Volta, Inc. (VLTA) Q3 2022 Earnings Call Transcript

Volta, Inc. (NYSE:VLTA) Q3 2022 Earnings Conference Call November 14, 2022 5:00 PM ET

Company Participants

Andrew Lipsher – Chief Development Officer

Vincent Cubbage – Interim CEO & Director

Brandt Hastings – Chief Commercial Officer

Stephen Pilatzke – CAO

Conference Call Participants

Matt Summerville – D.A. Davidson & Co.

Mark Delaney – Goldman Sachs

Andres Sheppard – Cantor Fitzgerald

Pavel Molchanov – Raymond James & Associates

Craig Shere – Tuohy Brothers

Operator

Welcome to the Volta Inc. Third Quarter 2022 Earnings Call. [Operator Instructions].

I will now turn the call over to your host, Drew Lipsher, Chief Development Officer. Mr. Lipsher, you may begin.

Andrew Lipsher

Good afternoon, and thank you for joining us on today’s conference call to discuss Volta’s third quarter financial results. This call is being broadcast over the web and can be accessed on the Investors section of our website at investors.voltacharging.com.

With me from Volta on today’s call are Vince Cubbage, Interim CEO; Brandt Hastings, Chief Commercial Officer; and Stephen Pilatzke, Chief Accounting Officer.

We would like to remind you that during this conference call, management will be making forward-looking statements. including statements regarding our expectations related to financial conditions, outlook for the sector and company and our expected investment in growth initiatives. Please note these forward-looking statements are based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect the company’s views only as of today should not be relied upon as representative of the views as of any subsequent date, and Volta undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements considering new information or future events. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For further discussion of the material risks and other important factors that could affect our financial results, please refer to the company’s filings with the SEC, including its annual report on Form 10-K for the year ended December 31, 2021, and its subsequent quarterly reports on Form 10-Q.

In addition, during today’s call, the company will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of Volta’s performance. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from GAAP results. You will find additional disclosures regarding the non-GAAP financial measures discussed on today’s call in Volta’s press release issued this afternoon and its filings with the SEC, each of which is posted on Volta’s website.

With that, I will turn the call over to Vince Cubbage, Volta’s Interim CEO.

Vincent Cubbage

Thank you, Drew. And hello, everyone. Thank you for joining us today to review our company’s third quarter results. Volta has completed 4 quarters as a public company and over this period has evolved tremendously. Volta was certainly one of the first companies to understand that to sustainably pursue the enormous opportunity of public EV charging, one would have to solve the issue of how to generate revenue before there was widespread adoption of electric vehicles. Our founder and talented employees solved this problem by creating Volta’s proprietary and beautifully designed dual media and public EV charging stations, along with a robust portfolio of intellectual property rights that set Volta and that classify itself. Today, Volta has over 3,000 chargers in 31 states and has been recognized as having the country’s most innovative public charging strategy. generating revenue and economic benefits far beyond just the intermittent cell of electrons to the early adopting EV driving community.

An understandable desire to build out a national charging network all once and to do it on our own let our prior management into a high cost structure that was another step with Volta as limited capital and unnecessary given the ability to leverage other public and private resources. In a significant course correction that is well underway, Volta is taking the necessary steps to reduce our cost structure, improve our operations, professionalize our organization and bring our headcount back to rational levels. Specifically, in the last few months, we realigned our organization to become more efficient, which enabled us to reduce our U.S. workforce by 54%. This change alone resulted in a 33% reduction in our cash labor expense.

And we didn’t just make the workforce smaller, we managed to make it better by significantly upgrading our talent in a number of key areas. For instance, our new finance and accounting team has reworked their department to significantly reduce the use of expensive offsite consultants and contract employees by simultaneously addressing the full financial control, material weaknesses and related controlled efficiencies that were identified in our prior management. Our teams work not only improved processes, procedures and systems across the company, but also eliminated approximately $15 million in annual unnecessary spending from the department.

These are just a few examples of the changes in the cost side of our business. The financial benefits of these changes are ahead of us as the structural costs we were settled with are unwound and the efforts across the company to do more with less are implemented. As of today, we expect that the cost reduction measures implemented have already reduced run rate cash expenses by over $35 million per year on an annualized basis. Management is continuing to aggressively implement additional cost reduction measures across all aspects of the business, which are not currently reflected in these numbers. And while these and future plan cost savings initiatives are certainly meaningful, we do not expect or believe them to impede our progress on improving our core business for accomplishing our internal and external priorities.

A good example of this resiliency is our revenue this quarter. Despite the challenging macro environment and reduction of the workforce, Volta is still able to grow its overall revenue to $14.4 million, a 69% increase year-over-year; and achieved record media revenue of $12.2 million, also up 66% year-over-year. This is a direct result of our Media Networks front-of-store effectiveness, our exceptional direct and programmatic media sales team, our upgraded internal marketing team and most importantly, the support of our valued national advertisers.

This quarter, we also continued our industry-leading pace in installing new charging stations adding 56 new sites in the quarter, bringing our total sites to 983 in 31 states and installing an additional 173 charge installs, ending the quarter with an installed base of 3,093 stalls. That’s up 45% year-over-year.

While our pace of installation is still one of the best in the industry, this quarter saw fewer total stalls installed due to management’s decision to preserve our very limited capital during our ongoing capital raising process in response to current market conditions and in part due to the attractive investment tax credits, which become available at the beginning of next year under the inflation reduction.

One impact of that decision is a reduction in network development activity and corresponding revenue in the quarter. Network development revenue for Q3 was $1.9 million versus $3.6 million in the prior quarter, which offset the increase in record media revenue in Q3. Given the difficult chemical constraints that we face, Volta will continue to slow its installation cadence until capital, including focus of the funds through the myriad of federal programs previously announced is more readily available. In the meantime, Volta will continue to support its media business and serve our excellent brand partners who value our unique offer.

Going forward, VOLTA is initiating discussions with our site partners to develop ways to accelerate network development while also addressing the increase in costs of installing infrastructure. One example of these discussions is prioritizing a site partner’s installations when’s they are willing to complete the permitting, engineering and site prep work necessary in advance, essentially make ready, taking Volta out of the construction process. and speeding installation.

We have also realigned and significantly expanded our policy team to better focus on identifying and pursuing outlook private partnerships that align with the $7.5 billion in public grants the federal government has allocated toward public EV charging infrastructure build-out under the bipartisan infrastructure law. Volta isn’t just asking for money and applying for navigating community grants hover. Like we did at the city of Hoboken, we have a much higher value-add approach, offering to work with local state and federal governments and NGOs to plan and optimize their public projects using our proprietary planning tool, PredictEV.

Our AI-driven PredictEV signing tool can ensure that all drivers in all communities have access to convenient and safe public charging, something that is core to our charging for all initiatives. And our media model provides an added advantage to communities by serving as a public and communications platform for delivering essential messaging like emergency alerts, weather alerts and information about community events. Volta currently has approximately 4,000 sign stalls that we believe may align with the objectives of the many, many government programs.

In short, we believe that Volta has the absolute right solution at the absolute right moment in time for this inevitable transition and evolution. We’re not just the network of chargers were a powerful dual energy and media network delivering charging for all. We connect drivers to clean, safe and accessible charging brands to customers and partners to opportunity. We remain as excited as ever about the opportunity in front of us and the prospects for Volta’s business and are working nonstop to address our near-term challenges.

And with that, I’ll hand it to Brandt to review our commercial operations.

Brandt Hastings

Thanks, Vince. Volta’s commercial organization made tremendous progress in the third quarter as demonstrated by the 69% year-over-year revenue growth that Vince just shared. One example, which you may have seen, is AdExchanger recently named Volta the Best Commerce Media Technology for our 2021 holiday campaign with Coca-Cola, demonstrating the power of Volta media network to drive measurable sales results for leading brands. And we continue to invest in our digital media capabilities, including launching 3D creative support and are receiving recognition for using our nationwide media network to educate drivers on the benefits of electric vehicles and reminding voters to cast their ballot in the midterm election.

On the government and policy front, Volta has recently highlighted the power of our media model to fund first typical EV charging in disadvantaged communities with our collaboration with Tucson Electric Power, which will bring 8 EV chargers to communities in Tucson, Arizona with a high percentage of renters.

And we’re sharing this differentiated message with key audiences, including the recent National Governors Association Conference, where Vince took the stage to explain the benefits of Volta’s model for cities and communities. And I’m excited to provide some additional updates with you all today. And before I go any further, I’d like to address how we’re thinking about Volta’s revenue in the context of the market conditions many other advertising power businesses have discussed on recent earnings calls.

The World Federation of Advertisers and Media Analyst Firm Ubiquity recently surveyed marketers from the largest multinational brands to understand how current economic conditions are impacting advertising budgets, and the results show that 3/4 of these companies are actively scrutinizing marketing spend, and advertising leaders must justify every investment. And under conditions like these, marketers prioritize digital media investments that deliver measurable business results. The Volta Media Network sits squarely at the intersection of where budgets are being reallocated, setting us up better than most to protect against economic uncertainty.

Volta constructs its dual EV charging in media screens, in prime locations, steps away from popular grocery, shopping and entertainment venues. And by being immediately beside the front doors of those locations, our media network delivers the last message a shopper sees on their way to grab a card, providing advertisers a critical opportunity to directly influence the items that end up on that shopper’s list. And Volta’s suite of sophisticated measurement tools allows us to clearly demonstrate the revenue-generating power of these desirable locations.

McKinsey estimates commerce media, otherwise known as retail media, is this new category of advertising that closes the loop between media impressions and commerce transactions, could represent as much as $100 billion in ad spending by 2026. The Volta team, however, is wasting no time in capturing growing retail media budgets today by proving the sales-driving potential of our media network, which we’ve highlighted in previous quarters.

Finally, we are currently in the middle of the Q4 holiday advertising season, regardless of the state of the economy, this is a critical time for brands to promote their products and services. Volta is winning holiday campaigns with brand name advertisers like Coca-Cola, seeking to preserve and grow market share as consumers consider trading down for more affordable options.

The placement of our media network outside of grocery stores and pharmacies also allows Volta to win campaigns for these retailers’ private label brands. Nature’s Promise, which is owned by A Whole Delhaize U.S.A. is one such example. As shoppers look to make their dollars go even further this holiday season, these more affordable store brands are attracted to Volta’s Media Network as the optimal canvas to promote their cost savings potential.

And while Volta’s Media Network is set up better than most to protect against economic uncertainty, our business is not immune to macroeconomic forces. One such factor is the automotive industry’s ongoing supply chain constraints. And without available inventory, many auto manufacturers are postponing vehicle launch campaigns, which often account for the largest advertising budgets. And despite this and other market forces, Volta’s Media Network is yielding positive results.

In the third quarter, our media revenue grew 66% year-over-year and became further diversified across consumer packaged goods brands running retail media campaigns, entertainment clients and financial services brands. exemplary of this strategy is the fact that our consumer packaged goods, or CPG business, grew 135% and year-over-year.

We welcomed many notable first-time advertisers in the third quarter, including Google, Neiman Marcus, Fiji Water, Peacock and Capital One. 79% of Q3 Media revenue was from repeat customers, including Cheap, Target, Disney, Bank of America and Coca-Cola, demonstrating the ongoing value our media platform delivers to leading brands.

Now I’d like to move on to our charging solutions business and reemphasize what Vince discussed regarding Volta’s focus on capturing federal grants. The Biden-Harris administration has made installing EV charging infrastructure along highways and within cities a key priority of the bipartisan infrastructure law in Inflation Reduction Act. And under this legislation, the equal distribution of critical charging infrastructure across all communities is of the utmost importance. And to that end, the federal government has announced its Justice 40 goal, which seeks to ensure that 40% of the overall benefits of these bills flow to disadvantaged communities.

Volta’s media powered model generates revenue regardless of how many EVs are charged allowing us to construct chargers in disadvantaged communities, where EV ownership may be lagging and making Volta particularly competitive for these federal grants. Volta’s dedicated charging solutions team continues to use our award-winning PredictEV infrastructure planning software to evaluate which of the nearly 8,000 EV stalls in our assigned construction and technical evaluation pipeline best satisfy the government’s requirements.

By analyzing multiple data sources, including local economic and equity data aligned with the administration’s Justice for initiative, PredictEV can identify locations that will simultaneously be competitive for community, government brands and valuable for Volta’s media business. This analytical review of our installation pipeline will allow Volta to continue expanding our network in the most capital-effective manner possible in the years ahead.

In closing, and want to reiterate the measurable value Volta’s model brings to all of our stakeholders, drivers, advertisers, commercial properties, retailers and municipalities. While we continue to monitor macroeconomic conditions, including the impact on advertising spending by marketers, we believe Volta is set out better than most.

The prominent placement of both those charging stations and media streams near the front doors of businesses and our roster of digital native media capabilities enable Volta to continue attracting new customers and commanding larger digital advertising budgets.

With that, I’d like to pass it over to Stephen Pilatzke, Volta’s Chief Accounting Officer, to comment on our Q3 financial results.

Stephen Pilatzke

Thanks, Brandt. Turning to our Q3 financial results. For the third quarter, Q3 revenue grew 69% year-over-year to $14.4 million. Q3 media revenue grew 9% sequentially and 66% year-over-year to $12.2 million.

We ended the quarter with an installed base of 983 sites, adding 56 new sites in the quarter. Volta’s installed base of stalls was 3,093 on September 30, 2022, up 6% quarter-over-quarter and 45% year-over-year. The company installed an incremental 173 stalls during Q3. For the third quarter, we exited the quarter with 1,378 sites and 3,930 stalls in our signed construction pipeline.

Our gross margin, excluding station depreciation for the quarter, was 34% as compared to 32.5% gross margin in Q3 of 2021. We continue to forecast a 25% to 30% gross margin for the full year. Including stock-based compensation and onetime expenses, SG&A was $40.0 million for the third quarter compared to $55.7 million in the prior year period. We have made significant improvements to our SG&A levels and continue to work to reduce our recurring spend.

Adjusted EBITDA was $30.9 million loss for the third quarter of 2022 as compared to a $22.1 million loss in the third quarter of 2021. Net loss was $42.5 million for the third quarter compared to a net loss of $69.7 million in the prior year period. The company had a cash and marketable securities balance of $15.6 million as of September 30, 2022. Our anticipation for the full year 2022 CapEx is dependent on the company’s ability to raise capital. Our weighted average shares outstanding for the third quarter were approximately 169 million.

And with that, we would like to open the line for Q&A.

Question-and-Answer Session

Operator

[Operator Instructions]. Our first question today comes from Matt Summerville from D.A. Davidson.

Matt Summerville

A couple of questions. A couple of things we didn’t hear about tonight. I’d love to get an update on where you’re at with rolling out charge for charge. I guess if I remember back to prior calls, the thought was you’re going to go through kind of a pilot process maybe in the first half of the year and come into the second half of the year ready to talk about sort of the game plan for that revenue stream. And I guess in that regard, it sort of struck me a little bit that your charging network operations revenue was essentially negligible in the quarter. So maybe start there, and then I have a follow-up.

Andrew Lipsher

Thanks for the question. , do you want to cover that?

Brandt Hastings

Yes. Great. Great question, Matt. So at a high level, charge on our DC network was deployed in Q2 and towards Q3. And as a result, 80% of our DC network currently has charge for charge. That probably explains why the increased DC is so small.

In addition on the financial statement line item within charging operations, we do have our cuts that are monetized as well, too. So it does depend upon when those credits or monetize that provides fluctuation on the charge for charge. But we are happy with the success on our charge for charge to the DC network and continue to track the utilization and look forward to presenting metrics as we grow that segment of the business.

Matt Summerville

And then, again, something that wasn’t mentioned, what’s sort of the update on Europe? We haven’t heard much about that. What’s the status of the business there? What are you doing headcount-wise? Are you still investing there? Are you pulling back? Just maybe dig in, in a little more detail where you’re at in Europe, where your site count installed base, whatever metrics you can kind of talk about and what you’re doing strategically right there as we sit here today.

Andrew Lipsher

Matt, I’ll take a shot at that. Europe is a very interesting market. And I think what everyone knows that we’ve deployed a team, and we’ve kind of started the process there that we’re well up the curve on in the U.S. The reception in Europe is very good. Volta is looked at just as attractive as it is here. We have a very good team on the ground. They are busy lining up potential counterparties, which we refer to as site partners and been very successful in generating interest in kind of early-stage indications.

From an overall strategic perspective, we have not yet initiated a significant build-out in Europe in part because of capital availability and in part because of the strong desire to have the business systems and organizational infrastructure well in place ahead of launching into an aggressive CapEx program. We expect to look as part of our year-end planning. We’re evaluating kind of every aspect of it. We like it. It’s quite interesting, but we should be able to update you in the future.

Operator

And our next question will come from Mark Delaney with Goldman Sachs.

Mark Delaney

The first was on potential capital raising. Could you please clarify if you’ve done any since the end of the calendar third quarter. Has there been any capital raising has potentially been done quarter-to-date? And maybe talk a little bit around what potential options there might be for the company to raise capital and how much you think you may need to raise.

Vincent Cubbage

Mark, thanks for the question. Drew has been coordinating all of the efforts in that entire area. Drew, do you want to take that?

Andrew Lipsher

Sure. Thanks, Mark. As you know, and as I think everyone knows, it’s the capital markets and the markets’ macroeconomic conditions have been challenging over the last couple of months. We continue to have active discussions with a number of parties about providing Volta with the appropriate both quantum and structure of financing to help drive our business forward and continue to fund growth. We will be providing you with an update as soon as we know something. I think as we become fine to saying you’ll be the second person to know we will be the first, but we continue to be encouraged by the conversations that we’re having and look forward to talking about that more shortly.

Mark Delaney

Okay. Understood. And then you outlined on the call today a number of cost reduction steps the company has taken. Maybe you could clarify what that means in terms of your current cash usage rate either per month or per quarter. Where does it currently stand?

Vincent Cubbage

Mark, we’re not giving the granularity to cash usage on a monthly basis. What I would tell you is we’re treating it as a precious commodity. We are managing the business on both a cash basis and a CapEx basis very carefully. We’re in an interesting position because there are many different stakeholders who very much want to see us succeed. And there are people in our organization, in our site partner network kind of across the business that are collaborating with us to think about how we can expand our network in a more capital-friendly way, less capital-intensive way. I think that what I would tell you is the process is still underway. It’s very much linked to our capital raising process. And as Drew has said, well, we’ll update the market as soon as all of that’s completed.

Mark Delaney

One last one for me, if I could, please. Your PredictEV was mentioned today and also I think on your last earnings call as one of the new focal areas and potential revenue-generating opportunity. Any more examples you can give us on the success you’re having with that and what it may mean for the company going forward?

Vincent Cubbage

Yes, sure. PredictEV is a very interesting part of the business. It’s the precursor to a network build-out, particularly when other people are allocating capital. And the site partner is trying to get us to put charges in front of their store, it’s a very one-to-one relationship. If a government agency is trying to figure out how to allocate $7.5 billion across 70 different kind of big cities, 50 states, a lot of different jurisdictions, it’s a much more difficult task. We have been extremely active on that front, and we have been meeting those conversations with the suggestion and the tool to go with it to properly plan for the capital allocation and the build-out using something more than a marketing material of a market participant.

Our PredictEV software is agnostic, whether it’s our equipment that goes in the ground or someone else’s. It’s using AI and machine learning, informs a policymaker or a city leader where the charger should go. And then what’s really tremendously to our benefit is that once those sites have been identified, we can lease squares our map on top of it and show a policymaker exactly where we already have sites in our MSA contracted backlog.

That’s a key differentiating factor of us versus all the other chargers who are competing for this money because the people who are kind of organizing their business to go after the money haven’t built the backlog of sites that Volta has. It’s one of the things Volta did very right, very early is instead of going after parking lot by parking lot, the business was organized around going after whole portfolios of properties through national property owners and REITs and contracting those over long-term contracts under MSAs.

So when we sit down with the policymaker, we have the tool to tell where it should go and then we have the inventory of sites where they can go, and their capital can enable it. And I guess the other piece that you didn’t ask on PredictEV is the charger itself has an economic benefit far beyond just charging on an EV car, which is the other part of the Volta story, which is why it’s so compelling.

Andrew Lipsher

Yes. I mean I think just, Mark, the only thing I would add to that is that since and I were forget a government event or been spoke on channel and then Canada, National Governance Association event around energy transition and EV infrastructure in Greenville, South Carolina. And PredictEV was one of the sort of pillars of the conversation that we had, and the reception that we got to the opportunity to work with us using PredictEV TV as the sort of the entry point to help cities or municipalities understand infrastructure deployment, I think, resonated very strongly. And Hoboken again remains an example of that.

Vincent Cubbage

Thanks, Mark. You can tell how much we like this part of the business because we can’t stop talking about it. But the other part about productivity that’s interesting is that the money that’s coming from the federal government to the states has a process associated with it and plans and approval of plans and the allocation of capital by market participants, the reimbursement of capital, all of that’s a ways off.

One of the interesting parts of PredictEV is that it is eligible for the planning money, and the planning money can be allocated by the states and by the local governments on an expedited basis. So we stand in a position where it’s a focus of a lot of our conversations right now, where those jurisdictions can hire us to use PredictEV today on a fee-for-service basis and to help them make the plan to allocate the capital that months and quarters off. So it’s an early tool as well as a very powerful tool.

Operator

And our next question will come from Andres Sheppard with Cantor Fitzgerald.

Andres Sheppard

Congrats on another quarter. I wanted to maybe follow up on Mark’s question in regards to the capital raising needs, right? So in the past, you had mentioned the need to raise that $250 million to $300 million of non-dilutive capital. Now I know you did the 150 million of shares via the ATM previously. But at these levels, it might not be the best idea to issue additional shares. And so as we stand now with about $16 million in cash as of the end of the quarter, is the expectation to raise capital in Q4 and in that range ideally non-dilutive?

Andrew Lipsher

Thanks, Andres. I appreciate the question. So I think just a quick comment on the ATM program, I think it’s not just Volta. I think you’ve seen a number of companies in our industry and in general industries, particularly leaseback companies, announced ATM programs over the last 4 to 6 months. It’s good housekeeping. It’s something that’s there. It’s an insurance policy of source on an as-needed basis. So we view the ATM program really as sort of a good housekeeping procedure more than, I think where you were headed, as a solution or a full solution to the capital needs going forward.

With regard to capital required to continue to fund our business and grow our business, look, we are in the market talking to a number of different investors. As you can probably imagine, every investor has his or her own opinion about structure and the nature of dilution or lack thereof in any capital structure. We are listening and talking actively to all interested parties. We are open to all structures that make sense.

The primary goal of Volta is to raise the money necessary to continue to deploy our chargers and continue to build out our program that Vince and Brandt alluded to in their — in their remarks. So we hope that it’s — again, we hope that it’s something in the near term that we come back to you guys and tell you more about.

Andres Sheppard

Okay. Fair enough. And maybe as a quick follow-up. Just help me understand a little bit better. So on Slide 6, you have your deployment pipeline and also your technical evaluation. I guess just — sorry if this is silly. But just help me understand in terms of the pipeline, what time period is that encompassing? In other words, when do you foresee making — deploying the charges that are in the pipeline and converting them into actually installed?

Andrew Lipsher

Great question, and maybe I’ll answer your question with a question, Andres. Do you know anyone at utilities who can get them to move faster?

Andres Sheppard

We can take that conversation off-line, but I’ll see what I can do.

Andrew Lipsher

We greatly appreciate the help on that side. Look, it’s a great question, just to maybe level set from a definitional perspective because we do talk about 3 turns on Slide 6. We talk about our installed base, which is obviously the network of chargers that we have in the ground that are operational. We talk about the deployment pipeline. Those are the number of installs that are in what we call the construction phase of the development phase.

So we’ve chosen the location, the site order agreements are signed. We’re in the — somewhere between permitting, engineering and commissioning of those stations. And then the technical evaluation installed, those are a little bit higher up in the pipeline. They are all signed under or pursuant to an MSA agreement, but we are in various stages of what we call qualification visits and early construction drawings to identify where — what the power requirements are, what the power availability is either at the property because, as you know, with our Level 2 chargers we typically pull from house power — and with DC fast chargers, we have to have a direct connection to the grid, so evaluating the power — we’re also looking at the economics of each of those sites as well to make sure that they have the appropriate payback periods and the economic benefits that we seek. And once we get through that technical evaluation pipeline, those stations will then move into or a good portion of those stations will move into the deployment pipeline.

From a time line perspective, it can really vary dramatically on an A by A basis. It depends on permitting. It depends on weather. There are a number of factors that can influence it, but we can see the full pipeline extend anywhere between 6 and 12 months depending on a number of those factors. And again, just to reiterate, part of the reason we’re out raising capital is the predictable availability of capital will also help accelerate or move some of those stations through both the technical evaluation and the deployment pipeline as well.

Operator

And our next question will come from Pavel Molchanov from Raymond James.

Pavel Molchanov

Yet another guy who asks about the balance sheet, but with the $60 million of cash on the balance sheet, which is roughly half quarter of SG&A, is there an a backup plan to provide any kind of bridge financing or even just a small amount of cash to get an extra several months of corporate cost funding if your primary financing plans end up being delayed into next year?

Andrew Lipsher

Well, Pavel, first of all, it wouldn’t be a conversation with that you unless you mentioned the balance sheet. So thank you very much. I appreciate it. But no, of course, look, we are talking to all Canadian side. We are talking to many different capital providers, many different sources of potential capital. And as I mentioned a moment ago in my remarks, we are looking at all possible structures. We are not necessarily thinking about this as a one-and-done type of situation. So your remarks are fair.

Pavel Molchanov

Okay. How much runway in your kind of internal planning do you have based on the cash balance as of September 30?

Andrew Lipsher

At this point, Pavel, that’s not something we’re going to comment on. I think our — we are looking at this business over the long term. We are putting both in the best position possible to continue to execute against its plan, service the relationships that we’ve got pursuant to the MSA partners that we have developed, those relationships that we are developing. Our plan is to be a leading provider of EV charging infrastructure for a long time. So — and we continue to reduce costs and working on those efforts as well. So this is an ongoing effort as well. So we believe that this is — we’re here for the long term.

Andres Sheppard

Okay. Looking at your — kind of an accounting question. Looking at your current liabilities, there was — I see a term loan payable and then some just standard working capital items. Is any of that due before, let’s say, December 31?

Andrew Lipsher

Other than in the ordinary course, no.

Brandt Hastings

The term loan is a public document.

Andrew Lipsher

Yes.

Pavel Molchanov

Okay. So that’s 2023 story?

Andrew Lipsher

Correct. More about that as we continue to explore capital options. But yes, we’re fine for now.

Pavel Molchanov

Understood. And then just a quick question on the demand side of the equation. You mentioned the macro ad slowdown. That’s — point is very well taken. Are there certain kinds of advertisers that are more resilient, consumer staples? Anything along those lines that are not affected by, for example, the supply conditions in the automotive value chain?

Brandt Hastings

It’s Brandt. I’ll jump in on that. Thanks for the question. So we’re very focused on continuing to grow revenue, particularly in our media business. We’re growing on an absolute basis. You saw the quarter. And while there are macroeconomic kind of areas that we’re watching in the fourth quarter, I mean this is peak season for many advertisers who are focused on their holiday campaigns. And so I think we’re all familiar with some of the headwinds in the automotive sector, for example.

But as you look into retail and as you look at brands around the holiday. Consumer packaged goods brands, for example, are very resilient. And I was just talking with a CMO very recently, and he was telling me how during these times of uncertainty, the focus goes on the prioritization of what marketers know works and what they know that they can also measure.

And I’m incredibly proud of what the Volta Media team has built over the past year, which is a digital advertising platform where advertisers can reach consumers in a real world, minutes before they make a purchase decision about product A or product B in our ability to demonstrate the effectiveness of that advertising back to the marketer. That combination of ingredients is what we feel continues to set up Volta better than most, particularly during times when marketers may be questioning their immediate priorities.

And I’d also point to some of the research that I referenced briefly on the call, if you look at the areas right now of high growth in advertising, digital out-of-home and retail media are both forecasted to be high-growth areas in advertising. And those are 2 areas where Volta plays exceptionally well. So that’s how we’re thinking about the business, particularly heading into the holiday season.

Operator

And our next question will come from Craig Shere with Tuohy Brothers.

Craig Shere

I want to make sure I understand the answer to Andres’ question. The $96 million CWIP doesn’t sound like it’s physical capital in the ground, but that it can include capitalized costs for permitting, engineering and other before physical equipment deployment. And so first, I want to make sure I have that right. And to the degree that’s right, that would imply that you’re not necessarily on the cusp of finishing off a sizable chunk of stalls or just de minimis incremental capital. Is that fair?

Andrew Lipsher

Craig, I’m sorry, you broke up a little bit. Can you repeat the beginning part of your question again? It was hard to hear. I’m sorry.

Craig Shere

No problem. So on your slide, the $96 million of CWIP, it sounds from the discussion like that’s not necessarily partially installed physical equipment on the ground but could be capitalized permitting, engineering and other costs such that — and I’m trying to get a sense of how close are you in terms of just a little bit additional capital to having a slew of additional revenue-generating stalls. And if you’re capitalizing a lot of costs that aren’t physical equipment, then maybe it would be a little more difficult to get your next, whatever, 500 stalls.

Andrew Lipsher

Yes. This is speaking. Sorry. It’s a great question. So within the construction progress balance, you are correct. Those are actual current available station inventory, which we’re looking to monetize and/or install in several different separate ways currently.

But your question is right. We do look at the value on our balance sheet as well as what the installation capitals required to install and satisfy our development pipeline. Each site is really unique in terms of how installation occurs. So depending upon what that deployment pipeline, looks like it can vary, but we’re currently working with entry to identify the most economically advantaged sites to deploy and to generate revenues upon those stations available.

Craig Shere

Okay. And I guess, just to sum it up, in that 96 million CWIP, there’s intangible capitalized costs that are physical equipment on the ground.

Andrew Lipsher

It’s — and currently right now, that’s all tangible items. It’s the charge stations and digital media screens, the line above on that slide that our stations in the ground.

Craig Shere

So you have $96 million of physical equipment that isn’t currently as yet in operation and revenue-producing. So you have a lot of equipment that’s on the cusp of potentially getting over the hump and being revenue-producing.

Andrew Lipsher

Yes. And that will include some engineering costs fringes, as you’d expect on the install side, but costs that are currently being deployed to a station to be able to monetize the screens of charging.

Craig Shere

All right. And I just want to get a better sense that there was a really big drawdown of cash in the quarter, and I’m trying to get a sense if there were some onetime events in that, like severance costs to cut your ongoing overhead or something, but it seemed like there was a very large drawdown from the second quarter cash balance to the third quarter.

Andrew Lipsher

Yes. Great question. I’ll push back on to the construction progress slide. We had several inventory payments required for suppliers that hit in the quarter, and that’s what’s really driving up the balance from the $67 million to $95 million.

Craig Shere

Got you. So that probably feeds into my first question, all those inventory payments kind of fill in your CWIP position. So you do have some assets on the ground that aren’t producing yet and with a little help, you can kind of get that over the home.

Andrew Lipsher

That’s correct, yes.

Operator

And we’ll take a follow-up question from Andres Sheppard with Cantor Fitzgerald.

Andres Sheppard

Sorry again. I wanted to — maybe I don’t think this was asked, but I just wanted to get an opportunity to see how the partnership with Walgreens was progressing. I assume some of the stores that you have in the pipeline for next quarter and for 2023, I presume some of those will be a result of that partnership with Walgreens. I guess what I’m really trying to get at is as you look forward to the installation of new chargers, are you going to be almost exclusively prioritizing the DC fast chargers as opposed to the level? Or is it still going to be some sort of mix?

Brandt Hastings

Yes, it’s Brandt. Thanks for the question. The short answer to your question is, yes, we’re continuing to focus on our partnership with Walgreens. We believe that, that will pick up pace as we enter into 2023. I think it’s no secret that anyone who follows our sector knows some of the challenges that we’re all experiencing around DC fast charge and deployment, given some of the supply chain strengths with transformers and given some of the backlogs that utilities have. That’s certainly playing a role into that partnership given the fact that it is so heavily focused on DC fast. I know the team is working very hard on mitigating those areas. However, in some cases, there’s only so much that we could do from our side, so to speak. So I’ll leave it there for now.

Operator

And This concludes our question-and-answer session. I’d like to turn the call back to Mr. Lipsher for closing remarks.

Andrew Lipsher

Thank you very much. And again, thank you to everyone who joined the call today for listening in. As you can hear, we continue to be incredibly excited and enthusiastic about Volta and appreciate everyone’s support and look forward to talking to you all soon. Thank you very much.

Operator

And this concludes today’s conference call. Thank you for attending.

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