Mobileye soars 38% in the year’s strongest IPO as self-driving tech (slowly) advances
All eyes on Mobileye… They grow up so fast. Chip giant Intel bought Israeli self-driving-tech startup Mobileye for $15B in 2017. Yesterday, Mobileye hit public markets solo at a $17B valuation. Shares soared 38% in the best opening day for a major US IPO this year.
- All-seeing eye: Mobileye makes cameras, chips, and software for autonomous and driver-assist features. It partners with 50+ carmakers, including Volkswagen, GM, and Ford. 125M cars use Mobileye’s driver-assist tech.
- “Spin offerings” are sizzling, though 2022 is tracking to be the worst year for US IPOs in decades. Like Intel, VW and AIG both successfully spun off divisions earlier this year.
Life in the slow lane… Self-driving hype has largely hit the brakes in recent years — but hasn’t come full stop. Back in the day, Tesla, GM’s Cruise, and Google’s Waymo promised fully self-driving cars by 2020. Despite $100B in autonomous investments, most self-driving cars today can’t even make a left turn. Still, there’s been progress:
- Robotaxi revival: This month Uber signed a 10-year deal with Hyundai- and Aptiv-owned Motional to offer driverless rides, after selling its self-driving biz in 2020.
- Still trucking: TuSimple completed a 100% driverless-truck trip this year. Some analysts predict autonomous trucks will become an even bigger biz than self-driving cars.
Sometimes it pays to go slow… especially when the path to profitability is long. Mobileye’s valuation has risen in the past five years while Waymo’s has plunged 80%. One reason: unlike Waymo, Mobileye also sells semi-autonomous tech for mainstream cars like VW Passats. That consistent revenue could help Mobileye become profitable before its pure self-driving peers: last quarter, Mobileye’s losses narrowed to just $7M from $21M last year.