow.

And then those test articles with those designed-in defects get tested according to very rigorous test plans that we've already agreed to with the FAA. Another thing that is really worth pointing out is the 18-point increase on the FAA side of Stage 4. This was a monumental achievement, the most progress that the FAA has ever delivered in the quarter for us. We're so, so grateful.

It is a testament to the massive lean in and the attention that we've been getting and also all the hard work that the Joby certification team has done upfront to prepare all of these -- all the certification work and the test plans.

Our next question today is coming from David Zazula from Barclays. Our next question is coming from Savi Syth from Raymond James.

If I might, with the commercial operations as stated in Dubai, I was wondering if you could share kind of general time lines and milestones that are being targeted for this year.

Thank you so much, Savi. So the work is going really well in Dubai. The partnership with the RTA and the work with all of the regulatory bodies in Dubai and the UAE has been going very, very well. As you may have heard, we had a phenomenal event in Dubai today where we announced the integration -- our integration of the Joby air taxi service into the Uber app.

And that was a really phenomenal example of the lean-in that we're seeing from all of our partners, so Uber, Delta and Toyota, are leaned into to a degree which they've never been leaned in before. I think this is one of the things that really makes Joby special is the strength of the partners we have and the degree to which they're behind us and excited about what we're building and excited to be shaping the future of transportation together.

Okay. And maybe if I could follow up on just the payload comments in that it may take time to evolve. Is that a software kind of evolution? Or is that like just a battery evolution to solve for that?

I would say that there are both elements there and as well as other upgrades that we expect to happen over time.

Next question today is coming from Amit Dayal from H.C. Wainwright.

So JoeBen, just on the UAE passenger flight expectations for the end of the year, like what certification requirements need to be followed to accomplish that?

So this work is layering on top of all the work that we're doing for our FAA certification. So completing all of those component and system ground tests that I'm talking about and also building aircraft that are conforming and which we're ready to put paying passengers in. So we have all the pieces in place. As I said, the relationship with the regulators in Dubai and the UAE are really strong. And we think we're in a great position there.

So yes, we think that -- we're very, very excited. And I would also highlight that in addition to Dubai this year, one of the reasons we're ramping manufacturing is because of the incredible demand that we expect to see from the eIPP local markets here in the U.S.

Understood. And then with respect to the vertical build-out here or in the UAE and other markets, how much of the CapEx will be shouldered by folks who are already sort of the developers, I guess? And do you need to -- or does Joby need to contribute to some of that investment as well?

It's Paul. On the UAE specifically, all of the infrastructure is being built out in conjunction with the folks over at RTA. So you've seen, I think, the 2 sites that are currently well underway in terms of development. And there are a number of more that are also sort of coming online in that particular market.

When it comes to the broader infrastructure question in markets outside of the UAE, look, we've got a firm footing of existing infrastructure that we can take advantage of from day 1. Actually, post the Blade acquisition, Blade has staffed 10-plus locations, many of which are in the eIPP geographies. So -- or what we expect to be the sort of eIPP geographies. So that's a really great place to sort of begin those operations.

Now we announced additional partners where there will be opportunities to leverage their resources just this quarter. So Metropolis was announced, and we're going to be developing 25 additional sites with them. That's a large parking garage owner. They have almost 5,000 parking garages across the U.S. with many of those in these eIPP markets that we're going to be targeting in the short term.

So we're going to be working with them to build the next leg of scale of infrastructure sort of beyond that. There may be certain sites where we're using our own capital, but we're going to be really thoughtful and lean far more on the developer ecosystem.

And what's been really exciting, I should mention, particularly post-eIPP is that we now have sort of approximate date certain for eVTOL operations in some of these geographies. So we've had a real pull from developers or potential real estate partners that want to kind of get ahead of that sort of rollout, so more news soon on that front.

Our next question today is coming from David Zazula from Barclays.

Sorry about the difficulties earlier. Could you talk about the aircraft deployment plan this year, including for those in production, where you're planning on deploying and what the expected use is?

Thank you, David. So as I spoke about, I think the massive challenge that sits before us is the manufacturing ramp that we're engaged in. And it's going to be a very significant lift. This is to get the TIA aircraft built and then to deliver aircraft for Dubai and aircraft for the eIPP program.

But the most important piece, as I touched on, was completing the build on all the test articles. And so that really takes precedence on the manufacturing line is ensuring that each of those test articles is coming out in a timely way because that's the gate to getting FAA pilots onto the aircraft.

So that's kind of the sequencing you can think about, but it is a huge lift that the manufacturing team is working through is to get that manufacturing ramped to build those test articles and then to build the aircraft for Dubai and the eIPP.

Very helpful. And then could I ask on the Uber side? How has the integration been on the Blade front? Have there been any challenges there? And then what do you think about the commercial opportunity with respect to that integration in this year and maybe into next?

It's Rob's Wiesenthal, CEO of Blade. Thanks for the question. When this integration gets deployed, which we hope first half this year, when you want to get to the airport, you just have to kind of think about your Blade, not how you get to the departure lounge. It's simple and seamless.

And you just literally, you book your Blade on the Uber app and an Uber ground vehicle picks you up and brings you straight to a Blade lounge, you check in and you're off on your 5- to 10-minute flight in New York to JFK or Newark.

And we not only expect that this is going to result in growth for Blade airport, but as important, in the not-too-distant future, that helicopter icon on that vehicle selector, which will be a helicopter to start will be swapped for Joby eVTOL. And this is a competitive advantage that no other eVTOL OEM has. So we're really excited about it.

I'd like to turn the floor back over to Teresa for further questions.

Thanks, Kevin, and thanks to all the analysts who asked questions today. This week, we invited members of our Reddit community to send in questions as well. We covered many of these already, but I'd like to get in at least one more if we can. And that question is, what's going on with respect to military and medical applications? How is Joby involved? Paul, do you want to take this one, please?

Sure. Yes. So when we think about the overall eIPP footprint that's really set to get announced in just a few weeks, we know that there are going to be 3 components of that. One is going to be cargo, one is going to be medical and the other is going to be passenger. And we intend to obviously deliver aircraft against each of those use cases in as many of the eIPP sites as we're able to deliver against.

We think the medical opportunity is a significant interesting sort of adjacency and frankly, one that has important community impact. So we want to make sure that we prioritize it alongside, obviously, these other 2 opportunities as well.

Regarding the defense opportunity, look, we announced that we would be developing a hybrid autonomous version of the S4 aircraft for defense customers last summer. We progressed to beginning the flight testing of that variant over the fall, and we continue to work on preparing for on-site customer demonstration shortly, followed by off-site customer demonstrations at their facilities in the fall.

I can say that the partnership between Joby and L3 is going great. And I think one of the big significant developments is that we've spent a lot more time with the core customers. So that includes folks like Army, Marines and then to our Navy. And I think we've gotten, and that is not just us, but also the folks at L3, increasing confidence that there are important capability gaps that this aircraft has an opportunity to fill.

What I think is also important to note, and this kind of goes against some of the commentary that folks have been talking about, it's really about finding the right aircraft to fill those capability gaps. Folks don't care if it's a variant of a commercial product. And in fact, the focus of the Pentagon is around dual-use technologies that can be very flexibly fielded. So we think we're in a very strong position with a proven aircraft, with proven manufacturing that is ready to ramp and a strong partner on the missionization front to deliver on this increasingly interesting opportunity.

We reached the end of our question-and-answer session. And ladies and gentlemen, that does conclude today's teleconference and webcast. You may disconnect your lines at this time, and have a wonderful day. We thank you for your participation today.

Greetings, and welcome to Joby Aviation's Third Quarter 2025 Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded.

It's now my pleasure to introduce your host, Teresa Thuruthiyil, Head of Investor Relations for Joby Aviation. Teresa, please go ahead.

Thank you. Good afternoon and evening, everyone. Thank you for joining us for Joby Aviation's Third Quarter 2025 Financial Results Conference Call. I'm Teresa Thuruthiyil, Joby's Head of Investor Relations. We will begin the discussion with comments from JoeBen Bevirt, Founder and Chief Executive Officer; and Rodrigo Brumana, Chief Financial Officer. For the Q&A portion of today's call, we'll also be joined by our Executive Chairman, Paul Sciarra; and Blade CEO, Rob Weisenthal.

Please note that our discussion today will include statements regarding future events and financial performance, as well as statements of belief, expectation and intent. These forward-looking statements are based on management's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a more detailed discussion of these risks and uncertainties, please refer to our filings with the SEC and the safe harbor disclaimer contained in today's shareholder letter. The forward-looking statements included in this call are made only as of the date of this call, and the company does not assume any obligation to update or revise them.

Also, during the call, we'll refer both to GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in our Q3 2025 shareholder letter, which you can find on our Investor Relations website, along with a replay of this call.

And with all of that said, I'll now turn the call over to JoeBen.

Thank you, Teresa, and thank you, everyone, for joining us today as we discuss our third quarter 2025 results. The past few months have been momentous for our team, as well as demonstrating the remarkable potential of our aircraft by flying in front of hundreds of thousands of people here at home and overseas, we've also moved the ball meaningfully down the field on certification, and we've passed one of the most important milestones in Joby's history today.

As we announced this morning, we have now begun power on testing of the first of several aircraft we will build for TIA or type inspection authorization. Entering TIA is widely understood as marking the final stage of the certification process and is a very strong indicator of a company's ability to reach type certification. This is the moment when our certification strategy, our intended type design and our manufacturing processes all converge into one physical asset. Let's take each of these in turn.

First, our certification strategy. It might sound simple, but our certification strategy is the result of more than a decade of working alongside the FAA to develop a certification basis, the means of compliance for our aircraft, certification plans and test plans. These are the documents we've been talking about quarter after quarter in these calls, and they are absolutely required to get to TIA.

Second, having a stable design is the result of years of focused engineering and testing using the same design and putting it through thousands of hours of testing on the ground and in the air. If you continue to make changes to your design, you can't enter TIA with a high degree of confidence that you'll complete it expediently.

Finally, on manufacturing processes. This aircraft is one of a series that we are producing under Joby's FAA-approved quality management system. Each of the TIA aircraft, including this one, will be built with FAA conforming components as required by our FAA-approved test plans. Each of the relevant components will be built to FAA DER or designated engineering representative approved designs and then inspected and signed off by FAA-designated airwaves representatives or DAR. This process adds a lot of overhead to the build processes. It's not fast or easy, but it is what's required to start TIA flight testing.

Bringing all of these elements together is a huge achievement and I'm incredibly grateful to the team at Joby and at the FAA for the years of hard work that led up to this moment. We continue to plan for this aircraft to take to the skies later this year, flown by Joby pilots, clearing the way for FAA pilots to start for credit testing next year.

As I mentioned earlier, having a mature and stable design is central to being able to move with certainty and pace through the certification process. And over the past quarter, we've been able to build on that maturity, demonstrating a remarkable cadence of flight testing and demonstration flights as well as continuing to fly several times a day out of Marina where we've demonstrated climbing, descending, accelerating and decelerating all at max rates. We also flew our first A to B mission flying down to Monterey and back. A few weeks later, we participated in the California International Air Show, completing a 20-minute flight that saw us take off vertically, [indiscernible] completed a demonstration that included multiple transitions between forward flight and hover and returned to Marina for a vertical landing.

And we did all this while a separate Joby team completed 2 full weeks of regularly scheduled flights in Osaka as part of the World Expo, demonstrating the aircraft to hundreds of thousands of attendees, including the Japanese Prime Minister and the Governor of Osaka.

The operational rigor and consistency we've demonstrated in completing these flights is a testament to the remarkable team we've built and the maturity of our aircraft. It is also preparation for our future commercial service.

Speaking of which, it was a privilege to fly rider cup fans back and forth from Manhattan to Long Island this quarter via our Blade service. 2.5-hour drives were replaced with 12-minute flights, highlighting the potential of vertical lift to a key audience suppliers. Our Blade team excels at delivering operations at scale, combined with the highest levels of customer service. This operational experience, combined with the maturity of our eVTOL platform puts us in a great position to take on the opportunity presented by the U.S. government's recently announced EIPP program.

Through an executive order, the President has directed the Department of Transportation and the FAA to ensure that mature eVTOL aircraft can begin operations in select markets in the U.S. ahead of full FAA certification.

We are already in advanced conversations with a wide range of state and local government entities who are submitting applications for the program, and we believe that having a TIA-ready aircraft as well as a wide set of operational experience will put us in a very strong position to deliver the high levels of safety the FAA will require to participate in this precertification program.

We see the EIP program pulling early demand for our aircraft forward. Taken alongside the demand we're also seeing from a range of international early adopters, it's clear we'll need to keep accelerating production if we are to keep up with the incredible demand we're seeing for our product. The level of production we are preparing for has never been seen in the aviation industry, and we're incredibly grateful to be working closely with Toyota as we plan and execute for scale. And we've already produced 15x more FAA conforming parts so far this year in Marina than we did in all of 2024.

As well as growing in Marina and adding more than 100 manufacturing roles this past quarter, we've now begun production of propeller blades at our Dayton, Ohio facility. This is a great example of our approach to scaling, where we'll perfect manufacturing processes at home in California before scaling them alongside Toyota.

Before I hand it over to Rodrigo to talk about our financials, I wanted to touch on my excitement for the future of Joby. Our core focus is and always has been the development of our core S/4 platform. That's the aircraft you see flying every day. We've put a huge amount of work into designing it from the ground up, and we've built it in a vertically integrated way. As I've said many times before, this vertically integrated approach is our superpower. Because now that our platform is mature, we're able to move with incredible pace to adapt it to a wide range of use cases and technologies.

Last year, we adopted it to fly with liquid hydrogen, completing a 561-mile flight with water as the only byproduct. I'm confident that hydrogen will play a very significant role in the future of aviation, supporting a wide range of new applications and aircraft types and the experience we've already built in this field puts Joby at the very forefront of innovation.

This year, we announced we would work with L3Harris to develop a turbine electric variant for defense use cases. And I'm pleased to say just 3 months after that announcement, we're already ground testing this aircraft with the hybrid system in the loop, and flight testing is set to begin imminently. In fact, just yesterday, we had the FAA on site working with us to grant [indiscernible] for this vehicle. L3Harris has been a great partner on this journey, and we remain on track to demonstrate the full capabilities of this aircraft in the coming quarters and compete for some of the $9 billion the U.S. Department of War has requested for the acquisition of Resilient, autonomous and hybrid aircraft in the FY '26 budget.

Joby's approach to vertical integration puts us in a unique position to move from concept to demonstration and from demonstration to deployment at a pace that's almost unheard of in today's aerospace industry. And it demonstrates the value of dual-use technologies, allowing us to get new tools into the hands of America's troops as quickly and cost efficiently as possible against the rapidly evolving national defense landscape. That advantage also counts when it comes to autonomy. While our initial air taxi product will launch with a fully qualified commercial pilot on board, I believe, a future where we are able to take the pilot out of the loop is approaching more rapidly than I expected even 6 months ago.

For decades, the principal barrier to commercial autonomy hasn't been technical or regulatory. It's been the way our commercial air traffic control system works. The current system still requires a human being on a radio to speak with another human being to deconflict airspace, file flight plans and confirm departures and arrivals. The current administration has indicated its intent to invest in modernizing this approach, making much needed investment in the infrastructure that controls our skies and laying the foundation for commercial air autonomy to take off much like the adoption of autonomous ground vehicles has.

At Joby, we're making sure we're ready for that step when it happens. Over the summer, the team we brought on board from X-Wing demonstrated our Superpilot AI technology stack as part of a landmark Department of War exercise over the Pacific Ocean. Using a conventional Cessna 208 aircraft, our team logged more than 7,000 miles of autonomous operations across more than 40 flight hours in and around Hawaii, managed primarily from Anderson Air Force Base in Guam, more than 3,000 miles away. Once again, illustrating our commitment to not just talking about innovation, but demonstrating it.

The same technology is set to be supercharged by our recent announcement with NVIDIA. Joby will be the aviation launch partner for NVIDIA's IGX Thor platform, which uses their black well architecture to help ingest extraordinary amounts of data in real time to support an even more performance and safe autonomy stack for our aircraft.

Integrating this level of compute will help us maximize the potential of autonomous flight. We'll be able to deliver autonomous mission management that enables the aircraft to determine, request and follow optimal flight plans while adapting to changes in weather, air traffic control instructions or unexpected events.

It will also support onboard compute processes for high rate data from radar, LiDAR and vision sensors as well as supporting sensor fusion, combining data from a range of sensors to deliver reliable and accurate aircraft state estimation and situational awareness in the most challenging environments. It also establishes a foundation to develop features that enhance operational insight, reliability and performance, including predictive system, health monitoring and digital twin modeling.

We'll be deploying Superpilot on the aircraft we're developing with L3Harris, allowing us to deliver to the government the same tech stack they've already seen successfully deployed on conventional planes. But this time, on a low altitude, VTOL capable aircraft. The testing we complete on this defense-focused vehicle will also feed forward into a commercial AI autonomy stack that we plan to have ready and tested just as soon as the commercial air traffic control system is ready for it.

The level of technological and regulatory progress we're seeing today is unprecedented. And it is matched by an incredible commitment to aerial innovation at both the state and federal level. We've positioned Joby to make the most of these opportunities, and I've never been more excited about the company and the technologies we're building. Rodrigo, over to you.

Thank you, JoeBen, and good evening, everyone. During the third quarter of 2025, we made several important advancements further positioning Joby to create durable long-term value for our shareholders. When we spoke last quarter, I identified 3 areas of focus, implementing a disciplined capital strategy, scaling methodically and translating our technical and regulatory progress into long-term value.

Let's talk about capital strategy first. At Joby, we are shaping a new industry in bringing an entirely new technology to market. This requires substantial efforts across engineering, regulation, partnerships, infrastructure and manufacturing. To achieve this, we are strengthening our balance sheet. At the end of the quarter, we had approximately $978 million in cash and short-term investments. In October, we added net proceeds of approximately $576 million further strengthening our position. This gives us the financial strength to continue to lead the industry and bring new innovations to markets across the globe.

Next is the scaling. We are investing now to build capacity for global air taxi demand. We are methodically scaling manufacturing, and we are very fortunate to have Toyota with us on that journey. As JoeBen said, propeller blades are a critical component in the highest part count on our aircraft. We have started to leverage our Ohio facility to begin ramping our production of propel blades. Ohio has the skewed labor, the supply chain network in this space to scale our production as we grow.

Scaling also means preparing our global operations. Following our acquisition of Blade, we are already running a network of high-frequency routes in New York and Europe, connecting major airports like JFK in prime locations like [indiscernible] Manhattan to the Hamptons. These routes are the blueprint for electrified air taxi service, proving the model today, so we can transition seamlessly once our aircraft is certified. At the same time, in addition to our successful flight demonstrations in Japan with ANA, we also expanded our global partnership with Uber to include Blade services. This opens up a powerful opportunity over time to connect thousands of daily Uber users with the experience of vertical lift well ahead of Joby's commercial launch.

Meanwhile, in Montreal, we formally accepted our first flight simulator developed in conjunction with CAE, a global leader in pilot training systems. This fully immersive simulator is a prerequisite for commercial pilot training, it marks an important milestone in preparing Joby for scaled operations. These efforts are building the foundation for our global network, beginning with Dubai next year and expanding to new markets around the world during our regulatory commercial and technical progress into long-term value.

Now I'll present our Q3 financial results in more detail. We ended the third quarter of 2025 with cash and short-term investments, totaling $978 million. During the quarter, we raised $101 million through our ATM facility and an additional $33 million from warrants that were exercised.

As I said earlier, after the quarter ended, we received net proceeds of $576 million through an equity offering, further increasing our cash reserves. Our Q3 use of cash, cash equivalents and short-term investments totaled $147 million, $35 million higher than last quarter. That was primarily due to an extra payroll run in Q3 versus Q2, growth in operating expenses, working capital changes and onetime costs related to our Blade acquisition, which accounted for $6 million. This spending also included about $30 million on property and equipment, up $1 million from last quarter.

We remain on track to hit the upper end of our full year 2025 guidance of $500 million to $540 million in use of cash, cash equivalents, in short-term investments, and that includes the impact of our Blade acquisition.

On a GAAP basis, we reported a Q3 net loss of $401 million, $77 million increase from Q2, largely driven by $262 million in noncash items, of which $229 million was a noncash charge related to [indiscernible] an earn-out revaluation. The remaining noncash items were related to stock-based compensation, depreciation and amortization, all within the normal ranges. The large noncash revaluation charge related to warrants in earn-out shares was due to the increase in our share price, which negatively impacts the calculation and gets updated every single quarter.

Revenue for the quarter was $23 million, including $14 million in revenue from Blade from August 29 through September 30 and $9 million from other revenue, which includes the completion of all required deliverables as part of our Agility Prime defense contract as well as other engineering services. We do not expect Agility Prime revenue to continue as the work has been completed.

Total operating expenses for the quarter, including about 1 month of late were $204 million, up about $36 million from the prior quarter. The increase was largely driven by the inclusion of Blade operating expenses and acquisition-related costs, coupled with higher staffing and program spend to support key milestones, including progress on the final assembly of our first TIA aircraft.

Adjusted EBITDA, a non-GAAP metric that we reconcile to our net income in our shareholder letter was a loss of $133 million in the third quarter. This was just about $1 million higher than the prior quarter, reflecting the revenue booked in Q3, offset by the increase in spending I called out before. Compared to the same period last year, our adjusted EBITDA loss was $12 million higher, driven by the growth in our team to support aircraft design, manufacturing and certification along with early commercialization investments.

As we look ahead, our focus remains on disciplined execution, advancing certification, scaling production and preparing for commercial launch. With a robust balance sheet, proven technology, mature program, flying aircraft and world-class partners, we are operating from a position of strength. We look forward to many folks at the Dubai Airshow in 2 weeks where our aircraft has been cleared by both, the General Civil Aviation Authority and the Dubai Civil Aviation Authority to fly full transition every single day.

Thank you for your continued support. And operator, please open the call for questions.

[Operator Instructions] Our first question today is coming from Kristine Liwag from Morgan Stanley.

I just wanted to follow up on your progress with your international partners. I was wondering with the early adopters, are you planning to provide commercial service with the Joby aircraft prior to getting FAA certification? Or are you waiting for FAA certification to start flying globally?

Kristine, this is JoeBen. Great to speak to you. We -- I assume you're speaking about Dubai in terms of the international partner, we will -- we're making incredible progress in Dubai. We have aircraft that's there and flying right now. And as Rodrigo mentioned in the prepared remarks, we have permission from the GCA and the Dubai Civil Aviation Authority to be conducting daily flights at the Dubai Airshow. So that's incredibly exciting.

And I think what you're going to expect to see over the course of 2026 is more and more flying there as we deploy more takeoff and landing locations. And we're seeing incredible momentum and amazing support from the local regulators. So in short, the answer to your question is, yes, we continue to expect to be operational in Dubai prior to FAA-type certification.

I see. Great. And for a follow-up, you guys highlighted your progress on autonomous systems with Superpilot, which sounds really interesting. So is this going to be a software that's also going to be added to the Joby Aircraft. And because from my understanding, the Joby aircraft initially would be VFR. So are you adding the IFR capabilities with autonomous systems? Or are you also going to add an expansion to IFR before going to full autonomous, like can you please help me understand the bridging there?

Yes. So thank you so much. This is a huge -- a bunch of -- huge accomplishments on the autonomy front and something that we're really, really excited about. The first, just to reiterate, the Superpilot, the [indiscernible] Superpilot enabled [indiscernible] and flew 7,000 miles around the Pacific as part of the reform pack exercise earlier this year. That demonstrates the operational maturity. We operated that aircraft in a whole bunch of different [indiscernible] of airspace. And really showcased how robust that autonomy platform is. As it comes -- when it comes to taking that autonomy platform and putting it into the -- the S4 platform, that's going to be something that we will do progressively. It's a very step-by-step approach that we're taking. But we do think that it's going to have really significant benefits when it comes to -- on both the safety side and the operational efficiency side. So we're really excited about that.

And we think that, that is built on the foundation of these changes that are -- we're expecting in the air traffic control framework, as I talked about in my prepared remarks. So we're really, really pleased with both the regulatory side of things and the technical side of things, also thrilled to be working closely with NVIDIA and bringing the phenomenal compute capabilities that they've developed to aviation. And yes, [indiscernible] across all the different dimensions on the autonomy progress.

Our next question today is coming from Austin Moeller from Canaccord Genuity.

As part of the EIPP, are there any avenues for you to generate revenue in any way in that test phase with those aircraft? And as a second part, could you generate revenue from flying aircraft in a JV partnership overseas during this test phase?

Austin, this is Paul. So with respect to IPP, this is kind of what's going on and sort of how we think it's going to play out. So right now, we have a number of different applications that we are close to that are in the process of getting filed with the Department of Transportation. Those are going to get filed basically through the end of the year. In the early part of next year, they will then down select to 5 with those starting, we think, in the middle of next year.

Now look, this is a really exciting opportunity for us because it allows us to put aircraft into operation here in the U.S., I think on a far faster time scale at scale, then we might have thought. And it's really one of the things that's driving the focus that J.B. mentioned in the prepared remarks around scaling production to now meet this kind of faster demand than we were expecting.

When we've -- based on what we know now, the application set is pretty broad. A number of them include passenger transport, cargo transport, medevac and certain of them, we think are going to have an opportunity to have a sort of commercial bet. So without having 100% confidence at this point, but we do think there are going to be interesting revenue-generating opportunities that come out of the IPP program.

Regarding your question with respect to JVs, I think the revenue that you may see from those sorts of partnerships would be preorders and/or prepayments for aircraft that were going into those JVs. We announced, obviously, the partnership with ANA in Japan. That is one that could sort of look like that. But I think the real question now is ensuring that we're able to build enough aircraft to meet this broader, faster demand that we saw. So that's why manufacturing is sort of the focus.

Okay. And just a follow-up. Are you going to be able to fly the conforming aircraft in TIA testing as long as the means of compliance remains at 97%? Or does it not matter for proceeding with flight testing in that space?

Yes. Thanks, Austin. So just to be really, really clear here, we are so excited about the progress we're making on building these aircraft for TIA testing. This is the culmination of all the work that we've been doing over more than a decade, and it builds on an incredible foundation of work from both Joby and from the FAA. And as I spoke about, this is heavy lifting from FAA DRs -- FAA, DARs to ensure that as each of these aircraft is getting built that they're getting built in a really meticulous way. So this is a huge moment to be beginning the power on testing of this aircraft.

I will also add that we are building a total 5 aircraft for TIA testing. And all 5 of those are in the production process as we speak. So the momentum we're seeing on manufacturing and scaling manufacturing is really fantastic. The reason this is so important is these are the aircraft that FAA pilots will get in and fly for credit, and that is the -- those are the final stages of our OTC process, like we're doing the heavy lifting. We're doing the work that's required to get us through OTC and it's happening right now. So just can't tell you how proud I am in the manufacturing team, how proud I am of the certification team, how grateful I am to the FAA and their lean in, they're working shoulder to shoulder with us. They were here yesterday, giving us [indiscernible] moving through the [indiscernible] process on the hybrid aircraft, and they're not getting paid, right? So the commitment, the lean in, the passion from these aviation professionals is just really unprecedented and we can't say how grateful we are to all of them.

[Operator Instructions] Our next question is coming from Andres Sheppard from Cantor Fitzgerald.

Congratulations on the quarter. JoeBen, I wanted to maybe go back to the first question just around commercialization. So it sounds like we're still targeting commercialization ahead of FAA certification in the Middle East. Are we able to get more clarity on kind of how you see that unfolding or just in terms of timing or number of aircraft. I think in the past, you had mentioned passenger flights potentially by the spring. So just wondering, is that time line for next year? Is that still on track? Or do we perhaps see maybe pushing into the right slightly?

Andres, great to catch up with you. So the -- the progress we're seeing and the momentum, as I mentioned, in Dubai, was really fantastic, both with the [indiscernible] with the device -- Civil Aviation Authority with the RTA. We've got all the regulators leaned in. Skyports is doing a phenomenal job on moving forward with infrastructure. We have a team there, and we're building out that team, staffing that team, doing the training and putting all the pieces in place, and I'm really excited and grateful for the progress that we're making day in and day out.

In terms of -- we expect to be ramping that operation through the course of this next year. I think the real critical bottleneck is going to be -- and the demand you asked about is very, very substantial there. The bottleneck is going to be how fast we can ramp manufacturing, as Paul was talking about, to meet that demand. And this is where I'm so proud of the team and the progress we're making on scaling production and scaling it alongside Toyota, whether that's in Marina, whether that is the progress we're making in Dayton on Blades. And I think this is the real central pillar of the work that we have in front of us is to scale the manufacturing as aggressively as we can, and we're making great progress.

Got it. Okay. And I guess as a maybe a follow-up for Rodrigo. Are you able to maybe help us understand like how should we think about Blades revenues for Q4 and for the -- I guess, throughout next year, I mean is $22 million in quarterly revenue and 55% gross margin, is that the norm or what's the best way to think about that for maybe next quarter and throughout next year?

Andres, thanks for the question, Rodrigo here. Well, we are not providing any guidance specific for next quarter or next year. However, we would like to point you to what has been said publicly and Blade had a number right before the acquisition on August 29. So essentially, we are not deviating from it.

Number two, let's just remind you that Q4 is when the low season starts. So Q4 is one of the lowest quarter there, and we are happy to have Rob here just to add a little more context here, Rob.

Andres, it's Rob Wiesenthal, speaking. It's been -- performance has been pretty good this summer as you've probably been reading. But I think what's also important to announce is kind of the kind of expansion opportunities that we've taken advantage of. Shortly before this call, we announced a pilot program for our very first commuter route to the public, serving New York suburbanites, who live in Westchester, Bedford Rye, [indiscernible] flights that go between [indiscernible] Airport in Manhattan that turns a 1.5-hour drive during rush hour into a 12-minute flight. You can fly with the commuter pass versus little as $125. It'll be a 5-day a week service. It's actually our very first public commuter route.

And that's important because the industry has been very much focused on airport flights, which is clearly an important use case. We've been doing it for over 6 years, but it was really time for us to kind of expand our service offerings to include commuter roots. And once the Joby aircraft is certified, we expect new landing zones to be approved and activated, which will offer even more convenience to people who work in big cities. And we're going to see more of this in the future. We already have pods of communities [indiscernible] New Jersey on the Jersey Shore where people fly to work there in back every morning, that's a 2-hour drive that comes a 15-minute flight. So we're very excited about the prospects of expansion under Joby's ownership and things are off to a great start.

Next question today is coming from Savi Syth from Raymond James.

Just a follow-up on one of Austin's questions earlier, just around certification and the shutdown as well. Just the TIA -- the flight that your aircraft that you're building and doing ground testing right now, is that the one that would be flying? Do the propellers kind of get added back? And then what exactly can you do with that aircraft in TIA testing while the government just shut down? It sounds like, as you pointed out, [indiscernible] coming in and doing certain things. But I was curious what you can and cannot achieve during this time?

Savi, this is Paul. So thus far, we've got an incredible lean-in from the FAA even during the shutdown. That included, as JB mentioned, I think, in the prepared remarks, having their FAA airworthiness folks here on site to do the checkout for the hybrid version of the aircraft. That's actually still ongoing today. And these are folks that are showing up without getting paid. So we're really obviously sort of grateful for their work on this -- in this sort of difficult period.

When it comes to the progression of the TIA aircraft, look, we're going to be doing the power on checkout, progressing then to Joby piloted flights and then moving from there to FAA highlighted flight testing for credit on that vehicle. Right now, we don't necessarily anticipate that the FAA flight test pilot portion of that testing is going to be delayed by the shutdown, but this is obviously still a very much evolving process. And we have been very pleased with the lean that we've gotten. But like if this shutdown persists longer and longer, there's certainly some uncertainty on how that's going to play out. But from the Joby standpoint, we just want to make sure that we're ready with the right aircraft, ready with the training for those pilots and then ready to begin the FAA flight testing just as soon as we can.

That's very helpful, Paul. And maybe if I can just follow up on that then. I think the rule of time is once you start TIA flight testing, it's about 1 year, 1.5 years from there to full certification. Just how much of that happens with kind of the Joby pilot, which versus kind of when do the FAA pilots going to step in and do that part of the testing?

So this fall, I guess I'll pick that off. Look, the timing of the TIA flight test portion is sort of variable depending on the program. And we've obviously got a plan that we're sort of working with FAA that includes 5 different aircraft that are going to be flown in various levels of parallelization to try to speed that process up as quickly as we can. As JB mentioned, all 5 of those aircraft are in some part of production at this moment. And obviously, the first one of those is sort of in this power on stage as we get ready for its first flights.

With respect to how much time is spent with the Joby pilots versus the FAA pilots. As a general rule, we want to make sure that we are doing the things that we need to do for FAA for credit flight testing internally before we do them with FAA pilots in sea. Much of that work has already been done on other versions of these aircraft. So it's really about making sure that we have those TIA aircraft ready at the right time. And in turn, we line that up with the availability of the FAA flight testing pilots. And that's going to be the sort of synchronization that we have to manage, starting basically now.

Our next question today is coming from Bill Peterson from JPMorgan Chase & Company.

This is Mahima on for Bill. I was curious, how should we think about the pace at which you'll move across the Stage V certification progress once TIA testing starts? And should we really start to see that acceleration beginning next year as soon as you get the FAA pilots on board?

Thanks, Mahima. So we're really excited to get into TIA, as Paul talked about. The other element and a key piece to be cognizant of is the way we built our reporting on Stage 5 is that we will get points on the board when we submit those test results. So there's a huge amount of work that's happening on the Joby side as we take the approved test plan and we build the part that is going to get tested or the aircraft is going to get tested and then we run the testing on it. And then we write the test report. We submit that and then we get credit on Stage 5. So it may be that a lot of the progress that happens on Stage 5 is when we're very, very close to the finish line.

I think the important thing is that in addition to making incredible progress on manufacturing of the 5 TIA aircraft, the team is also making incredible progress on the manufacturing of the test articles, and those test articles are very challenging from a manufacturing standpoint because each one of them is different from a -- from a production part. It has intentional changes that we're putting into those parts that have been specified by the FAA DERs. And so this is really fantastic work by the manufacturing team, and we're making incredible progress on it, which puts us in a great position, both for the TIA flight test, but also in terms of completing all of the component level testing required to complete Stage 5.

That's really helpful context. Maybe as a follow-up. You started manufacturing propeller bleeds in Dayton, but are there any other conforming parts you expect to also transition to Dayton in the near term? And then how quickly could you ramp up that capacity you'll need to support certification efforts?

Yes. Thank you. So really thrilled with the team in Dayton and the quality of workforce that we've been able to build there and the speed at which we've been able to onboard those folks and have them contributing in a huge way. We were also thrilled with the support that we've received from the state and local government in Dayton. And we see massive opportunities to continue to expand our footprint, both in our existing facility and as we look forward in the Dayton region more generally.

In addition, and again, following the model that I spoke about, where we perfect the process here at our pilot facility in California, and then we're able to scale it alongside our partners with Toyota -- our partnership with Toyota, I would love to just highlight how vitally important Toyota is and help strong relationship that we have with Toyota right now. We have never been closer to Toyota. Toyota has never been more leaned in. And we think that they are an unparalleled partner for us as we look to take aviation to a scale that has never been seen before.

[Operator Instructions] Our next question is coming from Edison Yu from Deutsche Bank.

I wanted to ask about the hybrid for defense. How should we think about the design? Is that something you just kind of put an engine on the existing airframe? Do you need to redo the airframe, is the supply chain going to get more complicated. Just how to think about the process and design for hybrid?

Thanks, Edison. This is Paul. So look, our approach is really in line with the sort of principles of dual use. Where possible, we want to take full advantage of the proven airframe that we have developed and tested over the last 5, 6 years. And we also want to be able to take advantage of the manufacturing lines that we already have ready to produce those components down the wall.

So I think the right way to think about that aircraft is a sort of variant of the existing vehicle that is then in turn missionized for different customer use cases. What I think is really exciting, though, is that we've been able to move from concept to soon sort of demonstration of that vehicle at a very rapid pace, basically sort of 3 months from when we announced the L3 partnership to the preparations for flight testing that are happening right now. In turn, we think we're going to be able to move from demonstration to flexible deployment with those customers very quickly because we've got a manufacturing line that we do not have to scale up or retool where most of the components are essentially the same manufacturing line that we're using for the broader sort of commercial vehicle.

And that speed is something that in our conversations to date, the customers are really looking for. They are not so happy with the sort of traditional procurement process, long spec writing, competitions and then sort of moving to these sort of restrictive contracts. They are instead looking for things that get new technology into the hands of warfighters far more quickly. And we think we've got an opportunity with this platform in conjunction with L3 to deliver exactly that.

Our next question is coming from Chris Pierce from Needham & Company.

I was just curious, and if you fast forward a year from now, like what's the best possible outcome for the Blade transaction? Is it just more passenger throughput in New York? Or what Rob talked about? Is it adding routes so you can see kind of customer demand to get through to consider air taxi at a higher rate? But if you fast forward a year, what would you consider to make a success out of this to get people enthusiastic about air taxi in the business?

It's [indiscernible]. I think if you step back and you look at the thesis of the acquisition, it was to derisk and accelerate the deployment of the Joby aircraft into commercial service. So we're going to continue working on projects where we can achieve profitable growth in new routes, expansion of existing schedules. We recently expanded our JFK schedule to include another note on the East side and also deepened our Newark efforts. And in Europe, we have been focusing there as well on opportunities.

So I think the focus on profitable growth to continue getting more data, acquiring more customers, getting more infrastructure access. And I think that's going to be terrific. That's really going to educate us and help us deploy these aircraft once they're certified and to do it in a way and it is speed that I don't think the competition can match. It's a real head start versus the competition in every market Joby wants to enter.

Next question is coming from Amit Dayal from H.C. Wainwright.

Just with respect to all the comments on the call today, keeping in mind where we are with manufacturing readiness and all of the testing going on. What is the earliest we can take advantage of the CIPP initiative? Is 227 a reasonable time frame? Or could it be potentially earlier than that where some of these aircraft get into operation?

Amit, this is Paul. I'll try to pick that up. I'm not sure I totally heard it, so I'm going to sort of repeat what I understood the question to be. So your question was when do we think we can start first operations under EIPP? And the answer to that is that we now have with the EIPP program once the down select happens early next year, we've got a date certain for the start of those operations, and that's essentially mid next year. That is a really exciting opportunity and one that I think Joby is sort of uniquely positioned to take advantage of. Our understanding under IPP is that it's going to require aircraft to be at a high level of maturity. Our understanding is that means it has to be in the TIA process. It's also going to require the operational know-how to put those aircraft into service in the real world. We already have a lot of that from the demo flights that we've done, and we get to really supercharge that with Rob's team of Blade that obviously knows a lot about high tempo vertical takeoff and landing operations already.

But finally, you also need to make sure that we have the aircraft. So part of the focus now around scaling production is to meet this demand that is now higher next year than I think we were initially anticipating. So our focus with both the expansion of the Marina facility, the continued rollout into Dayton and obviously, doing both of those things in close conjunction with Toyota is to make sure that we really ramp production to meet this opportunity. because from our perspective, an opportunity to get these aircraft operating in the U.S. as quickly as possible, benefits Joby, and it certainly benefits the broader industry, and we think we're in pole position to kind of make that happen.

Terrific. This is Teresa again. Thank you, Amit, and Kevin, and thanks to all the analysts for your questions today. This quarter, we're doing something a little different. We also invited our broader community to submit questions on X and Reddit. We were thrilled with the volume and the thoughtfulness of the engagement. We selected a few representative questions to ask and answer now.

First, what actually is coming right back to you, Paul, it says, when do you expect to start the integration of autonomous capabilities into S4?

Thanks, Teresa. So as J.B. mentioned in the prepared remarks, the first instantiation on a Joby developed aircraft of autonomy is very likely to be the hybrid aircraft that I mentioned earlier on in the call. This is one that's obviously focused on defense applications. We think that's a perfect test bed for the stock. One, because it's already been well tested with its customer on conventional aircraft. And two, because there's not the same sort of regulatory rigor around certification for these sorts of platforms. So it's the right place to begin to extend the existing super pilot capabilities to low altitude, be tall capable to prove that out as soon as we can and in a wide range of mission sets, so that we're ready if and when there is an opportunity to translate that to the commercial side of things to move very, very quickly.

So long and short, that's going to be, I think, the first example of how we begin to roll this out on a Joby [indiscernible].

Terrific. Thank you. Another question also coming in from X. How do you see the future product offerings as both Joby and Blade actively scale operations, particularly in Dubai? Rodrigo, would you like to start with on that one?

Sure. Let me take that. Just as we mentioned before, Blade helps to derisk and accelerate the deployment of Joby aircraft into commercial service, and that includes Dubai. So the knowledge we have in the roots on infrastructure, the flyer base, we are not starting [indiscernible]. We're not starting from scratch. Anybody else tries to do this. They're starting with zero knowledge. We have flown hundreds of thousands of people over the past decade.

And then if you take a look at our European operations, 1/3 of our European flyers are from the Middle East. So it's a brand that's well known there. The Middle East consumer consistently embrace premium brands from the West that provide exceptional experiences that have trust. So I think we're in terrific shape to help get that launch out in front of the public and have something that people really enjoy and find us extremely reliable.

Terrific. Thank you. Okay. I think we could maybe get one more in, and there's this one fun one. In fact, it asks for how about something fun. Five years into passenger flight. That kind of crazy things can you see Joby involved in that will blow our minds now? JoeBen?

Thanks, Teresa. So I think the key thing to focus on is that vertical integration is Joby Superpower. This is something that we have invested in heavily for many years, and it puts us in an incredible position to be able to develop just game-changing aircraft, all built on the foundation of the incredible technology foundation stack that we've built.

I'll add 2 other dimensions. One we've talked about, which is autonomy. Autonomy is going to unleash many new and exciting applications for aviation. And by leading the world in aviation autonomy, we think we're in a really strong position.

The final dimension is hydrogen. Hydrogen, as I think many of you have heard me speak about, it has 3x the specific energy of jet fuel. With fuel cells, we're able to convert the chemical energy and hydrogen into propulsion twice as efficiently as a small turbine can convert jet fuel into propulsion. And what that means is that you can build aircraft with game-changing new capabilities. And so as we look to the 5-year horizon, we think the future for Joby and the future for the technology stack that we're building has never been more promising, and I'm so excited to bring these transformations to the world.

Awesome. Thank you, everyone, for joining us today. We greatly appreciate your support.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation.