UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2024

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Cepton, Inc.

(Exact name of registrant as specified in its charter)

Delaware

001-39959

27-2447291

(State or other jurisdiction of
incorporation or organization)

(Commission File Number)

(I.R.S. Employer
Identification Number)


399 West Trimble Road San Jose, California						95131
(Address of principal executive offices)						(Zip Code)

Registrant’s telephone number, including area code: 408-459-7579

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.00001 per share

CPTN

The Nasdaq Stock Market LLC

Redeemable warrants, exercisable for common stock at an exercise price of $115.00 per share, subject to adjustment

CPTNW

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	x	Smaller reporting company	x
		Emerging growth company	x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of ~~August~~November 1, 2024, 16,~~043~~051,~~207~~981 shares of common stock, par value $0.00001, of the registrant were issued and outstanding.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q (the “Report”) includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical or current fact included in this Report are forward-looking statements. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target,” “designed to” or other similar expressions that predict or imply future events or trends or that are not statements of historical matters. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The Company cautions readers of this Report that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control, that could cause the actual results to differ materially from the expected results. These factors include the information set forth in Part II, Item 1A, of this Report under the heading “Risk Factors”, which we encourage you to carefully read. Forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of financial and performance metrics, projections of market opportunity and market share, expectations regarding our pending transaction with Koito Manufacturing Co., LTD (“Koito”), including our ability to close such transaction in a timely manner or at all, anticipated recoveries related to our cancelled General Motors (“GM”) series production award with Koito, potential benefits and the commercial attractiveness to its customers of the Company’s products and services, expectations regarding our new series production award, including potential payments relating to the new series production award, the potential success of the Company’s marketing and expansion strategies, and the potential for the Company to achieve design awards. These statements are based on various assumptions, whether or not identified in this Report, and on the current expectations of the Company’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. You are therefore cautioned not to place undue reliance on such statements. Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by law.

Cepton, Inc.

Quarterly Report on Form 10-Q

Table of Contents

		Page No.
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)	2
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2425
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3435
Item 4.	Controls and Procedures	3435
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	3637
Item 1A.	Risk Factors	3637
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3839
Item 3.	Defaults Upon Senior Securities	3839
Item 4.	Mine Safety Disclosures	3839
Item 5.	Other Information	3839
Item 6.	Exhibits	3839
SIGNATURES		4041

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

CEPTON, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except share data)

(unaudited)

	June 30,2024		December 31,2023
	September 30,2024		December 31,2023
ASSETS
Current assets:
Cash and cash equivalents	$	5647,~~021~~651	$	50,406
Short-term investments	—		5,969
Accounts receivable, net of allowance for credit losses of $0 and $0 (including $0 and $2,121 from a related party)	333		3,625
Accounts receivable, net of allowance for credit losses of $0 and $0 (including $248 and $2,121 from a related party)	556		3,625
Inventories	1,~~235~~048		2,396
Prepaid expenses and other current assets	3,~~393~~060		1,253
Total current assets	6052,~~982~~315		63,649
Property and equipment, net	1,~~249~~150		1,450
Restricted cash	1,283		1,283
Other assets	98,~~167~~703		10,067
Total assets	$	7263,~~681~~451	$	76,449
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	2,~~877~~416	$	1,128
Operating lease liabilities, current	2,~~045~~141		1,875
Accrued expenses and other current liabilities (including $2,200 and $385 with a related party)	3,833		4,066
Accrued expenses and other current liabilities (including $2,308 and $385 with a related party)	4,914		4,066
Total current liabilities	89,~~755~~471		7,069
Warrant liability	6166		43
Earnout liability	34		93
Operating lease liabilities, non-current	7,~~635~~063		8,720
Total liabilities	16,~~485~~634		15,925
Commitments and contingencies (Note 17)
Convertible preferred stock with a related party:
Convertible preferred stock – Par value $0.00001 per share – 5,000,000 shares authorized; 100,000 shares issued and outstanding (aggregate liquidation preference of $106.3 million and $104.1 million)	98,891		98,891
Convertible preferred stock – Par value $0.00001 per share – 5,000,000 shares authorized; 100,000 shares issued and outstanding (aggregate liquidation preference of $107.4 million and $104.1 million)	98,891		98,891
Stockholders’ equity (deficit):
Common stock – Par value $0.00001 per share – 35,000,000 shares authorized; 16,043,207 and 15,861,494 shares issued and outstanding	—		—
Common stock – Par value $0.00001 per share – 35,000,000 shares authorized; 16,051,981 and 15,861,494 shares issued and outstanding	—		—
Additional paid-in capital	98100,~~913~~177		96,583
Accumulated other comprehensive loss	(~~351~~352)		(345)
Accumulated deficit	(~~141~~151,~~257~~899)		(134,605)
Total stockholders’ equity (deficit)	(4252,~~695~~074)		(38,367)
Total liabilities, convertible preferred stock and stockholders’ equity (deficit)	$	7263,~~681~~451	$	76,449

See accompanying notes to the condensed consolidated financial statements

CEPTON, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations and Comprehensive ~~Income (~~Loss)

(In thousands, except share and per share data)

(unaudited)

	Three Months EndedJune 30,				Six Months EndedJune 30,
	Three Months EndedSeptember 30,				Nine Months EndedSeptember 30,
	2024		2023		2024		2023
Lidar sensor and prototype revenue (including revenue of $137, $1,214, $694 and $1,859 from a related party)	$	374	$	2,771	$	1,515	$	4,011
Lidar sensor and prototype revenue (including revenue of $236, $2,101, $931 and $3,915 from a related party)	$	466	$	3,802	$	1,981	$	7,813
Development revenue(including revenue of $10,000, $6, $10,750 and $234 from a related party)	10,054		16		10,859		261
Development revenue(including revenue of $32, $23, $10,781 and $293 from a related party)	81		31		10,940		292
Total revenue	~~10,428~~547		23,~~787~~833		12,~~374~~921		48,~~272~~105
Lidar sensor and prototype cost of revenue	~~976~~600		23,~~348~~339		2,~~188~~788		37,~~796~~135
Development cost of revenue	~~3,098~~29		5—		3,~~409~~438		116
Total cost of revenue	~~4,074~~629		23,~~353~~339		56,~~597~~226		37,~~912~~251
Gross profit	6,354		434		6,777		360
Gross (loss) profit	(82)		494		6,695		854
Operating expenses:
Research and development	35,~~234~~524		96,~~365~~706		814,~~888~~412		1623,~~603~~309
Selling, general and administrative	35,~~709~~332		6,~~185~~136		915,~~973~~305		1219,~~916~~052
Total operating expenses	610,~~943~~856		1512,~~550~~842		1829,~~861~~717		2942,~~519~~361
Operating loss	(~~589~~10,938)		(1512,~~116~~348)		(1223,~~084~~022)		(2941,~~159~~507)
Other income (expense):
Gain (loss) on change in fair value of earnout liability	59		(26)		59		736
Gain on change in fair value of earnout liability	—		91		59		827
(Loss) gain on change in fair value of warrant liability	(115)		36169		(1823)		~~130~~299
Other income, net	88		2		4,110		21
Other (expense) income, net	(321)		2		3,789		23
Loss on extinguishment of debt	—		—		—		(1,123)
Foreign currency transaction loss, net	—		—(7)		—		(~~750~~757)
Interest income, net	~~613~~622		~~917~~799		1,~~267~~889		12,~~216~~015
Income (loss) before income taxes	160		(14,187)		(6,666)		(28,929)
Loss before income taxes	(10,642)		(11,294)		(17,308)		(40,223)
Benefit (provision) for income taxes	21—		~~(3)~~—		14		(3)
Net income (loss)	$	181	$	(14,190)	$	(6,652)	$	(28,932)
Net loss	$	(10,642)	$	(11,294)	$	(17,294)	$	(40,226)
Less: cumulative preferred stock dividends	(1,~~118~~130)		(1,~~071~~083)		(23,~~224~~353)		(12,~~909~~992)
Net loss attributable to common stockholders	$	(~~937~~11,772)	$	(1512,~~261~~377)	$	(820,~~876~~647)	$	(3043,~~841~~218)
Net loss per share attributable to common stockholders, basic	$	(0.0673)	$	(0.9778)	$	(01.5629)	$	(12.9674)
Net loss per share attributable to common stockholders, diluted	$	(0.0673)	$	(0.9778)	$	(01.5629)	$	(12.9674)
Weighted-average common shares, basic	1516,~~978~~047,~~032~~213		15,~~737~~834,~~917~~152		15,~~933~~971,~~150~~448		15,~~708~~750,~~102~~586
Weighted-average common shares, diluted	1516,~~978~~047,~~032~~213		15,~~737~~834,~~917~~152		15,~~933~~971,~~150~~448		15,~~708~~750,~~102~~586
Net income (loss)	$	181	$	(14,190)	$	(6,652)	$	(28,932)
Net loss	$	(10,642)	$	(11,294)	$	(17,294)	$	(40,226)
Other comprehensive (loss) income, net of tax:
Changes in unrealized (loss) gain on available-for-sale securities	—		(11)		6		6
Changes in unrealized gain on available-for-sale securities	—		—		6		6
Foreign currency translation adjustments	(21)		~~(4)~~5		(1213)		1621
Total other comprehensive (loss) income, net of tax	(21)		~~(15)~~5		(67)		2227
Comprehensive income (loss)	$	179	$	(14,205)	$	(6,658)	$	(28,910)
Comprehensive loss	$	(10,643)	$	(11,289)	$	(17,301)	$	(40,199)

See accompanying notes to the condensed consolidated financial statements

CEPTON, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)

(In thousands, except share and per share data)

(unaudited)

	Convertible Preferred Stock			Common Stock			AdditionalPaid-inCapital		Accumulated OtherComprehensiveLoss		AccumulatedDeficit		Total Stockholders’Equity(Deficit)
	Shares	Amount		Shares	Amount
Balance — December 31, 2023	100,000	$	98,891	15,861,494	$	—	$	96,583	$	(345)	$	(134,605)	$	(38,367)
Exercise of stock options and release of RSUs	—	—		82,951	—		—		—		—		—
Stock-based compensation expense	—	—		—	—		926		—		—		926
Payments of employee taxes related to vested restricted stock units	—	—		(23,528)	—		(63)		—		—		(63)
Unrealized gain on available-for-sale investments	—	—		—	—		—		6		—		6
Cumulative translation adjustment	—	—		—	—		—		(10)		—		(10)
Net loss	—	—		—	—		—		—		(6,833)		(6,833)
Balance — March 31, 2024	100,000	$	98,891	15,920,917	$	—	$	97,446	$	(349)	$	(141,438)	$	(44,341)
Exercise of stock options and release of RSUs	—	—		134,162	—		4		—		—		4
Stock-based compensation expense	—	—		—	—		1,498		—		—		1,498
Payments of employee taxes related to vested restricted stock units	—	—		(11,872)	—		(35)		—		—		(35)
Unrealized loss on available-for-sale investments	—	—		—	—		—		—		—		—
Cumulative translation adjustment	—	—		—	—		—		(2)		—		(2)
Net income	—	—		—	—		—		—		181		181
Balance — June 30, 2024	100,000	$	98,891	16,043,207	$	—	$	98,913	$	(351)	$	(141,257)	$	(42,695)
Exercise of stock options and release of RSUs	—	—		10,559	—		—		—		—		—
Stock-based compensation expense	—	—		—	—		1,269		—		—		1,269
Payments of employee taxes related to vested restricted stock units	—	—		(1,785)	—		(5)		—		—		(5)
Cumulative translation adjustment	—	—		—	—		—		(1)		—		(1)
Net loss	—	—		—	—		—		—		(10,642)		(10,642)
Balance — September 30, 2024	100,000	$	98,891	16,051,981	$	—	$	100,177	$	(352)	$	(151,899)	$	(52,074)

	Convertible Preferred Stock			Common Stock			AdditionalPaid-inCapital		Accumulated OtherComprehensiveLoss		AccumulatedDeficit		Total Stockholders’Equity(Deficit)
	Shares	Amount		Shares	Amount
Balance — December 31, 2022	—	$	—	15,674,781	$	—	$	88,058	$	(366)	$	(86,059)	$	1,633
Issuance of convertible preferred stock, net of transaction costs	100,000	98,891		—	—		—		—		—		—
Exercise of stock options and release of RSUs	—	—		9,638	—		8		—		—		8
Stock-based compensation expense	—	—		—	—		2,280		—		—		2,280
Unrealized gain on available-for-sale investments	—	—		—	—		—		17		—		17
Cumulative translation adjustment	—	—		—	—		—		20		—		20
Net loss	—	—		—	—		—		—		(14,742)		(14,742)
Balance — March 31, 2023	100,000	$	98,891	15,684,419	$	—	$	90,346	$	(329)	$	(100,801)	$	(10,784)
Exercise of stock options and release of RSUs	—	—		157,049	—		5		—		—		5
Stock-based compensation expense	—	—		—	—		2,362		—		—		2,362
Payments of employee taxes related to vested restricted stock units	—	—		(17,049)	—		(63)		—		—		(63)
Unrealized loss on available-for-sale investments	—	—		—	—		—		(11)		—		(11)
Cumulative translation adjustment	—	—		—	—		—		(4)		—		(4)
Net loss	—	—		—	—		—		—		(14,190)		(14,190)
Balance — June 30, 2023	100,000	$	98,891	15,824,419	$	—	$	92,650	$	(344)	$	(114,991)	$	(22,685)
Exercise of stock options and release of RSUs	—	—		22,516	—		9		—		—		9
Stock-based compensation expense	—	—		—	—		2,332		—		—		2,332
Cumulative translation adjustment	—	—		—	—		—		5		—		5
Net loss	—	—		—	—		—		—		(11,294)		(11,294)
Balance — September 30, 2023	100,000	$	98,891	15,846,935	$	—	$	94,991	$	(339)	$	(126,285)	$	(31,633)

See accompanying notes to the condensed consolidated financial statements

CEPTON, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In thousands)

(unaudited)

	Six Months EndedJune 30,
	Nine Months EndedSeptember 30,
	2024		2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(617,~~652~~294)	$	(2840,~~932~~226)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	~~204~~302		~~235~~370
Stock-based compensation	23,~~424~~693		46,~~654~~989
Amortization of right-of-use asset	~~826~~1,253		~~773~~1,177
Gain on sales of property and equipment	(6059)		—
Accretion, other	(25)		(~~373~~682)
Gain on change in fair value of earnout liability	(59)		(~~736~~827)
Loss (gain) on change in fair value of warrant liability	1823		(~~130~~299)
Foreign currency transaction loss, net	—		~~750~~757
Loss from extinguishment of debt	—		1,123
Changes in operating assets and liabilities:
Accounts receivable, net (including $2,121 and $207 from a related party)	3,292		(791)
Accounts receivable, net (including $1,873 and $166 from a related party)	3,068		(802)
Inventories	1,~~161~~348		(~~1,216~~941)
Prepaid expenses and other current assets	(21,~~140~~806)		12,~~958~~974
Other long-term assets	74111		202
Accounts payable	1,~~749~~288		~~741~~(805)
Accrued expenses and other current liabilities (including $1,815 and $215 from a related party)	(232)		791
Accrued expenses and other current liabilities (including $1,923 and $215 from a related party)	848		1,144
Operating lease liabilities	(~~915~~1,391)		(~~289~~680)
Net cash used in operating activities	(~~335~~8,700)		(2130,~~240~~526)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(3)		(1,~~186~~292)
Purchases of short-term investments	—		(37,806)
Proceeds from sales of property and equipment	60		—
Proceeds from maturities of short-term investments	6,000		525,200
Net cash provided by (used in) investing activities	6,057		(3313,~~792~~898)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from convertible preferred stock with a related party, net of transaction costs	—		99,884
Repayment of secured term loan from a related party	—		(45,220)
Proceeds from issuance of common stock options	4		1322
Payments of employee taxes related to vested restricted stock units	(98103)		(63)
Net cash (used in) provided by financing activities	(9499)		54,~~614~~623
Effect of exchange rate changes on cash	(13)		~~429~~426
Net increase in cash, cash equivalents and restricted cash	5,615		11
Net (decrease) increase in cash, cash equivalents and restricted cash	(2,755)		10,625
Cash, cash equivalents and restricted cash, beginning of period	51,689		34,518
Cash, cash equivalents and restricted cash, end of period	$	5748,~~304~~934	$	3445,~~529~~143
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest	$	—	$	63
Cash paid for income taxes	$	714	$	—
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING INFORMATION

Changes in accrued purchases of property and equipment	$	3	$	—
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING INFORMATION
Right-of-use assets obtained in exchange for new operating lease liabilities	$	—	$	11,190

See accompanying notes to the condensed consolidated financial statements

CEPTON, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited) (

Note 1. Description of Business and Summary of Significant Accounting Policies

Description of Business

Cepton, Inc., and its wholly owned subsidiaries, (collectively, the “Company”) formerly known as Growth Capital Acquisition Corp. (“GCAC”), was originally incorporated in Delaware on January 4, 2010, under the name PinstripesNYS, Inc. GCAC changed its name to Growth Capital Acquisition Corp. on February 14, 2020. GCAC was a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or other similar business combination with one or more target businesses. On February 2, 2021, the Company consummated its initial public offering (the “IPO”), following which its shares began trading on the Nasdaq Stock Market (“Nasdaq”). On August 4, 2021, GCAC entered into a Business Combination Agreement (as amended, the “Merger Agreement”) with Cepton Technologies, Inc. (“Legacy Cepton”) and GCAC Merger Sub Inc., a wholly owned subsidiary of GCAC. On February 10, 2022, the transactions contemplated by the Merger Agreement (the “Business Combination”) were consummated. In connection with the closing of the Business Combination, GCAC changed its name to Cepton, Inc. and its shares and public warrants began trading on Nasdaq under the symbols “CPTN” and “CPTNW”, respectively. As a result of the Business Combination, Cepton, Inc. became the owner, directly or indirectly, of all of the equity interests of Legacy Cepton and its subsidiaries. Contemporaneously with the execution of the Merger Agreement, GCAC entered into subscription agreements with certain investors (the “PIPE Investors”), pursuant to which the PIPE Investors agreed to purchase an aggregate of 5,950,000 shares of common stock at a purchase price of $10.00 per share, or an aggregate purchase price of $59.5 million (the “PIPE Investment”).

The Company provides state-of-the-art, intelligent, lidar-based solutions for a range of markets such as automotive, smart cities, smart spaces, and smart industrial applications. The Company’s patented lidar technology enables reliable, scalable, and cost-effective solutions that deliver near- or long-range, high resolution 3D perception for smart applications. The Company is headquartered in San Jose, California, United States.

On July 29, 2024, the Company entered into an Agreement and Plan of Merger (the “Koito Merger Agreement” and, together with the transactions contemplated thereby, the “Transaction”) with Koito and Project Camaro Merger Sub, Inc., an indirectly wholly-owned subsidiary of Koito (“Merger Sub”), pursuant to which, among other things and on the terms and subject to the conditions set forth in the Koito Merger Agreement, Merger Sub shall be merged with and into Cepton, with Cepton continuing as the surviving corporation and an indirect subsidiary of Koito. See Note 2018 for further information.

Basis of Presentation and Principles of Consolidation

The condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The condensed consolidated financial statements include the accounts of the Company’s wholly owned subsidiaries in Canada, Germany and other locations. All intercompany balances and transactions have been eliminated in consolidation. The condensed consolidated financial statements include all adjustments considered necessary by management to fairly state the results of operations, financial position and cash flows. The accompanying interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern. As of ~~June~~September 30, 2024, the Company had cash and cash equivalents of $5647.07 million and an accumulated deficit of $~~141~~151.39 million. During the ~~six~~nine months ended ~~June~~September 30, 2024, the Company incurred an operating loss of $1223.10 million and had negative cash flows from operating activities of $08.37 million.

The Company is subject to risks and uncertainties frequently encountered by early-stage companies including, but not limited to, the uncertainty of successfully developing its products, securing certain contracts, building its customer base, successfully executing its business and marketing strategy and hiring appropriate personnel.

To date, the Company has been funded primarily by equity financings (including the Preferred Stock, as defined in Note 10), convertible promissory notes, and the net proceeds received through the Business Combination, PIPE Investment, and private placements of the Legacy Cepton convertible preferred stock. Failure to generate sufficient revenues, achieve planned gross margins and operating profitability, control operating costs, or secure additional funding may require the

Company to modify, delay, or abandon some of its planned future expansion or development, or to otherwise enact operating cost reductions available to management, which could have a material adverse effect on the Company’s business, operating results, financial condition, and ability to achieve its intended business objectives.

On September 7, 2023, the Company’s stockholders approved a one-for-ten reverse stock split of the Company’s issued common stock (the “Reverse Stock Split”) and a corresponding reduction in the total number of shares of common stock the Company is authorized to issue (the “Authorized Shares Reduction”). On September 18, 2023, the Company filed with the Secretary of State of the State of Delaware a Certificate of Amendment to its Second Amended and Restated Certificate of Incorporation to effect the Reverse Stock Split and Authorized Shares Reduction. The Reverse Stock Split and Authorized Shares Reduction became effective on September 21, 2023 (the “Effective Date”). The par value of the Company’s common stock was not adjusted as a result of the Reverse Stock Split. All of the Company’s share numbers, per share amounts, and related stockholders’ equity (deficit) balances presented herein have been retroactively adjusted to reflect the Reverse Stock Split. In addition, the exercise prices, conversion rates and other terms of the Company’s securities that adjusted pursuant to their terms as a result of the Reverse Stock Split have been presented after giving effect to such adjustments.

Concentration of Risk

Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, and accounts receivable. The Company maintains a substantial portion of its cash and cash equivalents in money market funds. The Company believes that the financial institutions that hold its cash and cash equivalents are financially sound and, accordingly, represent minimal credit risk. Deposits held with banks may exceed the amount of federal insurance limits provided on such deposits.

As of ~~June~~September 30, 2024 and December 31, 2023, ~~one~~two and three customers, respectively, each accounted for more than 10% of accounts receivable.

Customers with revenue equal to or greater than 10% of total revenue for the periods indicated were as follows:

	Three Months EndedJune 30,				Six Months EndedJune 30,
	Three Months EndedSeptember 30,				Nine Months EndedSeptember 30,
	2024		2023		2024		2023
Customer A	9749	%	4455	%	9291	%	4952	%
Customer B	—18	%	52—	%	4—	%	34—	%
Customer C	10	%	—	%	—	%	—	%
Customer D	—	%	31	%	—	%	35	%

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include, but are not limited to, inventory valuation and reserves, warranty reserves, valuation allowance for deferred tax assets, valuation of earnout and warrant liabilities, stock-based compensation, useful lives of property, plant and equipment, income tax uncertainties, and other loss contingencies. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from those estimates, and such differences could be material to the Company’s condensed consolidated financial condition and results of operations.

Product Warranties

The Company typically provides a one-year warranty on its products. Estimated future warranty costs are accrued and charged to cost of goods sold in the period that the related revenue is recognized. These estimates are derived from historical data and trends of product reliability and costs of repairing and replacing defective products. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Through ~~June~~September 30, 2024, there were immaterial changes to the accrued warranty liability which was recorded in accrued expenses and other current liabilities on the condensed consolidated balance sheet.

Reclassification

During the course of preparing the financial statements for the three and six months ended June 30, 2024, the Company identified an immaterial error in its presentation of basic and diluted net loss, which impacted each of the periods since the first quarter of 2023. The Company should have calculated the numerator of the basic and diluted net (loss) income per share using the net loss attributable to common stockholders, which is the net loss adjusted for the dividends on cumulative preferred stock earned during the period. The Company believes the correction of the error is immaterial to the previously issued condensed consolidated financial statements for prior periods.. Reclassification

~~The~~During ~~corrections~~the tocourse of preparing the financial statements for the second quarter of 2024, the Company’s ~~condensed~~identified ~~consolidated~~an ~~statement~~immaterial error in its presentation of ~~operations~~basic ~~for~~and diluted net loss, which impacted each of the ~~three~~periods ~~and~~since ~~six~~the ~~months~~first ~~ended~~quarter ~~June 30,~~of 2023. ~~were~~The asCompany ~~follows~~should have calculated the numerator of the basic and diluted net (inloss) ~~thousands~~income per share using the net loss attributable to common stockholders, ~~except~~which is the net loss adjusted for ~~per~~the ~~share~~dividends ~~data):~~on cumulative preferred stock earned during the period. The Company believes the correction of the error is immaterial to the previously issued condensed consolidated financial statements for prior periods.

	Three Months Ended June 30, 2023
	(As Previously Reported)		Correction		(As Corrected)
Less: cumulative preferred stock dividends	$	—	$	(1,071)	$	(1,071)
Net loss attributable to common stockholders	$	(14,190)	$	(1,071)	$	(15,261)
Net loss per share attributable to common stockholders, basic	$	(0.90)	$	(0.07)	$	(0.97)
Net loss per share attributable to common stockholders, diluted	$	(0.90)	$	(0.07)	$	(0.97)

The corrections to the Company’s condensed consolidated statement of operations for the three and nine months ended September 30, 2023 were as follows (in thousands, except for per share data):

	Six Months Ended June 30, 2023
	Three Months Ended September 30, 2023
	(As Previously Reported)		Correction		(As Corrected)
Less: cumulative preferred stock dividends	$	—	$	(1,~~909~~083)	$	(1,~~909~~083)
Net loss attributable to common stockholders	$	(2811,~~932~~294)	$	(1,~~909~~083)	$	(3012,~~841~~377)
Net loss per share attributable to common stockholders, basic	$	(10.8471)	$	(0.1207)	$	(10.9678)
Net loss per share attributable to common stockholders, diluted	$	(10.8471)	$	(0.1207)	$	(10.9678)


	Nine Months Ended September 30, 2023
	(As Previously Reported)		Correction		(As Corrected)
Less: cumulative preferred stock dividends	$	—	$	(2,992)	$	(2,992)
Net loss attributable to common stockholders	$	(40,226)	$	(2,992)	$	(43,218)

Net loss per share attributable to common stockholders, basic	$	(2.55)	$	(0.19)	$	(2.74)
Net loss per share attributable to common stockholders, diluted	$	(2.55)	$	(0.19)	$	(2.74)

Recently Issued Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires an enhanced disclosure of significant segment expenses on an annual and interim basis. This guidance will be effective for the annual periods beginning the year ended December 31, 2024, and for interim periods beginning January 1, 2025. Early adoption is permitted. Upon adoption, the guidance should be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this new pronouncement on its condensed consolidated financial statements disclosures

Note 2. Basic and Diluted Net Income (Loss) Per Share

The Company follows the two-class method when computing net income (loss) per common share when shares are issued that meet the definition of participating securities. The Company considers its convertible preferred stock outstanding as of ~~June~~September 30, 2024 to be participating as holders of such securities have non-forfeitable dividend rights in the event of the declaration of a dividend for shares of common stock. When the Company is in a net loss position, the net loss attributable to common stockholders is not allocated to the convertible preferred stock under the two-class method as these securities do not have a contractual obligation to share in losses. Basic net income (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the weighted-average number of shares of the Company’s common stock outstanding. When there is a net loss attributable to common stockholders, potentially dilutive common stock equivalents have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is anti-dilutive.

The following table presents the reconciliation of the numerators and denominators of basic and diluted net (loss) income per share:

	Three Months EndedJune 30,				Six Months EndedJune 30,
	Three Months EndedSeptember 30,				Nine Months EndedSeptember 30,
	2024		2023		2024		2023
Numerator
Net income (loss)	$	181	$	(14,190)	$	(6,652)	$	(28,932)
Net loss	$	(10,642)	$	(11,294)	$	(17,294)	$	(40,226)
Less: cumulative preferred stock dividends	(1,~~118~~130)		(1,~~071~~083)		(23,~~224~~353)		(12,~~909~~992)
Net loss attributable to common stockholders	$	(~~937~~11,772)	$	(1512,~~261~~377)	$	(820,~~876~~647)	$	(3043,~~841~~218)
Denominator
Weighted-average common shares outstanding – Basic	1516,~~978~~047,~~032~~213		15,~~737~~834,~~917~~152		15,~~933~~971,~~150~~448		15,~~708~~750,~~102~~586
Stock options to purchase common stock and RSUs	—		—		—		—
Weighted-average common shares outstanding – Diluted	1516,~~978~~047,~~032~~213		15,~~737~~834,~~917~~152		15,~~933~~971,~~150~~448		15,~~708~~750,~~102~~586

The following common stock equivalents were excluded from the computation of diluted net (loss) income per share for the periods presented because including them would have been antidilutive:

Three Months EndedJune 30,

Six Months EndedJune 30,

Three Months EndedSeptember 30,

Nine Months EndedSeptember 30,

2024

2023

2024

2023

Stock options to purchase common stock and RSUs

2,~~133~~387,~~230~~136

1,~~832~~672,~~296~~055

2,~~090~~387,~~874~~136

1,~~659~~850,~~589~~720

Preferred shares on an as-converted basis

4,~~112~~156,~~583~~279

3,~~942~~984,~~344~~232

4,~~112~~156,~~583~~279

3,~~942~~984,~~344~~232

Total

6,~~245~~543,~~813~~415

5,~~774~~656,~~640~~287

6,~~203~~543,~~457~~415

5,~~601~~834,~~933~~952

As of ~~June~~September 30, 2024 and 2023, 1,300,000 Earnout Shares (as defined in Note 13) were excluded from the table above because the shares are considered contingently issuable and the required common share price milestones were not achieved as of ~~June~~September 30, 2024 and 2023. As of ~~June~~September 30, 2024 and 2023, 13,800,000 common stock warrants (which are exercisable for an aggregate of 1,380,000 shares of common stock) were excluded from the table above as no shares were issuable under the treasury stock method of computing diluted earnings per share.

Note 3. Revenue

The Company disaggregates its revenue from contracts with customers by country of domicile based on the shipping location of the customer. Total revenue disaggregated by country of domicile was as follows (dollars in thousands):

	Three Months Ended June 30,
	Three Months Ended September 30,
	2024				2023
	Revenue		% of Revenue		Revenue		% of Revenue
Revenue by country of domicile:
Japan	$	~~10,137~~368	9767	%	$	12,~~265~~151	4556	%
United States	~~275~~170		331	%	1,~~466~~583		5341	%
Other	169		~~N/A~~2	%	5699		23	%
Total	$	~~10,428~~547	100	%	$	23,~~787~~833	100	%

	Six Months Ended June 30,
	Nine Months Ended September 30,
	2024				2023
	Revenue		% of Revenue		Revenue		% of Revenue
Revenue by country of domicile:
Japan	$	11,~~465~~834	9392	%	$	24,~~312~~454	5455	%
United States	~~861~~1,031		78	%	13,~~570~~153		3739	%
Other	4856		~~N/A~~—	%	~~390~~498		96	%
Total	$	12,~~374~~921	100	%	$	48,~~272~~105	100	%

As of ~~June~~September 30, 2024 and December 31, 2023, the Company had $2.56 million and $0.4 million of deferred revenue included in accrued expenses and other current liabilities, respectively, and no contract assets.

Note 4. Fair Value Measurement

The following tables summarize the Company's assets and liabilities measured at fair value on a recurring basis, by level, within the fair value hierarchy (in thousands):

	June 30, 2024
	September 30, 2024
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market fund	$	3734,~~061~~972	$	—	$	—	$	3734,~~061~~972
Total cash equivalents	$	3734,~~061~~972	$	—	$	—	$	3734,~~061~~972
Short-term investments:
Total short-term investments	$	—	$	—	$	—	$	—
Total assets measured at fair value	$	3734,~~061~~972	$	—	$	—	$	3734,~~061~~972
Liabilities:
Warrant liability	$	—	$	6166	$	—	$	6166
Earnout liability	—		—		34		34
Total liabilities measured at fair value	$	—	$	6166	$	34	$	95100


	December 31, 2023
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market fund	$	33,562	$	—	$	—	$	33,562
Total cash equivalents	$	33,562	$	—	$	—	$	33,562
Short-term investments:
U.S. government agency securities	$	—	$	5,969	$	—	$	5,969
Total short-term investments	$	—	$	5,969	$	—	$	5,969
Total assets measured at fair value	$	33,562	$	5,969	$	—	$	39,531

Liabilities:
Warrant liability	$	—	$	43	$	—	$	43
Earnout liability	—		—		93		93
Total liabilities measured at fair value	$	—	$	43	$	93	$	136

Cash equivalents consist primarily of money market funds with original maturities of three months or less at the time of purchase, and the carrying amount is a reasonable estimate of fair value. Short-term investments consist of investment

securities with original maturities greater than three months but less than twelve months and are included as current assets in the condensed consolidated balance sheets. For short-term investments, the fair value as of ~~June~~September 30, 2024 and December 31, 2023 approximates amortized cost basis.

Because the transfer of Private Placement Warrants to non-permitted transferees would result in the Private Placement Warrants having substantially the same terms as the Public Warrants, the Company determined that the fair value of each Private Placement Warrant is consistent with that of a Public Warrant. Accordingly, the Private Placement Warrants are classified as Level 2 financial instruments under warrant liability.

The value of the earnout liability is classified as Level 3 under the fair value hierarchy because it has been valued based on significant inputs not observable in the market. There was an immaterial ~~loss~~gain in Level 3 liabilities related to changes in earnout liability measured at fair value for the ~~six~~nine months ended ~~June~~September 30, 2024, which is shown in the condensed consolidated statement of operations and comprehensive income (loss).

Note 5. Inventories

Inventories consisted of the following as of ~~June~~September 30, 2024 and December 31, 2023 (in thousands):

	June 30,2024		December 31,2023
	September 30,2024		December 31,2023
Raw materials	$	~~439~~379	$	1,182
Work-in-process	~~602~~541		876
Finished goods	~~194~~128		338
Total inventories	$	1,~~235~~048	$	2,396

Inventories are carried and depicted above at the lower of cost or net realizable value. Write-downs were $0.61 million and $0.89 million for the three and ~~six~~nine months ended ~~June~~September 30, 2024. Write-downs were $0.3 4 million and $0.6 million for the three and ~~six~~nine months ended ~~June~~ September 30, 2023.

Note 6. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following as of ~~June~~September 30, 2024 and December 31, 2023 (in thousands):

	June 30,2024		December 31,2023
	September 30,2024		December 31,2023
Prepaid insurance	$	~~925~~560	$	365
Other prepaid expenses	2,~~391~~421		737
Other current assets	7779		151
Total prepaid expenses and other current assets	$	3,~~393~~060	$	1,253

Note 7. Property and Equipment, Net

Property and equipment, net, consisted of the following as of ~~June~~September 30, 2024 and December 31, 2023 (in thousands):

	June 30,2024		December 31,2023
	September 30,2024		December 31,2023
Machinery and equipment	$	2,213	$	2,326
Automobiles	45		45
Leasehold improvements	235		235
Computer and equipment	~~116~~96		116
Total property and equipment	2,~~609~~589		2,722
Less: accumulated depreciation and amortization	(1,~~360~~439)		(1,272)
Total property and equipment, net	$	1,~~249~~150	$	1,450

Depreciation and amortization related to property and equipment was $0.1 million and $0.23 million for the three and ~~six~~nine months ended ~~June~~September 30, 2024, respectively. Depreciation and amortization related to property and equipment was $0.1 million and $0.24 million for the three and ~~six~~nine months ended ~~June~~ September 30, 2023, respectively.

Note 8. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following as of ~~June~~September 30, 2024 and December 31, 2023 (in thousands):

	June 30,2024		December 31,2023
	September 30,2024		December 31,2023
Accrued payroll	$	1,~~149~~542	$	878
Accrued expenses and taxes	~~179~~789		2,798
Deferred revenue	2,~~500~~566		367
Warranty reserve	517		23
Total accrued expenses and other current liabilities	$	34,~~833~~914	$	4,066

Note 9. Debt

Secured Term Loan Agreement with Koito

On October 27, 2022, the Company entered into an Investment Agreement (the “Investment Agreement”) with Koito (See Note 10). Concurrently with the execution of the Investment Agreement, the Company entered into a Secured Term Loan Agreement with Koito to borrow Japanese Yen ¥5.8 billion (approximately $39.4 million) (the “Secured Term Loan Agreement”). The loan accrued interest at a rate equal to 1.0% per annum and was payable at maturity. The Secured Term Loan Agreement entered into with Koito was a related party transaction issued at a below market interest rate. Amortization of the debt discount, in accordance with the effective interest method, was recorded as interest expense in the accompanying condensed consolidated statement of operations and comprehensive income (loss). The loan was set to mature on the earlier of three business days after the closing of the transactions contemplated by the Investment Agreement and the date on which the Investment Agreement is terminated in accordance with its terms. On November 7, 2022, the Company borrowed Japanese Yen ¥5.8 billion (approximately $39.4 million) under the Secured Term Loan Agreement. Obligations under the Secured Term Loan Agreement were secured by interests in substantially all of the Company’s assets, including all patents. The agreement contained customary affirmative and negative covenants. On January 24, 2023, the Company repaid all outstanding principal and accrued interest under the Secured Term Loan Agreement.

For the ~~six~~nine months ended ~~June~~September 30, 2023, the Company recognized $0.3 million in interest expense in connection with the borrowings under the Secured Term Loan Agreement. Additionally, the Company recognized a $0.8 million foreign currency transaction loss on repayment using the applicable exchange rate on January 24, 2023 and a $1.1 million loss on extinguishment of debt.

Note 10. Convertible Preferred Stock

Convertible Preferred Stock with Koito

On October 27, 2022, the Company entered into the Investment Agreement with Koito pursuant to which, among other things, at the closing of the transactions, and based on the terms and subject to the conditions set forth therein, the Company issued and sold to Koito, 100,000 shares of Series A Convertible Preferred Stock, par value $0.00001 per share (the “Preferred Stock”), for a purchase price of $100.0 million (the “Initial Liquidation Preference”). The issuance and sale of the Preferred Stock and related matters were approved by the Company’s stockholders on January 11, 2023, and the Preferred Stock issued to Koito on January 19, 2023. In connection with the issuance of the Preferred Stock, the Company incurred direct and incremental expenses of $1.1 million, comprised of transaction fees, and financial advisory and legal expenses, which reduced the carrying value of the Preferred Stock.

As of ~~June~~September 30, 2024, the Company had authorized 5,000,000 shares of preferred stock, each with a par value of $0.00001. As of ~~June~~September 30, 2024, there were 100,000 shares of preferred stock issued and outstanding.

Dividend Provisions

The Preferred Stock ranks senior to the Company’s common stock with respect to payment of dividends and rights on the distribution of assets on any liquidation, dissolution or winding up of the affairs of the Company and ranks junior to all secured and unsecured indebtedness. The Preferred Stock has an Initial Liquidation Preference of $100.0 million, representing an aggregate Liquidation Preference (as defined below) of $100.0 million upon issuance. At the Company’s election, the Preferred Stock carries a 4.25% per annum dividend if paid in kind or a 3.25% per annum dividend if paid in cash, in each case payable quarterly in arrears. Holders of the Preferred Stock are entitled to these dividends regardless of whether the dividends are declared by the Company’s board of directors. Such dividends shall accrue and compound quarterly in arrears from the date of issuance of the shares. The Preferred Stock is also entitled to fully participate in any dividends paid to the holders of common stock in cash, in stock or otherwise, on an as-converted basis. As of ~~June~~September 30, 2024, the cumulative dividends accrued were $67.34 million, or $6374.1040 per share of Preferred Stock.

Liquidation Rights

In the event of any Liquidation, holders of the Preferred Stock are entitled to receive an amount per share equal to the greater of (1) the Initial Liquidation Preference per share plus any accrued or declared but unpaid dividends on such shares (the “Liquidation Preference”) or (2) the amount payable if the Preferred Stock were converted into common stock. The Preferred Stock will have distribution and liquidation rights senior to all other equity interests of the Company. As of ~~June~~September 30, 2024, the Liquidation Preference of the Preferred Stock was $~~106~~107.34 million.

Conversion Feature

The Preferred Stock may be converted, at any time in whole or in part at the option of the holder, beginning on January 19, 2024, into shares of the Company’s common stock equal to the quotient obtained by dividing the sum of the Liquidation Preference by the conversion price of $25.85 (the “Conversion Price”).

Anti-Dilution Provisions

The Conversion Price of the Preferred Stock has customary anti-dilution provisions for stock splits, stock dividends, sales of shares through a tender or exchange offer, including under the Purchase Agreement with Lincoln Park (each as defined in Notes 10 and 11), subject to customary exceptions for issuances pursuant to current or future equity-based incentive plans or arrangements (including upon the exercise of employee stock options).

Optional Redemption

The Company has the option, upon 30 days’ advance notice, to (A) repurchase all (but not less than all) of the outstanding Preferred Stock held by Koito or a Permitted Transferee (as defined in the Investment Agreement) on or after the second anniversary of the closing occurring after the end of the applicable fiscal year for which the Company has recorded positive net income, if the Company has recorded positive net income pursuant to U.S. GAAP in its audited financial statements for any fiscal year the end date of which falls after the fifth anniversary of the closing and (B) all or any portion of the outstanding Preferred Stock not held by Koito or a Permitted transferee any time after the seventh anniversary of the closing.

Fundamental Change Put Right

Upon occurrence of a fundamental change event, each holder of outstanding shares of the Preferred Stock has the right to require the Company to repurchase any or all of their Preferred Stock at a purchase price per share equal to the Liquidation Preference or in lieu of a repurchase, elect to convert the Preferred Stock into the Company’s common stock equal to the quotient obtained by dividing 110% of the Liquidation Preference by the Conversion Price.

A fundamental change is defined as either the direct or indirect sale, or other disposition of all or substantially all assets of the Company and its subsidiaries to any third party or the consummation of any transaction, the result of which is that any third party or group of third parties become the beneficial owner of more than 50% of the voting power of the Company. Solely with respect to shares held by Koito, the definition of a fundamental change is expanded to include agreements entered by the Company to issue equity exceeding 10% of the Company’s common stock, or any strategic alliance partnership, or joint venture agreement to a third party deemed to be a competitor with Koito (subject to certain exceptions).

Note 11. Stockholders’ Equity (Deficit)

Common Stock

Holders of common stock were entitled to one vote per share, and to receive dividends when, as and if declared by the board of directors, and, upon liquidation or dissolution, were entitled to receive all assets available for distribution to stockholders. The holders had no preemptive or other subscription rights and there were no redemption or sinking fund provisions with respect to such shares.

As of ~~June~~September 30, 2024, the Company had authorized 35,000,000 shares of common stock, each with a par value of $0.00001. As of ~~June~~September 30, 2024, there were 16,~~043~~051,~~207~~981 shares of common stock issued and outstanding.

Lincoln Park Transaction

On November 24, 2021, Legacy Cepton entered into a Purchase Agreement with Lincoln Park Capital LLC (“Lincoln Park”), pursuant to which Lincoln Park has agreed to purchase up to $100.0 million of common stock (subject to certain limitations contained in the Purchase Agreement) from time to time over a 36-month period (the “Purchase Agreement”) from February 10, 2022 to February 10, 2025, and certain other conditions set forth in the Purchase Agreement. The Company may, from time to time and at its sole discretion, direct Lincoln Park to purchase common stock in accordance with daily dollar thresholds as determined within the Purchase Agreement. The purchase price per share for common stock will be the lower of: (i) the lowest trading price for shares of common stock on the market in which it is listed, on the applicable purchase date and (ii) the average of the three (3) lowest closing sale price for common stock during the ten (10) consecutive business days ending on the business day immediately preceding such purchase date. In consideration for entering into the Purchase Agreement, the Company issued, as a commitment fee, 5,000 shares of common stock to Lincoln Park on the date of the closing of the Business Combination and subsequently an additional 15,000 shares of common stock 180 days after the date of the closing of the Business Combination.

No shares were sold under the Purchase Agreement in 2024 or 2023.

Note 12. Stock-Based Compensation

Equity Incentive Plans

On July 5, 2016, Legacy Cepton adopted the 2016 Stock Plan (the “2016 Plan”) under which 4,800,000 shares of Legacy Cepton’s common stock were reserved for issuance to employees, nonemployee directors, consultants, and advisors. As a result of the Business Combination, the Company no longer grants new incentive awards under the 2016 Plan and there were no shares reserved or available for future issuance under the 2016 Plan. Incentive awards existing under the 2016 Plan immediately prior to the Business Combination were converted into options to receive shares of common stock through application of the Exchange Ratio (“Post Conversion Awards”).

On February 10, 2022, the Company adopted the 2022 Stock Plan (the “2022 Plan”) under which 1,512,314 shares of the Company’s common stock were reserved for issuance to employees, nonemployee directors, consultants, and advisors. Per the terms of the 2022 Plan, in the event any Post Conversion Awards issued and outstanding under the 2016 Plan are cancelled, terminated, or expire, said number of shares will be made available for issuance under the 2022 Plan. The share limit shall automatically increase on the first trading day in January of every calendar year during the term of the 2022 Plan, by an amount equal to the lesser of (i) two percent (2%) of the total number of shares of common stock issued and outstanding on December 31 of the immediately preceding calendar year or (ii) such number of shares of common stock as may be established by the board of directors. As of ~~June~~September 30, 2024, there were 2,143,038 shares of common stock reserved for issuance under the 2022 Plan.

Incentive Stock Options and Nonqualified Stock Options

Stock options generally vest over four years, subject to a service condition, with 25% of the awarded stock options vesting on the first anniversary of the grant date and the remaining 75% vesting monthly over the remaining 36 months. The options expire ten years from grant date.

A summary of the Company’s employee and nonemployee stock option activity for the ~~six~~nine months ended ~~June~~September 30, 2024 is presented below:

	Shares	WeightedAverageExercisePrice		WeightedAverageRemainingContractTerm (in years)	AggregateIntrinsicValue (in thousands)
Outstanding as of December 31, 2023	1,258,483	$	19.22	4.5	$	767
Granted	—	$	—
Exercised	(3,896)	$	1.00
Expired/Forfeited	(~~198~~199,~~400~~421)	$	3031.9117
Outstanding as of June 30, 2024	1,056,187	$	17.10	4.8	$	599
Outstanding as of September 30, 2024	1,055,166	$	17.03	4.5	$	751
Exercisable as of June 30, 2024	996,769	$	15.13	4.6	$	599
Exercisable as of September 30, 2024	1,015,754	$	15.67	4.5	$	751
Vested and expected to vest as of June 30, 2024	1,056,187	$	17.10	4.8	$	599
Vested and expected to vest as of September 30, 2024	1,055,166	$	17.03	4.5	$	751

As of ~~June~~September 30, 2024, there was $1.50 million of unrecognized stock-based compensation expense related to unvested stock options expected to be recognized over a weighted-average period of 0.98 years. The total intrinsic value of options exercised during the ~~six~~nine months ended ~~June~~September 30, 2024 was immaterial. The Company recognizes forfeitures as they occur.

Restricted Stock Units (“RSUs”)

Each RSU represents a right to receive one share of the Company’s common stock when the RSU vests. RSUs generally vest over a period of one to four years, subject to a service condition. The fair value of RSU is equal to the fair value of the Company’s common stock on the date of grant.

A summary of the Company’s RSU activities for the ~~six~~nine months ended ~~June~~September 30, 2024 is presented below:

	Shares	Weighted Grant Date Fair Value
Outstanding as of December 31, 2023	608,029	$	16.36
Granted	1,~~079~~086,328	$	3.00
Released	(~~213~~223,~~217~~776)	$	17.7157
Forfeited	(84145,~~714~~311)	$	2015.1782
Outstanding as of June 30, 2024	1,389,426	$	5.55
Outstanding as of September 30, 2024	1,325,270	$	5.27

As of ~~June~~September 30, 2024, there was $65.84 million of unrecognized stock-based compensation expense related to unvested RSUs expected to be recognized over a weighted-average period of 2.64 years. The total intrinsic value of RSUs outstanding at ~~June~~September 30, 2024 was $34.71 million. The Company recognizes forfeitures as they occur.

Performance-based Stock units

Each performance-based stock unit (“PSU”) granted under the 2022 Plan represents a right to receive one share of the Company’s common stock upon satisfaction of the performance-based conditions applicable to the PSU. There were no PSUs issued during the ~~six~~nine months ended ~~June~~September 30, 2024. During the ~~six~~nine months ended ~~June~~September 30, 2023, the Company granted 12,300 PSUs under the 2022 Plan, with 6,600 PSUs in the first tranche and 5,700 PSUs in the second tranche. Each grant consisted of two market-based vesting tranches, with the first tranche to vest if, at the close of regular trading for 20 trading days out of any period of 30 consecutive trading days, either (i) the closing price of the Company’s common stock exceeds

tranche. Each grant consisted of two market-based vesting tranches, with the first tranche to vest if, at the close of regular trading for 20 trading days out of any period of 30 consecutive trading days, either (i) the closing price of the Company’s common stock exceeds $150.00 per share or (ii) the Company’s market capitalization exceeds $2.1 billion; and the second tranche to vest if, at the close of regular trading for 20 trading days out of any period of 30 consecutive trading days, either (i) the closing price of the Company's common stock exceeds $175.00 per share or (ii) the Company’s market capitalization exceeds $2.5 billion, provided in each case that the applicable stock price or market capitalization goal must be achieved no later than February 10, 2025 for the applicable tranche to vest, and provided further that the vesting of each tranche is subject to the grantee’s continued employment with the Company through the day on which the applicable goal is achieved.

The fair value of the PSUs at valuation date was determined using a Monte Carlo valuation model that utilizes significant assumptions, including expected volatility, dividend yield, stock price as of the valuation date, market capitalization targets and the corresponding share price targets necessary for each tranche of PSUs to vest, expected life, and risk-free rate.

The fair value of the PSUs at valuation date was $0.1 million with weighted-average grant date fair value of $9.77, amortizing over a derived service period of 21 and 22 months for each tranche, respectively. During the ~~six~~nine months ended ~~June~~September 30, 2024, 5,600 PSUs were cancelled.

Stock-Based Compensation

For the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, the Company recorded stock-based compensation expense as follows (in thousands):

Three Months EndedJune 30,

Six Months EndedJune 30,

Three Months EndedSeptember 30,

Nine Months EndedSeptember 30,

2024

2023

2024

2023

Cost of revenue

~~609~~9

4445

~~620~~629

~~104~~149

Research and development expense

~~416~~905

1,~~193~~148

12,~~204~~109

23,~~370~~518

Selling, general and administrative expense

~~473~~355

1,~~128~~142

~~600~~955

23,~~180~~322

Total stock-based compensation expense

1,~~498~~269

2,~~365~~335

23,~~424~~693

46,~~654~~989

For the three months ended ~~June~~September 30, 2024 and 2023, the Company capitalized $119 thousand and $4142 thousand, respectively, of stock-based compensation expense into inventory. For the ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, the Company capitalized $2130 thousand and $92134 thousand, respectively, of stock-based compensation expense into inventory.

Note 13. Earnout Liability

In addition to the shares issued upon closing of the Business Combination (see Note 1), additional contingent shares (“Earnout Shares”) are payable to each holder of common stock and/or options receiving consideration in the Business Combination, in the amounts set forth below:


(a)			If the closing price of the Company’s common stock equals or exceeds $150.00 per share for any 20 trading days within any consecutive 30-trading day period that occurs after February 10, 2022 and on or prior to February 10, 2025, the Company will issue to each holder of common stock that is entitled to Earnout Shares a number of shares of common stock equal to such holder’s pro rata portion of 700,000 shares.


(b)			If the closing price of the Company’s common stock equals or exceeds $175.00 per share for any 20 trading days within any consecutive 30-trading day period that occurs after February 10, 2022 and on or prior to February 10, 2025, the Company will issue to each holder of common stock that is entitled to Earnout Shares a number of shares of common stock equal to such holder’s pro rata portion of 600,000 shares.

The Company concluded the Earnout Shares meet the criteria for liability classification due to the existence of contingent settlement provisions that could result in holders receiving differing amounts of shares depending on the Company’s stock price or the price paid in a change of control. Because the settlement is not solely determined by the share price of the Company (that is, the share price observed in or implied by a qualifying change-in-control event), but also by the occurrence of a qualifying change-in-control event, this causes the Earnout Shares to not be indexed to the Company’s own shares, resulting in liability classification. Upon the closing of the Business Combination, the Company recorded these instruments as liabilities on the condensed consolidated balance sheet at fair value and recognizes subsequent changes in fair value in earnings at each reporting date. The fair value of the earnout liability was determined using a Monte Carlo

shares, resulting in liability classification. Upon the closing of the Business Combination, the Company recorded these instruments as liabilities on the condensed consolidated balance sheet at fair value and recognizes subsequent changes in fair value in earnings at each reporting date. The fair value of the earnout liability was determined using a Monte Carlo valuation model that utilizes significant assumptions, including expected volatility, expected term, and risk-free rate, to determine the probability of achieving the common share price milestones.

The following table summarizes the assumptions used in estimating the fair value of the earnout liability at each of the relevant dates:

	June 30,2024			December 31,2023
	September 30,2024			December 31,2023
Stock price	$	23.6908		$	3.14
Expected volatility	117.0		%	117.0		%
Risk-free interest rate	5.32		%	5.32		%
Expected term (in years)	0.86			1.2
Expected dividend yield	0		%	0		%

Stock price: the stock price was based on the closing price as of the valuation date.

Expected volatility: the volatility rate was determined using the historical volatility of the Company’s stock price, corresponding to the expected term of the awards.

Risk-free interest rate: The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of issuance for zero-coupon U.S. Treasury notes with maturities corresponding to the expected three-year term of the earnout period.

Expected term: The expected term is the remaining term of the three-year earnout period.

Expected dividend yield: The expected dividend rate is zero as the Company currently has no history or expectation of declaring dividends in the foreseeable future.

As of ~~June~~September 30, 2024, the balance of the earnout liability was immaterial. For the three ~~and six~~ months ended ~~June~~September 30, 2024, there ~~were~~was no gain or loss in the condensed consolidated statement of operations and comprehensive income (loss) for the change in fair value of the earnout liability. There was an immaterial ~~losses~~gain in the condensed consolidated statement of operations and comprehensive income (loss) for the change in fair value of the earnout liability for the nine months ended September 30, 2024. For the three and ~~six~~nine months ended ~~June~~September 30, 2023, the Company recorded an immaterial ~~loss~~gain and a gain of $0.78 million, respectively, in the condensed consolidated statement of operations and comprehensive income (loss) for the change in fair value of the earnout liability.

Note 14. Warrants

Common Stock Warrants Assumed in Business Combination

As part of GCAC’s IPO, 8,625,000 Public Warrants were sold. The terms of outstanding warrants and equity-based awards (including exercise price and number of shares issuable thereunder) were proportionately adjusted to reflect the Reverse Stock Split. The as-adjusted terms of the Public Warrants provide that every ten shares of common stock that could have been purchased pursuant to the exercise of warrants prior to the Effective Date represent one share of common stock that may be purchased pursuant to such warrants following the Effective Date. The exercise price for each warrant following the Effective Date equals the product of 10 multiplied by the exercise price prior to the Effective Date; accordingly, the exercise price for the Company’s warrants is $115.00 per share, subject to adjustments. The Public Warrants may be exercised only for a whole number of shares of common stock. The Public Warrants will expire five years after the completion of the Business Combination, or earlier upon redemption or liquidation. The Public Warrants are listed on Nasdaq under the symbol “CPTNW”.

The Company may redeem the Public Warrants when exercisable, in whole and not in part, at a price of $0.01 per warrant, so long as the Company provides not less than 30 days’ prior written notice of redemption to each warrant holder, and only if the reported last sale of common stock equals or exceeds $180.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders.

Simultaneously with GCAC’s IPO, GCAC consummated a private placement of 5,175,000 Private Placement Warrants with the Sponsor. The Private Placement Warrants are identical to the Public Warrants, including with respect to the Reverse Stock Split adjustments described above, except that the Private Placement Warrants are non-redeemable so long as they are held by the initial purchasers or such purchaser’s permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

The Company concluded the Private Placement Warrants meet the criteria for liability classification due to the existence of a settlement provision that adjusts the settlement amount based on who the holder of the warrant is (i.e., permitted vs. non-permitted transferees). This provision causes the Private Placement Warrants to not be indexed to the Company’s own shares, resulting in liability classification. Upon consummation of the Business Combination, the fair value of the Private Placement Warrants was recorded at a value of approximately $2.6 million. The fair value of the Private Placement Warrants was immaterial on ~~June~~September 30, 2024. For each of the three and ~~six~~nine months ended ~~June~~September 30, 2024, the Company recorded immaterial losses in the condensed consolidated statement of operations and ~~June~~comprehensive income (loss) for the change in fair value of the liability. For the three and nine months ended September 30, 2023, the Company recorded ~~immaterial~~a ~~losses~~gain orof ~~gains~~$0.2 million and $0.3 million, respectively, in the condensed consolidated statement of operations and comprehensive income (loss) for the change in fair value of the liability.

Note 15. Income Taxes

The Company’s provision for income taxes was immaterial for each of the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023. The difference between the Company’s effective income tax rate and the U.S. federal statutory rate is primarily attributable to unrecognized U.S. federal and state tax benefits because of a full valuation allowance that the Company has established against its federal and state deferred tax assets and foreign tax rate differential from U.S. federal statutory rate.

The Company conducts its business globally and its operating income is subject to varying rates of tax in the United States, Canada, Germany, and other locations. Consequently, the Company’s effective tax rate is dependent upon the geographic distribution of its earnings or losses and the tax laws and regulations in each geographical region.

Due to historical losses in the United States, the Company continues to maintain a full valuation allowance against the U.S. federal and state deferred tax assets. If management’s assessment of the deferred tax assets or the corresponding valuation allowance were to change, the Company would record the related adjustment to income during the period in which management makes the determination.

The Company is subject to income taxes in the U.S. federal, state, and various foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. All of the Company’s tax years remain open for examination by the federal and state tax authorities for three and four years, respectively, from the date of utilization of the net operating loss or research and development tax credits. The Company does not have any tax audits or other issues pending.

Note 16. Leases

The Company leases office and manufacturing facilities under non-cancelable operating leases expiring at various dates through April 2028. The Company’s lease agreements do not contain any material terms and conditions of residual value guarantees or material restrictive covenants.

The Company determines if an arrangement is or contains a lease at inception. Operating leases are included in other assets and operating lease liabilities in the Company’s condensed consolidated balance sheets.

Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the commencement date based on an amount equal to the present value of lease payments over the lease term. The Company’s leases do not provide an implicit rate; therefore, the Company uses an incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company uses the implicit rate when it is readily determinable. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed it to carry forward existing lease classification and to exclude leases with original terms of one year or less. Further, the Company elected to combine lease and non-lease components for all asset classes. Variable lease payments are defined as payments made for the right to use an asset that vary because of changes in facts or circumstances occurring after the commencement date, other than the passage of time. Any variable lease components are expensed as incurred. The operating lease right-of-use assets also include adjustments related to prepaid or deferred lease payments and lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Operating lease expense for lease payments is recognized on a straight-line basis over the lease term.

~~The~~commencement date, other than the passage of time. Any variable lease components are expensed as incurred. The operating lease right-of-use assets also include adjustments related to prepaid or deferred lease ~~expense~~payments ~~for~~and lease incentives. The Company’s lease terms may include options to extend or terminate the ~~three~~lease ~~and~~when ~~six~~it ~~months~~is ~~ended~~reasonably ~~June 30,~~certain ~~2024~~that ~~and~~the ~~2023~~Company ~~were~~will asexercise ~~follows~~that ~~(in~~option. ~~thousands):~~Operating lease expense for lease payments is recognized on a straight-line basis over the lease term.

	Three Months EndedJune 30,				Six Months EndedJune 30,
	2024		2023		2024		2023
Operating lease cost	$	799	$	803	$	1,599	$	1,468
Variable lease cost	233		203		437		408
Total operating lease cost	$	1,032	$	1,006	$	2,036	$	1,876

The components of lease expense for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):

Supplemental cash flow information for the six months ended June 30, 2024 and 2023 related to leases was as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Operating lease cost	$	799	$	803	$	2,398	$	2,271
Variable lease cost	215		202		652		610
Total operating lease cost	$	1,014	$	1,005	$	3,050	$	2,881

	Six Months EndedJune 30,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases included in operating activities	$	1,627	$	984
Right of use assets obtained in exchange for lease obligations:
Operating leases	$	—	$	11,190

Supplemental cash flow information for the nine months ended September 30, 2024 and 2023 related to leases was as follows (in thousands):


	Nine Months Ended September 30,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases included in operating activities	$	2,438	$	1,774
Right of use assets obtained in exchange for lease obligations:
Operating leases	$	—	$	11,190

Supplemental balance sheet information related to leases was as follows (in thousands):

	June 30, 2024		December 31, 2023
	September 30, 2024		December 31, 2023
Operating lease right-of-use assets	$	98,~~138~~674	$	10,038
Operating lease liabilities:
Operating lease liabilities, current	$	2,~~045~~141	$	1,875
Operating lease liabilities, non-current	7,~~635~~063		8,720
Total operating lease liabilities	$	9,~~680~~204	$	10,595

The operating lease right-of-use assets were recorded in other assets in the condensed consolidated balance sheets.

Weighted-average remaining term and discount rates were as follows (term in years):

	June 30, 2024		December 31, 2023
	September 30, 2024		December 31, 2023
Weighted-average remaining lease term	3.7853		4.27
Weighted-average discount rate	14.48	%	14.48	%

Maturities of lease liabilities were as follows (in thousands):

Year Ending December 31,
2024	$	1,621
2025	3,318
2026	3,324
2027	3,368
Thereafter	847
Total undiscounted lease payments	$	12,478
Present value adjustment for minimum lease commitments	(2,798)
Net lease liabilities	$	9,680

Maturities of lease liabilities were as follows (in thousands):


Year Ending December 31,
2024	$	811
2025	3,318
2026	3,324
2027	3,368
Thereafter	847
Total undiscounted lease payments	$	11,668

Present value adjustment for minimum lease commitments	(2,464)
Net lease liabilities	$	9,204

Note 17. Commitments and Contingencies

Legal Proceedings

From time to time, the Company may be involved in various legal claims, litigation and other matters that arise in the normal course of its operations. Although there can be no assurances and the outcome of these matters is currently not determinable, the Company currently believes that none of these claims, actions or proceedings are likely to have a material adverse effect on the Company’s financial position.

~~The~~Between ~~Company~~October ~~records~~3 ~~accruals~~and ~~for~~9, ~~its~~2024, ~~outstanding~~the ~~legal~~Company ~~proceedings,~~received ~~investigations~~four ordemand ~~claims~~letters ~~when~~(“Demand itLetters”) isfrom ~~probable~~purported shareholders alleging that athe ~~liability~~Company’s ~~will~~disclosures bein ~~incurred,~~its ~~and~~preliminary ~~the~~proxy ~~amount~~statement offiled ~~loss~~by ~~can~~the beCompany ~~reasonably~~with ~~estimated.~~the ~~The~~SEC ~~Company~~on ~~evaluated~~September ~~developments~~25, in2024 ~~legal~~(the ~~proceedings,~~“Preliminary ~~investigations~~Proxy orstatement”), ~~claims~~containing ~~that~~important ~~could~~information ~~affect~~regarding the ~~amount~~proposed oftransaction ~~any~~with ~~accrual~~Koito, aswere ~~well~~deficient. asThe ~~any~~Demand ~~developments~~Letters demand that ~~would~~the ~~result~~Company inmake acertain ~~loss~~additional ~~contingency~~disclosures, and state that the shareholders reserve their rights to ~~become~~take ~~both~~action ~~probable~~if ~~and~~the ~~reasonably~~Company ~~estimable.~~does ~~There~~not ~~were~~make nothe ~~material~~requested ~~accruals~~supplemental ~~for~~disclosures. ~~loss~~One ~~contingencies~~of ~~associated~~the ~~with~~Demand ~~such~~Letters ~~legal~~also ~~claims~~attached a draft proposed complaint, ~~actions~~stating orthat ~~litigation~~the asshareholder ofwould ~~June 30,~~be ~~2024~~prepared ~~and~~to ~~December 31,~~file ~~2023.~~if the Company does not make the requested supplemental disclosures.

In addition, on November 1, 2024, an alleged shareholder of the Company filed a complaint in the United States District Court for the Northern District of California against the Company and the members of its Board of Directors. The complaint, which is captioned Bailey v. Cepton et al., Case No.: 5:24-cv-7581 (the “Complaint”), alleges that the Preliminary Proxy Statement contains misleading disclosures and omissions, purportedly in violation of Section 14(a) of the Exchange Act. The Complaint also asserts a claim for control person liability under Section 20(a) of the Exchange Act. The Complaint seeks, among other things, an injunction enjoining the consummation of the Merger (defined in Note 18) and rescissory damages if the Merger is consummated without the Company having made the supplemental disclosures. The Company believes that the disclosures included in our Preliminary Proxy Statement, as amended from time to time and subject to the filing of a definitive proxy statement, complied fully with applicable law and that the Demand Letters and the Complaint are without merit.

The Company records accruals for its outstanding legal proceedings, investigations or claims when it is probable that a liability will be incurred, and the amount of loss can be reasonably estimated. The Company evaluated developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would result in a loss contingency to become both probable and reasonably estimable. There were no material accruals for loss contingencies associated with such legal claims, actions or litigation as of September 30, 2024 and December 31, 2023.

Contract Manufacturer Loss Contingencies

As a result of the GM series production award cancellation in December 2023, the Company cancelled production contracts with certain contract manufacturers. This led to the Company’s receipt of project loss claims from contract manufacturers. The project loss claims include item costs for which the Company believes it is not liable based on contractual rights and obligations created by legal agreements with the contract manufacturers. ~~The Company believes that a loss from these specific item costs is reasonably possible but not probable, and as a result no accrual has been made.~~ As of ~~June~~September 30, 2024, ~~the Company estimates the reasonably possible range of loss to be from zero to approximately~~ $10.13 million. ~~The~~contingent ~~Company~~liability ~~will~~was ~~continue~~accrued toand ~~assess~~included ~~the~~in ~~situation~~accrued ~~with~~expenses ~~its~~and ~~contract~~other ~~manufacturers~~current ~~and~~liabilities ~~will~~in ~~update~~the ~~its~~condensed ~~position~~consolidated asbalance ~~needed~~sheets.

Other Contingencies

As a result of the GM series production award cancellation, the Company sent a claim to Koito seeking recovery of a significant amount in project losses. The claim covers costs associated with materials, tooling, engineering, and other related project costs. The Company is seeking recovery during 2024; however, a formal recovery timeline and total amount have not been agreed to and are unknown at this time. For the ~~six~~nine months ended ~~June~~September 30, 2024, the Company recognized a $4.0 million gain related to cost recovery in other income, net in the condensed consolidated statement of operations and comprehensive income (loss), and received a cash payment in April 2024. The remaining portion of the cost recovery claim was uncertain and the amount was neither estimable, realized nor realizable.

Note 18. Related Party Transactions

Investment Agreement and Investor Rights Agreement with Koito

On October 27, 2022, the Company entered into the Investment Agreement with Koito pursuant to which, among other things, at the closing of the transactions, and based on the terms and subject to the conditions set forth therein, the Company issued and sold to Koito, 100,000 shares of Preferred Stock for a purchase price of $100.0 million. The issuance and sale of the Preferred Stock and related matters were approved by the Company’s stockholders on January 11, 2023, and the Preferred Stock issued to Koito on January 19, 2023. See Note 10 for further information. On January 19, 2023, the Company and Koito entered into the Investor Rights Agreement (the “Investor Rights Agreement”), pursuant to which, among other things, the Company ensured that two designees of Koito sat on the Company’s board of directors immediately following the issuance of the Preferred Stock. The Investor Rights Agreement also provides for certain investor consent, preemptive, registration, and termination rights, which contain certain provisions that limit the Company’s ability to access additional sources of funding without Koito’s consent.

Secured Term Loan Agreement with Koito

Concurrently with the execution of the Investment Agreement, the Company entered into a Secured Term Loan Agreement with Koito to borrow Japanese Yen ¥5.8 billion (approximately $39.4 million). On January 24, 2023, the Company repaid all outstanding principal and accrued interest under the Secured Term Loan Agreement. See Note 9 for further information.

Koito Letter of Intention and Koito Merger Agreement

On December 21, 2023, the Company received a non-binding indication of interest from Koito to acquire 100% of the outstanding shares of the Company not already owned by Koito, orsubject to certain ~~other~~executives ~~potential~~of ~~rollover~~the ~~participants~~Company, including Dr. Jun Pei, Cepton’s President and Chief Executive Officer (collectively, the “Rollover Participants”) agreeing to rollover all or a portion of their outstanding shares of common stock of the Company.

21On July 29, 2024, the Company entered into the Koito Merger Agreement with Koito and Merger Sub. The Koito Merger Agreement provides that, among other things and on the terms and subject to the conditions set forth in the Koito Merger Agreement, (i) Merger Sub shall be merged with and into the Company (the “Merger”), with the Company continuing as the surviving corporation (the “Surviving Corporation”) and an indirectly controlled subsidiary of Koito; (ii) at the effective time of the Merger (the “Effective Time”) each share of common stock of the Company, par value $0.00001 per share (the “Company Common Stock”) issued and outstanding immediately before the Effective Time (other than (a) shares of Company Common Stock held by any subsidiary of the Company immediately prior to the Effective Time; (b) shares of Company Common Stock held by Koito or any of its subsidiaries or owned by the Company as treasury stock, in each case, immediately prior to the Effective Time; and (c) shares of Company Common Stock that are issued and outstanding immediately prior to the Effective Time and for which the holder thereof is entitled to demand and properly demands the appraisal of such shares in accordance with, and complied in all respects with, Section 262 of the General Corporation Law of the State of Delaware) shall be converted automatically into the right to receive $3.17 per share without interest (the “Merger Consideration”); and (iii) each share of common stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become one (1) fully paid and non-assessable share of common stock, par value $0.00001 per share, of the Surviving Corporation.

OnEach ~~July~~share ~~29,~~of ~~2024,~~Preferred ~~the~~Stock ~~Company~~issued ~~entered~~and ~~into~~outstanding immediately prior to the ~~Koito~~Effective ~~Merger~~Time ~~Agreement~~shall ~~with~~remain ~~Koito~~outstanding and ~~Merger~~shall ~~Sub,~~not ~~pursuant~~be cancelled. The Company’s warrants to ~~which,~~acquire ~~among~~up ~~other~~to ~~things~~862,500 ~~and~~shares onof ~~the~~Company ~~terms~~Common Stock issued and ~~subject~~outstanding toon the ~~conditions~~date ~~set~~of ~~forth in~~ the Koito Merger Agreement, ~~Merger~~originally ~~Sub~~issued ~~shall~~as bea ~~merged~~component ~~with~~of ~~and~~the ~~into~~units ~~Cepton,~~sold ~~with~~in ~~Cepton~~Growth ~~continuing~~Capital asAcquisition Corp.’s initial public offering (the ~~surviving~~“Public ~~corporation~~Warrants”) and anwarrants ~~indirect~~to ~~subsidiary~~acquire ofup ~~Koito.~~to ~~See~~517,000 ~~Note~~shares 20of ~~for~~Company ~~further~~Common ~~information~~Stock ~~regarding~~issued at the ~~Transaction~~time ~~and~~of ~~other~~Growth ~~agreements~~Capital ~~entered~~Acquisition ~~into~~Corp.’s ininitial ~~connection~~public offering (the “Private Warrants” and, together with the ~~Transaction.~~Public Warrants, the “Warrants”) that are outstanding and unexercised as of immediately

During the three and six months ended June 30, 2024, the Company incurred $0.1 million and $1.6 million of transaction costs, which were recorded in selling, general and administrative expenses in the condensed consolidated statement of operations and comprehensive income (loss).

Transactions with Koito

Koito is an automotive tier 1 partner and investor of the Company. Sales to Koito were $10.1 million and $1.2 million (or 97% and 44% of our total revenue) for the three months ended June 30, 2024 and 2023, respectively. Sales to Koito were $11.4 million and $2.1 million (or 92% and 49% of our total revenue) for the six months ended June 30, 2024 and 2023, respectively. Accounts receivable from Koito were zero as of June 30, 2024 and $2.1 million as of December 31, 2023.

In December 2023, Koito informed the Company that GM, which had awarded Koito the series production award, had decided to re-scope its advanced driver assistance systems (“ADAS”) product offerings and, as a result, Koito cancelled all outstanding purchase orders to the Company that relate to the GM series production award. As is customary when an automotive program changes, the Company submitted a project investment cost recovery claim related to the cancellation. See Note 17 for further information.

Note 19. Segments

The Company conducts its business in one operating segment that develops and produces lidar sensors for use in automotive and smart infrastructure industries. The Company’s Chief Executive Officer is the chief operating decision maker (“CODM”). The CODM allocates resources and makes operating decisions based on financial information presented on a consolidated basis, accompanied by disaggregated information about sales and gross margin by product group. The profitability of the Company’s product group is not a determining factor in allocating resources and the CODM does not evaluate profitability below the level of the consolidated company. Long-lived assets of the Company located in its country of domicile, the United States, are approximately 100%.

Note 20. Subsequent Events

The Company has evaluated subsequent events from the balance sheet date through August 13, 2024, the issuance date of the condensed consolidated financial statements.

Koito Merger Agreement

On July 29, 2024, the Company entered into the Koito Merger Agreement with Koito and Merger Sub to effect the Transaction. The Koito Merger Agreement provides that, among other things and on the terms and subject to the conditions set forth in the Koito Merger Agreement, (i) Merger Sub shall be merged with and into the Company (the “Merger”), with the Company continuing as the surviving corporation (the “Surviving Corporation”) and an indirect subsidiary of Koito; (ii) at the effective time of the Merger (the “Effective Time”) each share of common stock of the Company, par value $0.00001 per share (the “Company Common Stock”) issued and outstanding immediately before the Effective Time (other than (a) shares of Company Common Stock held by any subsidiary of the Company immediately prior to the Effective Time; (b) shares of Company Common Stock held by Koito or any of its subsidiaries or owned by the Company as treasury stock, in each case, immediately prior to the Effective Time; and (c) shares of Company Common Stock that are issued and outstanding immediately prior to the Effective Time and for which the holder thereof is entitled to demand and properly demands the appraisal of such shares in accordance with, and complied in all respects with, Section 262 of the General Corporation Law of the State of Delaware) shall be converted automatically into the right to receive $3.17 per share without interest (the “Merger Consideration”); and (iii) each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become one (1) fully paid and non-assessable share of common stock, par value $0.00001 per share, of the Surviving Corporation.

Each share of Preferred Stock issued and outstanding immediately prior to the Effective Time shall remain outstanding and shall not be cancelled. The Company’s warrants to acquire up to 862,500 shares of Company Common Stock issued and outstanding on the date of the Koito Merger Agreement originally issued as a component of the units sold in Growth

Capital Acquisition Corp.’s initial public offering (the “Public Warrants”) and warrants to acquire up to 517,000 shares of Company Common Stock issued at the time of Growth Capital Acquisition Corp.’s initial public offering (the “Private Warrants” and, together with the Public Warrants, the “Warrants”) that are outstanding and unexercised as of immediately prior to the Effective Time shall be treated in accordance with the terms and conditions of the Warrant Agreement, dated as of January 29, 2021 by and between the Company and Continental Stock Transfer & Trust Company. The Company’s Earnout Shares shall be treated in accordance with the terms and conditions of the Business Combination Agreement, dated as of August 4, 2021, by and among the Company, GCAC Merger Sub Inc. and Cepton Technologies, as amended, pursuant to which, at the Effective Time, the Earnout Shares shall (i) be deemed unearned as the Merger Consideration does not exceed the share price milestone thresholds applicable to the Earnout Shares and (ii) be cancelled. If the Merger is consummated, shares of Company Common Stock and Public Warrants will be delisted from the Nasdaq Stock Market and deregistered under the Securities Exchange Act of 1934.

The consummation of the Transaction, expected to close by the first quarter of 2025, is subject to the fulfillment or waiver of certain conditions, including the receipt of the requisite stockholder approval at a meeting of the Company’s stockholders and the receipt of required regulatory approvals, consents or clearances with respect to the Transaction, including from the Committee on Foreign Investment in the United States. The Company has made customary representations, warranties and covenants in the Koito Merger Agreement, including, among others, covenants to use reasonable best efforts to conduct its business in the ordinary course during the period between the date of the Koito Merger Agreement and the consummation of the Merger. The parties have agreed to use reasonable best efforts to take all actions necessary to consummate the Merger, including cooperating to obtain the regulatory approvals necessary to consummate the Merger.

Voting Support Agreements

Concurrent with the execution of the Koito Merger Agreement, Koito and each of Dr. Jun Pei, Dr. Jun Ye and Dr. Mark McCord (the “Supporting Stockholders”) entered into voting support agreements (the “Voting Support Agreements”), pursuant to which, among other things, each of the Supporting Stockholders agreed, subject to the terms thereof, to vote or cause to be voted, all of the shares of Company Common Stock beneficially owned by such Supporting Stockholders in favor of the adoption of the Koito Merger Agreement. The aggregate number of shares of Company Common Stock beneficially owned by the Supporting Stockholders and required to be voted or cause to be voted in favor of the adoption of the Koito Merger Agreement pursuant to the Voting Support Agreements represents approximately 38.7% of the outstanding shares of Company Common Stock, and along with the shares of Company Common Stock beneficially owned by Koito (excluding the Company Common Stock to which the shares of Series A Preferred Stock held by Koito are convertible), approximately 50.9% of the outstanding shares of Company Common Stock. In the event that the Board effects a Recommendation Change, then the aggregate number of shares of Company Common Stock beneficially owned by the Supporting Stockholders and required to be voted or caused to be voted in favor of the adoption of the Koito Merger Agreement pursuant to the Voting Support Agreements, along with the shares of Company Common Stock beneficially owned by Koito (including the Company Common Stock to which the shares of Series A Preferred Stock held by Koito are convertible), would be reduced to represent 35% of the outstanding shares of Company Common Stock.

Rollover Agreement

Concurrent with the execution of the Koito Merger Agreement, Koito, Project Camaro Holdings, LLC, a Delaware limited liability company and wholly owned subsidiary of Koito (“Holdco”), and the Rollover Participants entered into a rollover agreement (the “Rollover Agreement”), pursuant to which, immediately prior to the Effective Time, Dr. Jun Pei, Dr. Mark McCord and Mr. Yupeng Cui will contribute 1,291,810, 515,886 and 476,549 shares of Company Common Stock (the “Rollover Shares”), respectively, and Koito will separately contribute its 1,962,474 shares of Company Common Stock and 100,000 shares of Series A Preferred Stock as contemplated therein, to Holdco in exchange for certain equity interests in Holdco. Pursuant to the Rollover Agreement, the Rollover Participants agreed to certain restrictive covenants, including restrictions on competition and solicitation. The Rollover Agreement also contemplates that at the closing, the Rollover Participants, Parent and Holdco will enter into an Amended and Restated Limited Liability Company Agreement of Holdco, which provides for scheduled repurchases of the equity interests issued to the Rollover Participants at a purchase price determined by multiplying the number of Rollover Shares by the Merger Consideration, plus an applicable rate of interest, subject to acceleration or reduction in certain circumstances.

Transaction costs

During the three and nine months ended September 30, 2024, the Company incurred $1.6 million and $3.2 million of transaction costs, which were recorded in selling, general and administrative expenses in the condensed consolidated statement of operations and comprehensive income (loss).

Other Transactions with Koito

Koito is an automotive tier 1 partner and investor of the Company. Sales to Koito were $0.3 million and $2.1 million (or 49% and 55% of our total revenue) for the three months ended September 30, 2024 and 2023, respectively. Sales to Koito were $11.7 million and $4.2 million (or 91% and 52% of our total revenue) for the nine months ended September 30, 2024 and 2023, respectively. Accounts receivable from Koito were $0.2 million as of September 30, 2024 and $2.1 million as of December 31, 2023.

Note 19. Segments

Note 20. Subsequent Events

The Company has evaluated subsequent events from the balance sheet date through November 8, 2024, the issuance date of the condensed consolidated financial statements, and determined there are no other transactions that require additional accounting or disclosure.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Unless otherwise indicated, references in this section to “we,” “our,” “us,” and “Cepton” generally refer to Cepton Technologies, Inc. and its consolidated subsidiaries prior to the Business Combination (as defined in Note 1 to the condensed consolidated financial statements in this Report) and to Cepton, Inc. and its consolidated subsidiaries after giving effect to the Business Combination. The following discussion and analysis of our results of operations and financial condition should be read in conjunction with the condensed consolidated financial statements included in this Report. This discussion contains forward-looking statements based upon our current expectations, estimates and projections that involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements due to, among other considerations, the matters discussed under “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” herein.

Certain amounts that appear in this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) may not sum due to rounding. Percentage amounts included in this MD&A have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this MD&A may vary from those obtained by performing the same calculations using the figures in our condensed consolidated financial statements included elsewhere in this Report. Terms used but not defined in this MD&A shall have the meanings ascribed to such terms in this Report.

On September 18, 2023, we filed with the Secretary of State of the State of Delaware a Certificate of Amendment to our Certificate of Incorporation to effect the Reverse Stock Split (as described in Note 1 to the condensed consolidated financial statements in this Report). The historical share and per share information included herein have been adjusted to reflect the Reverse Stock Split.

Business Overview

Cepton is focused on the deployment of high performance, mass-market lidar solutions to deliver safety and autonomy across the automotive and smart infrastructure markets. By adopting our solutions, our customers can enable safety and autonomy applications across a broad range of end-markets including our primary market, advanced driver assistance systems (“ADAS”) in consumer and commercial vehicles, which we believe represents not just the largest market opportunity for lidar applications over the next decade, but also the market with the best potential for near term mass-market commercialization.

Since the inception of our company in 2016, building lidars for broad market adoption has been our guiding principle. Mass-market deployment guided not just our end-market focus, but also our product design choices, our areas of technological innovation, and our approach to manufacturing, and our go-to-market strategy and partnerships. To pursue mass-market adoption, our value proposition has focused on developing a lidar that achieves high performance with automotive grade reliability at competitive prices. Our thesis was that lidar would gain broad based adoption only when solutions strike the right balance across three key facets of performance, cost and reliability.

As a Silicon Valley-based company led by recognized technical experts in the optical field, technology innovation is at the core of our company. We developed a comprehensive lidar platform consisting of proprietary components including our breakthrough scanning and imaging technology and our system-on-a-chip lidar engine application-specific integrated circuit, a portfolio of automotive-grade and industrial-grade long-range and near-range lidars, a software layer enabling the integration of automotive functions, and feature rich perception software capabilities.

Market Conditions

The global economy, including the financial and credit markets, continues to experience significant volatility and disruptions and has been impacted by ~~increases in~~ inflation ~~rates~~, the ongoing conflicts in Ukraine and the Middle East, rising fuel prices, ~~rising~~trade ~~interest rates~~tensions, declines in consumer confidence, declines in economic growth, and uncertainty about economic stability and political landscapes in the United States during an election year. The severity and duration of the impact of broader macroeconomic conditions on our business is dynamic and cannot be predicted.

For more information on our operations and risks related to our macroeconomic environment, please see the section titled “Risk Factors”.

GM ~~Project~~Series Production Award Cancellation

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On December 11, 2023, Koito informed us that GM has decided to re-scope its ADAS product offerings and, as a result, all outstanding purchase orders from Koito to us that relate to the GM series production award have been cancelled. As is customary when an automotive program changes, we submitted a project investment cost recovery claim related to the cancellation. See Note 1817 to our condensed consolidated financial statements included elsewhere in this Report for further information.

Koito Letter of Intention and Koito Merger Agreement

On December 21, 2023, we received a non-binding indication of interest from Koito to acquire 100% of the outstanding shares of the Company not already owned by Koito or certain other potential rollover participants including Dr. Jun Pei, Cepton’s President and Chief Executive Officer (collectively, the “Rollover Participants”).

On July 29, 2024, we entered into an Agreement and Plan of Merger (the “Koito Merger Agreement” and, together with the transactions contemplated thereby, the “Transaction”) with Koito Manufacturing Co., LTD (“Koito”) and Project Camaro Merger Sub, Inc., an indirectly wholly-owned subsidiary of Koito (“Merger Sub”), pursuant to which, among other things and on the terms and subject to the conditions set forth in the Koito Merger Agreement, Merger Sub shall be merged with and into Cepton, with Cepton continuing as the surviving corporation and an indirect subsidiary of Koito. Our Board of Directors has approved the Transaction and has recommended that our stockholders approve the Transaction at an upcoming meeting of our stockholders. If approved by our stockholders representing at least a majority of our outstanding shares, the Transaction is expected to close in the first quarter of 2025, subject to regulatory approvals and other customary closing conditions. No assurance can be given that the potential transaction will be consummated in a timely manner or at all. See Note 2018 to our condensed consolidated financial statements included elsewhere in this Report for further information.

During the three and ~~six~~nine months ended ~~June~~September 30, 2024, ~~the~~we ~~Company~~ incurred $0.1.6 million and $13.62 million of transaction costs related to the Transaction, respectively. The Transaction expenses include fees paid to attorneys, investment bankers, and accountants as well as other related costs.

New Series Production

In March 2024, we, alongside our tier 1 partner, Koito, were notified of a new series production by a global OEM, which will utilize our near-range lidar. On May 9, 2024, we entered into an engineering services contract with Koito for approximately $10.0 million in fees to support customer-specific product development and program execution efforts for this new OEM.

Key Factors Affecting Our Operating Results

We believe that our future performance and success depends, to a substantial extent, on our ability to capitalize on the following opportunities, which in turn is subject to significant risks and challenges, including those discussed below and in Part II, Item 1A of this Report under the heading “Risk Factors”.

Series Production Awards in the Automotive Market

An important part of our mission is to deploy high performance, mass-market lidar in the automotive market. Within the automotive market, we believe that passenger car ADAS applications represent the largest opportunity but also have the most stringent requirements for reliability, cost, and performance. Major automotive OEMs typically undergo several years of planning, technology selection, and vehicle integration work before introducing new and important technologies in their vehicle offerings. We anticipate that lidar, as a new sensor that improves safety and enhances autonomy, will undergo the same technology introduction and validation process as similar technologies in the past, such as anti-lock braking systems or stability control systems. The number of vehicle platforms and vehicle models that will be equipped with lidar will depend on OEM product planning, vehicle integration, and marketing schedules. Once a lidar supplier is chosen, the number of awarded vehicle platforms and vehicle models is likely to increase over time. This is because the development efforts of integrating lidar into the OEM’s product offerings is leveraged across multiple vehicle classes and platforms to maximize the OEM’s return on investment.

Adoption of Lidar Solutions in Automotive and Smart Infrastructure Markets

In an endless pursuit of safety and product differentiation, many leading automotive OEMs have decided to include lidar in their next generation of vehicles for increased safety and higher levels of autonomy. The speed of lidar adoption depends on many factors, including sensor performance, reliability, and cost, as well as the time it takes to win large series ~~production awards. Large automotive series production awards usually take a number of years to secure but once awarded,~~

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production awards. Large automotive series production awards usually take a number of years to secure but once awarded, the production award typically covers the entire duration of a typical vehicle model period of five to seven years for consumer vehicles. In the case of trucking applications, the production period of a typical model may exceed seven years in many cases. We are currently engaged in discussions with all of the top 10 global automotive OEMs based on vehicle production volume rankings from 2019 according to IHS Markit, a leading independent third-party industry analytics and information provider.

While lidar adoption in the automotive market may take multiple years to materialize, the smart infrastructure market could adopt lidar solutions at a more rapid pace. Applications within smart infrastructure vary widely from tolling to security, to delivery and logistics. These applications are typically project based and require certain levels of customization to deliver an end-to-end solution. To address opportunities in this market, we partner with system integrators who leverage our lidar hardware as well as our Helius® perception software to provide solutions unique to each opportunity. We expect to grow our system integrator partnership network to further drive the adoption of lidar in smart infrastructure applications.

We expect our revenue to increase as lidar adoption increases in the automotive and smart infrastructure markets; however, the rate of adoption may vary due to many factors, including but not limited to competing technologies, time to market, changes in macroeconomic conditions, including rising inflation ~~and interest rates~~, geopolitical conflicts and tensions, any of which may impact the pace and magnitude of lidar adoption and our revenues.

Product Cost and Margins

To drive mass-market adoption of lidar in automotive applications, product cost must be controlled. As such, cost is one of the primary design criteria that we focused on from the very beginning. Design choices were carefully evaluated to create products with the best overall balance between performance, reliability, and cost. Working with our partners, we expect to continue driving costs down as volumes increase and we achieve higher margin unit economics in the future.

In the smart infrastructure space, the average selling price of a lidar solution may be higher than that in the automotive space due to a number of reasons, such as unit volume, level of customization, and additional software content. At the same time, the cost of production is also higher due to lower production volumes and higher levels of system integration requirements.

If we cannot generate our expected revenues, margins or income from operations, we may be required to raise additional debt or equity capital, which may not be available or may only be available on terms that are onerous to our stockholders.

End Market Concentration

We believe that the automotive market represents a large portion of the total addressable market and large global automotive OEMs represent the majority of unit volume demand as well as leaders in active safety and autonomy. To drive mass-market commercialization of our lidar solutions, we have focused on top automotive OEMs and are currently engaged with all of the top 10 global automotive OEMs. Series production awards from top OEMs tend to be large and long-term in nature. While we continue to expand our system integrator partnership network to address opportunities in the smart infrastructure markets, program awards tend to be smaller and short-term in nature as compared to those in the automotive end-markets. As such, we expect a large portion of our future revenue to come from the automotive end-market.

Components of Results of Operations

Revenue

Revenue is primarily derived from the sale of components and licensing of our technologies to tier 1 suppliers for mass market ADAS applications in the automotive market, the sale of lidar sensors directly to end-user customers in the smart infrastructure market, and engineering development arrangements of our lidar products for customers. Our lidar sensors are used in applications such as advanced driver assistance systems, autonomous vehicles, and intelligent transportation systems. Our customers include leading OEMs and suppliers within the automotive and smart infrastructure industries.

We categorize our revenue as (1) lidar sensor and prototype revenue and (2) development revenue.

Lidar sensor and prototype revenue is primarily derived from the sale of components and license of technologies to tier 1 suppliers for mass market ADAS applications in the automotive market and the sale of lidar sensors directly to end-user customers in the smart infrastructure markets. We expect lidar sensor and prototype revenue towill ~~decrease~~be insignificantly ~~2024~~lower asin ~~compared to 2023 due to the cancellation of the GM series production award. Over time, we anticipate lidar sensor and~~

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2024 as compared to 2023 due to the cancellation of the GM series production award. Over time, we anticipate lidar sensor and prototype revenue growth as we continue to form strategic partnerships and as the primary source of revenue shifts from prototype sales to sales of commercialized production-ready lidar sensors in the foreseeable future thereafter.

Development revenue represents arrangements with tier 1 suppliers focused on the specific customization of our proprietary lidar capabilities to the customers’ applications, typically involving development of customized software for producing or operating lidar sensor prototypes for those customers. The timing of revenue recognition for development contracts is determined for each performance obligation based on the unique facts and circumstances within each development arrangement, which generally results in recognition at a point in time. This assessment is made at the outset of the arrangement for each performance obligation. WeDevelopment ~~anticipate development~~ revenue in 2024 is expected to be significantly higher as compared to 2023 due to ~~completion of~~ the engineering services contract with Koito to support a major global OEM series production award ~~during the second quarter of 2024~~. Over time, we anticipate development revenue to grow in the foreseeable future as we engage with customers in OEM development projects.

Cost of Revenue

Cost of revenue includes the manufacturing cost of our lidar sensors and components, which primarily consists of personnel-related costs directly associated with our manufacturing organization, and amounts paid to our third-party contract manufacturers and vendors. Our cost of revenue also includes cost of component inventory, product testing costs, an allocated portion of overhead costs, warranty expense, excess and obsolete inventory, and shipping costs. Development cost of revenue includes personnel-related costs incurred in the completion of the development projects. ~~Increased~~Excess ~~costs for components, logistics~~ and ~~other~~obsolete ~~supply chain expenses~~inventory, driven in part by ~~inflation~~the ~~and~~reduction ~~supply~~of ~~chain~~lidar ~~shortages~~sensor and prototype orders, have negatively impacted, and may continue to negatively impact, our cost of revenue. We anticipate lidar sensor and prototype cost of revenue to decrease in 2024 as compared to 2023 due to the cancellation of the GM series production award. We anticipate development cost of revenue to be higher in 2024 as compared to 2023 due to the completion of the engineering services contract with Koito to support a major global OEM series production award during the second quarter of 2024. Over time, we anticipate cost of revenue to increase in absolute dollars as we grow our sales in the foreseeable future.

Gross Margin

Our gross margin in future periods will depend on a variety of factors including market conditions that may impact our pricing and sales volume; product mix changes between established products and new products; excess and obsolete inventories; our cost structure for manufacturing operations, including third-party manufacturers, relative to volume; and margin on development revenue projects. Our gross margin varies by product and by development revenue projects. We expect our gross margins to fluctuate over time, depending on the factors described above.

Operating Expenses

Research and Development Expenses

Research and development expenses consist primarily of personnel-related costs, material expenses, permits, licenses, and professional services costs directly associated with our research and development activities. The remainder primarily relates to the allocated portion of overhead costs. Our research and development efforts are focused on enhancing and developing additional functionality for our existing products and on new product development, including new releases and upgrades to our lidar sensors. We expense research and development costs as incurred. We expect our research and development expenses for 2024 to be lower compared to 2023. Over time, we anticipate research and development costs to increase in absolute dollars as we increase our investment in ASIC and software development to broaden the capabilities of our solutions and introduce new products and features.

Selling, General and Administrative Expenses

Our selling, general and administrative expenses consist primarily of personnel-related costs, professional services costs, and advertising expenses directly associated with our sales and general and administrative activities. The remainder primarily relates to the allocated portion of overhead costs. We expect our selling, general and administrative expenses for 2024 to be lower compared to 2023. Over time, we anticipate selling, general and administrative expenses to increase in absolute dollars over time in the future to support our expected growth as we increase our sales and marketing activities, build brand awareness, grow our domestic and international operations, and increase the size of our general and administrative function.

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Gain (Loss) on Change in Fair Value of Earnout and Warrant Liabilities

The change in fair value of earnout and warrant liabilities consists of the change in fair value of earnout and warrant liabilities assumed in connection with the Business Combination as well as the change in fair value of other warrant liability.

Foreign Currency Transaction Loss, Net

We incur transaction gains and losses resulting from transactions denominated in currencies other than the functional currency of the Company. In 2023, we incurred foreign currency transaction losses resulting from the repayment of the Secured Term Loan with Koito (the “Secured Term Loan”), which was denominated in Japanese Yen.

Loss on Extinguishment of Debt

Loss on extinguishment of debt represents the loss associated with the repayment of the Secured Term Loan in 2023.

Other (Expense) Income, Net

Other (expense) income, net consists primarily of a realizable gain from recoveries ofin 2024 related to the GM series production award cancellation, inpartially ~~2024~~offset by a contingent loss resulting from project loss claims from our contract manufacturers affected by the GM series production award cancellation. ~~This~~In 2023, this amount was immaterial ~~in 2023~~.

Interest Income, Net

Interest income, net consists primarily of interest earned on our cash equivalents and short-term investments. In 2023 only, it also included interest expense from our debt financing. These amounts will vary based on our cash, cash equivalents and short-term investment balances, and also with market interest rates.

Provision (Benefit) for Income Taxes

Our provision for income taxes consists of federal, state, and foreign current and deferred income taxes. Any changes in the United States and foreign taxation of our business activities may increase our overall provision for income taxes in the future.

We have a full valuation allowance for net deferred tax assets, including federal and state net operating loss carryforwards and research and development credit carryforwards. We expect to maintain this valuation allowance until it becomes more likely than not that the benefit of our federal and state deferred tax assets are realizable by way of expected future taxable income.

We believe that we have adequately reserved for our uncertain tax positions, although we can provide no assurance that the final outcome of these matters will not be materially different. To the extent that the final outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and results of operations.

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Results of Operations for the Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2024 and 2023

The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this Report. The following table sets forth our condensed consolidated results of operations data for the periods presented:

	Three Months EndedJune 30,				Change$		Change%		Six Months EndedJune 30,				Change$		Change%
	Three Months EndedSeptember 30,				Change$		Change%		Nine Months EndedSeptember 30,				Change$		Change%
	2024		2023						2024		2023
	(dollars in thousands)								(dollars in thousands)
Lidar sensor and prototype revenue	$	~~374~~466	$	23,~~771~~802	$	(23,~~397~~336)	(8788	%)	$	1,~~515~~981	$	47,~~011~~813	$	(25,~~496~~832)	(6275	%)
Development revenue	~~10,054~~81		1631		~~10,038~~50		NM		10,~~859~~940		~~261~~292		10,~~598~~648		NM
Total revenue	$	~~10,428~~547	$	23,~~787~~833	$	7(3,~~641~~286)	NM(86	%)	$	12,~~374~~921	$	48,~~272~~105	$	84,~~102~~816	NM59	%
Lidar sensor and prototype cost of revenue	~~976~~600		23,~~348~~339		(12,~~372~~739)		(5882	%)	2,~~188~~788		37,~~796~~135		(14,~~608~~347)		(4261	%)
Development cost of revenue	~~3,098~~29		5—		~~3,093~~29		NMNA		3,~~409~~438		116		3,~~293~~322		NM
Total cost of revenue	~~4,074~~629		23,~~353~~339		1(2,~~721~~710)		73(81	%)	56,~~597~~226		37,~~912~~251		(1,~~685~~025)		43(14	%)
Gross profit	6,354		434		5,920		NM		6,777		360		6,417		NM
Gross (loss) profit	(82)		494		(576)		NM		6,695		854		5,841		NM
Operating expenses:
Research and development	35,~~234~~524		96,~~365~~706		(61,~~131~~182)		(6518	%)	814,~~888~~412		1623,~~603~~309		(78,~~715~~897)		(4638	%)
Selling, general, and administrative	35,~~709~~332		6,~~185~~136		(~~2,476~~804)		(4013	%)	915,~~973~~305		1219,~~916~~052		(23,~~943~~747)		(2320	%)
Total operating expenses	610,~~943~~856		1512,~~550~~842		(81,~~607~~986)		(5515	%)	1829,~~861~~717		2942,~~519~~361		(1012,~~658~~644)		(3630	%)
Operating loss	(~~589~~10,938)		(1512,~~116~~348)		141,~~527~~410		(9611	%)	(1223,~~084~~022)		(2941,~~159~~507)		1718,~~075~~485		(5945	%)
Other income (expenses):
Gain (loss) on change in fair value of earnout liability	59		(26)		85		NM		59		736		(677)		(92	%)
Gain on change in fair value of earnout liability	—		91		(91)		(100	%)	59		827		(768)		(93	%)
(Loss) gain on change in fair value of warrant liability	(115)		36169		(47174)		NM		(1823)		~~130~~299		(~~148~~322)		NM
Other income, net	88		2		86		NM		4,110		21		4,089		NM
Other (expense) income, net	(321)		2		(323)		NM		3,789		23		3,766		NM
Loss on extinguishment of debt	—		—		—		NA		—		(1,123)		1,123		(100	%)
Foreign currency translation loss, net	—		—(7)		—7		NA(100	%)	—		(~~750~~757)		~~750~~757		(100	%)
Interest income, net	~~613~~622		~~917~~799		(~~304~~177)		(3322	%)	1,~~267~~889		12,~~216~~015		51(126)		4(6	%)
Income (loss) before income taxes	160		(14,187)		14,347		NM		(6,666)		(28,929)		22,263		(77	%)
Loss before income taxes	(10,642)		(11,294)		652		(6	%)	(17,308)		(40,223)		22,915		(57	%)
Benefit (provision) for income taxes	21—		~~(3)~~—		24—		NMNA		14		(3)		17		NM
Net income (loss)	$	181	$	(14,190)	$	14,371	NM		$	(6,652)	$	(28,932)	$	22,280	(77	%)
Net loss	$	(10,642)	$	(11,294)	$	652	(6	%)	$	(17,294)	$	(40,226)	$	22,932	(57	%)


NA: Not applicable
NM: Not meaningful (greater than 100% change or otherwise)

Comparison of the Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2024 and 2023

Revenue

Lidar sensor and prototype revenue decreased by $23.43 million, or 8788%, to $0.45 million for the three months ended ~~June~~September 30, 2024, from $23.8 million for the three months ended ~~June~~September 30, 2023. Approximately $12.09 million of the decrease was driven by a decrease in lidar sales volume, $01.98 million was driven by a decrease in sales of custom lidar products due to the GM ~~project~~series production award cancellation, ~~and~~partially ~~approximately~~offset ~~$0.4 million was driven~~ by a ~~decrease~~$1.3 million increase in the average sales price for lidar sensors.

2930

Development revenue ~~increased~~remained byfairly ~~$10.0 million~~consistent towith ~~$10.1 million for the three months ended June 30, 2024, compared to an~~ immaterial ~~amount~~amounts earned for ~~the~~each ~~three~~of ~~months ended June 30, 2023. This increase was driven by a development work order entered into with Koito during~~ the three months ended ~~June~~September 30, 2024, ~~for which all milestones~~ and ~~deliverables were achieved and provided during the three months ended June 30, 2024~~2023.

Lidar sensor and prototype revenue decreased by $2.5.8 million, or 6275%, to $12.50 million for the ~~six~~nine months ended ~~June~~September 30, 2024, from $47.08 million for the ~~six~~nine months ended ~~June~~September 30, 2023. Approximately $13.52 million of the decrease was driven by a decrease in sales of custom lidar products due to the GM ~~project~~series production award cancellation, $03.60 million was driven by a decrease in lidar sales volume, ~~and~~partially offset by a $0.4 million ~~was~~increase ~~driven by a decrease~~ in the average sales price for lidar sensors.

Development revenue increased by $10.6 million to $10.9 million for the ~~six~~nine months ended ~~June~~September 30, 2024, from $0.3 million for the ~~six~~nine months ended ~~June~~September 30, 2023. The increase was driven by the completion of new development work order entered into with Koito, ~~which~~during ~~was~~the ~~fully~~second ~~completed~~quarter as of ~~June 30,~~ 2024.

Cost of Revenue

Lidar sensor and prototype cost of revenue decreased by $12.47 million, or 5882%, to $1.0.6 million for the three months ended ~~June~~September 30, 2024, from $23.3 million for the three months ended ~~June~~September 30, 2023. The decrease was driven by lower sales volume resulting in a $12.75 million cost reduction, ~~which~~and ~~was partially offset by~~ a $0.3 million ~~increase~~decrease in scrap and excess and obsolete expense.

Development cost of revenue ~~increased~~remained byfairly ~~$3.1 million~~consistent ~~for~~with ~~the~~immaterial ~~three~~amounts ~~months~~recorded ~~ended~~for ~~June~~each ~~30, 2024, compared to immaterial development cost~~ of ~~revenue for~~ the three months ended ~~June~~September 30, ~~2023.~~2024 ~~The~~and ~~increase in development cost of revenue resulted from the increase in development revenue described above~~2023.

Lidar sensor and prototype cost of revenue decreased by $14.63 million, or 4261%, to $2.28 million for the ~~six~~nine months ended ~~June~~September 30, 2024, from $37.81 million for the ~~six~~nine months ended ~~June~~September 30, 2023. The decrease was driven by lower sales volume resulting in a $14.95 million cost reduction, which was partially offset by a $0.32 million increase in scrap and excess and obsolete inventory expense.

Development cost of revenue increased by $3.3 million to $3.4 million for the ~~six~~nine months ended ~~June~~September 30, 2024, from $0.1 million for the ~~six~~nine months ended ~~June~~September 30, 2023. The increase in development cost of revenue resulted from the increase in development revenue described above.

Operating Expenses

Research and development expense decreased by $6.1.2 million, or 6518%, to $35.25 million for the three months ended ~~June~~September 30, 2024, from $96.47 million for the three months ended ~~June~~September 30, 2023, resulting primarily from a $31.52 million decrease in personnel related costs~~, a $1~~.~~4 million decrease in materials costs, and a $1.2 million decrease in engineering service.~~

Selling, general and administrative expense decreased by $20.58 million, or 4013%, to $35.73 million for the three months ended ~~June~~September 30, 2024, from $6.21 million for the three months ended ~~June~~September 30, 2023, resulting primarily from a $21.06 million decrease in personnel related costs, ~~and~~ a $0.52 million decrease in other general and administrative costs such as ~~advertisements~~advertisement and trade shows, partially offset by a $1.0 million increase in legal, accounting and other professional services expenses mainly related to the Transaction.

Research and development expense decreased by $78.79 million, or 4638%, to $814.94 million for the ~~six~~nine months ended ~~June~~September 30, 2024, from $1623.63 million for the ~~six~~nine months ended ~~June~~September 30, 2023, resulting primarily from a $45.79 million decrease in personnel costs, a $2.0 million decrease in material costs, a $0.9 million decrease in engineering services, and a $1.0 million decrease in ~~engineering~~travel ~~services~~and meals expenses.

Selling, general and administrative expense decreased by $23.97 million, or 2320%, to $1015.03 million for the ~~six~~nine months ended ~~June~~September 30, 2024, from $1219.91 million for the ~~six~~nine months ended ~~June~~September 30, 2023, resulting primarily from a $3.5.2 million decrease in personnel related costs, $0.5 million decrease in advertisement and trade shows expenses, $0.2 million decrease in travel and meals expenses, partially offset by a $12.63 million ofincrease ~~non-recurring~~in ~~transaction~~legal, ~~costs~~accounting and other professional services expenses mainly related to the Transaction.

Gain (loss) on Change in Fair Value of Earnout and Warrant Liabilities

~~The~~There ~~earnout liability~~ was ~~assumed~~no ingain ~~connection~~or ~~with~~loss ~~the~~on ~~Business Combination. The~~ change in fair value of the earnout liability ~~was an immaterial gain~~ for the three months ended ~~June~~September 30, 2024, compared to ana ~~immaterial~~gain ~~loss~~of $0.1 million for the three months ended ~~June~~September 30, 2023, a decrease of $0.1 million. The change in fair value of the warrant liability was an immaterial loss for the three months ended ~~June~~September 30, 2024, compared to ana ~~immaterial~~ gain of $0.2 million for the three months ended ~~June~~September 30, 2023, a decrease of $0.2 million.

The gain on change in fair value of the earnout liability decreased by $0.7 million for the six months ended June 30, 2024. The gain on change in fair value of the warrant liability decreased by $0.1 million for the six months ended June 30, 2024. 31

The gain on change in fair value of the earnout liability decreased by $0.8 million to an immaterial amount for the nine months ended September 30, 2024, compared to a gain of $0.8 million for the nine months ended September 30, 2023. The change in fair value of the warrant liability was an immaterial loss for the nine months ended September 30, 2024, compared to a gain of $0.3 million for the nine months ended September 30, 2023, a decrease of $0.3 million.

~~This~~The isdecreases were primarily due to a larger decrease in the Company’s common share price ~~during~~in ~~the~~2024 ~~six~~as ~~months ended June 30, 2023~~ compared to ~~the six months ended June 30, 2024~~2023.

Foreign Currency Transaction Loss, Net

There was no foreign currency transaction loss, net during the three and ~~six~~nine months ended ~~June~~September 30, 2024 or the three months ended ~~June~~September 30, 2023. During the ~~six~~nine months ended ~~June~~September 30, 2023, the Foreign currency transaction loss, net of $0.8 million resulted from the repayment of the Secured Term Loan with Koito, which was denominated in Japanese Yen.

Loss on Extinguishment of Debt

There were no losses on extinguishment of debt during the three and ~~six~~nine months ended ~~June~~September 30, 2024 or the three months ended ~~June~~September 30, 2023. Loss on extinguishment of debt of $1.1 million for the ~~six~~nine months ended ~~June~~September 30, 2023 resulted from repayment of the Secured Term Loan with Koito.

Other (Expense) Income, Net

Other (expense) income, net ~~increased~~was bya an$0.3 ~~insignificant~~million ~~amount~~expense for the three months ended ~~June~~September 30, 2024. This was due to a contingent loss incurred from project loss claims from our contract manufacturers affected by the GM series production award cancellation. Other (expense) income, net increased by $43.18 million for the ~~six~~nine months ended ~~June~~September 30, 2024 mainly due to a gain related to recoveries from the GM series production award cancellation that became realizable during the first quarter of 2024. ~~The~~Other ~~cancellation~~(expense) ofincome, ~~the~~net GMwas ~~series~~immaterial ~~production~~for ~~award~~each ~~occurred~~of ~~during~~ the ~~fourth~~three ~~quarter~~and ofnine months ended September 30, 2023.

Interest Income, Net

Interest income, net decreased by $0.32 million for the three months ended ~~June~~September 30, 2024. Interest income, ~~primarily~~net ~~due~~decreased toby ~~less~~$0.1 million for the nine months ended September 30, 2024. The decreases in interest income earned ~~from~~were ~~the~~primarily ~~investment~~due ofto ~~the~~decreasing cash ~~received~~and ~~from~~short-term ~~the~~investment ~~issuance~~balances ofin ~~Preferred~~2024 ~~Stock~~as compared to ~~Koito in~~ 2023.

Interest income, net remained fairly consistent for the six months ended June 30, 2024 and six months ended June 30, 2023.

Benefits (Provision) for Income Taxes

Our benefit (provision) for income taxes were immaterial for each of the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023. We provided a full valuation allowance on our net U.S. federal and state deferred tax assets for the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023. For all reporting periods, we had U.S. federal and state tax-effected net operating loss carryforwards available to reduce future taxable income, of which post-2017 federal net operating loss will be carried forward indefinitely and pre-2017 federal net operating loss carryover and state net operating loss carryover and state net operating loss carryover will expire on varying dates.

Liquidity and Capital Resources

Sources of Liquidity

As of ~~June~~September 30, 2024, we had cash and cash equivalents totaling $5647.07 million. We believe that our current cash position will be sufficient to satisfy our foreseeable liquidity needs and capital expenditure requirements, including for at least the next twelve months.

On October 27, 2022, we entered into an Investment Agreement with Koito, pursuant to which, among other things, at the closing of the transactions, and based on the terms and subject to the conditions set forth therein, we issued and sold to Koito, 100,000 shares of Preferred Stock for a purchase price of $100.0 million. The issuance and sale of the Preferred Stock and related matters were approved by our stockholders on January 11, 2023, and the Preferred Stock was issued to Koito on January 19, 2023. The Preferred Stock is convertible, beginning on January 19, 2024, into shares of our common stock at an approximate initial conversion price of $25.85 per share (subject to adjustment).

On July 29, 2024, we entered into the Koito Merger Agreement, pursuant to which Koito is expected to acquire all of the Company’s capital stock that is not already owned by Koito. The Transaction is expected to close in the first quarter of 2025, subject to regulatory approvals and other customary closing conditions. If the Transaction is consummated, we will become a privately-held subsidiary with increased liquidity and capital resources from Koito.

312025, subject to regulatory approvals and other customary closing conditions. If the Transaction is consummated, we will become a privately-held subsidiary with increased liquidity and capital resources from Koito.

In December 2023, Koito informed us that GM had decided to re-scope its ADAS product offerings and, as a result, all outstanding purchase orders placed with us related to the GM series production award have been cancelled. As is customary when an automotive program changes, we submitted a project investment cost recovery claim related to the cancellation to Koito and realized $4.0 million of cost recovery during the ~~six~~nine months ended ~~June~~September 30, 2024. The timing and amount of recovery, if any, of the remaining portion of our cost recovery claim is uncertain and unknown at this time. See Note 17 to the condensed consolidated financial statements included elsewhere in this Report.

We have incurred negative cash flows from operating activities and significant operating losses in the past as reflected in our accumulated deficit of $~~141~~151.39 million as of ~~June~~September 30, 2024. During the ~~six~~nine months ended ~~June~~September 30, 2024, we had negative cash flow from operating activities of $08.37 million. We expect to continue to invest in research and development and generate operating losses in the near future. In addition, our future capital requirements will depend on many factors, including our lidar sales volume (including if we have major customer wins or series production award wins), development project revenue, the timing and extent of spending in materials, equipment, and personnel to support our research and development efforts in lidar technology, the expansion of sales and marketing activities, market adoption of new and enhanced products and features, and increased spending due to inflation and supply chain shortages. If we are required to raise additional funds by issuing equity securities, dilution to stockholders would result. Any equity securities issued may also provide for rights, preferences, or privileges senior to those of common stockholders. For example, the Preferred Stock issued to Koito is ranked more senior to our common stock in the event of liquidation and includes other rights and preferences senior to those of our common stock. In addition, the Preferred Stock is convertible into shares of our common stock and, upon conversion, will result in dilution to our stockholders. If we raise funds by issuing debt securities, these debt securities would have rights, preferences, and privileges senior to those of common stockholders. Our ability to raise additional funds through the issuance of debt or equity securities may be subject to Koito’s consent pursuant to the Investor Rights Agreement and, until the closing of the Transaction or the termination thereof, the Koito Merger Agreement. For information regarding our cash requirements from lease obligations, see Note 16 to the condensed consolidated financial statements included elsewhere in this Report.

We are subject to risks and uncertainties frequently encountered by early-stage companies including, but not limited to, the uncertainty of successfully developing products, securing certain contracts, building a customer base, successfully executing business and marketing strategies, and hiring appropriate personnel.

To date, we have been funded primarily by equity financings (including the Preferred Stock), convertible promissory notes, and the net proceeds we received through the Business Combination, PIPE Investment, and private placements of the Legacy Cepton convertible preferred stock. Failure to generate sufficient revenues, achieve planned gross margins and operating profitability, control operating costs, or secure additional funding may require us to modify, delay, or abandon some of our planned future expansion or development, or to otherwise enact operating cost reductions available to management, which could have a material adverse effect on our business, operating results, financial condition, and ability to achieve our intended business objectives.

Cash Flow Summary — ~~Six~~Nine Months Ended ~~June~~September 30, 2024 and 2023

	Six Months EndedJune 30,
	Nine Months EndedSeptember 30,
	2024		2023
Net cash provided by (used in):	(dollars in thousands)
Operating activities	$	(~~335~~8,700)	$	(2130,~~240~~526)
Investing activities	6,057		(3313,~~792~~898)
Financing activities	(9499)		54,~~614~~623

Operating Activities

During the ~~six~~nine months ended ~~June~~September 30, 2024, our operating activities used $08.37 million in cash. We recorded a net loss of $617.73 million; however, this was offset by a $35.31 million of non-cash net expenses consisting primarily of stock-based compensation expense of $23.47 million and amortization of right-of-use assets of $01.83 million. During the ~~six~~nine months ended ~~June~~September 30, 2024, changes in our operating assets and liabilities increased net cash by $3.05 million, resulting primarily from a $3.31 million decrease in accounts receivable balance with more cash collection, ~~and~~ a $1.7 3 million increase in accounts payable balance due to timing of payments. The changes in operating assets and liabilities were partially offset by a $2.1 million increase in prepaid expenses and other current assets .

During the six months ended June 30, 2023, our operating activities used $21.2 million in cash. We recorded a net loss of $28.9 million; however, this was offset by $6.3 million of non-cash income and expenses consisting primarily of stock-based compensation expense of $4.7 million, loss on extinguishment of debt of $1.1 million, foreign currency transaction 33

32decrease in inventory balance, a $1.3 million increase in accounts payable balance due to timing of payments, and a $0.8 million increase in accrued expenses and other current liabilities. The changes in operating assets and liabilities were partially offset by a $1.8 million increase in prepaid expenses and other current assets and a $1.4 million decrease in operating lease liabilities.

During the nine months ended September 30, 2023, our operating activities used $30.5 million in cash. We recorded a net loss of $040.82 million; however, this was offset by a $8.6 million of non-cash income and expenses consisting primarily of stock-based compensation expense of $7.0 million, amortization of right-of-use assets of $1.2 million, loss on extinguishment of debt of $1.1 million, foreign currency transaction loss of $0.8 million, and depreciation and amortization of $0.4 million. These non-cash income items were partially offset by gains from the change in fair value of earnout and warrant liabilities of $1.1 million and other accretion of $0.97 million. During the ~~six~~nine months ended ~~June~~September 30, 2023, we generated net cash of $1.41 million from changes in our operating assets and liabilities resulting primarily from a $23.0 million decrease in prepaid expenses and other current assets due to amortization of our director and officers insurance policy, and a $01.81 million increase in accrued expenses and other current liabilities. ~~and~~These were offset by a $0.79 million ~~decrease~~increase in ~~accounts~~inventory ~~payable~~as ~~due~~the toCompany ~~timing~~made preparations for the start of ~~payments.~~the ~~These~~series ~~were~~production ~~offset~~prior byto production being delayed, and a $10.28 million increase in ~~inventory~~accounts asreceivable ~~the~~driven ~~Company~~by ~~prepares for~~ the ~~start~~increase ofin ~~series production~~revenue, and a $0.8 million ~~increase~~decrease in accounts ~~receivable~~payable due to the timing of payments.

Investing Activities

During the ~~six~~nine months ended ~~June~~September 30, 2024, our investing activities generated $6.1 million of cash, resulting primarily from proceeds from maturities of short-term investments of $6.0 million.

During the ~~six~~nine months ended ~~June~~September 30, 2023, our investing activities used $3313.89 million of cash, resulting primarily from purchases of short-term investments of $37.8 million and purchases of property and equipment of $1.23 million, partially offset by proceeds from maturities of short-term investments of $525.2 million.

Financing Activities

During the ~~six~~nine months ended ~~June~~September 30, 2024, our financing activities used $0.1 million of cash from payment of employee taxes on RSU vesting.

During the ~~six~~nine months ended ~~June~~September 30, 2023, our financing activities provided $54.6 million of cash consisting primarily of $99.9 million of net proceeds from the issuance of Preferred Stock to Koito, partially offset by the repayment of $45.2 million of short-term debt to Koito.

Critical Accounting Policies and Estimates

We prepare our condensed consolidated financial statements in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates, assumptions and judgments that can significantly impact the amounts we report as assets, liabilities, revenue, costs and expenses and the related disclosures. We base our estimates on historical experience and other assumptions that we believe are reasonable under the circumstances. Our actual results could differ significantly from these estimates under different assumptions and conditions. A discussion of the accounting policies that management considers critical in that they involve significant management judgments and assumptions, require estimates about matters that are inherently uncertain and because they are important for understanding and evaluating our reported financial results is included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023. There have been no material changes to our critical accounting policies.

Emerging Growth Company Status

Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable.

We are an “emerging growth company” as defined in Section 2(a) of the Securities Act of 1933, as amended, and have elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards, although we may decide to early adopt such new or revised accounting standards to the extent permitted by such standards. This may make it difficult or impossible to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.

Subject to certain conditions set forth in the JOBS Act, if, as an emerging growth company, we intend to rely on such exemptions, we are not required to, among other things: (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis); and (iv) disclose certain 34

33company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.

We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) ending December 31, 2026, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter; and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to “emerging growth company” shall have the meaning associated with it in the JOBS Act.

Recent Accounting Pronouncements

See Note 1 to our condensed consolidated financial statements included elsewhere in this Report for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of the date of this Report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to our market risk exposures or management of market risk from those disclosed in Quantitative and Qualitative Disclosures About Market Risk included under Part II, Item 7A in our Annual Report on Form 10-K for the year ended December 31, 2023.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Report.

Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.

As discussed elsewhere in this Report, we completed the Business Combination on February 10, 2022. Prior to the consummation of the Business Combination, we were a private company with limited accounting personnel and other resources with which to address our internal control over financial reporting. Based on the evaluation of our disclosure controls and procedures as of the end of the period covered by this Report, our management concluded that our disclosure controls and procedures were not effective as of such date because of the material weaknesses in our internal control over financial reporting identified as of December 31, 2021 that continued to exist with respect to our internal control over financial reporting as of ~~June~~September 30, 2024:

•We did not maintain a sufficient complement of resources with an appropriate level of accounting knowledge and experience commensurate with the financial reporting requirements for a public company, in particular with respect to technical accounting knowledge regarding the accounting for certain non-standard transactions.

We cannot assure you that additional significant deficiencies or material weaknesses in our internal control over financial reporting will not be identified in the future. Any failure to maintain or implement required new or improved controls, or to implement our remediation plans or any difficulties we encounter in our implementation thereof, could result in additional significant deficiencies or material weaknesses or result in material misstatements in our financial statements. If we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting when required, lenders and investors may lose confidence in the accuracy and completeness of our financial reports.

accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting when required, lenders and investors may lose confidence in the accuracy and completeness of our financial reports.

This material weakness has resulted in certain immaterial errors in our previous financial statements and, if not remediated, could result in misstatements of accounts or disclosures that would result in a material misstatement to the annual consolidated financial statements or the interim condensed consolidated financial statements that would not be prevented or detected.

Our management anticipates that our internal control over financial reporting will not be effective until the above material weakness is remediated. If our remediation of this material weakness is not effective, or we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal control over financial reporting in the future, the accuracy and timing of our financial reporting may be adversely affected, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports in addition to the Nasdaq listing requirements, investors may lose confidence in our financial reporting, and the price of our common stock may decline as a result. In addition, we may be unable to sell shares of common stock to Lincoln Park pursuant to the Purchase Agreement at prices we consider to be reasonable or at all, we may be unable to borrow funds from banking institutions on acceptable terms or at all, and we may face restricted access to various sources of financing in the future.

future, the accuracy and timing of our financial reporting may be adversely affected, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports in addition to the Nasdaq listing requirements, investors may lose confidence in our financial reporting, and the price of our common stock may decline as a result. In addition, we may be unable to sell shares of common stock to Lincoln Park pursuant to the Purchase Agreement at prices we consider to be reasonable or at all, we may be unable to borrow funds from banking institutions on acceptable terms or at all, and we may face restricted access to various sources of financing in the future.

We will continue to evaluate our accounting and financial staffing needs in light of the material weakness described above. While we have made progress to enhance our internal control over financial reporting and will continue to devote effort in control remediation, additional time is required to complete implementation and to assess and ensure the sustainability of these procedures. Accordingly, the material weakness cannot be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control Over Financial Reporting

Other than the remediation steps taken above, there were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) or 15d-15(d) of the Exchange Act during the quarter ended ~~June~~September 30, 2024 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, the Company may be involved in various legal claims, litigation and other matters that arise in the normal course of its operations. Although there can be no assurances and the outcome of these matters is not determinable, the Company currently believes that none of these claims, actions or proceedings are likely to have a material adverse effect on the Company’s financial position.

Item 1A. Risk Factors

In addition to the other information set forth in this Report, you should carefully consider the risk factors described in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which could materially affect our business, financial condition and/or operating results. The risks described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results. Other than risks disclosed herein, there have not been any material changes in the Risk Factors as previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.

We were recently awarded a series production award, alongside Koito; however, our business prospects, results of operations and financial condition could be materially and adversely affected if the development or the launch plans in which our products are expected to be deployed are significantly scaled back, delayed or terminated.

Our growth plans are substantially dependent on series production awards through Koito. Sales to Koito have historically accounted for a significant portion of our total revenue. In March 2024, we were notified of a series production award, alongside Koito, for our near-range lidar. The terms of this series production award are not final, and may change over time. If this customer terminates, significantly alters or delays this series production award, and/or alters its relationship with us or with Koito in a manner that is adverse to us, our business would be materially adversely affected.

We entered into an engineering services contract in May 2024 with Koito to support customer-specific product development and program execution efforts for this new OEM, and achieved the applicable milestones and received the related payments. While we expect to enter into future arrangements related to the development and volume production of our products, there can be no assurance that we will be able to achieve the applicable milestones or volume production or achieve them in time under any future arrangements relating to this new series production award. If we fail to achieve the applicable milestones, volume production, or for any other reason realize fewer fees than we expect, our results of operations and financial condition could be materially and adversely affected.

We, alongside Koito, were previously awarded a series production award for which the OEM delayed and then decided to re-scope its ADAS product offerings. As a result, Koito cancelled all outstanding purchase orders it had issued to us. If we are unable to maintain our relationship with Koito or the terms of our arrangements with Koito with respect to this new series production award differ from our expectations, including with respect to volume, pricing and timing, or Koito were to cancel all or a portion of the engineering services contract referred to above, then our business and prospects would be materially adversely affected.

There can be no assurance that we will be able to maintain our relationship with Koito, secure orders from this customer for our near-range lidar or recognize the benefits of any future arrangements, and the occurrence of one or more of these risks could materially adversely affect our business prospects, results of operations and financial condition and could cause our stock price to decline.

The Transaction is subject to the satisfaction of certain closing conditions, including government consents and approvals, some or all of which may not be satisfied or consummated within the expected timeframe, if at all, and the failure to complete the Transaction within the intended timeframe, or at all, would likely adversely affect our business, results of operations, financial condition, and the trading price of our common stock.

The Koito Merger Agreement contains a number of conditions that must be satisfied or waived prior to its completion, including the approval of the Koito Merger Agreement and the Transaction by the holders of a majority of the outstanding shares of our common stock entitled to vote thereon, and the receipt of required regulatory approvals, consents or clearances with respect to the Transaction, including from the Committee on Foreign Investment in the United States. We can provide no assurance that all required consents and approvals will be obtained or that all closing conditions will

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otherwise be satisfied (or waived, if applicable), and, even if all required consents and approvals can be obtained and all closing conditions are satisfied (or waived, if applicable), we can provide no assurance as to the terms, conditions and timing of such consents and approvals or the timing of the completion of the Transaction. Many of the conditions to completion of the Transaction are not within our control, and we cannot predict when or if these conditions will be satisfied (or waived, if applicable). Any adverse consequence of the Transaction could be exacerbated by any delays in completion of the Transaction or termination of the Koito Merger Agreement.

If the Transaction is not consummated within the intended timeframe or at all, we may be subject to a number of material risks, including potential declines in the trading price of our common stock a negative reactions from our investors, merchants, users, business partners, vendors and employees.

Each party’s obligation to consummate the Transaction is also subject to the accuracy of the representations and warranties of the other party (subject to customary materiality qualifications) and compliance in all material respects with the covenants and agreements contained in the Koito Merger Agreement as of the closing of the Transaction, including, with respect to us, covenants to conduct our business in the ordinary course of business and to refrain from taking certain types of actions without Koito’s consent and to not engage in certain kinds of material transactions prior to closing without Koito’s consent. In addition, the Koito Merger Agreement may be terminated under certain specified circumstances. Upon termination of the Koito Merger Agreement under specified circumstances, including, among others, if our Board of Directors changes its recommendation in favor of the Transaction or approves or recommends a competing alternative proposal, or we fail to obtain the required stockholder approval of the Transaction, we would be required to pay a termination fee to Koito of $1,250,000. As a result, we cannot assure you that the Transaction will be consummated, even if our stockholders have approved the Transaction, or that, if consummated, it will be exactly on the terms set forth in the Koito Merger Agreement or within the expected timeframe.

If the Transaction is consummated, our stockholders will forgo the opportunity to benefit from potential future appreciation in the value of the Company.

The Koito Merger Agreement provides that at the Effective Time, each share of Company Common Stock issued and outstanding immediately before the Effective Time (subject to certain exceptions) shall be converted automatically into the right to receive the Merger Consideration. If the transaction is consummated, our stockholders will no longer hold interests in the Company and, therefore, will not be entitled to benefit from any potential future appreciation in the value of the Company. In the absence of the transactions contemplated by the Koito Merger Agreement, we could have various opportunities to enhance the Company’s value, including, but not limited to, entering into a transaction that values the shares of our common stock higher than the value provided for in the Koito Merger Agreement. Therefore, if the Transaction is consummated, stockholders will forgo future appreciation, if any, in the value of the Company and the opportunity to participate in any other potential transactions that may have resulted in a higher price per share than the price to be paid in the transaction contemplated by the Koito Merger Agreement.

We will be subject to business uncertainties while the Transaction is pending, which could adversely affect our business.

The Koito Merger Agreement generally requires us to operate our business in the ordinary course in substantially the same manner as previously conducted pending consummation of the Transaction and restricts us, without Koito’s consent, from taking certain specified actions until the Transaction is consummated, including incurring indebtedness and making capital expenditures subject to certain specified exceptions. These restrictions may affect our ability to execute our business and goals, and prevent us from pursuing attractive business opportunities.

The Transaction could also disrupt our business or business relationships. Parties with which we have business relationships may delay or defer certain business decisions, seek alternative relationships with third parties or seek to alter their present business relationships with us. Parties with which we otherwise may have sought to establish business relationships may seek alternative relationships with third parties.

In addition, customers who would otherwise order our products may choose not to order from us during the pendency of the Transaction.

The pursuit of the Transaction has placed, and will continue to place, a significant burden on our management and other internal resources. It may also divert management’s time and attention from the day-to-day operation of our business and the execution of our other strategic initiatives. In addition, during the pendency of the Transaction, we may be unable to attract and retain key personnel.

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In addition, we have incurred and will continue to incur significant costs for professional services and other transaction costs in connection with the Transaction, and many of these costs are payable regardless of whether or not the Transaction is consummated.

Any of the foregoing could adversely affect our business, results of operations, cash flows and financial condition, and the trading price of our common stock.

The Koito Merger Agreement limits our ability to pursue alternatives to the Transaction.

The Koito Merger Agreement contains non-solicitation provisions that make it substantially more difficult for us to sell our assets or engage in another type of acquisition transaction with a party other than Koito. Specifically, we agreed, subject to certain exceptions with respect to unsolicited bids and the exercise of fiduciary duties by our Board of Directors, not to directly or indirectly solicit competing proposals or to enter into discussions concerning, or provide confidential information in connection with, any unsolicited competing proposals. We also agreed to cease all existing discussions with third parties regarding any competing proposals.

These non-solicitation provisions, among others contained in the Koito Merger Agreement, could discourage a third party that might have an interest in acquiring all of or substantially all of our assets or our common stock from considering or proposing such an acquisition, even if that party were prepared to pay consideration with a higher value than the consideration to be paid by Koito.

Stockholder litigation could prevent or delay the closing of the Transaction or otherwise negatively impact our business, operating results and financial condition.

We may incur additional costs in connection with the defense or settlement of any stockholder litigation relating to the Transaction. Such litigation may adversely affect our ability to complete the Transaction. We could incur significant costs in connection with any such litigation, including costs associated with our indemnification obligations to our directors.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Insider Trading Arrangements

During the quarter ended ~~June~~September 30, 2024, none of our officers or directors adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or constituted a “non- Rule 10b5-1 trading arrangement.”

Item 6. Exhibits


Exhibit No.						Description
2.1						Business Combination Agreement, dated as of August 4, 2021, by and among GCAC, Merger Sub and Cepton (incorporated by reference to Exhibit 2.1 to the Registration Statement on Form S-1 filed by the Company on February 11, 2022).
2.2						Amendment to Business Combination Agreement, dated as of January 21, 2022, by and among GCAC, Merger Sub and Cepton (incorporated by reference to Exhibit 2.2 to the Registration Statement on Form S-1 filed by the Company on February 11, 2022).
2.3						Agreement and Plan of Merger, by and among Cepton, Inc., Koito Manufacturing Co., Ltd.. and Project Camaro Merger Sub, Inc. dated as of July 29, 2024 (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by the Company on July 29, 2024).

3.1						Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 filed by the Company on February 11, 2022).
3.2						Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the Company on September 18, 2023).
3.3						Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the to the Current Report on Form 8-K filed by the Company on February 10, 2022).
3.4						Certificate of Designations of Series A Convertible Preferred Stock, par value $0.00001, of Cepton, Inc., dated January 18, 2023 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the Company on January 24, 2023).
10.1#						Engineering Services Contract, dated May 9, 2024 with Koito Manufacturing Co., Ltd (incorporated by reference to Exhibit 10.1 to the Current Report on Form 10-Q filed by the Company on May 14, 2024).
10.2						Form of Voting Support Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Company on July 29, 2024).
31.1*						Certification of the Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*						Certification of the Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*						Certification of the Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*						Certification of the Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*						Inline XBRL Instance Document.
101.SCH*						Inline XBRL Taxonomy Extension Schema Document.
101.CAL*						Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*						Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*						Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*						Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104*						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

*			Filed herewith.
#			As permitted by Regulation S-K, Item 601(b)(10)(iv) of the Securities Exchange Act of 1934, as amended, certain confidential portions of this exhibit have been redacted from the publicly filed document


3.1						Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 filed by the Company on February 11, 2022).
3.2						Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the Company on September 18, 2023).
3.3						Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the to the Current Report on Form 8-K filed by the Company on February 10, 2022).
3.4						Certificate of Designations of Series A Convertible Preferred Stock, par value $0.00001, of Cepton, Inc., dated January 18, 2023 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the Company on January 24, 2023).
10.1						Form of Voting Support Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Company on July 29, 2024).
10.2++						Employment Agreement by and between Cepton Technologies, Inc. and Jun Pei, dated September 9, 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the Company on September 9, 2024)
10.3++						Employment Agreement by and between Cepton Technologies, Inc. and Dongyi Liao, dated September 9, 2024 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed by the Company on September 9, 2024)
31.1*						Certification of the Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*						Certification of the Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*						Certification of the Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*						Certification of the Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*						Inline XBRL Instance Document.
101.SCH*						Inline XBRL Taxonomy Extension Schema Document.
101.CAL*						Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*						Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*						Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*						Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104*						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).


*			Filed herewith.
++			Indicates a management or compensatory plan.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CEPTON, INC.
Date: August 13, 2024		/s/ Jun Pei
Date: November 8, 2024		/s/ Jun Pei
	Name:	Jun Pei
	Title:	President and Chief Executive Officer(Principal Executive Officer)
Date: August 13, 2024		/s/ Dong (Dennis) Chang
Date: November 8, 2024		/s/ Dong (Dennis) Chang
	Name:	Dong (Dennis) Chang
	Title:	Interim Chief Financial Officer(Principal Financial and Accounting Officer)

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