UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2021~~March 31, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-38791

LUMINAR TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Delaware

83-1804317

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

2603 Discovery Drive

Suite 100

Orlando

Florida

32826

(Address of Principal Executive Offices)

(Zip Code)

(407) 900-5259

Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Class A common stock, par value of $0.0001 per share

LAZR

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐☒

Accelerated filer

☐

Non-accelerated filer

☒☐

Smaller reporting company

☒☐

Emerging growth company

☒☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of ~~November 5, 2021,~~April 29, 2022, the registrant had ~~259,965,800~~252,526,777 shares of Class A common stock and ~~101,588,670~~97,088,670 shares of Class B common stock, par value $0.0001 per share, outstanding.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS


		Page
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS		2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.		34
	Condensed Consolidated Balance Sheets (Unaudited)	34
	Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)	45
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) (Unaudited)	56
	Condensed Consolidated Statements of Cash Flows (Unaudited)	7
	Notes to Condensed Consolidated Financial Statements (Unaudited)	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.		2827
	Overview	2827
	Industrialization and Customer Update	2927
	Basis of Presentation	2928
	Components of Results of Operations	2928
	Results of Operations	3130
	Liquidity and Capital Resources	3231
	Off-Balance Sheet Arrangements	341
	Critical Accounting Policies and Estimates	3432
	Recent Accounting Pronouncements	3532
Item 3. Quantitative and Qualitative Disclosures About Market Risk.		3633
Item 4. Controls and Procedures.		3633

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.		3835
Item 1A. Risk Factors.		3835
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.		3835
Item 3. Defaults Upon Senior Securities.		3835
Item 4. Mine Safety Disclosures.		3835
Item 5. Other Information.		3835
Item 6. Exhibits.		3936
SIGNATURES		4037

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CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Form 10-Q”) ~~contains~~includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which involve substantial risks and uncertainties. These statements reflect the current views of management with respect to future events and our financial performance. In some cases, you can identify these statements by forward-looking words such as “outlook,” “believes,” “expects,” “future,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words or phrases, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies, product plans, future growth, market opportunities, strategic initiatives, industry positioning, customer acquisition and retention, revenue growth and anticipated trends in our business.

These statements are only predictions based on our current expectations and projections about future events. These statements involve known and unknown risks, uncertainties and other important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking ~~statements. Given~~statements, including, our history of losses and our expectation that we will continue to incur significant expenses, including substantial R&D costs, and continuing losses for the foreseeable future as well as our limited operating history which makes it difficult to evaluate our future prospects and the risks and challenges we may encounter; our strategic initiatives which may prove more costly than we currently anticipate and potential failure to increase our revenue to offset these initiatives; whether our lidar products are selected for inclusion in autonomous driving or ADAS systems by automotive OEMs or their suppliers, and whether we will be de-selected by any customers; the lengthy period of time from a major commercial win to implementation and the risks ~~uncertainties~~of cancellation or postponement of the contract or unsuccessful implementation; potential inaccuracies in our forward looking estimates of certain metrics and our future cost of goods sold (COGS) and bill of materials (BOM) and total addressable market; the discontinuation, lack of success of our customers in developing and commercializing products using our solutions or loss of business with respect to a particular vehicle model or technology package and whether end automotive consumers will demand and be willing to pay for such features; our inability to reduce and control the cost of the inputs on which we rely, which could negatively impact the adoption of our products and our profitability; the effect of continued pricing pressures, competition from other lidar manufacturers, automotive original equipment manufacturers (“OEMs”) cost reduction initiatives and the ability of automotive OEMs to re-source or cancel vehicle or technology programs which may result in lower than anticipated margins, or losses, which may adversely affect our business; general economic uncertainty and the effect of general economic conditions on our industry in particular, including the level of demand and financial performance of the autonomous vehicle industry and market adoption of lidar as well as developments in alternative technology and the increasingly competitive environment in which we operate; our ability to manage our growth and expand our business operations effectively, including into international markets, such as China, which exposes us to operational, financial and regulatory risks; adverse impacts due to limited availability and quality of materials, supplies, and capital equipment, or dependency on third-party service providers whether we will be able to successfully transition our engineering designs into high volume manufacturing, including our ability to transition to an outsourced manufacturing business model and whether we and our outsourcing partners and suppliers can successfully operate complex machinery; whether we can successfully select, execute or integrate our acquisitions; whether the complexity of our products results in undetected defects and reliability issues which could reduce market adoption of our new products, limit our ability to manufacture, damage our reputation and expose us to product liability, warranty and other claims; our ability to maintain and adequately manage our inventory; our ability to remediate the material weakness in our internal controls over financial reporting; our ability to protect and enforce our intellectual property rights; changes in personnel and availability of qualified personnel and dependence on Austin Russell, our Founder, President and Chief Executive Officer; the amount and timing of future sales and whether the average selling prices of our products could decrease rapidly over the life of the product as well as our dependence on a few key customers, who are often large corporations with substantial negotiating power; the effects of the ongoing coronavirus (COVID-19) pandemic or other infectious diseases, health epidemics, pandemics and natural disasters on Luminar’s business; interruption or failure of our information technology and communications systems and cybersecurity risks to our operational systems, security systems, infrastructure, integrated software in our lidar solutions; and those other factors ~~you should not place undue reliance on these forward-looking statements. These factors include the information set forth~~discussed in Part 1, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021 under the heading “Risk Factors” and Part II, Item 1A, of this Quarterly Report under the heading “Risk Factors”, which we encourage you to carefully read. Given these risks, uncertainties and other factors, you should not place undue reliance on these forward-looking statements. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. We undertake no obligation to update any forward-looking statements made in this Form 10-Q to reflect events or circumstances after the date of this Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we

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believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.

WEBSITE AND SOCIAL MEDIA DISCLOSURE

We use our website (https://www.luminartech.com/) and various social media channels as a means of disclosing information about the Company and its products to its customers, investors and the public (e.g., @luminartech on Twitter, Luminartech on YouTube, and Luminar Technologies on LinkedIn). The information on our website (or any webpages referenced in this Quarterly Report on Form 10-Q) or posted on social media channels is not part of this or any other report that the Company files with, or furnishes to, the SEC. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands)


		September 30, 2021		December 31, 2020			March 31, 2022		December 31, 2021
		(Unaudited)					(Unaudited)
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	129,323	$	208,944	Cash and cash equivalents	$	159,416	$	329,977
Restricted cash	Restricted cash	725		775		Restricted cash	710		725
Marketable securities		415,544		276,710
Marketable securities (including $12,250 and $12,200 with a related party as of March 31, 2022 and December 31, 2021, respectively, see Note 15)						Marketable securities (including $12,250 and $12,200 with a related party as of March 31, 2022 and December 31, 2021, respectively, see Note 15)	547,440		462,141
Accounts receivable	Accounts receivable	1,033		5,971		Accounts receivable	3,256		13,013
Inventories, net		7,871		3,613
Inventory						Inventory	10,012		10,342
Prepaid expenses and other current assets	Prepaid expenses and other current assets	23,883		4,797		Prepaid expenses and other current assets	37,545		29,195
Total current assets	Total current assets	578,379		500,810		Total current assets	758,379		845,393
Property and equipment, net	Property and equipment, net	11,128		7,689		Property and equipment, net	16,437		11,009
Operating lease right-of-use assets	Operating lease right-of-use assets	10,165		—		Operating lease right-of-use assets	14,005		9,145
Intangible assets, net	Intangible assets, net	2,488		—		Intangible assets, net	2,361		2,424
Goodwill	Goodwill	3,110		701		Goodwill	2,945		3,110
Other non-current assets	Other non-current assets	2,536		1,151		Other non-current assets	13,673		12,455
Total assets	Total assets	$	607,806	$	510,351	Total assets	$	807,800	$	883,536

LIABILITIES AND STOCKHOLDERS’ EQUITY	LIABILITIES AND STOCKHOLDERS’ EQUITY					LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	9,682	$	6,039	Accounts payable	$	17,293	$	14,419
Accrued and other current liabilities	Accrued and other current liabilities	18,551		10,452		Accrued and other current liabilities	24,848		19,844
Operating lease liabilities	Operating lease liabilities	4,927		—		Operating lease liabilities	5,079		4,735
Debt, current		66		99

Total current liabilities	Total current liabilities	33,226		16,590		Total current liabilities	47,220		38,998
Warrant liabilities	Warrant liabilities	27,753		343,400		Warrant liabilities	16,399		31,230
Debt, non-current		177		302

Convertible senior notes						Convertible senior notes	609,766		608,957
Operating lease liabilities, non-current	Operating lease liabilities, non-current	6,639		—		Operating lease liabilities, non-current	10,102		5,768
Other non-current liabilities	Other non-current liabilities	911		1,318		Other non-current liabilities	429		598
Total liabilities	Total liabilities	68,706		361,610		Total liabilities	683,916		685,551
Commitments and contingencies (Note 13)	Commitments and contingencies (Note 13)	0		0		Commitments and contingencies (Note 13)	0		0
Stockholders’ equity:	Stockholders’ equity:					Stockholders’ equity:
Class A common stock	Class A common stock	26		22		Class A common stock	27		27
Class B common stock	Class B common stock	10		11		Class B common stock	10		10
Additional paid-in capital	Additional paid-in capital	1,287,558		733,175		Additional paid-in capital	1,314,742		1,257,214
Accumulated other comprehensive income		100		34
Accumulated other comprehensive loss						Accumulated other comprehensive loss	(4,556)		(908)
Treasury stock						Treasury stock	(275,519)		(235,871)
Accumulated deficit	Accumulated deficit	(748,594)		(584,501)		Accumulated deficit	(910,820)		(822,487)
Total stockholders’ equity	Total stockholders’ equity	539,100		148,741		Total stockholders’ equity	123,884		197,985
Total liabilities and stockholders’ equity	Total liabilities and stockholders’ equity	$	607,806	$	510,351	Total liabilities and stockholders’ equity	$	807,800	$	883,536

See accompanying notes to the unaudited condensed consolidated financial statements.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited, in thousands, except share and per share data)

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Revenue $ 7,978 $ 4,223 $ 19,600 $ 11,519
Cost of sales 10,762 6,924 26,254 18,209
Gross loss (2,784) (2,701) (6,654) (6,690)
Operating expenses:
Research and development 25,890 10,152 59,813 28,268
Sales and marketing 5,868 2,332 12,010 5,407
General and administrative 35,603 6,611 65,113 16,116
Total operating expenses 67,361 19,095 136,936 49,791
Loss from operations (70,145) (21,796) (143,590) (56,481)
Other income (expense), net:
Change in fair value of warrant liabilities 17,072 (7,988) (22,649) (12,562)
Loss on extinguishment of debt — — — (866)
Interest expense and other (374) (1,076) (860) (2,097)
Interest income and other 843 (351) 1,744 (221)
Total other income (expense), net 17,541 (9,415) (21,765) (15,746)
Loss before benefit from income taxes (52,604) (31,211) (165,355) (72,227)
Benefit from income taxes (1,264) — (1,262) —
Net loss $ (51,340) $ (31,211) $ (164,093) $ (72,227)
Net loss attributable to common stockholders $ (51,340) $ (37,458) $ (164,093) $ (78,474)
Net loss per share attributable to common stockholders:
Basic and diluted $ (0.15) $ (0.29) $ (0.48) $ (0.61)
Shares used in computing net loss per share attributable to common stockholders:
Basic and diluted 352,122,485 130,601,660 341,858,435 129,643,774
Comprehensive Loss:
Net loss $ (51,340) $ (31,211) $ (164,093) $ (72,227)
Net unrealized gains (losses) on available-for-sale debt securities 93 (28) 66 (19)
Comprehensive loss $ (51,247) $ (31,239) $ (164,027) $ (72,246)

~~See accompanying notes to the unaudited condensed consolidated financial statements.~~

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)~~

~~(Unaudited, in thousands, except share data)~~
Series A Convertible
Preferred Stock Series X Convertible
Preferred Stock Founders Convertible
Preferred Stock Class A
Common Stock Class B
Common Stock Additional
Paid-in
Capital Accumulated
Other
Comprehensive
Income (Loss) Accumulated
Deficit Total
Stockholders’
Equity (Deficit)
Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount
Balance as of June 30, 2020 94,818,151 $ 244,743 — $ — 26,206,837 $ 3 139,635,890 $ 14 — $ — $ 13,889 $ 8 $ (263,219) $ (249,305)
Issuance of Series X convertible preferred stock for cash, net of issuance costs of $5,889 — — 17,065,536 164,111 — — — — — — — — — —
Share-based compensation — — — — — — — — — — 1,306 — — 1,306
Other comprehensive income — — — — — — — — — — — (28) — (28)
Net loss — — — — — — — — — — — — (31,211) (31,211)
Balance as of September 30, 2020 94,818,151 $ 244,743 17,065,536 $ 164,111 26,206,837 $ 3 139,635,890 $ 14 — $ — $ 15,195 $ (20) $ (294,430) $ (279,238)
Balance as of June 30, 2021 — $ — — $ — — $ — 236,483,687 $ 24 105,118,203 $ 11 $ 1,244,228 $ 7 $ (697,254) $ 547,016
Issuance of Class A common stock upon exercise of stock options and vesting of restricted stock units — — — — — — 1,920,137 — — — 1,547 — — 1,547
Vendor payments in shares in lieu of cash — — — — — — 291,940 — — — 4,848 — — 4,848
Acquisition of Optogration, Inc. — — — — — — 370,034 — — — 6,527 — — 6,527
Issuance of earn-out shares — — — — — — 10,242,703 1 6,970,467 — (2) — — (1)
Conversion of Class B common stock into Class A common stock — — — — — — 10,500,000 1 (10,500,000) (1) — — — 0
Share-based compensation — — — — — — — — — — 30,410 — — 30,410
Other comprehensive income — — — — — — — — — — — 93 — 93
Net loss — — — — — — — — — — — — (51,340) (51,340)
Balance as of September 30, 2021 — $ — — $ — — $ — 259,808,501 $ 26 101,588,670 $ 10 $ 1,287,558 $ 100 $ (748,594) $ 539,100


	Three Months Ended March 31,
	2022		2021
Revenue:
Products	$	1,541	$	2,933
Services	5,314		2,380
Total revenue	6,855		5,313
Cost of sales:
Products	11,818		5,309
Services	4,836		2,330
Total cost of sales	16,654		7,639
Gross loss	(9,799)		(2,326)
Operating expenses:
Research and development	33,109		14,010
Sales and marketing	9,398		2,635
General and administrative	30,025		10,273
Total operating expenses	72,532		26,918
Loss from operations	(82,331)		(29,244)
Other income (expense), net:

Change in fair value of warrant liabilities	(3,857)		(46,649)

Interest expense and other	(3,280)		(200)
Interest income and other	1,539		170
Total other income (expense), net	(5,598)		(46,679)
Loss before provision for income taxes	(87,929)		(75,923)
Provision for income taxes	404		—
Net loss	$	(88,333)	$	(75,923)

Net loss per share:
Basic and diluted	$	(0.25)	$	(0.23)
Shares used in computing net loss per share:
Basic and diluted	348,683,836		332,987,523
Comprehensive Loss:
Net loss	$	(88,333)	$	(75,923)
Net unrealized losses on available-for-sale debt securities	(3,648)		(43)
Comprehensive loss	$	(91,981)	$	(75,966)

See accompanying notes to the unaudited condensed consolidated financial statements.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of ~~Convertible Preferred Stock and~~ Stockholders’ Equity ~~(Deficit)~~

(Unaudited, in thousands, except share data)
Series A Convertible
Preferred Stock Series X Convertible
Preferred Stock Founders Convertible
Preferred Stock Class A
Common Stock Class B
Common Stock Additional
Paid-in
Capital Accumulated
Other
Comprehensive
Income (Loss) Accumulated
Deficit Total
Stockholders’
Equity (Deficit)
Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount
Balance as of December 31, 2019 94,818,151 $ 244,743 — $ — 26,206,837 $ 3 139,635,890 $ 14 — $ — $ 10,457 $ (1) $ (222,203) $ (211,730)
Issuance of Series X convertible preferred stock for cash, net of issuance costs of $5,889 — — 17,065,536 164,111 — — — — — — — — — —
Share-based compensation — — — — — — — — — — 4,738 — — 4,738
Other comprehensive income — — — — — — — — — — — (19) — (19)
Net loss — — — — — — — — — — — — (72,227) (72,227)
Balance as of September 30, 2020 94,818,151 $ 244,743 17,065,536 $ 164,111 26,206,837 $ 3 139,635,890 $ 14 — $ — $ 15,195 $ (20) $ (294,430) $ (279,238)
Balance as of December 31, 2020 — $ — — $ — — $ — 218,818,037 $ 22 105,118,203 $ 11 $ 733,175 $ 34 $ (584,501) $ 148,741
Issuance of Class A common stock upon exercise of warrants, stock options and vesting of restricted stock units — — — — — — 19,585,787 2 — — 496,972 — — 496,974
Vendor payments in shares in lieu of cash — — — — — — 291,940 — — — 4,848 — — 4,848
Acquisition of Optogration, Inc. — — — — — — 370,034 — — — 6,527 — — 6,527
Issuance of earn-out shares — — — — — — 10,242,703 1 6,970,467 — (2) — — (1)
Conversion of Class B common stock into Class A common stock — — — — — — 10,500,000 1 (10,500,000) (1) — — —
Share-based compensation — — — — — — — — — — 46,168 — — 46,168
Payments of employee taxes related to vested restricted stock units — — — — — — — — — — (140) — — (140)
Cash received from Gores on settlement of recapitalization of escrow — — — — — — — — — — 10 — — 10
Other comprehensive loss — — — — — — — — — — — 66 — 66
Net loss — — — — — — — — — — — — (164,093) (164,093)
Balance as of September 30, 2021 — $ — — $ — — $ — 259,808,501 $ 26 101,588,670 $ 10 $ 1,287,558 $ 100 $ (748,594) $ 539,100


	Class A Common Stock	Class B Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)	Treasury Stock			Accumulated Deficit		Total Stockholders’ Equity (Deficit)
			Shares			Amount				Shares					Amount
Balance as of December 31, 2020			218,818,037	$	22		105,118,203	$	11		$	733,175	$	34		$	—	$	(584,501)	$	148,741
Issuance of Class A common stock upon exercise of Public and Private Warrants			15,574,037	1			—	—			492,219		—			—		—		492,220
Issuance of Class A common stock upon exercise of stock options			183,918	—			—	—			322		—			—		—		322
Share-based compensation			—	—			—	—			1,843		—			—		—		1,843
Other comprehensive loss			—	—			—	—			—		(43)			—		—		(43)
Net loss			—	—			—	—			—		—			—		(75,923)		(75,923)
Balance as of March 31, 2021			234,575,992	$	23		105,118,203	$	11		$	1,227,559	$	(9)		$	—	$	(660,424)	$	567,160

Balance as of December 31, 2021			266,076,525	$	27		97,088,670	$	10		$	1,257,214	$	(908)		$	(235,871)	$	(822,487)	$	197,985
Shares repurchased			—	—			—	—			—		—			(39,648)		—		(39,648)
Issuance of Class A common stock upon exercise of Private Warrants			401,365	—			—	—			18,689		—			—		—		18,689
Issuance of Class A common stock upon exercise of stock options and vesting of restricted stock units			2,117,059	—			—	—			1,085		—			—		—		1,085
Retirement of unvested restricted common stock			(40,763)	—			—	—			—		—			—		—		—
Vendor stock-in-lieu of cash program			1,424,350	—			—	—			14,613		—			—		—		14,613



Share-based compensation			—	—			—	—			23,657		—			—		—		23,657
Payments of employee taxes related to vested restricted stock units			—	—			—	—			(516)		—			—		—		(516)

Other comprehensive loss			—	—			—	—			—		(3,648)			—		—		(3,648)
Net loss			—	—			—	—			—		—			—		(88,333)		(88,333)
Balance as of March 31, 2022			269,978,536	$	27		97,088,670	$	10		$	1,314,742	$	(4,556)		$	(275,519)	$	(910,820)	$	123,884

See accompanying notes to the unaudited condensed consolidated financial statements.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited, in thousands)


		Nine Months Ended September 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Cash flows from operating activities:	Cash flows from operating activities:					Cash flows from operating activities:
Net loss	Net loss	$	(164,093)	$	(72,227)	Net loss	$	(88,333)	$	(75,923)
Adjustments to reconcile net loss to net cash used in operating activities:	Adjustments to reconcile net loss to net cash used in operating activities:					Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	Depreciation and amortization	2,240		1,929		Depreciation and amortization	805		657
Noncash lease expense related to operating lease right-of-use assets	Noncash lease expense related to operating lease right-of-use assets	2,682		—		Noncash lease expense related to operating lease right-of-use assets	885		890
Amortization of premium on marketable securities						Amortization of premium on marketable securities	444		262

Change in fair value of warrants						Change in fair value of warrants	3,857		46,649
Vendor stock-in-lieu of cash program						Vendor stock-in-lieu of cash program	7,848		—
Amortization of debt discount and issuance costs						Amortization of debt discount and issuance costs	809		—
Impairment of inventories						Impairment of inventories	1,356		257

Change in fair value of warrants		22,649		12,562
Share-based compensation—vendor payments		2,744		—
Impairment of inventories		1,601		4,393

Loss on extinguishment of debt		—		866
Share-based compensation	Share-based compensation	49,887		4,710		Share-based compensation	26,698		1,837

Warranty related to sensors		1,239		—
Deferred taxes		(1,264)		—
Other		883		389

Product warranty and other						Product warranty and other	107		853
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:					Changes in operating assets and liabilities:
Accounts receivable	Accounts receivable	5,748		723		Accounts receivable	9,757		3,828
Inventories	Inventories	(6,658)		(3,206)		Inventories	(768)		(442)
Prepaid expenses and other current assets	Prepaid expenses and other current assets	(16,971)		(3,571)		Prepaid expenses and other current assets	(3,300)		(5,797)
Other non-current assets	Other non-current assets	(88)		544		Other non-current assets	158		(1,318)
Accounts payable	Accounts payable	3,330		2,462		Accounts payable	5,983		1,766
Accrued and other current liabilities	Accrued and other current liabilities	5,910		2,885		Accrued and other current liabilities	1,200		(813)
Other non-current liabilities	Other non-current liabilities	(4,095)		(190)		Other non-current liabilities	(343)		(720)
Net cash used in operating activities	Net cash used in operating activities	(94,256)		(47,731)		Net cash used in operating activities	(32,837)		(28,014)
Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Cash received from acquisition of Optogration, Inc.		358		—

Purchases of marketable securities	Purchases of marketable securities	(530,179)		(123,403)		Purchases of marketable securities	(193,687)		(226,245)
Proceeds from maturities of marketable securities	Proceeds from maturities of marketable securities	306,907		8,465		Proceeds from maturities of marketable securities	91,454		69,275
Proceeds from sales of marketable securities	Proceeds from sales of marketable securities	83,493		4,448		Proceeds from sales of marketable securities	12,842		29,505

Purchases of property and equipment	Purchases of property and equipment	(4,155)		(1,963)		Purchases of property and equipment	(5,004)		(889)

Net cash used in investing activities	Net cash used in investing activities	(143,576)		(112,453)		Net cash used in investing activities	(94,395)		(128,354)
Cash flows from financing activities:	Cash flows from financing activities:					Cash flows from financing activities:

Proceeds from issuance of Series X convertible preferred stock		—		170,000
Issuance cost paid for Series X convertible preferred stock		—		(5,662)
Proceeds from the issuance of debt		—		31,910
Repayment of debt		(159)		(11,206)

Proceeds from exercise of warrants	Proceeds from exercise of warrants	153,927		—		Proceeds from exercise of warrants	—		153,927
Proceeds from exercise of stock options	Proceeds from exercise of stock options	4,738		—		Proceeds from exercise of stock options	1,092		321

Payments of employee taxes related to vested restricted stock units						Payments of employee taxes related to vested restricted stock units	(516)		—

Repurchase of common stock and redemption of warrants						Repurchase of common stock and redemption of warrants	(43,920)		(2)
Other financing activities	Other financing activities	(345)		(1,238)		Other financing activities	—		(142)
Net cash provided by financing activities		158,161		183,804
Net increase (decrease) in cash, cash equivalents and restricted cash		(79,671)		23,620
Net cash provided by (used in) financing activities						Net cash provided by (used in) financing activities	(43,344)		154,104
Net decrease in cash, cash equivalents and restricted cash						Net decrease in cash, cash equivalents and restricted cash	(170,576)		(2,264)
Beginning cash, cash equivalents and restricted cash	Beginning cash, cash equivalents and restricted cash	209,719		27,305		Beginning cash, cash equivalents and restricted cash	330,702		209,719
Ending cash, cash equivalents and restricted cash	Ending cash, cash equivalents and restricted cash	$	130,048	$	50,925	Ending cash, cash equivalents and restricted cash	$	160,126	$	207,455
Supplemental disclosures of cash flow information:	Supplemental disclosures of cash flow information:					Supplemental disclosures of cash flow information:
Cash paid for interest	Cash paid for interest	$	53	$	2,013	Cash paid for interest	$	—	$	19

Supplemental disclosures of noncash investing and financing activities:	Supplemental disclosures of noncash investing and financing activities:					Supplemental disclosures of noncash investing and financing activities:

Issuance of Class A common stock upon exercise of warrants	Issuance of Class A common stock upon exercise of warrants	$	338,293	$	—	Issuance of Class A common stock upon exercise of warrants	$	18,689	$	338,293

Operating lease right-of-use assets obtained in exchange for lease obligations upon adoption of ASC 842	Operating lease right-of-use assets obtained in exchange for lease obligations upon adoption of ASC 842	10,849		—		Operating lease right-of-use assets obtained in exchange for lease obligations upon adoption of ASC 842	—		10,849
Operating lease right-of-use assets obtained in exchange for lease obligations	Operating lease right-of-use assets obtained in exchange for lease obligations	2,876		—		Operating lease right-of-use assets obtained in exchange for lease obligations	5,746		2,876
Deferred financing costs recorded in accrued liabilities						Deferred financing costs recorded in accrued liabilities	—		223

Assets acquired under finance leases (capital lease prior to adoption of ASC 842)		—		43
Purchases of property and equipment recorded in accounts payable and accrued liabilities	Purchases of property and equipment recorded in accounts payable and accrued liabilities	543		313		Purchases of property and equipment recorded in accounts payable and accrued liabilities	1,950		504

Merger related expense recorded in accounts payable and accrued liabilities		—		3,669
Issuance cost for Series X preferred stock recorded in accounts payable		—		227

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 1. Organization and Description of Business

Luminar Technologies, Inc. and its wholly-owned subsidiaries (the “Company” or “Luminar”) was originally incorporated in Delaware on August 28, 2018 under the name Gores Metropoulos, Inc (“Gores”). The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. On December 2, 2020 (the “Closing Date”), the Company (at such time named Gores Metropoulos, Inc.) consummated the business combination (the “Business Combination”) pursuant to the Agreement and Plan of Merger (the “Merger Agreement”), dated August 24, 2020 with the pre-Business Combination Luminar Technologies, Inc. (“Legacy Luminar”). Legacy Luminar was incorporated in Delaware on March 31, 2015. In connection with the consummation of the Business Combination, the Company changed its name from Gores Metropoulos, Inc. to Luminar Technologies, Inc. The Company’s common stock is listed on the NASDAQ under the symbol “LAZR.” The Company’s public warrants to purchase shares of Class A common stock were listed on the NASDAQ under the symbol “LAZRW,” until they were delisted on March 5, 2021 upon exercise and redemption.

Unless the context otherwise requires, the “Company” refers to the combined company and its subsidiaries following the Business Combination, “Gores” refers to the Company prior to the Business Combination and “Legacy Luminar” refers to Luminar Technologies, Inc., prior to the Business Combination. Refer to Reverse Merger with Gores in Note 3 to the financial statements of the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 for additional information relating to the Business Combination.

The Company is a developer of advanced sensor technologies and software for the autonomous vehicle industry, encompassing Laser Imaging, Detection and Ranging (lidar) technology. The Company manufactures and distributes commercial lidar sensors and certain components for the autonomous vehicle industry. The Company is headquartered in Orlando, Florida and has various facilities located in ~~Palo Alto, California, Detroit, Michigan, Boston, Massachusetts, Colorado Springs, Colorado,~~the United States and internationally in Munich, ~~Germany and Orlando, Florida, which is also the Company’s headquarters.~~Germany.

Note 2. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. All intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenues and expenses, and related disclosures. The significant estimates made by management include inventory reserves, valuation allowance for deferred tax assets, valuation of warrants, ~~revenue,~~forecasted costs associated with non-recurring (“NRE”) services, product warranty reserves, stock-based compensation expense and other loss contingencies. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. Actual results could differ from those estimates.

Segment Information

The Company has determined its operating segments using the same indicators which are used to evaluate its performance internally. The Company has two business activities which are its operating segments:

(i) “Autonomous Solutions” for automotive ~~mobility~~ applications, which includes manufacturing and distribution of lidar sensors that measure distance using laser light to generate a 3D map, non-recurring engineering services related to the Company’s lidar products, and development of software products that enable autonomy capabilities; and

(ii) ~~“Component Sales”~~“Components” which includes development of ~~ultra-sensitive~~application-specific integrated circuits, pixel-based sensors, as well as designing, testing and providing consulting services for non-standard integrated circuits. In August 2021, the Company acquired Optogration, Inc. (“Optogration”), which has been included in the Components segment.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

~~(“Optogration”) to secure supply for a key enabling component as the Company advances towards series production and scale of its lidar sensor offering.~~

The Company’s chief operating decision maker (“CODM”), its Chief Executive Officer, reviews the operating results of these segments for the purpose of allocating resources and evaluating financial performance.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk, consist primarily of cash and cash equivalents, marketable investments and accounts receivable. A significant portion of the Company’s cash and cash equivalents is held at high-quality domestic financial institutions. Deposits held with the financial institutions may, at times, exceed the amount of insurance provided on such deposits. ~~The~~Cash held by the Company ~~held cash~~ in foreign entities ~~of $1.6 million and $0.6 million~~ as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, respectively.~~2021 was not material.

The Company’s revenue is derived from customers located in the United States and international markets. ~~The Company generally does not require collateral.~~

~~Three~~Four customers accounted for ~~35%~~39%, ~~17%~~20%, 11% and ~~12%~~10%, respectively, of the Company’s accounts receivable at ~~September 30, 2021 and one customer~~March 31, 2022. Two customers accounted for ~~86%~~39% and 31% of the Company’s accounts receivable at December 31, ~~2020.~~2021.

Significant Accounting Policies

The Company’s significant accounting policies are disclosed in its Annual Report on Form 10-K for the year ended December 31, ~~2020. Other than the accounting policies discussed below related to equity investments and in Note 12 related to the adoption of Accounting Standards Codification (“ASC”) 842,~~ ~~Leases, there~~2021. There has been no material change to the Company’s significant accounting policies during the ~~nine~~three months ended ~~September 30, 2021.~~

~~Equity Investments~~

The Company holds marketable equity investments over which the Company does not have a controlling interest or significant influence. Marketable equity investments are measured using the quoted prices in active markets with changes recorded in other income (expense), net on the condensed consolidated statement of operations.March 31, 2022.

Recently Adopted Accounting Pronouncements

In ~~February 2016,~~October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. ~~2016-02,~~ ~~Leases~~ (Topic 842) and issued subsequent amendments to the initial guidance in 2017, 2018 and 2019 (collectively “ASC 842”). Under the new guidance, a lessee is required to recognize assets and liabilities for both finance, previously known as capital, and operating leases with lease terms of more than 12 months. The ASU also requires disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. In transition, the Company recognized and measured leases at the beginning of the period of adoption, January 1, 2021, using a modified retrospective approach that included a number of optional practical expedients that the Company elected to apply. See Note 12 for disclosure on the impact of adopting this standard.

~~Recent Accounting Pronouncements Not Yet Effective~~

~~In June 2016, the FASB issued ASU 2016-13,~~ ~~Financial Instruments—Credit Losses (ASC 326)~~: Measurement of Credit Losses of Financial Instruments, which, together with subsequent amendments, amends the requirement on the measurement and recognition of expected credit losses for financial assets held. ASU 2016-13 will be effective for the Company beginning January 1, 2023, with early adoption permitted. The Company is currently in the process of evaluating the effects of this pronouncement on the Company’s financial statements and does not expect it to have a material impact on the consolidated financial statements.

~~In October 2021, the FASB issued ASU~~ No. 2021-08 (“ASU 2021-08”), Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with ~~Customers. The new guidance~~Customers. ASU 2021-08 requires an acquirer to recognize and measure contract assets and contract liabilities acquired in ~~this update affects all entities that enter into~~ a business combination ~~within~~in accordance with Topic 606. At the ~~scope of ASC 805-10.~~acquisition date, it requires an acquirer to account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts, which should generally result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements. The Company elected to early adopt ASU 2021-08 ~~will be effective for the Company beginning~~as of January 1, ~~2023.~~2022. The ~~Company is currently in the process~~adoption of ~~evaluating the effects of this pronouncement on the Company’s financial statements and does~~ASU 2021-08 did not ~~expect it to~~ have a material impact on the Company’s consolidated financial ~~statements.~~position, operating results or cash flows.

Note 3. ~~Business Combination~~

On August 3, 2021, (the “Acquisition Date”) the Company completed its acquisition of OptoGration. The OptoGration acquisition helps the Company secure intellectual property and supply of Indium Gallium Arsenide (“InGaAs”) photodetector

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

(used to convert optical power into an electrical current) semiconductor chips. The acquisition of OptoGration is part of the Company’s vertical integration strategy, which will secure supply of a key component of its sensor technology.

Pursuant to the terms of the Stock Purchase Agreement between the Company and OptoGration, the Company acquired all of the issued and outstanding capital stock of OptoGration for an aggregate purchase price of approximately $6.3 million payable in Class A common stock of the Company. Subsequent to the Acquisition Date, up to $22.0 million of post combination compensation may be payable to the shareholders of OptoGration subject to certain service and performance conditions. The results of operations related to OptoGration are included in our consolidated statements of operations beginning from the Acquisition Date. The impact of the acquisition on the consolidated financial results of the Company for the three months ended September 30, 2021 was not material.

~~Recording of Assets Acquired and Liabilities Assumed~~

Preliminary estimates of fair value included in the consolidated financial statements, in conformity with ASC 820, Fair Value Measurement, represent the Company’s best preliminary estimates and preliminary valuations. In accordance with ASC 805, Business Combinations, the preliminary allocation of the consideration value is subject to adjustment until the Company has completed its analysis, but not to exceed one year after the Acquisition Date to provide the Company with the time to complete the valuation of its assets and liabilities. As of September 30, 2021, the Company has completed a preliminary estimate of deferred tax balances but the process of finalizing deferred tax balances will take place after the current period tax returns are filed. As of September 30, 2021, the Company was still in the process of finalizing assessment of working capital accounts. The completion of this analysis could result in changes to the Company’s allocation of the consideration value to assets acquired and liabilities assumed.

~~Settlement of a pre-existing agreement with OptoGration~~

Prior to the acquisition, the Company had contracted with OptoGration as a supplier. In assessing whether said pre-existing supply contract was at market, favorable or unfavorable from the Company’s perspective, the Company assessed whether the terms of the supply contract, including pricing, were consistent with what the Company would have required from another company that would have contracted for similar products and production volumes. The Company concluded that the supply agreement was at market, and thus no gain or loss was recognized upon effective settlement of the said pre-existing supply agreement.

~~The following table summarizes the preliminary purchase price allocation to assets acquired and liabilities assumed, including identification of measurement period adjustments:~~


	~~Preliminary Recorded Value~~
~~Cash and cash equivalents~~	$	~~358~~
~~Accounts receivable~~	~~810~~
~~Other current assets~~	~~482~~
~~Property and equipment~~	~~1,248~~
~~Other non-current assets~~	~~384~~
~~Intangible assets (1)~~	~~2,650~~
~~Goodwill (2)~~	~~2,409~~
~~Total assets acquired~~	~~8,341~~
~~Current Liabilities~~	~~(488)~~
~~Non-current liabilities~~	~~(1,511)~~
~~Total liabilities assumed~~	~~(1,999)~~
~~Net assets acquired~~	$	~~6,342~~

~~(1) Identifiable intangible assets were measured using the income approach.~~

(2) Goodwill is the excess of the consideration transferred over the net assets recognized and represents the expected future economic benefits as a result of other assets acquired that could not be individually identified and separately recognized. Goodwill is not amortized. The factors that made up the goodwill recognized included assembled workforce and component cost savings. Goodwill is not expected to be deductible for tax purposes.

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~Identifiable intangible assets recognized:~~


	~~Useful Life~~	~~Preliminary Recorded Value~~
~~Customer relationships~~	~~10 years~~	$	~~780~~
~~Tradename~~	~~≤ 1 year~~	~~120~~
~~Developed technology~~	~~10 years~~	~~1,750~~
~~Total intangible assets~~		$	~~2,650~~

~~Note 4.~~ Revenue

The Company’s revenue ~~till date has~~is comprised of sales of lidar sensors hardware, components and ~~engineering~~NRE services.

Disaggregation of Revenues

The Company disaggregates its revenue from contracts with customers by (1) geographic region based on ~~the primary locations where the customer is situated,~~customer’s billed to location, and (2) type of good or service and timing of transfer of goods or services to customers (point-in-time or over time), as it believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors. Total revenue based on the disaggregation criteria described above, as well as revenue by segment, are as follows (in thousands):


		Three Months Ended September 30,									Three Months Ended March 31,
		2021				2020					2022				2021
		Revenue		% of Revenue		Revenue		% of Revenue			Revenue		% of Revenue		Revenue		% of Revenue

Revenue by primary geographical market:	Revenue by primary geographical market:									Revenue by primary geographical market:
North America	North America	$	5,713	72	%	$	1,473	35	%	North America	$	4,968	73	%	$	2,539	48	%
Asia Pacific	Asia Pacific	—		—	%	507		12	%	Asia Pacific	1,860		27	%	321		6	%
Europe and Middle East	Europe and Middle East	2,265		28	%	2,243		53	%	Europe and Middle East	27		—	%	2,453		46	%
Total	Total	$	7,978	100	%	$	4,223	100	%	Total	$	6,855	100	%	$	5,313	100	%
Revenue by timing of recognition:	Revenue by timing of recognition:									Revenue by timing of recognition:
Recognized at a point in time	Recognized at a point in time	$	873	11	%	$	1,286	30	%	Recognized at a point in time	$	1,541	22	%	$	2,053	39	%
Recognized over time	Recognized over time	7,105		89	%	2,937		70	%	Recognized over time	5,314		78	%	3,260		61	%
Total	Total	$	7,978	100	%	$	4,223	100	%	Total	$	6,855	100	%	$	5,313	100	%
Revenue by segment:	Revenue by segment:									Revenue by segment:
Autonomy Solutions	Autonomy Solutions	$	7,550	95	%	$	3,481	82	%	Autonomy Solutions	$	5,898	86	%	$	4,336	82	%
Component Sales		428		5	%	742		18	%
Components										Components	957		14	%	977		18	%
Total	Total	$	7,978	100	%	$	4,223	100	%	Total	$	6,855	100	%	$	5,313	100	%

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Nine Months Ended September 30,
2021 2020
Revenue % of Revenue Revenue % of Revenue
Revenue by primary geographical market:
North America $ 12,313 63 % $ 3,198 28 %
Asia Pacific 475 2 % 720 6 %
Europe and Middle East 6,812 35 % 7,601 66 %
Total $ 19,600 100 % $ 11,519 100 %
Revenue by timing of recognition:
Recognized at a point in time $ 4,914 25 % $ 2,076 18 %
Recognized over time 14,686 75 % 9,443 82 %
Total $ 19,600 100 % $ 11,519 100 %
Revenue by segment:
Autonomy Solutions $ 17,708 90 % $ 9,587 83 %
Component Sales 1,892 10 % 1,932 17 %
Total $ 19,600 100 % $ 11,519 100 %

Volvo Stock Purchase Warrant

In March 2020, the Company issued a stock purchase warrant (“Volvo Warrants”) to Volvo Car Technology Fund AB (“VCTF”) in connection with an engineering services contract. The ~~warrants~~Volvo Warrants entitle VCTF to purchase ~~from the Company~~ up to 4,089,280 shares of Class A common stock, at a price of $3.1769 per share from the ~~Company.~~Company and were determined to be an equity classified award to VCTF. The ~~warrants~~Volvo Warrants vest and become exercisable in 2 tranches based on satisfaction of certain commercial milestones, upon reaching commercial production and delivering of production units. The grant date fair value of warrants, aggregating $2.9 million, represents consideration payable to VCTF and will be recognized as reduction in revenue consistent with the revenue recognition pattern when these warrants become probable of vesting. The Company’s management determined that the vesting of ~~these warrants~~the first of the two tranches of Volvo Warrants was probable as of December 31, 2021. As such, the Company had recognized a reduction in revenue in the amount of $1.0 million related to the said first tranche of the Volvo Warrants in the year ended December 31, 2021. The Company’s management determined that the vesting of the second tranche of Volvo Warrants was not probable as of ~~September 30, 2021. The following factors were considered in this determination:~~

•During the second quarter of 2021, the Company issued a joint press release stating that Volvo intends to include Luminar’s Iris unit, the Company’s latest generation lidar sensor which meets the size, weight, cost, power and reliability requirements of automotive qualified series production, as a standard component on one of its vehicle programs as opposed to being only an optional component. While the announcement increased the estimated targeted volume for the Company’s potential business with Volvo, the anticipated start of production and the necessary prototype testing procedures were not modified. This announcement did not impact the probability or likelihood of reaching commercial production.

•The Company is in the process of transitioning from currently producing B-sample prototype Iris units at its manufacturing operations in Orlando, Florida to producing C-sample prototype Iris units at its contract manufacturing partner. This transition is expected to occur by the end of this calendar year.

•The Company only recently completed its initial design freeze for the prototype C-sample Iris units. This design includes modifications from the Company’s B-sample Iris units as well as modifications to the production process for its contract manufacturing partner. The prototype units produced with this design and production process will need to undergo certain industry standard testing procedures. The Company anticipates reaching commercial production once it substantially completes these industry standard testing procedures, which is expected to be achieved in the fourth quarter of 2021.March 31, 2022.

Contract assets and liabilities

Contract assets primarily represent revenues recognized for performance obligations that have been satisfied but for which amounts have not been billed. The Company’s contract assets as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 were ~~$11.8~~$14.8 million and ~~$0,~~$9.9 million, respectively. Contract liabilities consist of deferred revenue and customer advanced payments. Deferred revenue includes billings in excess of revenue recognized related to product sales and other services revenue and is recognized as revenue when

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

the Company performs under the contract. Customer advanced payments represent required customer payments in advance of product shipments according to customer’s payment term. Customer advance payments are recognized in revenue as or when control of the performance obligation is transferred to the customer. The Company’s contract liabilities were ~~$0.6 million and $2.3~~$0.9 million as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, respectively,~~2021, and were included in accrued and other current liabilities in the condensed consolidated balance sheets.

The significant changes in contract assets balances consisted of the following (in thousands):



	March 31, 2022		December 31, 2021
Beginning balance	$	9,907	$	—
Revenue recognized for performance obligations that have been satisfied but for which amounts have not been billed	4,865		9,907
Ending balance	$	14,772	$	9,907

The significant changes in contract liabilities balances consisted of the following (in thousands):

September 30, 2021 December 31, 2020
Beginning balance $ 2,284 $ 225
Revenue recognized that was included in the contract liabilities beginning balance (2,284) (225)
Net increase due to cash received and not recognized as revenue and billings in excess of revenue recognized during the period 579 2,284
Ending balance $ 579 $ 2,284

~~Note 5. Investments~~

~~Debt Securities~~

~~The Company’s investments in debt securities consisted of the following as of September 30, 2021 and December 31, 2020 (in thousands):~~

September 30, 2021
Cost Gross
Unrealized
Gains Gross
Unrealized
Losses Fair Value
U.S. Treasury $ 120,260 $ 13 $ (63) $ 120,210
U.S. agency and government sponsored securities 4,994 — — 4,994
Commercial paper 132,991 5 (2) 132,994
Corporate bonds 138,832 147 (9) 138,970
Asset-backed securities 20,814 9 (1) 20,822
Total debt securities $ 417,891 $ 174 $ (75) $ 417,990
Included in cash and cash equivalents $ 47,193 $ 1 $ — $ 47,194
Included in marketable securities $ 370,698 $ 173 $ (75) $ 370,796

December 31, 2020
Cost Gross
Unrealized
Gains Gross
Unrealized
Losses Fair Value
U.S. Treasury $ 155,339 $ 14 $ (6) $ 155,347
U.S. agency and government sponsored securities 19,996 — — 19,996
Commercial paper 182,218 6 (4) 182,220
Corporate bonds 45,431 21 (2) 45,450
Asset-backed securities 7,012 6 — 7,018
Total debt securities $ 409,996 $ 47 $ (12) $ 410,031
Included in cash and cash equivalents $ 133,319 $ 4 $ (2) $ 133,321
Included in marketable securities $ 276,677 $ 43 $ (10) $ 276,710



	March 31, 2022		December 31, 2021
Beginning balance	$	898	$	2,284

Revenue recognized that was included in the contract liabilities beginning balance	(250)		(1,792)
Net increase due to cash received and not recognized as revenue and billings in excess of revenue recognized during the period	259		406
Ending balance	$	907	$	898

1310

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Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 4. Investments

Debt Securities

The Company’s investments in debt securities consisted of the following as of March 31, 2022 and December 31, 2021 (in thousands):


	March 31, 2022
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. treasury securities	$	251,673	$	1	$	(2,685)	$	248,989
U.S. agency and government sponsored securities	4,996		—		(89)		4,907
Commercial paper	130,103		1		(126)		129,978
Corporate bonds	158,595		1		(1,348)		157,248
Asset-backed securities	41,185		—		(311)		40,874
Total debt securities	$	586,552	$	3	$	(4,559)	$	581,996
Included in cash and cash equivalents	$	80,201	$	2	$	(28)	$	80,175
Included in marketable securities	506,351		1		(4,531)		501,821


	December 31, 2021
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. treasury securities	$	161,938	$	1	$	(474)	$	161,465
U.S. agency and government sponsored securities	4,995		—		(25)		4,970
Commercial paper	40,788		—		(4)		40,784
Corporate bonds	165,522		13		(345)		165,190
Asset-backed securities	46,540		—		(74)		46,466
Total debt securities	$	419,783	$	14	$	(922)	$	418,875
Included in cash and cash equivalents	$	950	$	—	$	—	$	950
Included in marketable securities	418,833		14		(922)		417,925

The following table presents the gross unrealized losses and the fair value for those debt securities that were in an unrealized loss position for less than 12 months as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 (in thousands):


		September 30, 2021				December 31, 2020					March 31, 2022				December 31, 2021
		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value			Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
U.S. Treasury		$	(63)	$	19,972	$	(6)	$	65,298
U.S. treasury securities										U.S. treasury securities	$	(2,685)	$	228,993	$	(474)	$	146,454
U.S. agency and government sponsored securities	U.S. agency and government sponsored securities	—		4,994		—		—		U.S. agency and government sponsored securities	(89)		4,907		(25)		4,970
Commercial paper	Commercial paper	(2)		35,934		(4)		47,629		Commercial paper	(126)		114,980		(4)		30,285
Corporate bonds	Corporate bonds	(9)		22,641		(2)		15,575		Corporate bonds	(1,348)		156,246		(345)		145,522
Asset-backed securities	Asset-backed securities	(1)		1,270		—		—		Asset-backed securities	(311)		40,874		(74)		45,251
Total	Total	$	(75)	$	84,811	$	(12)	$	128,502	Total	$	(4,559)	$	546,000	$	(922)	$	372,482

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Equity Investments

The Company’s equity investments ~~included in marketable securities~~consisted of the following as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020 were as follows~~2021 (in thousands):

~~September 30, 2021~~

~~December 31, 2020~~

~~Equity investments included in marketable securities~~

~~44,748~~

—


	Condensed Consolidated Balance Sheets Location	March 31, 2022		December 31, 2021
Money market funds(1)	Cash and cash equivalents	$	47,497	$	25,654
Marketable equity investments(1)	Marketable securities	45,619		$	44,216
Non-marketable equity investment measured using the measurement alternative(2)	Other non-current assets	$	10,002	$	10,002
Total		$	103,118	$	79,872

(1) Investments with readily determinable fair values.

(2) Investment in privately held company without readily determinable fair value.

In December 2021, the Company made an investment in 1,495 Class A Preferred Units of Robotic Research OpCo, LLC (“Robotic Research”) for consideration of $10.0 million, which was settled by issuing 618,924 shares of Class A common stock of the Company. The Company’s investment in Robotic Research represents less than 5% of Robotic Research’s capitalization. The Company neither has a significant influence over Robotic Research nor does its investment amount to a controlling financial interest in Robotic Research. As such, the Company measured the investment in Robotic Research at cost as provided under the guidance for measurement of equity investment using the measurement alternative.

Total realized and unrealized gains and losses associated with the Company’s equity investments ~~consisted of~~was not material in the ~~following (in thousands):~~

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Net realized gains (losses) recognized on equity investments sold $ 236 $ — $ 317 $ —
Net unrealized gains (losses) recognized on equity investments held 70 — 45 —
Total net gains (losses) recognized in other income (expense), net $ 306 $ — $ 362 $ —
three months ended March 31, 2022 and 2021.

Note 6.5. Financial Statement Components

Cash and Cash Equivalents

Cash and cash equivalents consisted of the following (in thousands):


		September 30, 2021		December 31, 2020			March 31, 2022		December 31, 2021
Cash	Cash	$	17,097	$	10,652	Cash	$	31,744	$	303,373
Money market funds	Money market funds	65,032		64,971		Money market funds	47,497		25,654
U.S. Treasury		—		24,999
U.S. treasury securities						U.S. treasury securities	19,997		—

Commercial paper	Commercial paper	47,194		108,322		Commercial paper	60,178		950

Total cash and cash equivalents	Total cash and cash equivalents	$	129,323	$	208,944	Total cash and cash equivalents	$	159,416	$	329,977

Inventories, net

Inventories consisted of the following (in thousands):


		September 30, 2021		December 31, 2020			March 31, 2022		December 31, 2021
Raw materials	Raw materials	$	4,858	$	625	Raw materials	$	6,535	$	5,866
Work-in-process	Work-in-process	1,672		52		Work-in-process	2,265		1,171
Finished goods	Finished goods	1,341		2,936		Finished goods	1,212		3,305
Total inventories, net	Total inventories, net	$	7,871	$	3,613	Total inventories, net	$	10,012	$	10,342

The Company’s inventory write-down (primarily due to obsolescence, lower of cost or market assessment, and other adjustments) was $1.4 million and $0.3 million for the three months ended March 31, 2022 and 2021, respectively.

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Notes to Condensed Consolidated Financial Statements (Unaudited)

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):



	March 31, 2022		December 31, 2021
Prepaid expenses	$	15,893	$	14,651
Contract assets	14,772		9,907
Advance payments to vendors	4,417		1,810

Other receivables	2,463		2,827
Total prepaid expenses and other current assets	$	37,545	$	29,195

Property and Equipment

Property and equipment consisted of the following (in thousands):



	March 31, 2022		December 31, 2021
Machinery and equipment	$	8,286	$	7,694
Computer hardware and software	2,871		2,854

Leasehold improvements	885		869
Vehicles, including demonstration fleet	2,631		2,421

Furniture and fixtures	829		272

Construction in progress	8,454		3,677
Total property and equipment	23,956		17,787
Accumulated depreciation and amortization	(7,519)		(6,778)
Total property and equipment, net	$	16,437	$	11,009

Property and equipment capitalized under finance lease (capital lease prior to adoption of ASC 842) were not material.

Depreciation and amortization expense associated with property and equipment was $0.7 million and $0.7 million for the three months ended March 31, 2022 and 2021, respectively.

Intangible Assets

The following table summarizes the activity in the Company’s intangible assets during the three months ended March 31, 2022 (in thousands):


	Three Months Ended March 31, 2022
Beginning of the period	$	2,424
Amortization	(63)
End of the period	$	2,361

The components of intangible assets were as follows (in thousands):


	March 31, 2022							December 31, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Remaining Period (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Remaining Period (Years)
Customer relationships	$	780	$	(52)	$	728	9.3	$	780	$	(33)	$	747	9.6
Tradename	120		(120)		—		—	120		(120)		—		—
Developed technology	1,750		(117)		1,633		9.3	1,750		(73)		1,677		9.6
Total intangible assets	$	2,650	$	(289)	$	2,361	9.3	$	2,650	$	(226)	$	2,424	9.6

Amortization expense related to intangible assets was $0.1 million and $0.0 million for the three months ended March 31, 2022 and 2021, respectively.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

As of March 31, 2022, the expected future amortization expense for intangible assets was as follows (in thousands):


Period	Expected Future Amortization Expense
Remaining 2022	$	190
2023	253
2024	253
2025	253
2026	253
Thereafter	1,159
Total	$	2,361

Goodwill

The carrying amount of goodwill allocated to the Company’s reportable segments was as follows (in thousands):


	Autonomy Solutions		Components		Total
As of March 31, 2022	$	687	$	2,258	$	2,945
As of December 31, 2021	$	687	$	2,423	$	3,110

Other Non-Current Assets

Other non-current assets consisted of the following (in thousands):



	March 31, 2022		December 31, 2021
Security deposits	$	2,574	$	1,187
Non-marketable equity investment	10,002		10,002

Other non-current assets	1,097		1,266
Total other non-current assets	$	13,673	$	12,455

Accrued and Other Current Liabilities

Accrued and other current liabilities consisted of the following (in thousands):



	March 31, 2022		December 31, 2021
Accrued compensation and benefits	$	13,755	$	9,899
Accrued expenses	6,431		6,727
Warranty reserves	1,401		1,798

Accrued interest payable	2,242		316



Other	1,019		1,104
Total accrued and other current liabilities	$	24,848	$	19,844

Note 6. Convertible Senior Notes and Capped Call Transactions

In December 2021, the Company issued $625.0 million aggregate principal amount of 1.25% Convertible Senior Notes due 2026in a private placement, which included $75.0 million aggregate principal amount of such notes pursuant to the exercise in full of the option granted to the initial purchasers to purchase additional notes (collectively, the “Convertible Senior Notes”). The interest on the Convertible Senior Notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2022. The Convertible Notes will mature on December 15, 2026, unless earlier repurchased or redeemed by the Company or converted pursuant to their terms.

The total net proceeds from the debt offering, after deducting fees paid to the initial purchasers paid by the Company was approximately $609.4 million.

Each $1,000 principal amount of the Convertible Senior Notes is initially convertible into 50.0475 shares of the Company’s Class A common stock, par value $0.0001, which is equivalent to an initial conversion price of approximately $19.98 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events prior to the

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

maturity date but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity dateor if the Company delivers a notice of redemption in respect of some or all of the Convertible Senior Notes, the Company will, under certain circumstances, increase the conversion rate of the Convertible Senior Notes for a holder who elects to convert its Convertible Senior Notes in connection with such a corporate event or convert its Convertible Senior Notes called for redemption during the related redemption period, as the case may be. The Convertible Senior Notes are redeemable, in whole or in part (subject to certain limitations), at the Company’s ~~inventory write-down (primarily due~~option at any time, and from time to ~~obsolescence, lower~~time, on or after December 20, 2024, and on or before the 40th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of ~~cost~~the Convertible Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, but only if certain liquidity conditions are satisfied and the last reported sale price per share of the Class A common stock exceeds 130% of the conversion price on (1) each of at least 20 trading days, whether or ~~market assessment,~~not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice, and (2) the trading day immediately before the date the Company sends such notice. If the Company undergoes a fundamental change (as defined in the indenture governing the Convertible Senior Notes) prior to the maturity date, holders may require the Company to repurchase for cash all or any portion of their Convertible Senior Notes in principal amounts of $1,000 or a multiple thereof at a fundamental change repurchase price equal to 100% of the principal amount of the Convertible Senior Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.

Holders of the Convertible Senior Notes may convert their Convertible Senior Notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2026, in multiples of $1,000 principal amount, only under the following circumstances: (1) during any calendar quarter (and only during such calendar quarter) commencing after the calendar quarter ending on March 31, 2022, if the last reported sale price per share of the Class A common stock exceeds 130% of the conversion price for each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the 5 consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of Convertible Senior Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of the Class A common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of specified corporate events or distributions on the Class A common stock; and (4) if the Notes are called for redemption. On or after June 15, 2026, holders may convert all or any portion of their Convertible Senior Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of its Class A common stock or a combination of cash and shares of its Class A common stock, at the Company’s election. As of March 31, 2022, the conditions allowing holders of the Convertible Senior Notes to convert were not met.

It is the Company’s current intent to settle the principal amount of its outstanding Convertible Senior Notes in cash and any excess in shares of the Company’s Class A common stock.

The Convertible Senior Notes are senior unsecured obligations and will rank equal in right of payment with the Company’s future senior unsecured indebtedness; senior in right of payment to the Company’s future indebtedness that is expressly subordinated to the Convertible Senior Notes; effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing that indebtedness; and structurally subordinated to all existing and future indebtedness and other ~~adjustments) was $0.1 million~~liabilities, including trade payables, and ~~$1.6 million for~~(to the ~~three and nine months ended September 30, 2021, respectively, and $1.9 million and $4.4 million for~~extent the ~~three and nine months ended September 30, 2020, respectively.~~

~~Prepaid Expenses and Other Current Assets~~

~~Prepaid expenses and other current assets consisted~~Company is not a holder thereof) preferred equity, if any, of the ~~following~~Company’s subsidiaries.

The Company has classified the Convertible Senior Notes as a non-current liability under the guidance in ASC 470-20, as amended by ASU 2020-06. Debt discount and issuance costs aggregating approximately $16.2 million were initially recorded as a reduction to the principal amount of the Convertible Senior Notes and is being amortized as interest expense on a straight line basis over the contractual terms of the notes. The Company estimates that the difference between amortizing the debt discounts and the issuance costs using the straight line method as compared to using effective interest rate method is immaterial.

The net carrying amount of the Convertible Senior Notes was as follows (in thousands):

September 30, 2021 December 31, 2020
Prepaid expenses $ 4,723 $ 1,073
Contract assets 11,788 —
Advance payments to vendors 3,443 961
Prepaid rent and other receivables 3,929 2,763
Total prepaid expenses and other current assets $ 23,883 $ 4,797

~~Property and Equipment~~

~~Property and equipment consisted of the following (in thousands):~~

September 30, 2021 December 31, 2020
Machinery and equipment $ 10,265 $ 5,940
Computer hardware and software 3,263 2,450
Demonstration fleet and demonstration units 1,709 1,821
Leasehold improvements 990 791
Vehicles 795 835
Furniture and fixtures 571 293
Construction in progress 3,127 1,410
Total property and equipment 20,720 13,540
Accumulated depreciation and amortization (9,592) (5,851)
Total property and equipment, net $ 11,128 $ 7,689

~~Property and equipment capitalized under finance lease (capital lease prior to adoption of ASC 842) consisted of the following (in thousands):~~

September 30, 2021 December 31, 2020
Computer hardware and software $ 88 $ 88
Machinery and equipment 838 838
Total property and equipment, gross 926 926
Less: accumulated depreciation (321) (219)
Total property and equipment, net $ 605 $ 707

Depreciation and amortization expense associated with property and equipment was $0.7 million and $2.1 million for the three and nine months ended September 30, 2021, respectively, and $0.7 million and $1.9 million for the three and nine months ended September 30, 2020, respectively.

~~Other Non-Current Assets~~

~~Other non-current assets consisted of the following (in thousands):~~

September 30, 2021 December 31, 2020
Security deposits $ 1,101 $ 1,106
Other non-current assets 1,435 45
Total other non-current assets $ 2,536 $ 1,151


	March 31, 2022		December 31, 2021
Principal	$	625,000	$	625,000
Unamortized debt discount and issuance costs	(15,234)		(16,043)
Net carrying amount	$	609,766	$	608,957

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

~~Accrued~~The following table sets forth the interest expense recognized related to the Convertible Senior Notes (in thousands):


	Three Months Ended March 31, 2022
Contractual interest expense	$	1,926
Amortization of debt discount and issuance costs	809
Total interest expense	$	2,735

The remaining term over which the debt discount and ~~Other Current Liabilities~~issuance costs will be amortized is 4.7 years. Interest expense of $1.9 million is reflected as a component of interest (expense) income, net in the accompanying condensed consolidated statement of operations for the three months ended March 31, 2022.

~~Accrued and other current liabilities consisted~~In connection with the offering of the ~~following (in thousands):~~

September 30, 2021 December 31, 2020
Accrued expenses $ 6,152 $ 3,998
Warranty liabilities 1,721 259
Contract liabilities 579 2,284
Accrued compensation and benefits 7,045 3,071
Contract losses 9 558
Finance lease (capital lease prior to adoption of ASC 842) liabilities, current 257 282
Employee tax withholding 2,788 —
Total accrued and other current liabilities $ 18,551 $ 10,452

~~Other Non-Current Liabilities~~

~~Other non-current liabilities consisted~~Convertible Senior Notes, the Company entered into privately negotiated capped call option transactions with certain counterparties (the “Capped Calls”). The Capped Calls each have an initial strike price of approximately $19.98 per share, subject to certain adjustments, which corresponds to the initial conversion price of the ~~following (in thousands):~~

September 30, 2021 December 31, 2020
Deferred rent $ — $ 826
Finance lease (capital lease prior to adoption of ASC 842) liabilities, non-current 145 331
Other non-current liabilities 766 161
Total other non-current liabilities $ 911 $ 1,318
Convertible Senior Notes. The Capped Calls have initial cap prices of $30.16 per share, subject to certain adjustment events. The Capped Calls are generally intended to reduce the potential dilution to the Class A common stock upon any conversion of the Convertible Senior Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Convertible Senior Notes, as the case may be, with such reduction and/or offset subject to a cap based on the cap price. The Capped Calls expire on April 6, 2027, subject to earlier exercise. The Capped Calls are subject to either adjustment or termination upon the occurrence of specified extraordinary events affecting the Company, including a merger event, a tender offer, and a nationalization, insolvency or delisting involving the Company. In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including changes in law, failure to deliver, and hedging disruptions. The Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The net cost of $73.4 million incurred to purchase the Capped Calls was recorded as a reduction to additional paid-in capital in the accompanying consolidated balance sheet.

Note 7. Fair Value Measurements

As of ~~September 30, 2021,~~March 31, 2022, the Company carried cash equivalents, marketable investments and Private Warrants. The Company had previously carried Public Warrants which were exercised and redeemed in March 2021.

Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 — Observable inputs, which include unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than Level 1 inputs, such as quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined by using pricing models, discounted cash flow methodologies or similar techniques.

The Company determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments.

Marketable investments classified within Level 2 of the fair value hierarchy are valued based on other observable inputs, including broker or dealer quotations, alternative pricing sources or U.S. Government Treasury yield of appropriate term. When quoted prices in active markets for identical assets or liabilities are not available, the Company relies on non-binding quotes from its investment managers, which are based on proprietary valuation models of independent pricing services. These models generally use inputs such as observable market data, quoted market prices for similar instruments, historical pricing trends of a security as relative to its peers. To validate the fair value determination provided by its investment managers, the Company reviews the pricing movement in the context of overall market trends and trading information from its investment managers. The Company performs routine procedures such as comparing prices obtained from independent source to ensure that appropriate fair values are recorded.

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Notes to Condensed Consolidated Financial Statements (Unaudited)

Given that the transfer of Private Warrants to anyone outside of a small group of individuals constituting the sponsors of Gores Metropoulos, Inc. would result in the Private Warrants having substantially the same terms as the Public Warrants, management determined that the fair value of each Private Warrant is the same as that of a Public Warrant, with an insignificant adjustment for short-term marketability restrictions, as of December 31, ~~2020.~~2021. As of ~~September 30, 2021,~~March 31, 2022, management

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

determined the fair value of the Private Warrants using observable inputs in the Black-Scholes valuation model, which used the remaining term of warrants of ~~4.18~~3.68 years, volatility of ~~65.1%~~75.6% and a risk-free rate of ~~0.79%~~2.44%. Accordingly, the Private Warrants are classified as Level 3 financial instruments.

The following table presents changes in Level 3 liabilities relating to Private Warrants measured at fair value ~~as of September 30, 2021~~ (in thousands):


	Private Warrants
Balance as of December 31, ~~2020~~2021	$	—31,230
~~Private warrants transferred from Level 2~~Change in fair value prior to exercise in January 2022	~~52,832~~4,586
Exercises in January 2022	(18,688)
~~Measurement~~Other measurement adjustments	~~(25,079)~~(729)
Balance as of ~~September 30, 2021~~March 31, 2022	$	~~27,753~~16,399

The decrease in fair value of private warrants for the three and nine months ended September 30, 2021 was $17.1 million and $25.1 million, respectively, which was included in the change in fair value of warrant liabilities in the condensed consolidated statement of operations and comprehensive loss. The decrease in Private Warrant liability as of September 30, 2021 is predominantly attributable to the decrease in per share price of the Company’s Class A common stock.

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Notes to Condensed Consolidated Financial Statements (Unaudited)

The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows (in thousands):


		Fair Value (in thousands) Measured as of September 30, 2021 Using:									Fair Value (in thousands) Measured as of March 31, 2022 Using:
		Level 1		Level 2		Level 3		Total			Level 1		Level 2		Level 3		Total
Assets:	Assets:									Assets:
Cash equivalents:	Cash equivalents:									Cash equivalents:
Money market funds	Money market funds	$	65,032	$	—	$	—	$	65,032	Money market funds	$	47,497	$	—	$	—	$	47,497

U.S. treasury securities										U.S. treasury securities	19,997		—		—		19,997
Commercial paper	Commercial paper	—		47,194		—		47,194		Commercial paper	—		60,178		—		60,178
Total cash equivalents	Total cash equivalents	$	65,032	$	47,194	$	—	$	112,226	Total cash equivalents	$	67,494	$	60,178	$	—	$	127,672
Marketable investments:	Marketable investments:									Marketable investments:
U.S. Treasury		$	120,210	$	—	$	—	$	120,210
U.S. treasury securities										U.S. treasury securities	$	228,992	$	—	$	—	$	228,992
U.S. agency and government sponsored securities	U.S. agency and government sponsored securities	—		4,994		—		4,994		U.S. agency and government sponsored securities	—		4,907		—		4,907
Commercial paper	Commercial paper	—		85,800		—		85,800		Commercial paper	—		69,800		—		69,800
Corporate bonds	Corporate bonds	—		138,970		—		138,970		Corporate bonds	—		157,248		—		157,248
Asset-backed securities	Asset-backed securities	—		20,822		—		20,822		Asset-backed securities	—		40,874		—		40,874
Equity investments	Equity investments	44,748		—		—		44,748		Equity investments	45,619		—		—		45,619
Total marketable investments	Total marketable investments	$	164,958	$	250,586	$	—	$	415,544	Total marketable investments	$	274,611	$	272,829	$	—	$	547,440
Liabilities:	Liabilities:									Liabilities:

Private Warrants	Private Warrants	$	—	$	—	$	27,753	$	27,753	Private Warrants	$	—	$	—	$	16,399	$	16,399
Total warrant liabilities	Total warrant liabilities	$	—	$	—	$	27,753	$	27,753	Total warrant liabilities	$	—	$	—	$	16,399	$	16,399


		Fair Value (in thousands) Measured as of December 31, 2020 Using:									Fair Value (in thousands) Measured as of December 31, 2021 Using:
		Level 1		Level 2		Level 3		Total			Level 1		Level 2		Level 3		Total
Assets:	Assets:									Assets:
Cash equivalents:	Cash equivalents:									Cash equivalents:
Money market funds	Money market funds	$	64,971	$	—	$	—	$	64,971	Money market funds	$	25,654	$	—	$	—	$	25,654
U.S. Treasury		24,999		—		—		24,999

Commercial paper	Commercial paper	—		108,322		—		108,322		Commercial paper	—		950		—		950

Total cash equivalents	Total cash equivalents	$	89,970	$	108,322	$	—	$	198,292	Total cash equivalents	$	25,654	$	950	$	—	$	26,604
Marketable investments:	Marketable investments:									Marketable investments:
U.S. Treasury		$	130,348	$	—	$	—	$	130,348
U.S. treasury securities										U.S. treasury securities	$	161,465	$	—	$	—	$	161,465
U.S. agency and government sponsored securities	U.S. agency and government sponsored securities	—		19,996		—		19,996		U.S. agency and government sponsored securities	—		4,970		—		4,970
Commercial paper	Commercial paper	—		73,898		—		73,898		Commercial paper	—		39,834		—		39,834
Corporate bonds	Corporate bonds	—		45,450		—		45,450		Corporate bonds	—		165,190		—		165,190
Asset-backed securities	Asset-backed securities	—		7,018		—		7,018		Asset-backed securities	—		46,466		—		46,466
Marketable equity investments										Marketable equity investments	44,216		—		—		44,216
Total marketable investments	Total marketable investments	$	130,348	$	146,362	$	—	$	276,710	Total marketable investments	$	205,681	$	256,460	$	—	$	462,141
Liabilities:	Liabilities:									Liabilities:
Public Warrants		$	228,933	$	—	$	—	$	228,933

Private Warrants	Private Warrants	—		114,467		—		114,467		Private Warrants	—		—		31,230		31,230
Total warrant liabilities	Total warrant liabilities	$	228,933	$	114,467	$	—	$	343,400	Total warrant liabilities	$	—	$	—	$	31,230	$	31,230

As of March 31, 2022 and December 31, 2021, the estimated fair value of the Company’s outstanding Convertible Senior Notes was $631.9 million and $669.4 million, respectively. The fair value was determined based on the quoted price of the Convertible Senior Notes in an inactive market on the last trading day of the reporting period and have been classified as Level 2 in the fair value hierarchy. See Note 6 for further information on the Company’s Convertible Senior Notes.

The Company’s other financial instruments’ fair value, including accounts receivable, accounts payable and other current liabilities, approximate its carrying value due to the relatively short maturity of those instruments. The carrying amounts of the

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Company’s finance leases approximate their fair value, which is the present value of expected future cash payments based on assumptions about current interest rates and the creditworthiness of the Company.

Note 8. Earnings (Loss) Per Share

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted average number of shares of common stock during the period plus, common stock equivalents, as calculated under the treasury stock method, outstanding during the period. If the Company reports a net loss, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be antidilutive. The Company computes earnings (loss) per share using the two-class method for its Class A and Class B common stock. Earnings (loss) per share is same for both Class A and Class B common stock since they are entitled to the same liquidation and dividend rights.

The following table sets forth the computation of basic and diluted loss per share for the three months ended March 31, 2022 and 2021 (in thousands, except for share and per share amounts):


	Three Months Ended March 31,
	2022		2021
Numerator:
Net loss	$	(88,333)	$	(75,923)


Denominator:
Weighted average common shares outstanding- Basic	348,683,836		332,987,523

Weighted average common shares outstanding- Diluted	348,683,836		332,987,523
Net loss per shares attributable to common shareholders- Basic and Diluted	$	(0.25)	$	(0.23)

The following table presents the potential shares of Common Stock outstanding that were excluded from the computation of diluted net loss per share of common stock as of the periods presented because including them would have been antidilutive:



															March 31, 2022
Warrants															5,776,772
Stock options															10,187,197
Restricted stock awards and restricted stock units															15,077,199
Liability classified RSUs															2,628,407
Vendor stock-in-lieu of cash program															833,173
Convertible Senior Notes															31,279,716



Earn-out shares															8,606,717
Total															74,389,181

The Company uses the if converted method for calculating the dilutive effect of the Convertible Senior Notes. These notes will have a dilutive impact when the average market price of the Company’s common stock for a given period exceeds the initial conversion price of $19.981 per share. These Convertible Senior Notes were not convertible as of March 31, 2022 because the closing price of Class A common stock as of March 31, 2022 was less than the initial conversion price.

Note 8.9. Stockholders’ Equity

Class A and Class B Common Stock

The Company’s Board of Directors has authorized two classes of common stock, Class A and Class B. As of ~~September 30, 2021,~~March 31, 2022, the Company had authorized 715,000,000 and 121,000,000 shares of Class A and Class B common stock with a par value of $0.0001 per share for each class. As of ~~September 30, 2021,~~March 31, 2022, the Company had ~~259,808,501~~269,978,536 and ~~101,588,670~~97,088,670 shares of Class A and Class B common stock issued and outstanding, respectively. Holders of the Class A and Class B common stock have identical rights, except that holders of the Class A common stock are entitled to 1 vote per share and the holder of the Class B common stock is entitled to 10 votes per share.

1819

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

~~the Class B common stock is entitled to 10 votes per share. On July 1, 2021, 10,500,000 shares of Class B common stock were converted into Class A common stock on a one-for-one basis.~~

Public and Private Warrants

As of December 31, ~~2020,~~2021, the Company had ~~13,333,309~~0 Public Warrants and ~~6,666,666~~3,077,021 Private Warrants outstanding.

~~As of March 16, 2021, 3,589,645~~In January 2022, 1,389,529 Private ~~Warrants and 13,128,671 Public~~ Warrants were exercised on a cashless basis and the Company ~~received $153.9 million in cash proceeds from the exercise~~issued 401,365 shares of ~~these warrants. Pursuant~~Class A common stock pursuant to the terms of the agreements governing the rights of the holders of the Public Warrants, the Company redeemed the remaining unexercised and outstanding 204,638 Public Warrants after March 16, 2021 for a redemption price of $0.01 per Public Warrant.

exercises. The Company had ~~3,077,021~~1,687,492 Private ~~Warrants and no Public~~ Warrants outstanding as of ~~September 30, 2021 and such~~March 31, 2022. These Private Warrants are set to expire on December 2, 2025. Each Private Warrant allows the ~~sponsor~~holder to purchase ~~one~~1 share of Class A common stock at $11.50 per share.~~During the three and nine months ended September 30, 2021, the fair value gain (loss) of Warrants was $17.1 million and $(22.6) million, respectively.~~

Stock-in-lieu of Cash Program

The Company has entered into arrangements with certain vendors and other third parties wherein the Company at its discretion may elect to compensate the respective vendors / third parties for services provided in either cash or by issuing shares of the Company’s Class A common stock (“Stock-in-lieu of Cash Program”). During the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022, the Company issued ~~291,940~~674,350 shares of Class A common stock as part of the Stock-in-lieu of Cash Program. The Company considers the shares issuable under the Stock-in-lieu of Cash Program as liability classified awards when the arrangement with the vendors ~~require~~requires the Company to issue a variable number of ~~registered~~ shares to settle amounts owed. As of ~~September 30, 2021,~~March 31, 2022, the Company ~~did not have any outstanding liabilities~~had a total of $2.5 million in prepaid expenses and other current and non-current assets related to its Stock-in-lieu of Cash Program.

~~Note 9. Earnings (Loss) Per Share~~

~~Basic earnings (loss) per share is computed by dividing net income (loss) by~~In November 2021, the ~~weighted average number of~~Company entered into an agreement with Daimler North America Corporation (“Daimler”) wherein Daimler will be providing certain data and other services. To compensate Daimler for these services, the Company agreed to issue 1.5 million shares of Class A common stock ~~outstanding~~to Daimler. These shares vest over a period of two years. The Company recorded costs related to these shares as research and development expense of $2.0 million during the ~~period. Diluted earnings per share is computed by dividing net income by~~three months ended March 31, 2022. During the ~~weighted average number of~~three months ended March 31, 2022, the Company issued 750,000 shares of Class A common stock during the period plus, common stock equivalents, as calculated under the treasury stock method, outstanding during the period. If the Company reports a net loss, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be antidilutive.related to this arrangement. The Company computes earnings (loss) per share using the two-class method for its Class A and Class B common stock. Earnings (loss) per share is same for both Class A and Class B common stock since they are entitledunamortized cost relating to the ~~same liquidation~~shares issued to Daimler under this agreement was recorded as $9.2 million in prepaid expenses and ~~dividend rights. Earnings (loss) per share calculations for all periods prior to the Business Combination have been retrospectively restated to the equivalent number~~other current and non-current assets as of ~~shares reflecting the exchange ratio established in the reverse capitalization.~~March 31, 2022.

The ~~following table sets forth the computation~~Company’s vendor Stock-in-lieu of ~~basic and diluted loss per share~~Cash Program activity for the three ~~and nine~~ months ended ~~September 30, 2021 and 2020: (in thousands, except for share and per share amounts):~~
Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Numerator:
Net loss $ (51,340) $ (31,211) $ (164,093) $ (72,227)
Deemed dividend attributable to BCF accretion — (6,247) — (6,247)
Net loss attributable to common shareholders $ (51,340) $ (37,458) $ (164,093) $ (78,474)
Denominator:
Weighted average common shares outstanding- Basic 352,122,485 130,601,660 341,858,435 129,643,774
Weighted average common shares outstanding- Diluted 352,122,485 130,601,660 341,858,435 129,643,774
Net loss per shares attributable to common shareholders- Basic and Diluted $ (0.15) $ (0.29) $ (0.48) $ (0.61)
March 31, 2022 was as follows:

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~September 30, 2021~~

~~Warrants~~

~~7,166,301~~

~~Stock options~~

~~12,700,104~~

~~Restricted stock awards and restricted stock units~~

~~10,966,176~~

~~Earn-out shares~~

~~8,606,717~~

~~Total~~

~~39,439,298~~


	Shares	Weighted Average Grant Date Fair Value per Share




Outstanding as of December 31, 2021	1,500,000	$	15.72
Granted	674,350	12.93

Vested	(1,424,350)	14.09
Outstanding as of March 31, 2022	750,000	15.72

Note 10. Stock-based Compensation

~~The~~Prior to becoming a publicly traded entity, the Company ~~maintained the 2015 Stock Plan (the “2015 Plan”) under which~~issued incentive stock options, non-qualified stock options, and restricted stock ~~were granted~~ to employees and non-employee ~~consultants. In connection with~~consultants under its 2015 Stock Plan (the “2015 Plan”). Since the closing of the Business Combination, the Company ~~assumed the 2015 Plan upon the Closing. The Company discontinued the 2015 Plan, provided that the outstanding~~has not issued any new stock-based awards ~~previously granted~~ under the 2015 ~~Plan continue to remain outstanding under the 2015~~ Plan.

In December 2020, the Company’s Board adopted and the Company’s stockholders approved the 2020 Equity Incentive Plan (the “2020 Plan”). The 2020 Plan became effective upon the closing of the Business Combination. Under the 2020 Plan, as of ~~September 30, 2021,~~March 31, 2022, the Company was authorized to issue a maximum number of 36,588,278 shares of Class A common stock. ~~The Company granted 11,465,582 restricted stock units in the nine months ended September 30, 2021.~~

Stock Options

Under the terms of the 2015 Plan, incentive stock options had an exercise price at or above the fair market value of the stock on the date of the grant, while non-qualified stock options were permitted to be granted below fair market value of the stock on the date of grant. Stock options granted have service-based vesting conditions only. The service-based vesting conditions vary, though typically, stock options vest over four years with 25% of stock options vesting on the first anniversary of the grant and the remaining 75% vesting monthly over the remaining 36 months. Option holders have a 10-year period to exercise their options before they expire. Forfeitures are recognized in the period of occurrence.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

A summary of the Company’s stock option activity for the nine months ended ~~September 30, 2021~~March 31, 2022 was as follows:


		Number of Common Stock Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (In Thousands)			Number of Common Stock Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (In Thousands)

Outstanding as of December 31, 2020		16,188,071	$	1.67
Outstanding as of December 31, 2021								Outstanding as of December 31, 2021	11,507,643	$	1.72

Exercised	Exercised	(2,822,956)	1.68					Exercised	(654,935)	1.67
Cancelled/Forfeited	Cancelled/Forfeited	(665,011)	1.67					Cancelled/Forfeited	(665,511)	1.67
Outstanding as of September 30, 2021		12,700,104	1.71		8.33	$	176,413
Outstanding as of March 31, 2022								Outstanding as of March 31, 2022	10,187,197	1.73		7.50	$	143,555

The aggregate intrinsic value of stock options exercised during the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 was ~~$55.1~~$8.3 million. The intrinsic value is calculated as the difference between the exercise price and the fair value of the common stock on the exercise date. The total grant-date fair value of the options vested was ~~$4.5~~$0.8 million during the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022.

Restricted Stock Awards

Prior to June 30, 2019, the Company granted restricted stock awards to employees. Recipients purchased the restricted stock on the grant date and the Company has the right to repurchase the restricted shares at the same price recipients paid to obtain those shares. The restrictions lapse solely based on continued service, and generally lapse over 4 years —25% on the first anniversary of the date of issuance, and the remaining 75% monthly over the remaining 36 months. At the grant date of the

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

award, recipients of restricted stock are granted voting rights and receive dividends on unvested shares. No restricted stock awards have been granted after June 30, 2019.

Restricted stock awards activity for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 was as follows:


		Shares	Weighted Average Grant Date Fair Value per Share			Shares	Weighted Average Grant Date Fair Value per Share

Outstanding as of December 31, 2020		1,815,891	$	1.15
Outstanding as of December 31, 2021					Outstanding as of December 31, 2021	666,298	$	1.21

Forfeited	Forfeited	(99,780)	1.12		Forfeited	(11,783)	1.22
Vested	Vested	(831,819)	0.93		Vested	(168,144)	1.16
Outstanding as of September 30, 2021		884,292	1.19
Outstanding as of March 31, 2022					Outstanding as of March 31, 2022	486,371	1.23

Restricted Stock units

~~To date, the~~The Company has ~~granted~~been granting restricted stock units (“RSUs”) under the 2020 Plan. Each RSU granted under the 2020 Plan represents a right to receive one share of the Company’s Class A common stock when the RSU vests. RSUs generally vest over a period up to six years. The fair value of RSU is equal to the fair value of the Company’s common stock on the date of grant.

A summary of the Company’s restricted stock units activity for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 was as follows:


		Shares	Weighted Average Grant Date Fair Value per Share			Shares	Weighted Average Grant Date Fair Value per Share

Outstanding as of December 31, 2020		—	$	—
Outstanding as of December 31, 2021					Outstanding as of December 31, 2021	11,983,032	$	19.56
Granted	Granted	11,465,582	20.13		Granted	4,429,640	14.10
Forfeited	Forfeited	(188,251)	23.00		Forfeited	(326,912)	17.94
Vested	Vested	(1,195,447)	19.20		Vested	(1,494,932)	19.48
Outstanding as of September 30, 2021		10,081,884	20.18
Outstanding as of March 31, 2022					Outstanding as of March 31, 2022	14,590,828	17.92

~~Compensation expense~~Fixed Value Equity Awards

~~Stock-based compensation expense by function was as follows (in thousands):~~

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Cost of sales $ 1,619 $ 83 $ 2,829 $ 237
Research and development 6,318 541 12,743 1,608
Sales and marketing 1,859 150 2,979 334
General and administrative 23,724 523 31,336 2,531
Total $ 33,520 $ 1,297 $ 49,887 $ 4,710

The Company issues fixed value equity awards to certain employees as a part of their compensation package. These awards are issued as RSUs out of the 2020 ~~Plan~~EIP and are accounted for as liability classified awards under ASC 718 — Stock Compensation. Fixed value equity awards granted have service-based conditions only and vest quarterly over a period of four years. These awards represent a fixed dollar amount settled in a variable number of shares determined at each vesting period. ~~For the three and nine months ended~~ ~~September 30, 2021, the Company recorded $1.2 million and $1.8 million in stock-based compensation expense related to these awards.~~

~~As discussed in Note 3 as part of the Optogration acquisition, the Company owes up to $22.0 million of post combination compensation related to certain service and performance conditions. As of~~ ~~September 30, 2021, it is probable that the conditions will be met and as a result, the Company recorded $2.1 million in stock-based compensation expense.~~

Stock-based compensation expense related to the liability classified awards (fixed value equity awards and compensation related to Optogration acquisition) was $0.6 million in each of the three and six months ended June 30, 2021, $3.3 million and $3.9 million, respectively, in the three and nine months ended September 30, 2021, which was recorded in current and non-current accrued liabilities, as appropriate.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

For the three months ended March 31, 2022 and 2021, the Company recorded $1.8 million and $0.0 million, respectively, in stock-based compensation expense related to these awards.

Optogration Awards

As part of the Optogration acquisition in August 2021, the Company owes up to $22.0 million of post combination compensation related to certain service and performance conditions. As of March 31, 2022, it is probable that the conditions will be met, and as a result, the Company recorded $9.1 million in stock-based compensation expense through March 31, 2022.

Compensation expense

Stock-based compensation expense by function was as follows (in thousands):


	Three Months Ended March 31,
	2022		2021
Cost of sales	$	1,786	$	83
Research and development	7,102		762
Sales and marketing	2,868		186
General and administrative	14,942		806
Total	$	26,698	$	1,837

Stock-based compensation expense by type of award was as follows (in thousands):


	Three Months Ended March 31,
	2022		2021
Equity Classified Awards:
Stock options	$	522	$	163
RSAs	(166)		1,674
RSUs	21,509		—
Liability Classified Awards:
Fixed value equity awards	1,780		—
Optogration awards	3,053		—

Total	$	26,698	$	1,837

Note 11. Income Taxes

The Company had ~~benefit from~~provision for income taxes of ~~$1.3~~$0.4 million and ~~$1.3~~$0.0 million ~~respectively~~ for the three ~~and nine~~ months ended ~~September 30,~~ March 31, 2022 and 2021, respectively. The effective tax rate was 0%0.5% and 0.0% for the three ~~and nine~~ months ended ~~September 30, 2020.~~March 31, 2022 and 2021, respectively. The effective tax rates differ significantly from the statutory tax rate of 21%, primarily due to the Company’s valuation allowance movement in each period presented.

As of September 30, 2021, the Company is in the process of evaluating the deferred tax balances associated with the Optogration acquisition. Preliminary estimate of the acquired deferred tax liability balances necessitated a partial release of the Company’s valuation allowance in the amount of $1.3 million. The completion of this analysis when the tax returns for the current period are filed may result in changes to the Company’s allocation of the consideration value to assets acquired and liabilities assumed. In accordance with ASC 805, Business Combinations, the preliminary calculation of the deferred tax balances is subject to adjustment until the Company has completed its analysis, but not to exceed one year after the Acquisition Date to provide the Company with the time to complete the valuation of its assets and liabilities and file its tax returns.

The realization of tax benefits of deferred tax assets is dependent upon future levels of taxable income, of an appropriate character, in the periods the items are expected to be deductible or taxable. Based on the available objective evidence, the Company does not believe it is more likely than not that the net deferred tax assets will be realizable. Accordingly, the Company has provided a full valuation allowance against the domestic net deferred tax assets as of September 30, 2021 and December 31, 2020. The Company intends to maintain the remaining valuation allowance until sufficient positive evidence exists to support a reversal of, or decrease in, the valuation allowance.

The Company reports income tax related interest and penalties within its provision for income tax in its condensed consolidated statements of operations. Similarly, the Company reports the reversal of income tax-related interest and penalties within its provision for income tax line item to the extent the Company resolves its liabilities for uncertain tax positions in a manner favorable to its accruals therefor. During the three and nine months ended September 30, 2021, there were no material changes to the total amount of unrecognized tax benefits.

Note 12. Leases

The Company ~~leases manufacturing equipment under non-cancelable finance leases expiring at various dates through December 2025. The Company also~~ leases office and manufacturing facilities under non-cancelable operating leases expiring at various dates through ~~June 2026.~~September 2028. In October 2021, the Company entered into a lease agreement commencing on April 1, 2022 for a term of 65 months through August 31, 2027. In September 2021, the Company gave a notice to the landlord to terminate the lease of certain office space in Orlando, Florida. The amounts of operating lease right-of-use assets and liabilities associated with the termination were not material. Some of the Company’s leases include 1 or more options to renew, with renewal terms that if exercised by the Company, extend the lease term from one to six years. The exercise of these renewal options is at the Company’s discretion. The Company’s lease agreements do not contain any material terms and conditions of residual value guarantees or material restrictive covenants. The Company’s short-term leases and sublease income were not material.

The Company adopted ASC 842 using the modified retrospective method on January 1, 2021. The Company elected the available package of practical expedients and implemented internal controls to enable the preparation of financial information upon adoption. The most significant impact of the adoption of ASC 842 was the recognition of right-of-use, or ROU, assets and lease liabilities for operating leases of $10.8 million and $12.0 million, respectively, and a reversal of deferred rent of $1.2 million on January 1, 2021. The Company’s accounting for finance leases remained substantially unchanged. The adoption of ASC 842 did not have any impact on the Company’s operating results or cash flows.

The Company determines if an arrangement is or contains a lease at inception. Operating leases are included in operating lease right-of use assets and operating lease liabilities in the Company’s condensed consolidated balance sheets. Finance leases are included in property and equipment, and finance lease liabilities in the Company’s condensed consolidated balance sheets.

Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the commencement date based on an amount equal to the present value of lease payments over the lease term. The Company’s leases do not provide an implicit rate, therefore the Company uses an incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company uses the implicit rate when it is readily determinable. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed it to carry forward existing lease classification and to exclude leases with original terms of one year or less. Further, the Company elected to combine lease and non-lease components for all asset classes. Any variable lease components are expensed as incurred. The operating lease

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

right-of-use asset also includes adjustments related to prepaid or deferred lease payments and lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Operating lease expense for lease payments is recognized on a straight-line basis over the lease term.

The components of lease expenses for ~~the three and nine months ended September 30, 2021~~ were as follows (in thousands):

Three Months Ended Nine Months Ended
September 30, 2021 September 30, 2021
Operating lease cost $ 1,202 $ 3,560
Variable lease cost 420 1,324
Total operating lease cost $ 1,622 $ 4,884
Finance lease cost:
Amortization of right-of-use assets $ 42 $ 126
Interest on finance lease liabilities 14 42
Total finance lease cost $ 56 $ 168



	Three Months Ended
	March 31, 2022		March 31, 2021
Operating lease cost	$	1,116	$	1,174
Variable lease cost	385		459
Total operating lease cost	$	1,501	$	1,633

Supplemental cash flow information ~~for the nine months ended September 30, 2021~~ related to leases was as follows (in thousands):



	~~Amount~~
~~Cash paid for amounts included in the measurement of lease liabilities:~~
~~Cash paid for operating leases included in operating activities~~	$	~~(3,723)~~
~~Cash paid for finance leases included in financing activities~~	~~(258)~~
~~Right of use assets obtained in exchange for lease obligations:~~
~~Operating leases~~	~~2,876~~
~~Finance leases~~	—



	Three Months Ended
	March 31, 2022		March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases included in operating activities	$	(1,314)	$	(1,219)

Right of use assets obtained in exchange for lease obligations:
Operating leases	5,746		2,876

Supplemental balance sheet information related to leases was as follows (in thousands):



	March 31, 2022		December 31, 2021
Operating leases:
Operating lease right-of-use assets	$	14,005	$	9,145
Operating lease liabilities:
Operating lease liabilities, current	$	5,079	$	4,735
Operating lease liabilities, non-current	10,102		5,768
Total operating lease liabilities	$	15,181	$	10,503

Weighted average remaining terms were as follows (in years):

March 31, 2022

December 31, 2021

Weighted average remaining lease term

Operating leases

3.97

2.95

Weighted average discount rates were as follows:



	March 31, 2022		December 31, 2021
Weighted average discount rate
Operating leases	3.62	%	2.80	%

Maturities of lease liabilities were as follows (in thousands):


	Operating Leases
Year Ending December 31,
2022 (remaining nine months)	$	3,993
2023	4,591
2024	2,373
2025	2,351
2026	1,795
2027	1,231
Thereafter	800
Total lease payments	17,134
Less: imputed interest	(1,953)
Total leases liabilities	$	15,181

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

~~Supplemental balance sheet information related to leases was as follows (in thousands):~~



	~~September 30, 2021~~
~~Operating leases:~~
~~Operating lease right-of-use assets~~	$	~~10,165~~
~~Operating lease liabilities:~~
~~Operating lease liabilities, current~~	$	~~4,927~~
~~Operating lease liabilities, non-current~~	~~6,639~~
~~Total operating lease liabilities~~	$	~~11,566~~
~~Finance leases:~~
~~Property and equipment, gross~~	$	~~926~~
~~Less: accumulated depreciation~~	~~(321)~~
~~Property and equipment, net~~	$	~~605~~

~~Finance lease liabilities, current~~	$	~~257~~
~~Finance lease liabilities, non-current~~	~~145~~
~~Total finance lease liabilities~~	$	~~402~~

~~Weighted average remaining terms were as follows (in years):~~



			~~September 30, 2021~~
~~Weighted average remaining lease term~~
~~Operating leases~~			~~3.13~~
~~Finance leases~~			~~2.03~~

~~Weighted average discount rates were as follows:~~



	~~September 30, 2021~~
~~Weighted average discount rate~~
~~Operating leases~~	~~2.76~~	%
~~Finance leases~~	~~9.92~~	%

~~Maturities of lease liabilities were as follows (in thousands):~~

Operating Leases Finance Leases
Year Ending December 31,
2021 (remaining three months) $ 1,286 $ 78
2022 4,963 240
2023 3,515 71
2024 1,283 28
2025 1,205 26
2026 602 —
Total lease payments 12,854 443
Less: imputed interest (1,288) (41)
Total leases liabilities $ 11,566 $ 402

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~Disclosures under ASC 840, Leases~~

~~Rent expense was $1.3 million and $4.2 million for the three and nine months ended September 30, 2020, respectively.~~

~~As of December 31, 2020, future minimum lease payments under all noncancelable capital and operating leases with an initial lease term in excess of one year were as follows (in thousands):~~
Capital Leases Operating Leases
2021 $ 331 $ 5,834
2022 240 6,172
2023 70 4,544
2024 28 746
2025 25 —
Thereafter — —
Total minimum lease payments 694 $ 17,296
Less: amount representing interest 80
Capital lease obligations $ 614

Note 13. Commitments and Contingencies

Purchase Obligations

The Company purchases goods and services from a variety of suppliers in the ordinary course of business. Purchase obligations are defined as agreements that are enforceable and legally binding and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum, or variable price provisions, and the approximate timing of the transaction. The Company had purchase obligations primarily for purchases of inventory, R&D, and general and administrative activities totaling ~~$54.1~~$39.1 million as of ~~September 30, 2021,~~March 31, 2022, which are expected to be received within a year. In October 2021, the Company entered into an office space lease commencing April 1, 2022. This will commit the Company to total rent payments of $5.0 million and variable costs of $1.4 million through the end of the lease ending August 31, 2027.

In June 2021, the Company entered into an agreement with P3 USA, Inc. (“P3”) to provide engineering, and general and administrative services. Under the said agreement, the Company issued 291,940 shares of Class A common stock to P3 in the third quarter of 2021. In September 2021, the Company entered into an amendment to modify the existing agreement with P3 and among other things, extended the term of the agreement until December 2025. The Company ~~expects that the expenses to be incurred~~has committed a spend of $30.0 million with P3 ~~will be at least $30.0 million~~ over the ~~extended term under the amended agreement.~~contracted term.

Legal Matters

From time to time, the Company is involved in actions, claims, suits and other proceedings in the ordinary course of business, including assertions by third parties relating to intellectual property infringement, breaches of contract or warranties or employment-related matters. When it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated, the Company records a liability for such loss contingencies. The Company’s estimates regarding potential losses and materiality are based on the Company’s judgment and assessment of the claims utilizing currently available information. Although the Company will continue to reassess its reserves and estimates based on future developments, the Company’s objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from the Company’s current estimates.

Note 14. Segment and Customer Concentration Information

Reportable segments are (i) Autonomy Solutions and (ii) ~~Component Sales.~~Components. These segments reflect the way the ~~CODM~~chief operating decision maker (“CODM”) evaluates the Company’s business performance and manages its operations. Each segment has distinct product offerings, customers, and market penetration. The Chief Executive Officer is the CODM of the Company.

Autonomy Solutions

This segment manufactures and distributes commercial lidar sensors that measure distance using laser light to generate a highly accurate 3D map for automotive mobility applications. This segment is impacted by trends in and the strength of the autonomous vehicles and associated infrastructure/technology sector.

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~~LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~Component Sales~~Components

This segment is in the business of development of ultra-sensitive pixel-based sensors. This segment also designs, tests and provides consulting services for non-standard integrated circuits that are essential for systems to meet the requirement of customers. This segment is impacted by trends in and the strength of automobile and aeronautics sector as well as government spending in military and defense activities.

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

The accounting policies of the operating segments are the same as those described in Note 2. Segment operating results and reconciliations to the Company’s consolidated balances are as follows (in thousands):


		Three Months Ended September 30, 2021											Three Months Ended March 31, 2022
		Autonomy Solutions		Component Sales		Total reportable segments		Eliminations (1)		Total Consolidated			Autonomy Solutions		Components		Total reportable segments		Eliminations (1)		Total Consolidated
Revenue:	Revenue:											Revenue:
Revenues from external customers	Revenues from external customers	$	7,550	$	428	$	7,978	$	—	$	7,978	Revenues from external customers	$	5,898	$	957	$	6,855	$	—	$	6,855
Revenues from internal customer	Revenues from internal customer	2,379		1,516		3,895		(3,895)		—		Revenues from internal customer	2,361		2,156		4,517		(4,517)		—
Total revenue	Total revenue	$	9,929	$	1,944	$	11,873	$	(3,895)	$	7,978	Total revenue	$	8,259	$	3,113	$	11,372	$	(4,517)	$	6,855
Depreciation and amortization	Depreciation and amortization	$	673	$	235	$	908	$	—	$	908	Depreciation and amortization	$	544	$	261	$	805	$	—	$	805
Operating loss		(69,614)		(787)		(70,401)		256		(70,145)
Operating income (loss)												Operating income (loss)	(82,177)		270		(81,907)		(424)		(82,331)
Other significant items:	Other significant items:											Other significant items:
Segment assets	Segment assets	606,431		11,064		617,495		(9,689)		607,806		Segment assets	815,160		10,992		826,152		(18,352)		807,800
Inventories, net	Inventories, net	7,531		340		7,871		—		7,871		Inventories, net	9,813		199		10,012		—		10,012


		Three Months Ended September 30, 2020											Three Months Ended March 31, 2021
		Autonomy Solutions		Component Sales		Total reportable segments		Eliminations (1)		Total Consolidated			Autonomy Solutions		Components		Total reportable segments		Eliminations (1)		Total Consolidated
Revenue:	Revenue:											Revenue:
Revenues from external customers	Revenues from external customers	$	3,481	$	742	$	4,223	$	—	$	4,223	Revenues from external customers	$	4,336	$	977	$	5,313	$	—	$	5,313
Revenues from internal customer	Revenues from internal customer	639		813		1,452		(1,452)		—		Revenues from internal customer	1,275		1,142		2,417		(2,417)		—
Total revenue	Total revenue	$	4,120	$	1,555	$	5,675	$	(1,452)	$	4,223	Total revenue	$	5,611	$	2,119	$	7,730	$	(2,417)	$	5,313
Depreciation and amortization	Depreciation and amortization	$	665	$	23	$	688	$	—	$	688	Depreciation and amortization	$	638	$	20	$	658	$	(1)	$	657
Operating income (loss)	Operating income (loss)	(21,800)		4		(21,796)		—		(21,796)		Operating income (loss)	(28,868)		(237)		(29,105)		(139)		(29,244)
Other significant items:	Other significant items:											Other significant items:
Segment assets	Segment assets	191,778		2,979		194,757		(3,304)		191,453		Segment assets	650,211		3,708		653,919		(2,705)		651,214
Inventories, net	Inventories, net	2,912		9		2,921		—		2,921		Inventories, net	3,245		38		3,283		—		3,283

Nine Months Ended September 30, 2021
Autonomy
Solutions Component
Sales Total
reportable
segments Eliminations (1) Total
Consolidated
Revenue:
Revenues from external customers $ 17,708 $ 1,892 $ 19,600 $ — $ 19,600
Revenues from internal customer 5,500 3,865 9,365 (9,365) —
Total revenue $ 23,208 $ 5,757 $ 28,965 $ (9,365) $ 19,600
Depreciation and amortization $ 1,963 $ 278 $ 2,241 $ (1) $ 2,240
Operating loss (142,651) (1,100) (143,751) 161 (143,590)
Other significant items:
Segment assets 606,431 11,064 617,495 (9,689) 607,806
Inventories, net 7,531 340 7,871 — 7,871
(1) Represents the eliminations of all intercompany balances and transactions during the period presented.

Two customers accounted for 52% and 23% of the Company’s revenue for the three months ended March 31, 2022. One customer accounted for 45% of the Company’s revenue for the three months ended March 31, 2021.

Note 15. Related Party Transactions

Equity Investments

In February 2021, the Company invested $15.0 million in a special purpose acquisition company, of which Mr. Jun Hong Heng, is the Chairman and Chief Executive Officer, and a principal shareholder. Mr. Heng became a director of the Company in June 2021. The terms of such investment were no less favorable to the Company than to other third party investors. During 2021, the Company sold $2.9 million of this investment and had a remaining balance of $12.1 million as of December 31, 2021. The fair value of this investment as of March 31, 2022 was $12.3 million.

Note 16. Subsequent Event

On March 14, 2022, the Company entered into a stock purchase agreement to acquire all issued and outstanding shares of capital stock of Freedom Photonics LLC (“Freedom Photonics”). The closing consideration was paid in the form of shares of Class A common stock of the Company and additional stock consideration would be due to the sellers if certain post-closing conditions are met. Management is in the process of making a determination whether some or all of the additional consideration is required to be reflected as compensation costs in the post-acquisition periods. The transaction closed on April 13, 2022.The

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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Nine Months Ended September 30, 2020
Autonomy
Solutions Component
Sales Total
reportable
segments Eliminations (1) Total
Consolidated
Revenue:
Revenues from external customers $ 9,587 $ 1,932 $ 11,519 $ — $ 11,519
Revenues from internal customer 639 2,544 3,183 (3,183) —
Total revenue $ 10,226 $ 4,476 $ 14,702 $ (3,183) $ 11,519
Depreciation and amortization $ 1,825 $ 104 $ 1,929 $ — $ 1,929
Operating income (loss) (56,673) 192 (56,481) — (56,481)
Other significant items:
Segment assets 191,778 2,979 194,757 (3,304) 191,453
Inventories, net 2,912 9 2,921 — 2,921

~~(1) Represent~~Company is currently finalizing the ~~eliminations~~allocation of ~~all intercompany balances~~the purchase price which is expected to be allocated primarily to goodwill and ~~transactions during the period presented.~~

~~Two customers accounted for 63% and 24%~~intangible assets. Freedom Photonics is expected to be included as part of the Company’s ~~revenue for~~Components segment.

On May 2, 2022, the ~~three months ended September 30, 2021. Three customers accounted for 38%, 31% and 11%~~Board of Directors of the Company granted an award of 10.8 million RSUs to Austin Russell, the Company’s ~~revenue for~~Chief Executive Officer. This award represents Mr. Russell’s total compensation from the ~~nine months ended September 30, 2021, Two customers accounted for 52%~~Company, and ~~17%~~is subject to all of the ~~Company’s revenue~~following vesting conditions:

•Market condition: Upon achievement of stock price of $50 or more, $60 or more, and $70 or more. Stock price will be measured based on volume-weighted average price per share for ~~the three months ended September 30, 2020. One customer accounted for 64%~~90 consecutive trading days;

•Service condition: Vesting over 7-years; and

•Performance condition: Upon start of ~~the Company’s revenue for the nine months ended September 30, 2020.~~production of one series production program.

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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion in conjunction with the condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed with the SEC on ~~April 14, 2021.~~March 1, 2022. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2020,~~2021, and in Part II, Item 1A - “Risk Factors” and elsewhere in this report. See also “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this report.

Overview

~~Our vision~~Luminar is ~~to make autonomous transportation safe and ubiquitous. As~~ a global ~~leader~~automotive technology company ushering in ~~lidar autonomous driving technology, we~~a new era of vehicle safety and autonomy. We are enabling ~~the world’s first autonomous~~ solutions for ~~automotive~~ series production in passenger cars and commercial ~~trucks.~~trucks as well as other targeted markets.

Founded in 2012 by President and Chief Executive Officer Austin Russell, weLuminar built a new type of lidar from the chip-level up, with technological breakthroughs across all core components. As a result, we have created what we believe is the ~~only~~ lidar sensor that meets the demanding performance, safety, and cost requirements for Level 3 through Level 5 autonomous vehicles in production, bypassing the traditional limitations of legacy lidar technology, while also enabling ~~Advanced~~Level 0 through Level 3 (Advanced Driving Assistance Systems (“ADAS”) and/or Luminar Proactive SafetyTM) with our Proactive ~~Safety~~SafetyTM solution. Integrating this advanced hardware with our custom developed software stack enables a turn-key autonomous solution to accelerate widespread adoption across automakers at series production scale.

Our lidar hardware and software products help set the standard for safety in the industry and are designed to enable accurate and reliable ~~detection~~detections of some of the most challenging “edge cases” ~~that~~ autonomous vehicles can encounter on a regular basis. This is achieved by advancing existing lidar range and resolution to new levels, ensuring hard-to-see objects like a tire on the road ahead or a child that runs into the street are ~~more likely~~not missed, as well as by developing our software to ~~be detected. Our software is also critical to interpreting~~interpret the data ~~and informing~~needed to inform autonomous and assisted driving decisions.

Our full-stack hardware and presently under development software autonomy solution for cars and trucks as well as our standalone lidar technology offerings ~~have made~~is expected to make us one of the leading technology partners for the world’s top OEMs. We are currently partnering with eight of the top-ten global automakers, by sales, and have the goal of being the first lidar company to produce highway self-driving and next-generation Proactive Safety systems for series production. With over 500 employees across eight global locations, we have scaled to over 50 partners in the last two years, including the first industry-wide automotive series production award in the autonomous space, awarded by Volvo Cars in May 2020, with series production expected to commence in 2022. We subsequently entered into a strategic partnership with Daimler Truck AG in October 2020 and with Mobileye Vision Technologies Ltd (“Mobileye”) in November 2020. In March 2021, we announced a partnership with Zenseact to deliver autonomous software for series production vehicles and entered into a relationship with SAIC Motor Corporation, the largest automaker in China. Since that time we have announced partnerships with Pony.AI, a leading autonomous vehicle company, and have announced a partnership with Airbus UpNext, as we work to make not only automotive, but also air transportation safer. In June 2021, we saw a watershed moment when Volvo announced that our Proactive Safety will be standard on Volvo’s upcoming fully electric flagship vehicle, which we believe will help the automaker to save even more lives as it sets a new benchmark for automotive safety. In September 2021, Polestar disclosed that they will integrate our technology into certain of their future production vehicles. In November 2021, we announced that NVIDIA has selected us as its lidar partner for their production autonomous vehicle platform known as NVIDIA DRIVE Hyperion.

The automotive industry is among the largest in the world and features an estimated total addressable market opportunity (“TAM”) for ADAS and autonomous solutions (Level 0 through Level 5) expected to exceed $150 billion by 2030. Our model to capture this opportunity is to directly partner with top established automotive companies to power their autonomous future. Correspondingly, we have successfully established customer partnerships with over 50 companies across three primary application verticals: passenger vehicles, commercial trucks, and robo-taxis. We have multiple levers for sustained growth, including significant industry tailwinds, a strong five-year product roadmap in production and development, a robust series production and standardization pipeline with anticipated long-term contracts and substantial new, adjacent market opportunities. Powered by breakthrough technology, our solutions are ready to enable autonomous vehicles to be safe and ubiquitous.

COVID-19 Impact

The coronavirus (COVID-19) pandemic has adversely affected our and some of our customers’ business ~~operations, which has impacted our revenue in 2020 and 2021 as well as resulted in the impairment of inventory in 2020.~~operations. The extent of the continued impact of the coronavirus pandemic on our operational and financial performance will depend on various future developments, including the duration and spread of the outbreak, including the emergence of variants, and impact on our customers, suppliers, and employees, all of which is uncertain at this time. ~~The~~We expect the coronavirus (COVID-19) pandemic ~~may potentially~~to adversely impact our ~~revenue~~business, including product development and industrialization initiatives, timing of shipment of products and provision of services to customers, supply chain, and may impact our financial position and results of ~~operations, but we~~operations. We are unable to predict at this time the ~~size~~potential adverse impact. For more information on our operations and ~~duration~~risks related to health epidemics, including the COVID-19 pandemic, see Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2021.

Industrialization Update

Luminar believes it remains on track to its previously announced goal of ~~this adverse impact.~~achieving series production readiness for Iris lidar and core software by the end of 2022. In the first quarter of 2022, Luminar continued to validate and successfully ramp production of lidar transceivers (its most complex component) at contract manufacturing partner Fabrinet.

In the first quarter of 2022, Luminar delivered certain software prototypes to a third party testing company to further validate its Proactive Safety™ capability. Luminar believes it remains on track to a Sentinel software beta release by year end.

Customer Updates

Luminar recently announced two new major commercial wins:

•Mercedes Benz: In January 2022, we announced a partnership with Mercedes-Benz to accelerate the development of future automated driving technologies for Mercedes passenger cars.

•Nissan: Nissan recently announced and demonstrated its integration of Luminar’s lidar as part of the development of a new driver-assistance technology.

We identify major commercial wins only when we have entered into a collaboration or partnership agreement and have reason to believe that such engagement is expected to result in future series production. Given the customary business practices in the automotive industry, there remains potential risk that our major commercial wins may not ultimately generate any

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~~Industrialization and Customer Update~~

~~Industrialization Update~~

~~Iris product development and tooling are both predominantly complete, and we are entering~~significant revenue. See the ~~C-phase~~discussion under the heading “The period of ~~our product lifecycle. We continue to work closely with our manufacturing partners Celestica and Fabrinet and have successfully secured next year’s supply chain.~~

In Q3, we debuted our Proactive Safety™ functionality, which is enabled by our Sentinel software, at IAA Mobility2. We successfully developed our alpha version of the full-stack Sentinel solution, and demonstrated both advanced automatic emergency braking and assisted highway driving capabilities. We expect to unveil Sentinel alpha on Iris to the public at the Consumer Electronics Show (CES) in January 2022.

~~Customer Update~~

~~Luminar recently announced one new major commercial win and several new customer engagements:~~

•~~NVIDIA:~~ ~~This week we announced that NVIDIA~~* has selected Luminar as its lidar partner for their autonomous vehicle reference platform known as NVIDIA DRIVE Hyperion. Luminar’s Iris will be part of a best-in-class sensor suite to help deliver safe, highly assisted and full self-driving capabilities. This AI vehicle computing platform accelerates development of autonomous consumer vehicles, which will be available for production vehicles in 2024.

•~~Polestar:~~ ~~Polestarcited Luminar as their partner for best-in-class long range sensors and autonomous driving capabilities.~~

•~~Kodiak:~~ ~~Kodiak announced its fourth-generation autonomous truck, which will feature Luminar’s Iris sensor, sleekly integrated into the roofline.~~

•~~Embark:~~ ~~Embark announced its partnership with Luminar to accelerate their 2024 commercialization of self-driving trucks.~~

~~_________~~

*NVIDIA is classified astime from a major commercial win ~~because they~~to implementation is long and we are ~~a major industry player and publicly announced selection~~subject to the risks of cancellation or postponement of the contract or unsuccessful implementation” in “Risk Factors” in Item IAof Part I in our lidar as part of their Hyperion reference platform, which is expected to be designed into significant commercial program(s). NVIDIA is a technology/platform provider and relevant written agreements would ultimately be made directlyAnnual Report on Form 10-K for the fiscal year ended December 31, 2021 filed with the ~~end users of Nvidia’s Hyperion reference platform.~~SEC on March 1, 2022.

Basis of Presentation

We currently conduct our business through two operating segments: (i) Autonomy Solutions and (ii) ~~Component Sales.~~Components.

Components of Results of Operations

Revenue

Our revenue producing activities ~~can be viewed as~~are organized in two ~~separate and distinct~~ operating segments: (i) Autonomy Solutions and (ii) ~~Component Sales.~~Components.

The Autonomy Solutions segment is engaged in design, manufacturing, and sale of lidar sensors ~~as well as related perception and autonomy enabling software solutions~~ catering mainly to the original equipment manufacturers in the automobile, commercial vehicle, robo-taxi and adjacent industries. The Autonomy Solutions segment ~~has historically entered into Strategic Partner Programs (“SPP”)~~revenue also includes fees earned from non-recurring engineering services provided to customers in connection with ~~leading automotive partners~~customization of our sensor and other customers. An SPP is a contract under which we deliver our product to a specified customer at a fixed price under customary terms and conditions, usually in collaboration on an autonomous vehicle development program. With many major automakers having signed SPP contracts, we are shifting our focus from entering into SPPs with new partners to converting existing SPPs and relationships with our partners into series production programs. Once we achieve series production, the primary sources of revenue are expected to shift from prototype sales and services revenue to sales of lidar hardware, perception software ~~and autonomy enabling software for series production vehicles.~~products.

The ~~Component Sales~~Components segment provides ~~designing, testing~~advanced semiconductors and related components as well as design, test and consulting services ~~for non-standard integrated circuits~~ to ~~U.S.~~the Autonomy Solutions segment as well as various third-party customers, including government agencies and defense contractors, in markets generally ~~for purposes~~ unrelated to autonomous vehicles.

Revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Fixed fee arrangements are satisfied over time and utilize the input method based on costs incurred. Accordingly, revenue for fixed fee arrangements is recognized on a percentage of completion basis. ~~Contracts~~Certain customer contracts are also structured as time and materials and billed at cost of time incurred plus a markup. ~~We anticipate more closely aligning~~Such time and ~~integrating our Component Sales segment operations with portions~~material contracts are recognized over time.

Two customers accounted for 52% and 23% of ~~our Autonomy Solutions segment, specifically in relation to lidar solutions~~the Company’s revenue for the ~~defense and other adjacent markets.~~

~~Table~~three months ended March 31, 2022. One customer accounted for 45% of ~~Contents~~

the Company’s revenue for the three months ended March 31, 2021.

Cost of sales and gross profit (loss)

Cost of sales ~~of the Autonomy Solutions segment~~ includes the fixed and variable manufacturing cost of our lidar sensors, which primarily consists of personnel-related costs ~~(including~~including certain engineering ~~personnel), including~~personnel and stock-based compensation and material purchases from third-party contract manufacturers and suppliers which are directly associated with our manufacturing ~~organization, and cost of material purchased from third-party contract manufacturers and suppliers.~~process. Cost of sales ~~also~~ includes cost of providing services to customers, depreciation and amortization for manufacturing fixed assets or equipment, cost of ~~component inventory,~~components, product testing and launch-related costs, ~~costs of providing services,~~ an allocated portion of overhead, facility and ITinformation technology (“IT”) costs, write downs for excess and obsolete inventory and shipping costs.

~~Cost of sales of~~The Components segment provides certain services and components to the ~~Component Sales~~Autonomy Solutions segment ~~includes the~~which are recorded as cost of ~~providing products~~goods sold or research and development costs depending on the nature and use of such services ~~as well as an allocated portion of overhead, facility~~ and ~~IT costs.~~components by the Autonomy Solutions segment. These inter-segment transactions are eliminated in the consolidated results.

Gross profit (loss) equals revenue less cost of sales. ~~Our cost of sales is expected to increase as our revenue continues to grow.~~

Operating Expenses

Research and Development (R&D)

R&D costs are expensed as incurred.

Our R&D efforts are focused on enhancing and developing additional functionality for our existing products and on new product development, including new releases and upgrades to our lidar sensors and integrated software solutions. R&D expenses consist primarily of:

•Personnel-related expenses, including salaries, benefits, and stock-based compensation expense, for personnel in our research and engineering functions;

•Expenses related to materials, software licenses, supplies and third-party services;

•Prototype expenses;

•An allocated portion of facility and IT costs and ~~depreciation; and~~depreciation.

•~~Component Sales~~The Components segment provides certain services ~~provided~~and components to ~~Luminar~~the Autonomy Solutions segment which are ~~accounted for~~recorded as ~~R&D~~cost of goods sold or research and development costs depending on the nature and use of such services and

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components by ~~Luminar.~~

~~R&D costs~~the Autonomy Solutions segment. These inter-segment transactions are ~~expensed as incurred.~~eliminated in our consolidated results. We expect our R&D costs to increase for the foreseeable future as we continue to invest in research and development activities to achieve our product roadmap.

Sales and Marketing Expenses

Sales and marketing expenses consist of personnel and personnel-related expenses, including stock-based compensation of our business development team as well as advertising and marketing expenses. These include the cost of marketing programs, trade shows, promotional materials, demonstration equipment, an allocated portion of facility and IT costs and depreciation.

We expect to increase our sales and marketing activities, mainly in order to continue to build out our geographic presence to be closer to our partners and better serve them. We also expect that our sales and marketing expenses will increase over time as we continue to hire additional personnel to scale our business.

General and Administrative Expenses

General and administrative expenses consist of personnel and personnel-related expenses, including stock-based compensation of our executive, finance, human resources, information systems and legal departments as well as legal and accounting fees for professional and contract services.

We expect our general and administrative expenses to increase for the foreseeable future as we scale headcount with the growth of our business, and as a result of operating as a public company, including compliance with the rules and regulations of the SEC, legal, audit, additional insurance expenses, investor relations activities, and other administrative and professional services.

Change in Fair Value of Warrants

~~Change in fair value of warrants are non-cash changes and primarily consists of changes in fair value related to the warrant liabilities.~~ The warrant liabilities are classified as marked-to-market liabilities ~~pursuant to ASC 480~~ and the corresponding increase or decrease in value ~~impacts our net loss.~~is reflected in change in fair value of warrants.

Interest Income and ~~other,~~Other, and Interest Expense and Other

Interest income and other consists primarily of income earned on our cash equivalents and marketable securities. These amounts will vary based on our cash, cash equivalents and marketable securities balances, and also with market rates. It also includes realized gains and losses related to the marketable securities, as well as impact of gains and losses related to foreign exchange transactions. Interest expense and other consisted primarily of interest on convertible senior notes issued in December 2021, finance leases and interest on our senior secured term loan facility, which was repaid upon consummation of the Business Combination.

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Results of Operations for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~

The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this report. The following table sets forth our consolidated results of operations data for the periods presented (in thousands):


		Three Months Ended September 30,								Nine Months Ended September 30,									Three Months Ended March 31,
		2021		2020		$ Change		% Change		2021		2020		$ Change		% Change			2022		2021		$ Change		% Change
Revenue	Revenue	$	7,978	$	4,223	$	3,755	89	%	$	19,600	$	11,519	$	8,081	70	%	Revenue	$	6,855	$	5,313	$	1,542	29	%
Cost of sales	Cost of sales	10,762		6,924		3,838		55	%	26,254		18,209		8,045		44	%	Cost of sales	16,654		7,639		9,015		118	%
Gross loss	Gross loss	(2,784)		(2,701)		(83)		3	%	(6,654)		(6,690)		36		(1)	%	Gross loss	(9,799)		(2,326)		(7,473)		321	%
Operating Expenses:	Operating Expenses:																	Operating Expenses:
Research and development	Research and development	25,890		10,152		15,738		155	%	59,813		28,268		31,545		112	%	Research and development	33,109		14,010		19,099		136	%
Sales and marketing	Sales and marketing	5,868		2,332		3,536		152	%	12,010		5,407		6,603		122	%	Sales and marketing	9,398		2,635		6,763		257	%
General and administrative	General and administrative	35,603		6,611		28,992		439	%	65,113		16,116		48,997		304	%	General and administrative	30,025		10,273		19,752		192	%
Total operating expenses	Total operating expenses	67,361		19,095		48,266		253	%	136,936		49,791		87,145		175	%	Total operating expenses	72,532		26,918		45,614		169	%
Loss from operations	Loss from operations	(70,145)		(21,796)		(48,349)		222	%	(143,590)		(56,481)		(87,109)		154	%	Loss from operations	(82,331)		(29,244)		(53,087)		182	%
Other income (expense), net:	Other income (expense), net:																	Other income (expense), net:

Change in fair value of warrants	Change in fair value of warrants	17,072		(7,988)		25,060		(314)	%	(22,649)		(12,562)		(10,087)		80	%	Change in fair value of warrants	(3,857)		(46,649)		42,792		(92)	%
Loss on extinguishment of debt		—		—		—		—	%	—		(866)		866		(100)	%

Interest expense and other	Interest expense and other	(374)		(1,076)		702		(65)	%	(860)		(2,097)		1,237		(59)	%	Interest expense and other	(3,280)		(200)		(3,080)		1540	%
Interest income and other	Interest income and other	843		(351)		1,194		(340)	%	1,744		(221)		1,965		(889)	%	Interest income and other	1,539		170		1,369		805	%
Total other income (expense), net	Total other income (expense), net	17,541		(9,415)		26,956		(286)	%	(21,765)		(15,746)		(6,019)		38	%	Total other income (expense), net	(5,598)		(46,679)		41,081		(88)	%
Loss before income taxes	Loss before income taxes	(52,604)		(31,211)		(21,393)		69	%	(165,355)		(72,227)		(93,128)		129	%	Loss before income taxes	(87,929)		(75,923)		(12,006)		16	%
Benefit from income taxes		(1,264)		—		(1,264)		nm		(1,262)		—		(1,262)		nm
Provision for income taxes																		Provision for income taxes	404		—		404		nm
Net loss	Net loss	$	(51,340)	$	(31,211)	$	(20,129)	64	%	$	(164,093)	$	(72,227)	$	(91,866)	127	%	Net loss	$	(88,333)	$	(75,923)	$	(12,410)	16	%

Revenue

The increase in revenue in the three months ended ~~September 30, 2021,~~March 31, 2022 compared to the same period of ~~2020~~2021 was primarily driven by increased revenue from our Autonomy Solutions ~~segment partially offset by a decrease in revenue from our Component Sales~~ segment. The ~~increase in revenue in the nine months ended September 30, 2021 , compared to the same period of 2020 was driven by increased revenue from our Autonomy Solutions partially offset by~~following table sets forth a ~~decrease in revenue from our Component Sales segment. The~~ breakdown of our revenue by these segments for the periods presented ~~was as follows~~ (in thousands):


		Three Months Ended September 30,								Nine Months Ended September 30,									Three Months Ended March 31,
		2021		2020		$ Change		% Change		2021		2020		$ Change		% Change			2022		2021		$ Change		% Change
Revenue:
Revenue from sales to external customers:																		Revenue from sales to external customers:
Autonomy Solutions	Autonomy Solutions	$	7,550	$	3,481	$	4,069	117	%	$	17,708	$	9,587	$	8,121	85	%	Autonomy Solutions	$	5,898	$	4,336	$	1,562	36	%
Component Sales		428		742		(314)		(42)	%	1,892		1,932		(40)		(2)	%
Components																		Components	957		977		(20)		(2)	%
Total	Total	$	7,978	$	4,223	$	3,755	89	%	$	19,600	$	11,519	$	8,081	70	%	Total	$	6,855	$	5,313	$	1,542	29	%

The increase in revenue of our Autonomy Solutions segment in the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022 compared to same ~~periods of 2020~~period in 2021 was primarily driven by ~~program~~increase in revenue from customization / non-recurring engineering services and increase in sales of ~~our sensors and software for future series production programs.~~

The decrease in revenue of our Component Sales segment in the three months ended September 30, 2021, was primarily due to the completion of two large firm-fixed price contracts. The decrease in revenue of our Component Sales segment in the nine months ended September 30, 2021, compared to the same period of 2020 was primarily due to the winding down of effort on several customer contracts that were completed in the third quarter of 2021.sensors.

Cost of Sales ~~and Gross Loss~~

The ~~$3.8~~$9.0 million increase in the cost of sales in the three months ended ~~September 30, 2021,~~March 31, 2022, compared to the same period ~~of 2020,~~in 2021, was due to an increase in personnel headcount, including stock-based compensation, contractor fees, and higher project service costs to customize our sensors. These increases were offset by lower direct material costs and excess inventory reserves, and increased factory utilization from higher sensor production. Our gross loss increased by $(0.1) million in the three months ended September 30, 2021, compared to the same period of 2020, primarily due to increased personnel and contractor fees to support higher production and sensor projects, and sensor repairs, offset slightly by higher project revenue, and improved factory efficiency and utilization from higher Model H and Model Iris production.

~~The $8.0 million~~launch-related costs, increase in ~~our cost~~sales of ~~sales~~sensors and increases in ~~the nine months ended September 30, 2021, compared to the same period~~customization / NRE services and tooling costs, as well as impairment of ~~2020, was due to an increase in personnel headcount, including stock-based compensation, contractor fees,~~inventory and ~~project~~

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~~service~~ costs to customize our sensors. These increases were offset by lower excess inventory reserves and improved factory yield, efficiency, and utilization from higher sensor production. Our gross loss increased by $36.0 thousand in the nine months ended September 30, 2021, compared to the same period of 2020, primarily due to increased personnel and consulting fees to support higher production and sensor projects, and sensor repairs, offset slightly by higher project service revenue from customization of our sensors, higher sensor sales and improved factory utilization associated with ~~the initial ramp-up~~industrialization of ~~Model H and Model~~ Iris ~~sensors.~~as we get closer to series production readiness.

Operating Expenses

Research and Development

The ~~$15.7 million and $31.5~~$19.1 million increase in research and development expenses in the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 compared to the same ~~periods of 2020~~period in 2021 was primarily due to to:

•a ~~$12.3 million and $26.0~~$9.4 million increase in personnel-related ~~costs including stock-based compensation~~ costs driven mainly by increased headcount and an increase in stock-based compensation expense; and

•a ~~higher fair value of equity awards, consultant and~~$8.6 million increased contractor fees and external spend in relation to ~~preparing for multiple series production launches~~continued development and ~~continued investments in research~~testing of our sensor and ~~development.~~software products, as well as development activities related to advanced manufacturing.

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Sales and Marketing

The ~~$3.5 million and $6.6~~$6.8 million increase in sales and marketing expenses for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 compared to the same ~~periods of 2020~~period in 2021 was primarily due to to:

•a ~~$2.2 million and $4.4~~$3.3 million increase in personnel related costs including stock-based compensation costs ~~from increase in headcount~~due to increased headcount; and ~~consultancy fees, and~~

•a ~~$0.9 million and $1.3~~$2.7 million increase in marketing expenses related to trade shows and presentations in auto industry ~~conventions.~~conventions as well as increased outside consultants costs related to business development activities.

General and Administrative

The ~~$29.0 million and $49.0~~$19.8 million increase in general and administrative expenses for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 compared to the same ~~periods of 2020~~period in 2021 was primarily due to to:

•a ~~$24.4 million and $31.9~~$15.8 million increase in personnel costs including stock-based compensation costs, driven mainly by increased ~~headcount~~headcount;

•a $2.0 million increase in costs associated with being a public company, including audit fees and tax advisory fees; and

•a ~~higher fair value of equity awards, and an~~$2.2 million increase in travel related expenses as domestic and international travel increased with the easing of Covid-19 restrictions. Increased public company costs for the three and nine months ended September 30, 2021 compared to the same periods of 2020 included $2.0 million and $6.1 million in higher insurance costs, and approximately $1.2 million and $6.7 million in higher professional services fee for legal and ~~accounting services and regulatory fees.~~other costs associated with our acquisition of Freedom Photonics LLC.

Change in Fair Value of Warrant Liabilities

The change in fair value of warrant liabilities is a non-cash benefit or charge due to the corresponding decrease or increase in the estimated fair value of warrants. ~~The fair value~~

In January 2022, 1,389,529 Private Warrants ~~decreased by $17.1~~were exercised. The non-cash charge related to Private Warrants was $3.9 million infor the three months ended ~~September 30, 2021. In~~ March 2021, 16,718,316 Public and Private Warrants were exercised and 204,638 Public Warrants were redeemed and prior to the exercise and redemption, the fair value of the warrants was calculated and the net increase of $46.6 million in the fair value was recorded.31, 2022.

Segment Operating Income or Loss

Segment income or loss is defined as income or loss before taxes. Our segment income or loss breakdown is as follows (in thousands):


		Three Months Ended September 30,								Nine Months Ended September 30,									Three Months Ended March 31,
		2021		2020		$ Change		% Change		2021		2020		$ Change		% Change			2022		2021		$ Change		% Change
Segment operating income (loss)	Segment operating income (loss)																	Segment operating income (loss)
Autonomy Solutions	Autonomy Solutions	$	(69,614)	$	(21,800)	$	(47,814)	219	%	$	(142,651)	$	(56,673)	$	(85,978)	152	%	Autonomy Solutions	$	(82,177)	$	(28,868)	$	(53,309)	185	%
Component Sales		(787)		4		(791)		(19775	%)	(1,100)		192		(1,292)		(673	%)
Components																		Components	270		(237)		507		(214	%)

Liquidity and Capital Resources

Sources of Liquidity

Our capital requirements will depend on many factors, including lidar and software sales volume, the timing and extent of spending to support ~~our manufacturing ramp-up for series production,~~ R&D ~~and launch~~ efforts, investments in information technology systems, the expansion of sales and marketing activities, and market adoption of new and enhanced products and features. Until we can generate sufficient revenue from ~~lidar sensors~~sale of products and ~~software~~services to cover our operating expenses, working capital, and capital expenditures, we expect our ~~current liquidity, comprising of~~ cash, cash equivalents and marketable securities, and proceeds from debt and/or equity financings to fund our cash needs. If we are required to raise additional funds by issuing equity securities, dilution to stockholders would

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result. Any equity securities issued may also provide for rights, preferences or privileges senior to those of holders of our common stock. If we raise funds by issuing debt securities, these debt securities may have rights, preferences and privileges senior to those of holders of our common stock. The terms of debt securities or borrowings could impose significant restrictions on our operations. The credit market and financial services ~~industry~~industries have in the past, and may in the future, experience periods of uncertainty that could impact the availability and cost of equity and debt financing.

We ~~believe~~expect to continue to invest in our ~~existing~~product and software development as well as incur efforts to build customer relations and markets. Further, we expect to invest in developing advanced manufacturing capabilities, both, internally as well as with our contract manufacturing partners. For example, in January 2022, we executed an arrangement with Celestica committing approximately $26.9 million for purchase of capital equipment as well as engineering efforts related to manufacturing process. We expect to fund these product and business development initiatives, and capital expenditures either through our cash, ~~and~~ cash equivalents ~~will be sufficient to meet~~and marketable securities or through our ~~working capital and capital expenditure needs for at least the next 12 months.~~Stock-in-lieu of Cash Program.

As of ~~September 30, 2021,~~March 31, 2022, we had cash and cash equivalents totaling ~~$129.3~~$159.4 million and marketable securities of ~~$415.5 million, combining for a total liquidity of $544.9~~$547.4 million. To date, our principal sources of liquidity have been proceeds received from issuances of debt and equity.Market and

~~In March 2021,~~

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economic conditions, such as increase in interest rates by federal agencies, may materially impact relative cost and mix of these sources of liquidity.

To date, we ~~received $153.9 million in cash proceeds from the exercise of Public and Private warrants.~~

We have not generated positive cash flows from operating activities and have incurred significant losses from operations in the past as reflected in our accumulated deficit of ~~$748.6~~$910.8 million as of ~~September 30, 2021.~~March 31, 2022. We expect to continue to incur operating losses for at least the foreseeable future due to continued R&D and other infrastructure investments that we have made and intend to continue to make in our business and, as a result, we may require additional capital resources to grow our business. We believe that ~~our~~ current cash, cash equivalents, and marketable securities will be sufficient ~~for us~~ to continue to execute our business strategy ~~over~~in the next ~~two years~~12 months and until we expect to begin series production.

Cash Flow Summary

The following table summarizes our cash flows for the periods presented:


		Nine Months Ended June 30,					Three Months Ended March 31,
		2021		2020			2022		2021
Net cash provided by (used in):	Net cash provided by (used in):					Net cash provided by (used in):
Operating activities	Operating activities	$	(94,256)	$	(47,731)	Operating activities	$	(32,837)	$	(28,014)
Investing activities	Investing activities	$	(143,576)	$	(112,453)	Investing activities	$	(94,395)	$	(128,354)
Financing activities	Financing activities	$	158,161	$	183,804	Financing activities	$	(43,344)	$	154,104

Operating Activities

Net cash used in operating activities was ~~$94.3~~$32.8 million during the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022. Net cash used in operating activities was due to our net loss of ~~$164.1~~$88.3 million adjusted for non-cash items of ~~$82.7~~$42.8 million, primarily consisting of ~~$22.6~~$26.7 million of stock-based compensation, $7.8 million of vendor payments in stock in lieu of cash and $3.9 million of change in fair value of warrant liabilities, ~~$49.9 million of stock-based compensation, $1.6 million of inventory impairment and $2.2 million of depreciation and amortization,~~ offset by use of cash for operating assets and liabilities of ~~$12.8 million due to the timing of cash payments to vendors and cash receipts from customers.~~

Net cash used in operating activities was $47.7 million during the nine months ended September 30, 2020. Net cash used in operating activities was due to our net loss of $72.2 million adjusted for non-cash items of $24.8 million, primarily consisting of $12.6 million of change in fair value of warrant liabilities, $4.7 million of stock-based compensation, $4.4 million of impairment of inventories and $1.9 million of depreciation and amortization, offset by use of cash for operating assets and liabilities of $0.4$12.7 million due to the timing of cash payments to vendors and cash receipts from customers.

Investing Activities

Net cash used in investing activities of ~~$143.6~~$94.4 million in the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 comprised of ~~$530.2~~$193.7 million related to purchases of marketable securities and ~~$4.2~~$5.0 million in capital expenditures, offset by ~~$83.5~~$12.8 million and ~~$306.9~~$91.5 million, respectively, of cash proceeds from sales and maturities of marketable securities.

Net cash used in investing activities of $112.5 million in the nine months ended September 30, 2020 was comprised of $123.4 million related to purchases of marketable securities and capital expenditures of $2.0 million, offset by cash proceeds from sales and maturities of marketable securities of $4.4 million and $8.5 million, respectively.

Financing Activities

Net cash ~~provided by financing activities~~used in ~~the nine months ended September 30, 2021 was $158.2 million, compared to $183.8 million for the nine months ended September 30, 2020. Net cash provided by~~ financing activities of ~~$158.2~~$43.3 million in the three months ended March 31, 2022 comprised primarily ~~related to $153.9~~of $43.9 million ~~of cash received from exercises of Public and Private Warrants, $4.7 million of cash~~

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~~received from exercises of stock options, offset by $0.2 million of~~ cash paid for ~~repayment~~repurchases of ~~debt and $0.3 million~~shares of ~~cash paid for other financing activities.~~

Net cash provided by financing activities of $183.8 million in the nine months ended September 30, 2020 primarily related to $164.3 million of net cash received from of the issuance of Series X convertible preferred stock and $20.7 million of net cash received from the issuance of debt, offset by $1.2 million of cash paid for other financing activities.

~~Off-Balance Sheet Arrangements~~

As of September 30, 2021, we did not have any off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K, such as the use of unconsolidated subsidiaries, structured finance, special purpose entities or variable interest entities.Class A common stock.

Critical Accounting Policies and Estimates

Our condensed consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. On an ongoing basis, we evaluate our estimates and assumptions. Our actual results may differ from these estimates under different assumptions or conditions.

We believe our critical accounting policies involve the greatest degree of judgment and complexity and have the greatest potential impact on our condensed consolidated financial statements.

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, there were no significant changes to our critical accounting policies and estimates. For a more detailed discussion of our critical accounting policies and estimates, please refer to our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~

~~Revenue~~

We adopted the requirements of the new revenue recognition standard, known as ASC 606, effective January 1, 2019, utilizing the modified retrospective method of transition. Revenue from product sales is recognized upon transfer of control of promised products. Revenue is recognized in an amount that reflects the consideration that we expect to receive in exchange for those products and services. For service projects, revenue is recognized as services are performed and amounts are earned in accordance with the terms of a contract at estimated collectible amounts.

Revenues related to custom products are recognized over time using the cost input method. In using this input method, we generally apply the cost-to-cost method of accounting where sales and profits are recorded based on the ratio of costs incurred to estimated total costs at completion. Recognition of profit on these contracts requires estimates of the total contract value, the total cost at completion, and the measurement of progress towards completion. Significant judgment is required when estimating total contract costs and progress to completion on the arrangements, as well as whether a loss is expected to be incurred on the contract. If circumstances arise that change the original estimates of revenues, costs, or extent of progress toward completion, revisions to the estimates are made. These revisions may result in increases or decreases in estimated revenues or costs, and such revisions are reflected in income in the period in which the circumstances that gave rise to the revision become known to us. We perform ongoing profitability analysis of our contracts accounted for under this method in order to determine whether the latest estimates of revenues, costs, and profits require updating. If at any time these estimates indicate that the contract will be unprofitable, the entire estimated loss for the remainder of the contract is recorded immediately.

We enter into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations; however, determining whether products or services are considered distinct performance obligations that should be accounted for separately versus together may sometimes require significant judgment. Transaction price is allocated to each performance obligation on a relative standalone selling price (SSP) basis. Judgment is required to determine SSP for each distinct performance obligation. We use a range of amounts to estimate SSP when products and services are sold separately. In instances where SSP is not directly observable, we determine SSP using information that may include other observable inputs available to it.

~~Changes in judgments with respect to these assumptions and estimates could impact the timing or amount of revenue recognition.~~

~~Emerging Growth Company Status~~

Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose

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not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable.

We are an “emerging growth company” as defined in Section 2(a) of the Securities Act, and have elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards. Following the consummation of the Business Combination, our Post-Combination Company will remain an emerging growth company until the earliest of (i) the last day of the fiscal year in which the market value of our common stock that held by non-affiliates exceeds $700 million as of the end of that year’s second fiscal quarter, (ii) the last day of the fiscal year in which we achieve total annual gross revenue of $1.07 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which we issue more than $1 billion in non-convertible debt in the prior three-year period or (iv) December 31, 2024. We expect to continue to take advantage of the benefits of the extended transition period, although we may decide to early adopt such new or revised accounting standards to the extent permitted by such standards. This may make it difficult or impossible to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used. As of June 30, 2021, the market value of our common stock held by non-affiliates was $4.6 billion, as such, we will cease to be an emerging growth company as of December 31, 2021.

Recent Accounting Pronouncements

See Note 2 of the notes to condensed consolidated financial statements included in this report.

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ITEM 3. Quantitative and Qualitative Disclosures about Market Risk.

We are exposed to market risk in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of fluctuations in interest rates and foreign currency exchange rates. We do not hold or issue financial instruments for trading purposes. For a discussion of market risk, see “Quantitative and Qualitative Disclosure about Market Risk” in Item 7A of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021. Our exposure to market risk has not changed materially since December 31, ~~2020.~~2021.

We had cash and cash equivalents, and marketable securities totaling ~~$544.9~~$706.9 million as of ~~September 30, 2021.~~March 31, 2022. Cash equivalents and marketable securities were invested primarily in U.S. treasury securities, commercial paper, corporate bonds, U.S. agency and government sponsored securities, equity investments and ~~money market funds.~~asset-backed securities. Our investment policy is focused on the preservation of capital and supporting our liquidity needs. Under the policy, we invest in highly rated securities, while limiting the amount of credit exposure to any one issuer other than the U.S. government. We do not invest in financial instruments for trading or speculative purposes, nor do we use leveraged financial instruments. We utilize external investment managers who adhere to the guidelines of our investment policy. A hypothetical 100 basis point change in interest rates would not have a material impact on the value of our cash and cash equivalents or marketable investments.

As of March 31, 2022, the principal amount outstanding of our Convertible Senior Notes was $625.0 million. The fair value of the Convertible Senior Notes is subject to interest rate risk, market risk and other factors due to their conversion features. The fair value of the Convertible Senior Notes will generally increase as our common stock price increases and will generally decrease as our common stock price declines. The interest and market value changes affect the fair value of the Convertible Senior Notes but do not impact our financial position, cash flows or results of operations due to the fixed nature of the debt obligations. We carry the Convertible Senior Notes at face value less unamortized discount on our consolidated balance sheets.

Our Convertible Senior Notes bear fixed interest rate, and therefore, are not subject to interest rate risk. We have not utilized derivative financial instruments, derivative commodity instruments or other market risk sensitive instruments, positions or transactions in any material fashion, except for the privately negotiated capped call transactions entered into in December 2021 related to the issuance of our Convertible Senior Notes.

Our results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. Currently, all of our revenue is generated in U.S. dollars. Our expenses are generally denominated in the currencies of the jurisdictions in which we conduct our operations, which are primarily in the U.S. and in Europe. Luminar’s results of operations and cash flows in the future may be adversely affected due to an expansion of non-U.S. dollar denominated contracts, growth of its international entities, and changes in foreign exchange rates. The effect of a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have a material impact on our historical or current consolidated financial statements. To date, we have not engaged in any hedging strategies. As our international operations grow, we will continue to reassess our approach to manage the risk relating to fluctuations in currency rates.

ITEM 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

In designing and evaluating our disclosure controls and procedures, management recognizes that any disclosure controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Our management, with the participation of our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the fiscal quarter ended ~~September 30, 2021.~~March 31, 2022. Based on this evaluation and for the reasons set forth below, our CEO and CFO have concluded that our disclosure controls and procedures were not effective as of ~~September 30, 2021~~March 31, 2022 due to the material ~~weakness~~weaknesses in internal control over financial reporting ~~that was~~ disclosed in Part II, Item 9A of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021 (the ~~“2020~~“2021 Annual Report”).

Previously identified material weaknesses

As discussed in Part II, Item 9A in our 2021 Annual Report, we identified deficiencies in the control environment, control activities, information & communication, and monitoring components of the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO framework”) that constitute material weaknesses, either individually or in the aggregate. The material weaknesses in these components of the COSO framework resulted from a lack of sufficient number of qualified personnel within our accounting and internal audit

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functions who possessed an appropriate level of expertise to effectively perform certain functions and activities and led to additional material weaknesses, as discussed in Part II, Item 9A in our 2021 Annual Report.

Notwithstanding the conclusion by our CEO and CFO that our disclosure controls and procedures as of ~~September 30, 2021~~March 31, 2022 were not effective, and notwithstanding the identified material ~~weakness,~~weaknesses, management, including our CEO and CFO, believes the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with U.S. GAAP.

~~Material Weakness~~Remediation Plan and Status

Management is committed to remediating the material weaknesses identified as promptly as possible. As ~~discussed~~part of our remediation plan described in ~~the 2020~~Part II, Item 9A in our 2021 Annual Report, ~~on Form 10-K,~~ we ~~completed~~are continuing to test the ~~Business Combination on December 2, 2020. Prior to the Business Combination, the Company was a special purpose acquisition company formed for the purpose~~ongoing operating effectiveness of ~~effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or other similar business combination with one or more target businesses. As a result, previously~~new and existing internal controls are no longer applicable or comprehensive enough as of the assessment date as the Company’s operations prior to the Business Combination were insignificant compared to those of the Post-Combination Company. The design and implementation of internal control over financial reporting for the Post-Combination Company has required and will continue to require significant time and resources from management and other personnel. Because of this, the design and ongoing development of our framework for implementation and evaluation of internal control over financial reporting is in its preliminary stages. As a result, management was unable, without incurring unreasonable effort or expense, to conduct an assessment of our internal control over financial reporting as of December 31, 2020.

Based on an initial assessment, we concluded that our internal control over financial reporting was not effective as of December 31, 2020 because of the material weakness described below. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

In connection with our financial statement close process for the year ended December 31, 2020, we identified a material weakness in our internal control over financial reporting resulting from a lack of sufficient number of qualified personnel within our accounting function who possessed an appropriate level of expertise to effectively perform the following functions:

~~Table of Contents~~

•~~identify, select and apply GAAP sufficiently to provide reasonable assurance that transactions were being appropriately recorded; and~~

•assess risk and design appropriate control activities over information technology systems and financial and reporting processes necessary to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements.

~~Material Weakness Remediation~~

Management continues to be actively engaged to take steps to remediate the material weakness, including the hiring of additional accounting and finance personnel with technical public company accounting and financial reporting experience.controls. The material ~~weakness will not~~weaknesses cannot be considered completely remediated until ~~management designs and implements effective~~the applicable controls ~~that operate~~have operated for a sufficient period of time and management has concluded, through testing, that these controls are ~~effective.~~operating effectively. We cannot assure you that the measures we have taken to date, and are continuing to implement, will be sufficient to remediate the material weaknesses we have identified or avoid potential future material weaknesses.

During the three months ended March 31, 2022, we continued to initiate and will continue to implement measures designed to improve our internal control over financial reporting to remediate this material weakness, including the following:

•During 2021, we initiated formalizing our internal controls environment and had performed a risk assessment and scoping of key systems and business processes, including a risk assessment at the financial statement assertion level to ensure that the level of precision of relevant controls is adequate to address the identified risks. We will continue to revise our risk assessment and scoping to rectify the deficiencies noted, enhance design and implement new controls, expand education and training, update documentation and strengthen supervisory reviews by our management. We will continue to remediate the design effectiveness of certain specific controls and test the operating effectiveness of the remediated controls in 2022.

•We have added and we continue to be in the process of adding sufficient number of qualified personnel within our accounting function. In the fourth quarter of 2021, we have hired our new Chief Accounting Officer, and in the first quarter of 2022, we have hired our new Corporate Controller, Assistant Corporate Controller and Vice President of Internal Audit. We will further invest in building an in-house internal audit function and hire further personnel with accounting, financial reporting, and compliance experience as necessary.

•We are in the process of strengthening access and segregation of duties related Information Technology General Controls related to financial accounting and reporting systems. We will increase standardization and automation within accounting processes to improve the reliability of information used by existing accounting personnel. We will revise our information technology general controls in the context of the systems and applications used in the key processes to address access changes segregation of duties related deficiencies.

•We will provide training, implement technology tools, and enhance oversight over the execution and review of manual journal entry controls.

Changes in Internal Control Over Financial Reporting

~~Management continued to take action to remediate~~Other than the material weakness during the quarterly period ended September 30, 2021. However, the material weakness will not be considered remediated until management designs and implements effective controls that operate for a sufficient period of time and management has concluded, through testing, that these controls are effective.

~~There has been~~above-mentioned remediation efforts, there were no ~~change~~changes in our internal control over financial reporting ~~(as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred~~ during the ~~quarterly period~~quarter ended ~~September 30, 2021~~March 31, 2022 that ~~has~~have materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting. We have not experienced any material impact to our internal control over financial reporting despite the fact that most of our employees are working remotely due to the COVID-19 pandemic. We are continually monitoring and assessing the impact of the COVID-19 situation on our internal controls to minimize any impact on their design and operating effectiveness.

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PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings.

Information with respect to this Item may be found under the heading “Legal Matters” in Note 13 to the condensed consolidated financial statements in this Quarterly Report on Form 10-Q, which information is incorporated herein by reference.

ITEM 1A. Risk Factors.

There have been no material changes from the Risk Factors previously disclosed in Part 1, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021. You should carefully consider the Risk Factors discussed in our Annual Report on Form 10-K as they could materially affect our business, financial condition and future results of operation.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

~~None applicable.~~Unregistered Sales of Equity Securities

During the three months ended March 31, 2022, we issued an aggregate of 1,424,350 shares of Class A common stock to various vendors and partners in lieu of cash payment for services provided to us. The shares were issued in private placement transactions in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). We subsequently filed a post-effective amendment to a registration statement on Form S-1 on a registration statement on Form S-3 (File No. 333-262250) and a registration statement on Form S-3 (File No. 333-257989) for the resale of these shares which become effective on February 3, 2022 and March 7, 2022, respectively.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In December 2021, our Board of Directors authorized a program for us to repurchase shares of $312.5 million of the Company’s Class A common stock. The Company’s share repurchase program does not obligate the Company to acquire any specific number of shares. Under the program, shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time. As of March 31, 2022, approximately $37.0 million remained available for stock repurchases pursuant to our stock repurchase program. The following table summarizes the stock repurchase activity for the three months ended March 31, 2022 and the approximate dollar value of shares that may yet be purchased pursuant to our stock repurchase program (in thousands, except share and per share amounts):


Period	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Program	(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
January 1, 2022 — January 31, 2022	1,008,779	$	17.66	1,008,779	$	58,810
February 1, 2022 — February 28, 2022	—	$	—	—	$	58,810
March 1, 2022 — March 31, 2022	1,673,769	$	13.04	1,673,769	$	36,982
Total	2,682,548	$	14.78	2,682,548

ITEM 3. Defaults Upon Senior Securities.

None.

ITEM 4. Mine Safety Disclosures.

Not applicable.

ITEM 5. Other Information.

None.

3835

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ITEM 6. Exhibits.
Incorporation by Reference
Exhibit Number Description Form File Number Exhibit/Appendix Reference Filing Date Filed Herewith
3.1
Second Amended and Restated Certificate of Incorporation of the Company.
8-K/A 001-38791 3.1 12/8/20
3.2
Amended and Restated Bylaws of the Company.
8-K/A 001-38791 3.2 12/8/20
10.1
Amended and Restated Offer Letter by and between Luminar Technologies, Inc. and Alan Prescott dated November 11, 2021
X
31.1
Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15(d)-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
X
31.2
Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15(d)-14(a) under the Securities Exchange Act of 1934, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
X
32.1
Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
X
101.INS XBRL Instance Document X
101.SCH XBRL Taxonomy Extension Schema Document X
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document X
101.DEF XBRL Taxonomy Extension Definition Linkbase Document X
101.LAB XBRL Taxonomy Extension Label Linkbase Document X
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document X
104 Cover Page Interactive Data File (formatted as Inline XBRL). X

Incorporation by Reference

Exhibit Number

Description

Form

File Number

Exhibit/Appendix Reference

Filing Date

Filed Herewith

3.1

Second Amended and Restated Certificate of Incorporation of the Company.

8-K/A

001-38791

3.1

12/8/20

3.2

Amended and Restated Bylaws of the Company.

8-K/A

001-38791

3.2

12/8/20

31.1

Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15(d)-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15(d)-14(a) under the Securities Exchange Act of 1934, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Furnished
herewith

101.INS

XBRL Instance Document

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

104

Cover Page Interactive Data File (formatted as Inline XBRL).

†~~Indicates a management contract or compensatory plan, contract or arrangement.~~

3936

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SIGNATURES.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	Luminar Technologies, Inc.

Date: ~~November 15, 2021~~May 6, 2022	By:	/s/ Austin Russell
		Austin Russell
		President, Chief Executive Officer and Chairman of the Board of Directors
		(Principal Executive Officer)



		/s/ Thomas J. Fennimore
		Thomas J. Fennimore
		Chief Financial Officer ~~and Secretary~~
		(Principal Financial Officer)

4037


	Series A Convertible Preferred Stock			Series X Convertible Preferred Stock			Founders Convertible Preferred Stock			Class A Common Stock			Class B Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Stockholders’ Equity (Deficit)
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount
Balance as of June 30, 2020	94,818,151	$	244,743	—	$	—	26,206,837	$	3	139,635,890	$	14	—	$	—	$	13,889	$	8	$	(263,219)	$	(249,305)
Issuance of Series X convertible preferred stock for cash, net of issuance costs of $5,889	—	—		17,065,536	164,111		—	—		—	—		—	—		—		—		—		—
Share-based compensation	—	—		—	—		—	—		—	—		—	—		1,306		—		—		1,306
Other comprehensive income	—	—		—	—		—	—		—	—		—	—		—		(28)		—		(28)
Net loss	—	—		—	—		—	—		—	—		—	—		—		—		(31,211)		(31,211)
Balance as of September 30, 2020	94,818,151	$	244,743	17,065,536	$	164,111	26,206,837	$	3	139,635,890	$	14	—	$	—	$	15,195	$	(20)	$	(294,430)	$	(279,238)

Balance as of June 30, 2021	—	$	—	—	$	—	—	$	—	236,483,687	$	24	105,118,203	$	11	$	1,244,228	$	7	$	(697,254)	$	547,016
Issuance of Class A common stock upon exercise of stock options and vesting of restricted stock units	—	—		—	—		—	—		1,920,137	—		—	—		1,547		—		—		1,547
Vendor payments in shares in lieu of cash	—	—		—	—		—	—		291,940	—		—	—		4,848		—		—		4,848
Acquisition of Optogration, Inc.	—	—		—	—		—	—		370,034	—		—	—		6,527		—		—		6,527
Issuance of earn-out shares	—	—		—	—		—	—		10,242,703	1		6,970,467	—		(2)		—		—		(1)
Conversion of Class B common stock into Class A common stock	—	—		—	—		—	—		10,500,000	1		(10,500,000)	(1)		—		—		—		0
Share-based compensation	—	—		—	—		—	—		—	—		—	—		30,410		—		—		30,410


Other comprehensive income	—	—		—	—		—	—		—	—		—	—		—		93		—		93
Net loss	—	—		—	—		—	—		—	—		—	—		—		—		(51,340)		(51,340)
Balance as of September 30, 2021	—	$	—	—	$	—	—	$	—	259,808,501	$	26	101,588,670	$	10	$	1,287,558	$	100	$	(748,594)	$	539,100



	September 30, 2021		December 31, 2020
Deferred rent	$	—	$	826
Finance lease (capital lease prior to adoption of ASC 842) liabilities, non-current	145		331

Other non-current liabilities	766		161
Total other non-current liabilities	$	911	$	1,318



	Three Months Ended		Nine Months Ended
	September 30, 2021		September 30, 2021
Operating lease cost	$	1,202	$	3,560
Variable lease cost	420		1,324
Total operating lease cost	$	1,622	$	4,884
Finance lease cost:
Amortization of right-of-use assets	$	42	$	126
Interest on finance lease liabilities	14		42
Total finance lease cost	$	56	$	168


	Operating Leases		Finance Leases
Year Ending December 31,
2021 (remaining three months)	$	1,286	$	78
2022	4,963		240
2023	3,515		71
2024	1,283		28
2025	1,205		26
2026	602		—

Total lease payments	12,854		443
Less: imputed interest	(1,288)		(41)
Total leases liabilities	$	11,566	$	402



	Capital Leases		Operating Leases
2021	$	331	$	5,834
2022	240		6,172
2023	70		4,544
2024	28		746
2025	25		—
Thereafter	—		—
Total minimum lease payments	694		$	17,296
Less: amount representing interest	80
Capital lease obligations	$	614


	Nine Months Ended September 30, 2021
	Autonomy Solutions		Component Sales		Total reportable segments		Eliminations (1)		Total Consolidated
Revenue:
Revenues from external customers	$	17,708	$	1,892	$	19,600	$	—	$	19,600
Revenues from internal customer	5,500		3,865		9,365		(9,365)		—
Total revenue	$	23,208	$	5,757	$	28,965	$	(9,365)	$	19,600
Depreciation and amortization	$	1,963	$	278	$	2,241	$	(1)	$	2,240
Operating loss	(142,651)		(1,100)		(143,751)		161		(143,590)
Other significant items:
Segment assets	606,431		11,064		617,495		(9,689)		607,806
Inventories, net	7,531		340		7,871		—		7,871


	Nine Months Ended September 30, 2020
	Autonomy Solutions		Component Sales		Total reportable segments		Eliminations (1)		Total Consolidated
Revenue:
Revenues from external customers	$	9,587	$	1,932	$	11,519	$	—	$	11,519
Revenues from internal customer	639		2,544		3,183		(3,183)		—
Total revenue	$	10,226	$	4,476	$	14,702	$	(3,183)	$	11,519
Depreciation and amortization	$	1,825	$	104	$	1,929	$	—	$	1,929
Operating income (loss)	(56,673)		192		(56,481)		—		(56,481)
Other significant items:
Segment assets	191,778		2,979		194,757		(3,304)		191,453
Inventories, net	2,912		9		2,921		—		2,921