Quanergy declares bankruptcy

LiDAR manufacturer Quanergy has filed for Chapter 11 bankruptcy after coming public 10 months ago through a SPAC with China's CITIC Capital at an assumed $1.4 billion equity value.

According to Quanergy, it plans to carry on with business as usual throughout the Chapter 11 procedure and aims to conclude an expedited sale process with the bankruptcy court's blessing. Quanergy aims to pay post-petition operations and costs in the usual course using available cash on hand as well as regular operating cash flows to assist finance and protect its operations.

Kevin Kennedy, CEO of Quanergy, will likewise retire on December 31, 2022.

Kevin Kennedy, the company's CEO, said that it had been an honour to hold the position for the past 2.5 years. "The company changed our technology focus during this period to security and industrial applications, which enabled the company to expand revenue by meeting client needs in a new area," the statement reads

Lawrence Perkins, a recently appointed chief restructuring officer and president, will take over as the company's new executive leader. He believes Quanergy has taken important actions to address lingering financial problems brought on by erratic capital market conditions.

According to Perkins "Despite these challenges, the Company has seen improving demand in the security, smart spaces, and industrial markets, and improvements in supply chain conditions. We are confident that Quanergy’s efforts have positioned the company for a value-maximizing transaction during the Chapter 11 sale process." Says Perkins

Quanergy announced sales of $2.3 million for Q3 2022, which ended on September 30. At the time, this was said to be close to the top of their guidance range and increased 104% from the previous year.

In comparison to the third quarter of 2021, it reported a third-quarter GAAP net loss of $17.7 million, and a third-quarter adjusted EBITDA loss of $12.3 million, compared to $6.1 million.

Hard times for LiDAR manufacturers?

Quanergy is not the only LiDAR developer experiencing financial difficulties, Ibeo Automotive Systems GmbH, a German LiDAR developer, filed for bankruptcy last month due to its inability to obtain more growth financing.

Ibeo's assets were purchased by MicroVision, a maker of MEMS-based solid-state automotive LiDAR and advanced driver-assistance systems (ADAS) technologies, for $15.8 million.

In the third fiscal quarter of 2022, AEye reported revenue of $768,000 and a GAAP loss of $23.6 million. The quarter's non-GAAP losses came to $17 million. At the end of the third quarter, AEye had marketable securities, cash, and cash equivalents totaling $112.2 million.

Two well-known LiDAR businesses, Ouster and Velodyne, recently declared their intention to merge in an all-stock deal. It is anticipated that the agreement, which was signed on November 4, 2022, will be finished in the first half of 2023.

The CEO and co-founder of the autonomous driving business Cruise, Kyle Vogt, predicted that the LiDAR market will converge last year. Vogt claims that the problem is that "totally overlapping potential clients, with very no discount applied to future predictions," make up the expected revenue.