A：The purpose of the partnership with Honda is to advance the development of solid-state lithium metal battery technology for automotive and other applications, leveraging Honda's engineering excellence and solid-state battery manufacturing capacity to unlock the full potential of carbon C(graphite) with Honda's diverse product portfolio.

A：The collaboration and licensing arrangement with Volkswagen and Powerco focuses on milestones and payments related to automotive cell development, larger format cells, and the future technology roadmap, further solidifying the relationship with top automotive original equipment manufacturers (OEMs).

A：The key operational metrics for the Eagle Line include core goods up greater than 90% and key metrics of productivity hitting targets. Sales volumes are ramping as process stability and control improve, with an expectation to further increase output in the second half of 2026 and accelerate customer sample shipments.

A：QSC 5 technology provides a significantly safer cell design compared to conventional and next-generation lithium-ion cells, as demonstrated through larger scale safety testing that includes nail penetration, external short circuit, and thermal stability testing up to 300°C.

A：The mission of CS is to revolutionize energy storage, positioning the company to take advantage of technology transformations in transportation, AI, and defense. Better batteries are in demand due to electric vehicles reshaping the global automotive market, drones and unmanned systems rewriting strategy, and AI enabling new capabilities for businesses and individuals. CS is advancing commercialization with major customers and investing in future technology roadmaps to capitalize on these high-value opportunities.

A：Capital expenditures (CapEx) in the second quarter were 4.6 million. For the full year 2026, the guidance for CapEx was lowered to be between 27 million and 37 million, reflecting capital discipline.

A：Operational progress is strong and on track with the goal of scalable production with the Eagle Eye technology. The company is working with four of the top ten global automakers for automotive commercialization, including a new deal with Honda. They have also updated the powerco collaboration and licensing arrangement with milestones for automotive skill development and shipped cells to an additional automotive OEM in the past quarter. In terms of entering new high value markets, they have appointed talented leaders, engaged with data center architects, and shipped fewer P5 cells to a major American defense prime. The company is also engaged with global customers in aerospace, defense, and other advanced applications.

A：The key goals for the company include demonstrating scalable production with the Eagle Eye technology, advancing automotive commercialization with QS EV, entering into new high value markets, and going beyond USCell 5 with the future technology roadmap.

A：The company is now organized into three business verticals. It sees broad-based demand for better batteries across various applications such as AI data centers, aerospace, consumer electronics, medical devices, defense, and many others, all of which can be served by the Q technology platform. The company's approach to serving the automotive market includes development pilot clients for batteries and high-volume manufacturing capabilities, while for QSB C and qsas customers, it focuses on fast-moving markets and different go-to-market channels with opportunities for value creation.

A：The relationship with VW Powerco continues to be strong, with both teams working closely together in San Jose. The updated agreement includes milestones related to larger format practices and technology elements from the company's advanced product roadmap. Financially, customer bills under the agreement represent a cost share for the company's expenses. The new scope of work ties payments to deliverables aligned to the product roadmap and eliminates milestone payments related to the motorsport race series. This update is forecasted to have a net neutral financial impact in terms of cash when compared to the prior agreement.

A：The impact on cash flow is described as neutral, with lower expenses offsetting lower cash inflow. The 130 million pre付款 from Powerco remains unchanged and is based on technical milestones and alignment on the four factor form factor. As outlined, progress has been made, demonstrated by the eco line and the demonstration of larger separators coming off the Cobra line.

A：The E line is improving in productivity, meeting customer demands, and is the basis for technology transfer to higher volume line partners with customers. This allows for the shipment of products in response to customer demand in the U.S. defense prime sector.

A：The QS Data Center vertical is advancing rapidly with new general manager Noi ramping up on the business. The company is working closely with data center architects and ODMs to develop designs for integration, which is happening very quickly, suggesting that the business is progressing well and is expected to continue to evolve rapidly.

A：The new vertical is focused on QS Data Centers, which is distinct from the automotive and other business segments like consumer electronics. The Advanced Solutions business includes various other opportunities, including aerospace, defense, medical devices, and consumer electronics. The company is actively exploring opportunities for the QS technology platform in these areas.

A：The focus on data centers is due to the market's need for high power delivery, with power being one of the biggest bottlenecks. The data center market, in particular, benefits from the company's high energy and power density offerings, which are safe and well-suited for the market's demands. Aligning with the company's goal of focusing on high-value markets, efforts are being directed towards these verticals to capture the market as quickly as possible.

A：The power transition is reflected in the company's agreement with Powerco, which now projects up to $34 million in revenue remaining through Q2 of 2028, down from $40 million previously. The timing of the Powerco forecast indicates that production is expected to start in 2029, maintaining the company's trajectory towards this milestone.

A：The progress of the Eagle Line determines the speed at which technology can be transferred to Oracle for further development and implementation.

A：The current focus areas for the new business lines are to first drive customer demand and work with JDA, and secondly, to build out the ecosystem by designing battery manufacturing partnerships.

A：The immediate next focus after market entry is to reinforce go-to-market personnel strategies to ensure customer service and then to work on increasing volumes to customers.

A：The Power Collaboration agreement expanded the capacity for VW powerco to 85 GW hours, with the incremental 5 GW hours permitted by VW powerco going outside of the automotive market.

A：The new markets have their unique specifications that align with the automotive roadmap but also have distinct requirements such as power, temperature operation, and capacity for specific applications like data centers and military uses.

A：The next steps for securing a deal with Honda involve moving the joint development to the next level, leveraging the Japanese ecosystem, and continuing the evaluation of technology synergies. The timeline for these steps is pending, but the priority is to enhance Honda's product portfolio using the company's architecture and battery expertise.

A：Specific milestones include developing an integrated product ahead of the 800 V transition and the deployment of megawatt racks in data centers, with timelines targeting deployment towards the end of 2028.