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TuSimple (NASDAQ: TSP) has ambitions to introduce autonomous trucks on US highways in 2024. Piper Sandler analyst Alex Potter believes these ambitions led the company to increase spending on research and development and hire key people at a rapid pace. Potter believes this decision is necessary and says that Piper Sandler fully sanctions the decision to “spend more TODAY than deal with staff shortages in the future.” 80% of TSP’s employees work in research and development, and talented people are in short supply.
TSP made many strategic hires in the second quarter, including Adrian Thompson, VP of Systems Engineering and Test. Thompson brings extensive experience directing safety-critical systems development in several industries, including aerospace and defense, and self-propelled vehicles.
The company’s terminal in Fort Worth, Texas officially opened in the second quarter as part of the Alliance Mobility Innovation Zone. This terminal is located near a world-class intermodal hub and will serve as the operations center in Texas.
In the second quarter, TuSimple completed a logistics pilot project with Giumarra Companies that shipped fresh watermelons from Giumarra’s facility in Nogales, Arizona to a distribution center in Oklahoma City, Oklahoma. The company reported that it is in phase 3 of 4 to prepare trucks for full driverless demos.
“Autonomous trucking technology is a real game changer for us as its time and cost efficiency gives us an improved way to deliver fresher fruits and vegetables in the United States, particularly to food deserts and rural communities.” – Tim Riley, President of Giumarra Companies.
TSP’s fleet of ~ 70 tractor units covered ~ 900,000 road miles in the second quarter, bringing the cumulative total to ~ 4.6 million miles driven by the quarter end. The full “Driver Out” demo is still on schedule for the end of 2021.
TSP added 1,000 trucks to its reservation book this quarter, bringing it to a total of 6,775 (plus 17% Q / Q). Another oral offer was made, but that deal has not officially been closed at this point.
The company announced its second quarter results on Thursday, August 5th. Sales of $ 1.5 million were hundreds of thousands of dollars higher than expected. Adjusted EBITDA of $ 66 million missed estimates by $ 7 million due to discretionary operating expenses. Both Needham and Piper Sandler confirmed the bullish ratings.
TSP’s shares are down 10% following the results.
Posted by Michael Elkins | Michael.Elkins@streetinsider.com
