Although our lives are increasingly online, we still live in a physical world where the limits of technological innovations are determined by the quality of physical devices, and the manufacturing capacity of the economy determines the price of goods.
Failures in quality control for physical devices can be costly. For example, the 2016 Samsung recall of 2.5 million units of the Galaxy Note 7 cost $5.3 billion because the batteries were heating up and causing fires. Tesla had to recall all Cybertrucks manufactured between November 2023 and April 2024 due to a defect where the accelerator pedal could get trapped inside the vehicle’s trim, putting drivers’ lives at risk. A production breakdown at a Boeing factory caused the door of Alaska Airlines Flight 1282 to blow off mid-flight at 16K feet; had it occurred at cruising altitude, passengers likely would have died.
However, the increasing quality of AI presents an opportunity to improve quality control and the manufacturing process as a whole by helping companies more effectively identify and correct defects before products are pushed through production. Lumafield wants to address this opportunity by building a high-quality manufacturing dataset through CT scans in order to increase the accuracy and reduce the costs of industrial inspection and, eventually, to enable fully autonomous manufacturing.
X-ray computed tomography (CT) scans, which you may have heard referred to as “CAT” scans at a doctor’s office, take multiple images from different angles to construct a 3D model of their target. In medicine, this is useful for helping doctors diagnose tears and breaks. CT scans can be used the same way in manufacturing by helping companies more effectively identify and fix product defects before they are shipped to the public without the need to rely on traditional and potentially destructive testing methods. However, high costs have historically prevented smaller companies from accessing industrial CT scans.
Lumafield provides low-cost industrial CT scanners called Neptune and Triton, as well as a browser-based CT analysis system called Voyager, to allow companies to affordably inspect and improve the quality of their manufacturing. However, local CT imaging solutions are only the first step. In a September 2024 interview with Contrary Research, Lumafield’s CEO Eduardo Torrealba explained that Lumafield’s larger vision was to use data across many scans to enable fully automated manufacturing processes.
At present, a broad, high-quality database of manufacturing information doesn’t exist online, making it difficult to train AI to identify and resolve product defects. However, with time, Lumafield wants to build that database from its scans. As it collects more data points from customers, its Atlas AI agent will grow more effective at identifying product anomalies and expediting quality assurance and manufacturing processes.
To learn more about Lumafield and how the company is addressing this quality control opportunity, check out our new memo on the company, as well as our recent conversation with Lumafield’s CEO, Eduardo Torrealba on Research Radio.
Important Disclosures
This material has been distributed solely for informational and educational purposes only and is not a solicitation or an offer to buy any security or to participate in any trading strategy. All material presented is compiled from sources believed to be reliable, but accuracy, adequacy, or completeness cannot be guaranteed, and Contrary LLC (Contrary LLC, together with its affiliates, “Contrary”) makes no representation as to its accuracy, adequacy, or completeness.
The information herein is based on Contrary beliefs, as well as certain assumptions regarding future events based on information available to Contrary on a formal and informal basis as of the date of this publication. The material may include projections or other forward-looking statements regarding future events, targets or expectations. Past performance of a company is no guarantee of future results. There is no guarantee that any opinions, forecasts, projections, risk assumptions, or commentary discussed herein will be realized. Actual experience may not reflect all of these opinions, forecasts, projections, risk assumptions, or commentary.
Contrary shall have no responsibility for: (i) determining that any opinions, forecasts, projections, risk assumptions, or commentary discussed herein is suitable for any particular reader; (ii) monitoring whether any opinions, forecasts, projections, risk assumptions, or commentary discussed herein continues to be suitable for any reader; or (iii) tailoring any opinions, forecasts, projections, risk assumptions, or commentary discussed herein to any particular reader’s objectives, guidelines, or restrictions. Receipt of this material does not, by itself, imply that Contrary has an advisory agreement, oral or otherwise, with any reader.
Contrary is registered with the Securities and Exchange Commission as an investment adviser under the Investment Advisers Act of 1940. The registration of Contrary in no way implies a certain level of skill or expertise or that the SEC has endorsed Contrary. Investment decisions for Contrary clients are made by Contrary. Please note that, although Contrary manages assets on behalf of Contrary clients, Contrary clients may take any position (whether positive or negative) with respect to the company described in this material. The information provided in this material does not represent any investment strategy that Contrary manages on behalf of, or recommends to, its clients.
Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, company or product made reference to directly or indirectly in this material, will be profitable, equal any corresponding indicated performance level(s), or be suitable for your portfolio. Due to rapidly changing market conditions and the complexity of investment decisions, supplemental information and other sources may be required to make informed investment decisions based on your individual investment objectives and suitability specifications. All expressions of opinions are subject to change without notice. Investors should seek financial advice regarding the appropriateness of investing in any security of the company discussed in this presentation.
Please see www.contrary.com/legal for additional important information.
