Conferencia de resultados del 3T de 2026 de indie (INDI): los ingresos aumentan un 31%, el radar entra en producción en serie

Puntos clave

• Los ingresos del tercer trimestre de 2026 alcanzaron los 70,2 millones de dólares, con un incremento del 31% interanual y del 10% intertrimestral. Los ingresos del negocio principal aumentaron aproximadamente un 14% intertrimestral hasta los 40,7 millones de dólares.
• La pérdida operativa no GAAP se redujo a 7,2 millones de dólares frente a los 11,3 millones de dólares del año anterior. La pérdida neta no GAAP atribuible a indie fue de 11,6 millones de dólares, o 0,05 dólares por acción.
• La dirección situó su previsión de ingresos para el cuarto trimestre en 73 a 81 millones de dólares, con un punto medio de 77 millones de dólares que implica aproximadamente un crecimiento interanual del 33%.
• El chipset de radar para automoción de indie entró en producción a gran escala tras completar el PPAP. La dirección prevé que el radar sea un motor clave de crecimiento en 2027.
• La cartera de visión obtuvo más de 40 adjudicaciones de diseño de IA física en 2026, mientras que menos del 20% del total de adjudicaciones de diseño del iND880 había comenzado a generar envíos.
• La cartera estratégica de pedidos aumentó ligeramente hasta los 6.200 millones de dólares, excluyendo a Wuxi y las recientes adjudicaciones de IA física. La dirección afirmó que sus perspectivas de ingresos para 2027 se mantienen alineadas con las estimaciones actuales de los analistas.

Datos financieros clave

Rendimiento comercial y operativo

El radar entra en producción a gran escala

El chipset de radar para automoción de indie pasó a la producción a gran escala, con envíos significativos en curso hacia su socio Tier 1. El producto completó el PPAP, confirmando su cualificación para automoción y el cumplimiento normativo de fabricación.

La empresa también logró ser seleccionada para suministrar radares a uno de los tres principales fabricantes (OEM) de Norteamérica. La dirección describió el programa como de gran volumen y amplia penetración, pero no facilitó una fecha de producción.

A través de su relación con el proveedor Tier 1, indie prevé finalmente unos envíos anuales de radar de 50 a 70 millones de unidades con un precio medio de venta (ASP) de 5 a 6 dólares. La dirección espera una contribución sustancial a partir del cuarto trimestre y un crecimiento significativo a lo largo de 2027.

La arquitectura de visión sin DRAM gana tracción

La dirección señaló que la escasez de memoria y los aumentos de precio de la DRAM, que se han multiplicado por tres o cuatro, han acelerado la adopción del procesador de visión sin DRAM iND880. Las nuevas adjudicaciones de diseño para retrovisores electrónicos (eMirror) y espejos laterales incluyeron a fabricantes (OEM) coreanos e indios.

El iND880 también logró dos adjudicaciones de diseño no automotrices durante el trimestre, correspondientes a una aplicación para drones y un robot humanoide. La dirección indicó que algunos clientes pasaron del contacto inicial al primer envío en un plazo de dos o tres meses. Menos del 20% del total de adjudicaciones de diseño del producto había comenzado a enviarse, y dichos programas aún se encontraban en las fases iniciales de aceleración de la producción.

La IA física amplía el mercado direccionable

indie está incrementando su enfoque en robots humanoides, drones, robots colaborativos y robots móviles autónomos. Una parte sustancial de su presupuesto de I+D para 2027 se redirigirá a adaptar los SoC de próxima generación para la IA física.

La empresa mencionó adjudicaciones de diseño con Agibot, Unitree y Figure AI. Su tecnología LiDAR también fue adoptada para una aplicación de robótica de almacén por una importante compañía logística global. La dirección estimó un contenido superior a 100 dólares en algunas plataformas humanoides.

Estos programas no están incluidos en la cartera estratégica de pedidos actual porque la dirección considera que el calendario, el escalado inicial y los eventuales líderes del mercado son demasiado inciertos para pronosticarse con precisión.

Software y fotónica

El negocio de percepción en cabina emotion3D se adjudicó un programa de producción OEM para un vehículo destinado al mercado australiano, con una producción programada para comenzar en 2027. Se espera que las regalías por software oscilen entre 4 y 8 dólares según el conjunto de funciones. La dirección prevé que el software aporte de forma significativa en 2027, aunque probablemente se mantenga por debajo del 10% de los ingresos en su primer año.

El negocio Quantum registró ingresos y reservas récord, con un aumento de las reservas del 17% intertrimestral. Entre las adjudicaciones figuraron el mayor pedido de distribución de claves cuánticas de variable continua de la empresa y dos contratos NRE para una fuente láser integrada de computación cuántica.

Los productos fotónicos SLED completaron la cualificación y fueron seleccionados para el programa satelital CHIME. indie también consiguió un contrato de suministro de 2 millones de dólares para su programa de láser LXM en comunicaciones espaciales.

Previsiones de la dirección

Para el cuarto trimestre de 2026, la dirección ofreció las siguientes perspectivas:

La dirección prevé un crecimiento de los ingresos para todo el año 2026 superior al 20%. También se fija como objetivo la rentabilidad no GAAP en el 2T 2027 y un flujo de caja positivo en el trimestre posterior.

La empresa espera que la adquisición del negocio de sensores de imagen CMOS de ams-OSRAM se cierre a finales de año, sujeta a las condiciones habituales pendientes. La dirección no prevé una contribución significativa a los ingresos ni a los gastos operativos en el cuarto trimestre por parte del negocio adquirido.

Riesgos y aspectos a vigilar

• La demanda en el sector del automóvil fue más débil en China, aunque la dirección informó de solidez en los vehículos fabricados en China para la exportación.
• Wuxi se ha enfrentado a una notable presión sobre los márgenes durante los últimos 9 a 12 meses. Su desinversión sigue sujeta a la revisión regulatoria en China.
• Se prevé que la venta propuesta de Wuxi genere aproximadamente 135 millones de dólares en ingresos brutos en efectivo, aunque el plazo de cierre sigue siendo incierto.
• La dirección prevé que el margen bruto combinado aumente hasta el rango bajo del 50% tras la desinversión de Wuxi. Hasta entonces, el mix de negocios podría seguir pesando sobre los márgenes.
• Los programas de IA física avanzan con rapidez, pero la dirección señaló que la magnitud del escalado, el calendario y los eventuales líderes del mercado aún no pueden predecirse con precisión.
• La adquisición de ams-OSRAM ha recibido la aprobación definitiva de inversión extranjera directa (FDI), pero continúa sujeta a las condiciones habituales de cierre.

Puntos destacados de la sesión de preguntas y respuestas con analistas

• Exposición al ciclo automotriz: La dirección señaló que la trayectoria de ingresos de indie está más impulsada por el aumento de la cuota de mercado y la aceleración de nuevos programas que por la producción global de vehículos. Considera que la empresa está parcialmente aislada de la ciclicidad general del sector de la automoción.
• Mix de crecimiento del 4T: El incremento intertrimestral previsto en los ingresos principales está vinculado fundamentalmente al escalado de nuevos programas de visión y radar. La fotónica está aportando, pero sigue representando un volumen menor.
• Margen bruto: La dirección espera que el margen bruto del cuarto trimestre mejore ligeramente respecto al 41,6%. Tras la desinversión de Wuxi, se prevé que el margen bruto combinado se sitúe en el rango bajo del 50%.
• Transición de ingresos en 2027: A pesar de la exclusión prevista de los ingresos de Wuxi, la dirección espera que el crecimiento orgánico de radar y visión —en particular el iND880 sin DRAM— compense con creces dichos ingresos en 2027.
• Conversión de la cartera de pedidos: La dirección explicó que la cartera estratégica de pedidos de 6.200 millones de dólares utiliza una ventana móvil de 10 años. Prevé que la conversión de la cartera sume varios cientos de millones de dólares al ritmo anual de ingresos a lo largo de los próximos años.
• Liquidez: La dirección afirmó que el efectivo disponible debería financiar las operaciones a lo largo de la senda prevista hacia la rentabilidad, incluso tras financiar la operación de ams-OSRAM y sin asumir ingresos procedentes de la venta de Wuxi.

Transcripción completa de la conferencia de resultados

Transcripción completa de la conferencia de resultados

Comentarios de la dirección

Operator

Good afternoon, and welcome to indie's Third Quarter 2026 Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded.

I will now turn the call over to Ashish Gupta, Investor Relations. Mr. Gupta, please go ahead.

Ashish Gupta

Thank you, operator. Good afternoon, and welcome to indie's Third Quarter 2026 Earnings Call. Joining me today are Don McClymont, indie's CEO and Co-Founder; Naixi Wu, indie's CFO; and Mark Tyndall, EVP of Corporate Development and Investor Relations. Don will provide opening remarks and discuss business highlights. Naixi will then review indie's Q3 results and business outlook.

Please note that we will be making forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect our views only as of today and should not be relied upon as representative of views as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations.

For material risks and other important factors that could affect our financial results, please review our risk factors in our annual report on Form 10-K for the fiscal year ended December 31, 2025, as supplemented by our quarterly reports on Form 10-Q as well as other public reports filed with the SEC.

Finally, the results and guidance discussed today are based on consolidated non-GAAP financial measures, such as non-GAAP operating loss, non-GAAP net loss and non-GAAP net loss per share. For a complete reconciliation to GAAP and the definitions of the non-GAAP reconciling items, please see our Q3 earnings press release and the accompanying presentation, which provides more detail on our non-GAAP measures. Both were posted on our website in advance of this call at www.indie.inc.

I'll now turn the call over to Donald.

Donald McClymont

Thanks, Ashish, and welcome, everyone. I'm pleased to report that indie delivered a solid third quarter. Revenue was $70.2 million, above the midpoint of our guidance, up 31% year-over-year and 10% sequentially. Our core business led the way, growing approximately 14% quarter-over-quarter.

Before turning to our business achievements, let me provide some context on the market environment. The automotive environment in the third quarter was mixed. Demand was strong in Europe and the United States, but was weaker in China. In Europe, new car registrations in the EU rose 9.3% year-over-year in September and are up 5.7% year-to-date according to the European Automobile Manufacturers' Association, with electrified vehicles continuing to gain share. In the United States, demand was resilient. September new vehicle sales rose more than 4% year-over-year according to MarkLines, and Cox Automotive raised its full year 2026 sales forecast to 16.1 million units.

China, the world's largest vehicle market, showed some softness. Even so, the shift towards electrified technology-rich vehicles with advanced features such as radar continues to support content growth for indie with export from China, a particular area of strength. Beyond automotive, physical AI is also gaining rapid momentum. According to Counterpoint Research, global humanoid robot shipments rose nearly 300% year-over-year in the first half of 2026. indie's deep automotive heritage gives us a strong foundation to capitalize on this emerging opportunity.

Our proven expertise in multi-camera vision processing, radar sensing, LiDAR and sensor fusion enables us to deliver reliable perception at scale. These capabilities apply directly to humanoid robots and other physical AI applications, including drones, collaborative robots and autonomous mobile robots or AMR. We are rapidly increasing our focus on physical AI and a substantial percentage of our 2027 R&D budget will be redirected to customizing our next-generation SoCs for this market. As reported in prior quarters, we have already secured design wins at leading humanoid robotics customers, including Agibot, Unitree and Figure AI as well as several emerging players. Agibot and Unitree ranked first and second globally in humanoid robot shipments in the first half of 2026. Additionally, during the quarter, our LiDAR technology was adopted for a warehouse robot application by a major global logistics company. These early wins show that our automotive ADAS technologies transferred to humanoid robotics with estimated content of more than $100 on some humanoid platforms. As humanoid robots move from pilot deployments to broader commercial adoption, indie is well positioned to benefit significantly as one of the broadest sensor suppliers to the physical AI market.

Let me now turn to our key achievements during the quarter. Starting with radar, I'm pleased to share that we have progressed into high-volume production of our automotive radar chipset with material shipments to our Tier 1 partner ongoing. The chipset is fully automotive qualified, having completed the production part approval process, or PPAP. This rigorous process confirms that both the product and our manufacturing meet the stringent quality requirements of our automotive customers. The move to large volume production is a significant inflection point for our radar business and sets the stage for our radar revenue ramp through 2027 and beyond.

We also continue to broaden our radar customer engagement jointly with our Tier 1 partner, particularly in China. And additionally, I'm happy to note that our radar technology has now been selected by one of the top 3 North American OEMs. We are also extending both our radar and LiDAR technology into physical AI. Autonomous machines such as robots and drones need robust all-weather perception to sense and safely navigate the world around them. In robotics, radar complements cameras by providing reliable detection in low light, dust and poor visibility, while LiDAR can map a scene with sub-millimeter precision.

In vision, given the escalating issues with DRAM availability and pricing, our differentiated DRAM-less solution, particularly for eMirror application is proving to be the perfect fit. For example, we have secured new eMirror and side-view mirror design wins with 2 OEMs, one Korean and the other Indian. These wins extend our camera-based mirror replacement business in 2 of the world's fastest-growing automotive markets. Our iND880 vision processor also continues to expand beyond automotive.

During the quarter, we secured 2 new design wins, one in the drone application and the other in a humanoid robot. The iND880 DRAM-less architecture reduces system latency and compute load for faster, more efficient perception. This makes the iND880 ideal for the robotics ecosystem. In commercial vehicles, the iND880 was featured at the IAA in a demonstration of Stoneridge's next-generation ECU architecture. This showcase reinforces our partnership with a leading commercial vehicle supplier and our position in centralized vision architectures. It also builds momentum towards further production engagements with truck and bus OEMs.

Our in-cabin perception software from the emotion3D acquisition continues to gain traction, both as a stand-alone offering and as part of our pre-integrated hardware plus software platform. We were awarded an OEM production program on a vehicle model for the Australian market with production starting in 2027. Additionally, our combined SoC and perception software solution for advanced driver and occupant monitoring was named "In-Cabin Solution of the Year" by AutoTech Breakthrough, recognizing the strength of our integrated approach.

Turning to Photonics. Our Quantum business delivered record revenue and record bookings in the third quarter with bookings up 17% sequentially. Highlights include our largest product order to date for continuous variable quantum key distribution or CV-QKD. We also secured 2 new NRE contracts for the first phase of development of an integrated laser source for quantum computing. These programs demonstrate the differentiation of our Photonic Light Source Platform as quantum applications progress toward commercialization. We are also expanding our Photonics business into higher reliability markets beyond automotive.

During the quarter, our SLED photonics products completed final qualification and were selected for the CHIME space satellite program, validating the strength of our portfolio and supporting our diversification strategy. We also advanced our LXM laser program for a space communications application and secured a $2 million supply contract. Together, these milestones demonstrate growing traction for our photonics technologies across multiple attractive end markets. Earlier this week, we received the final FDI regulatory approval for our acquisition of ams-OSRAM's CMOS Image Sensor Business. We now expect the transaction to close at the end of the year, subject to the satisfaction of the remaining customary closing conditions.

Before we move to our financials, I want to say a word about how we report our forward visibility in the form of our strategic backlog, which we report in November each year. Over the past year, our strategic backlog trended slightly up to $6.2 billion, excluding our China Wuxi business. Importantly, this figure does not include our recent physical AI design wins. In physical AI from drones to humanoid robots, our vision portfolio alone has secured more than 40 design wins in 2026. These are exciting, fast-moving markets and could be expected to contribute considerably to our strategic backlog and future revenue as these markets mature. However, today, it's just too early to predict with the precision, the size of the initial ramp and the winners for this market. We have, therefore, taken a conservative approach and excluded them from our strategic backlog this year.

Let me be clear, the underlying momentum in our business is strong and continues to build with major discussions ongoing, which potentially will result in significant increase in our strategic backlog when it is next reviewed, and these discussions have in turn transitioned into design win commitments. As Naixi will detail, our fourth quarter outlook implies approximately 33% year-over-year growth at the midpoint. We will continue to report design wins and growth metrics that reflects how the business is performing quarter-by-quarter. I also want to note that based on our current visibility, our 2027 revenue outlook is in line with current analyst estimates.

With that, I'll turn the call over to Naixi to review our financial results and our outlook in more detail.

Naixi Wu

Thank you, Donald, and good afternoon, everyone. indie's third quarter revenue was $70.2 million, $0.2 million above the midpoint of our outlook. Revenue increased 10% quarter-over-quarter and 31% year-over-year. Core business revenue was approximately $40.7 million, ahead of the midpoint of our outlook and up approximately 14% sequentially, reflecting continued momentum in our ADAS portfolio. Revenue from our Wuxi subsidiary increased approximately 5% sequentially to $29.5 million. Non-GAAP operating expenses for the quarter were $36.4 million, approximately $0.6 million below our outlook of $37 million. As a result, while leveraging our top line growth, our non-GAAP operating loss narrowed significantly to $7.2 million from $11.3 million in the third quarter of 2025, a reduction of more than 1/3 and a clear demonstration of our continued progress towards profitability.

Including net interest expense of $3.1 million, our non-GAAP net loss was $10.3 million. After excluding the noncontrolling interest in Wuxi, the non-GAAP net loss attributable to indie was $11.6 million or $0.05 per share on a base of 233 million shares, an improvement of $0.02 from the third quarter of 2025. Please refer to the presentation on our website for a more detailed breakdown of our non-GAAP measures.

Turning to the Wuxi divestiture, which still remains under review by the regulators in China. As a reminder, in the fourth quarter of 2025, we entered into a definitive agreement with United States Auto Engineering Co. Ltd, or UFA, a publicly listed company in China. Under the agreement, we will sell our entire equity interest in Wuxi indie Micro for gross proceeds of approximately $135 million, payable in cash at closing before applicable taxes and fees. The discussions with the regulators in UFA are constructive. We're optimistic that a transaction can still close by the end of the year. Upon closing, we expect to use the net proceeds to further strengthen our balance sheet and optimize our capital structure, including addressing our convertible debt.

Turning to the balance sheet. We ended the quarter with total cash and cash equivalents, including restricted cash of $144.3 million, a decrease of $4.7 million from the prior quarter. We expect to reach non-GAAP profitability in the second quarter of 2027 and to turn cash flow positive the following quarter. After funding the closing consideration for the ams-OSRAM acquisition and independent of any proceeds from the Wuxi divestiture, we believe our existing cash provides ample liquidity to fund our operations through that path to profitability.

Moving to our outlook. For the fourth quarter of 2026, we expect total revenue of between $73 million and $81 million or $77 million at the midpoint. We expect our core business to contribute approximately $47 million and our Wuxi subsidiary at approximately $30 million at the midpoint. We expect non-GAAP operating expense of $37.5 million in the fourth quarter, up slightly from $36.4 million in the third quarter. With a net interest expense of approximately $3.4 million and no tax expense, we expect net loss per share to decrease to approximately $0.04, assuming the midpoint of revenue range and the base of 240 million shares.

To summarize, the third quarter was another quarter of solid execution. Revenue grew 10% sequentially and 31% year-over-year, led by approximately 14% sequential growth in our core business as our ADAS portfolio continues to ramp. We reduced our non-GAAP operating loss by approximately $4 million from the prior year period, and our loss per share improved by $0.02. Our balance sheet remains solid with over $144 million in cash, and we expect approximately $135 million in gross proceeds from the Wuxi divestiture to strengthen it further.

Looking ahead, our fourth quarter outlook implies 33% year-over-year growth and full year revenue growth of more than 20%. With radar now in volume production, we remain focused on disciplined spending and continued progress towards profitability.

With that, I will turn the call back to Donald for closing remarks.

Donald McClymont

In closing, Q3 was a strong quarter for indie. We delivered double-digit revenue growth both sequentially and year-over-year, and we are on track for a full year revenue growth of more than 20% in the mixed automotive market. Just as importantly, we are executing on the milestones that will drive our next phase of growth. Our automotive radar chipset is in high-volume production, setting the stage for our continued radar revenue ramp. Our vision portfolio has secured more than 40 design wins so far this year, and our technology is moving rapidly into physical AI across humanoid robots, drones and other autonomous machines. Our Photonics business delivered record quantum revenue and bookings while expanding into new high-margin markets.

With a growing design win pipeline and a broadening customer base, we believe indie is exceptionally well positioned to deliver sustained growth and long-term value for our shareholders. That concludes our prepared remarks.

Operator, please open the line for questions.

Operator

[Operator Instructions] Our first question is from Cody Acree with StoneX.

Preguntas y respuestas

Cody Grant Acree

Congrats on the progress. It's nice to hear, Donald, that our street models are not far off for '27. That's definitely encouraging. We're at least on the right path. You opened the call with a talk about the auto industry softer in China, stronger in the U.S. and Europe. Can you maybe talk about how indie is leveraged against the broader auto cycle? Obviously, you're in the early stages of radar and machine vision ramp, and I would think that would really insulate you from cyclical swings, but we are hearing better things about the overall auto cycle. Just curious on your thoughts here.

Donald McClymont

Yes. I mean the primary thing that defines our revenue profile is our own share gain, and that's beginning to accelerate, as you can see from the numbers right now, and we expect it will continue to do such as we progress through the next weeks and months and quarters. So yes, you're 100% correct. I mean we are somewhat insulated from the cycle. Generally speaking, it's been reasonably positive actually worldwide. There has been some softness domestically in China that we saw, but the China export market models being designed, manufactured in China for export to whatever Central Europe and so have shown some strength. So at this point, we don't view macro as a huge driver, at least not compared to our own share gain.

Cody Grant Acree

And you mentioned China a bit better in export. Can you maybe just talk about your DRAM-less vision engagements there? Help us frame maybe the size of the opportunity there and the pace at contribution you expect over the next few quarters? Are those engagements starting to generate revenue?

Donald McClymont

Yes. I mean they are absolutely. And I wouldn't single out China necessarily only. They were kind of the vanguard of the adoption of the product, but we are now beginning to see it worldwide in certain applications within the car, particularly in the United States. We've had some very significant uptick in adoption over the course of the last quarter. And we expect that, that will continue. It has been a very challenging area for supply chain given the scarcity of memory and the pricing increase of 3x or 4x over the course of the last period. And that has driven many significant manufacturers to adopt us and even 1 or 2 are beginning to talk about it publicly.

Cody Grant Acree

And then lastly, and not to bring up a sore point, but your equity has obviously suffered along with the rest of the group, but you particularly suffered. Has that prompted any supplier conversations, any partner, any OEM or Tier 1 partner conversations? The auto industry is particularly sensitive about their supplier health. Just if you can help us with those discussions.

Donald McClymont

Well, I mean, I think, generally speaking, the automotive industry is used to a bit of suffering. But the bottom line is our cash position is still strong, and that's really where the rubber hits the road, again, using an automotive analogy there for you. So I think at this point, everybody is cool. We haven't had any explicit discussions at all actually around that. It's been a tough tape for the last month or so. But I mean, at this point, there's nothing structurally that's changed for us, and we're somewhat confused by the market at this point, but we'll drive through it. We'll execute to it. We run our own race, drive our products into production and drive them into heavy growth. And I think we'll get rewarded for it in the fullness of time.

Operator

Our next question is from Anthony Stoss with Craig-Hallum.

Anthony Stoss

Donald, I wanted to go through gross margin. So the gross margins in the quarter ticked down sequentially to 41.6%. Why did it happen? And can you give us a sense what you expect for Q4 and maybe for 2027? And then I have a follow-up.

Donald McClymont

Largely driven by mix in -- particularly in our Wuxi business. That's had some fairly severe margin pressure over the course of the last, I mean, 9 to 12 months or so. And that has continued, although we do see light at the end of the tunnel, in that supply chain tightness may allow us to leverage prices back up as we go forward. And as we've highlighted before, once Wuxi is divested, then our blended gross margin should tick up into the low 50s.

Anthony Stoss

Q4, do you think it's, kind of, in that same 41% range? Or does it move up a little bit?

Donald McClymont

I think we'll see it go up a little bit as some of these measures begin to take effect.

Anthony Stoss

Got it. And then your top 3 North American win for radar, can you discuss timing and perhaps the number of models you might expect out of the gate?

Donald McClymont

We do see fairly broad adoption of that in terms of number of models that we'll see. And timing is not public yet, but it's a relatively near-term opportunity for us.

Anthony Stoss

Got it. And then lastly, can you talk about the AMS that you expect it to close in the next month or so? What do you expect revenue-wise, gross margin-wise, et cetera? If you don't mind.

Donald McClymont

Yes. I mean this quarter is slated to close. It won't contribute significantly in either revenue or OpEx through the end of the quarter. And at this point, we believe it should be commensurate with our average gross margins, maybe a little on the low side before we are able to tune it up and get our arms around it and make sure that we optimize the manufacturing in that group.

Operator

Our next question is from Suji Desilva with ROTH Capital.

Sujeeva De Silva

Donald, I appreciate all the automotive analogies in your replies. So the Tier 1 radar program staying on that, you talked about a large OEM, how many OEMs are helping contribute to revenue today? And maybe do you expect in 12 months? And you talked about it being $1 billion lifetime opportunity, $100 million a year at peak. How far away are we from that kind of ramp-up is it? Just give us some idea, maybe time frame would be helpful.

Donald McClymont

I mean there are multiple OEMs who are signed up to this already. We do expect a fairly broad adoption of this through our key Tier 1. Our expectation is, in fact, that we'll get to a point of somewhere between 50 million and 70 million units shipped per year at an ASP between $5 and $6. So maybe a little higher than the number you just mentioned in terms of annual run rate. We do expect significant growth from it next year. It will be one of the key drivers of our growth as we go through '27.

I mean very significant. We will get some material contribution from it -- from this quarter and on into '27. And the level of interest in it, just given the performance that is simply the best in the business, the best on the market. People who have seen radar deployments and presentations for 20 years are saying it's the most significant progress in radar technology in the last 20 years in their career time. So you can expect a lot more design wins as we go forward from this.

Sujeeva De Silva

Great. It sounds like an exciting upside opportunity to what I thought. And then switching over to the video cluster, the iND880. It sounds like you have -- you said 40 design wins. I'm curious how many of those -- what portion of those are seeing revenue today? It sounds like it's still early. And what's the linearity of some more of those 40 design wins coming online in the next several quarters? I know Korea, India are 2 places you mentioned, but curious how that's going to progress from here.

Donald McClymont

Yes. I mean we've seen some almost alarmingly quick adoption of the chip just given the DRAM situation, people can't ship or they can't ship economically even down to the level of 2 or 3 months from first contact to first shipment for us. So it's kind of hard to call how quickly it's going to ramp. Certainly, it's been surprising us so far and has been a material contributor to the ramp-up that we've gone through this year, and we expect it to accelerate. I mean, in terms of the number of design wins that have ramped so far, I mean, it's probably less than 20% of the total, which are even in those guys who have begun to ship are still at the slim end of the ramp. So we have a lot of upside to come.

Operator

Our next question is from Lannie Trieu with TD Cowen.

Joshua Buchalter

This is Lannie on for Josh today. Congratulations on the results and great to hear about your design wins to date. I wanted to talk about your emotion3D in-cabin software win that you had mentioned. Given that it's going into production next year, how should we think about the revenue ramp through the year and the potential beyond that? And I have a follow-up.

Donald McClymont

Well, just by way of reminder, it's a software business. So we generate license fees and then royalty stream as we ship or as our customer ships product into the field. So the ASP for the software royalty is somewhere between $4 and $8 depending on the feature set that we deploy into the market. And you can assume that it ramps with the same sort of profile as any one of our hardware products. We also, a while ago, publicly announced our first quarter, our first -- or one of our first design wins with Mahindra, which is now beginning to generate revenue from that flow.

And we are expecting reasonably significant contribution to our overall revenue profile in '27 from software, probably not more than 10% in the first year, but we do see it growing very quickly. And we also see it as, sort of, following wind for the one-stop shop product that we have where we supply the hardware with the software also integrated. So we are seeing a lot of great traction for that product. Again, we trade on technology as a company. Our radar technology is the best on the planet. Our ISP technology is the best on the planet. And likewise, our perception software is getting the same plaudits from our customers once they see it. So we are running into open doors.

Joshua Buchalter

Great. That's great to hear. And then pivoting from the auto business, really interesting to see your SLEDs chosen for CHIME. I believe the press release had mentioned some satellites scheduled for launch in 2028 and 2030. So focusing more on the 2028 launch, can you talk a little bit about your content opportunity? Should we see some revenue maybe end of next year and more materially in 2028? Or how should we think about that layering into your P&L?

Donald McClymont

I mean, it's relatively small compared to our core business. It's more intended to highlight the diversity of the technologies that we have now available to us. Typically, these programs generate some nonproduct-based revenue in terms of services or NREs or customization fees that we realize for the development of the programs. And then as the satellites launch, of course, we get the recurring product revenue. At this point, we're not really subsegmenting out how much revenue that is, but let's say, single-digit revenue.

Operator

Our next question is from Rebecca Zamsky with B. Riley Securities.

Craig Ellis

This is Rebecca on for Craig Ellis. I think your core business revenue grew about 14% sequentially and the guide implies about $47 million. So could you provide some color of how that's split across radar, vision and photonics? And how much of the 4Q step-up is new program ramps versus share gains on existing platforms?

Donald McClymont

Well, I mean, firstly, it's mostly driven by new program ramps as opposed to, let's say, share gain for our Tier 1 customer. We are mostly driven by our vision and radar programs. Those are the large movers. The optical group is beginning to contribute. It will become significant over time, but it's still smaller than the other two.

Craig Ellis

And on the radar selection as a top 3 North American OEM, when should we start to expect production? And how should we think about the shape of the ramp through 2027 and '28?

Donald McClymont

So we haven't publicized that yet. It's a little early to provide specific guidance on specific programs, but it is a large volume program for us with a high penetration in that particular customer. So we do expect it to be significant, and we'll provide more information as time progresses.

Operator

Our next question is from John Tanwanteng with CJS Securities.

Jonathan Tanwanteng

I was wondering if you could go over the strategic backlog calculation again and if there's any difference in how you calculate that, number one? And number two, how you expect that to layer on into revenue over the next 2 or 3 years or so?

Donald McClymont

No change in the methodology per se other than the part that we highlighted in the script that we did not include the physical AI wins just as it's a little too early for us to, kind of, call how the long-term revenue profiles of these guys are going to roll out. So we did drive a lot of additional business in our core automotive business during the last 12 months. But the way that the model works, I think, as you know, John, we have a, sort of, a rolling 10-year window and some of the designs which are just ramping now or have ramped in the last year or so roll off out of the window. And in some cases, we haven't won the follow-on designs for those yet because the cycle is just not there yet. But I mean, the sales progress in our company has been just phenomenal over the course of the last 12 months. So the fact that it's relatively flat versus last year isn't indicative of how we see our momentum in the market.

In terms of how we roll that into the following years, as we said in the guide, in the script, we feel extremely strong about what the perception is of our revenue ramp going out there. We do expect that we will add multiple hundred million dollars of annual run rate over the course of the next couple of years into the equation as that converts into run rate business.

Jonathan Tanwanteng

Okay. Great. And I was wondering if you could quantify how much contribution you might be seeing in '27 from contracts you've won or, I guess, vision processors that have moved over the finish line because of the DRAM discussion, whether they started there or it was a deciding factor. [indiscernible] Just help us understand how much more where DRAM-less was the deciding factor in a vision processor with DRAM. How much incremental have you seen next year versus this year if that DRAM discussion wasn't there?

Donald McClymont

I mean, the product was good to start with. But I think if anything, it's just speeded the adoption of it given the DRAM issues. We do expect, given the divestiture of Wuxi impending and that dropping off of our revenue in '27, we do expect to be able to more than replace that revenue in '27 from the organic growth of radar and vision through that and the DRAM-less iND880 is a key cornerstone of that.

Jonathan Tanwanteng

Okay. Great. If I could get one more in there. How big is your non-auto business today? And what's the growth expected next year?

Donald McClymont

I mean we don't really segment that out actually, John. But it's still, I mean, still -- automotive is still our key business.

Operator

There are no further questions at this time. I would like to turn the floor back over to Donald McClymont for closing comments.

Donald McClymont

Well, thanks, everybody, for attending and looking forward to seeing you at the investor conferences through the course of the remainder of the quarter. Thanks, everybody.

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.