Mobileye Global (NASDAQ:MBLY) reported a largely stable second quarter for revenue while profitability improved sharply, as executives pointed to stronger-than-market EyeQ chip volumes, a new Israeli research and development incentive and an expanded push into robotaxis as key themes for the company’s next phase.
On the company’s second-quarter 2026 earnings call, President and Chief Executive Officer Amnon Shashua said Mobileye’s core business “continues to perform very well in 2026,” providing what he called “a strong foundation” for upcoming advanced product launches. For the quarter ended June 27, 2026, EyeQ volume rose 3% year over year, outperforming the production volume of Mobileye’s top 10 customers by more than eight percentage points, Shashua said.
Profitability Boosted by Israeli R&D Incentive
Mobileye’s adjusted operating income was $155 million in the second quarter, up 46% from a year earlier, while adjusted operating margin expanded to 31%, up about 10 percentage points from the second quarter of 2025. Shemesh said the increase was more than accounted for by the recognition of $93 million in contra R&D expense tied to a new R&D incentive enacted by the Israeli government during the quarter.
About half of that benefit related to the second quarter, while the other half reflected the retroactive first-quarter impact, Shemesh said. She added that the new regime became law during the second quarter but is effective from the start of 2026. Mobileye expects the benefit to continue in future years, though Shemesh noted it is subject to potential changes in law and could vary by quarter based on qualifying R&D expenditures, exchange rates and other factors.
Shashua said the first half of the year provides a more representative view of Mobileye’s underlying performance because the second quarter included the first-quarter R&D credit impact. First-half revenue rose 13% year over year, while production volume at the company’s core customers declined 3%, he said. First-half adjusted operating margin was 23%, up six percentage points from a year earlier. Mobileye generated $210 million of operating cash flow in the first half.
Guidance Raised for 2026
Mobileye increased its full-year revenue outlook to a midpoint of $1.995 billion and tightened the range, implying 4% to 7% revenue growth. Shemesh said the midpoint assumes slightly more than 39 million EyeQ units, nearly 1 million more than the company’s prior outlook. The upside is being partially offset by lower expectations in the aftermarket and Moovit businesses and the pushout of some advanced product samples into 2027.
The company also raised its adjusted operating income outlook to a midpoint of $395 million, up from $210 million previously. Mobileye is incorporating $180 million to $200 million of benefit from the R&D incentive in its full-year outlook. Shemesh said this positive impact, along with higher revenue, is being partly offset by increased spending to support early robotaxi expansion activities and a modest rise in operating expenses related primarily to foreign exchange.
For the third quarter, Shemesh said Mobileye expects 9.3 million to 9.5 million EyeQ units and revenue to decline about 5% to 6% year over year. Gross margin is expected to be slightly below second-quarter levels, while operating expenses excluding the R&D incentive are expected to rise slightly from the second quarter due to typical seasonality.
Robotaxi Strategy Expands Beyond Supplying Technology
Shashua said Mobileye has decided to establish a “fully vertically integrated robotaxi offering” in which the company will control all aspects of the value chain. The initiative targets a 2027 launch in at least one U.S. city and will proceed in parallel with Mobileye’s existing self-driving system development.
Shashua said Mobileye has gained confidence from the progress of its work with Volkswagen Group company MOIA, including public rider testing with safety drivers in Hamburg, Germany, using vehicles equipped with Mobileye’s self-driving system. He said the company expects additional milestones through 2026 and 2027.
During the question-and-answer portion of the call, Shashua said several factors had changed since Mobileye previously considered whether to operate robotaxi fleets itself. He cited increased availability of level-four-ready base vehicles, more mature compute and sensor stacks, and greater clarity on demand and revenue per robotaxi. He said Mobileye’s calculations indicate revenue of about $125,000 per robotaxi per year, which he called conservative, and a vehicle cost below $100,000 with Mobileye’s sensors and compute.
Shashua said the strategy would give Mobileye flexibility, including operating vehicles in its own service, deploying them on third-party platforms or selling vehicles to robotaxi operators with recurring revenue as vehicles generate rider fares. The company plans to use Moovit, its mobility division, for fleet supply, demand optimization, trip planning and rider engagement. Shashua said Moovit will shift resources away from the B2B side of its business and reduce headcount to focus on the new strategy.
ADAS, China Exports and Advanced Programs
Mobileye executives said the company continues to benefit from several secular drivers, including growth in India, exports by Chinese automakers into emerging markets and new customer wins. Shashua said Surround ADAS is expected to drive average selling price growth starting in 2028.
Shashua also discussed recent Stellantis awards, saying Mobileye won a high-volume 2027 program with Cloud-Enhanced ADAS that supports highway hands-free driving in a cost-efficient package. He said a lower-volume, later-timing, higher-risk program was awarded to other suppliers, an outcome he described as consistent with how automakers are allocating risk.
Nimrod Nehushtan, executive vice president of business development and strategy, said the Stellantis program is an upgrade of an existing production project and will introduce REM through Cloud-Enhanced ADAS. He said the implementation is relatively straightforward for the automaker and provides Mobileye with a tailwind in average selling price. Nehushtan said Stellantis intends to adopt the technology broadly across its vehicles beginning in 2027, gradually moving toward standard-fit integration of REM in its fleet.
On China, Nehushtan said Mobileye has benefited from export growth at Chinese automakers including Geely and Chery, with “the vast majority” of those export volumes using Mobileye’s EyeQ system. He said those automakers have also nominated Mobileye for future programs, which he described as a vote of confidence in Mobileye’s system for export markets.
CEO Succession and Long-Term Opportunities
Shashua addressed his decision to step down as chief executive once a successor is appointed, saying Mobileye is entering a new phase as SuperVision, Chauffeur and Drive move toward commercialization. He said the board has assembled a search committee and is “casting a wide net” for the company’s next leader.
Following the appointment of a successor, Shashua said he aims to focus on technology strategy, innovation and long-term opportunities. He identified robotaxis and humanoid robotics as major long-term opportunities built on the same “physical AI foundation.”
In response to analyst questions, Shashua said he believes autonomous vehicle technology is “largely solved” from a scientific standpoint for the programs Mobileye has underway, while humanoid robotics remains an area where he wants to spend more time. He said Mobileye is still targeting 2028 for an initial humanoid robot deployment, with a business-to-consumer focus and about 500 units expected to be built that year.
About Mobileye Global (NASDAQ:MBLY)
Mobileye Global Inc (NASDAQ: MBLY) is a leader in the development of advanced driver-assistance systems (ADAS) and autonomous driving technologies. Headquartered in Jerusalem, Israel, the company designs and supplies computer vision-based solutions that enable vehicles to detect and respond to road conditions, obstacles and signage. Mobileye’s core offering centers on its proprietary EyeQ system-on-a-chip (SoC) family, which processes video streams from automotive cameras to deliver features such as lane-keeping assist, adaptive cruise control, collision prevention and traffic sign recognition.
Founded in 1999 by Prof.
