Core Insights - Getaround is shutting down its U.S. operations after previously cutting 30% of its North American workforce, focusing instead on its European business [1][2][4] - The company has faced significant financial challenges, including a lack of liquidity, leading to the decision to cease U.S. operations [7] Company Overview - Getaround, founded in 2009, raised over $750 million from notable investors, including a $300 million round led by Softbank Vision Fund [3] - The company expanded into Europe through acquisitions, including Drivy and Nabobil in 2019, and went public in 2022 via a SPAC merger [4] Operational Changes - The board approved an "orderly wind down" of U.S. operations, resulting in layoffs and an estimated charge of $1.5 million to $2 million [5] - Customers were notified to return rentals by the end of Wednesday to avoid liability issues, with the company canceling all future U.S. rentals [2][6] Leadership Statements - Interim CEO AJ Lee described the decision to shut down U.S. operations as incredibly difficult, citing ongoing liquidity issues despite restructuring efforts [7]

Core Points - Getaround, Inc. plans to wind down its U.S. business operations, including its car-share and HyreCar businesses, while continuing its European operations [1][2] - The decision to cease U.S. operations was made after careful consideration of various strategic options due to ongoing liquidity issues despite improvements in profitability [2] - Getaround aims to maximize the value of its assets for stakeholders through this wind-down, focusing on strategic opportunities in Europe [2][3] Company Overview - Getaround is a leading car-sharing platform in Europe, leveraging its innovative technology to enhance profitability and operational efficiency [3] - The company offers a digital experience for car-sharing, enabling contactless transactions and promoting a shift away from car ownership [4] - Getaround operates in over 1,000 cities across 8 countries, including the U.S. and Europe, and was launched in 2011 [4]

Core Viewpoint - Levi & Korsinsky, LLP has initiated an investigation into Getaround, Inc, focusing on potential violations of securities laws and the implications for shareholders [1] Group 1 - The investigation is aimed at determining whether Getaround, Inc misled investors regarding its business operations and financial performance [1] - Shareholders are being notified about the investigation to ensure they are aware of their rights and potential actions [1] - The outcome of the investigation could have significant implications for the company's stock performance and shareholder value [1]

Group 1 - The article discusses an investigation initiated by Levi & Korsinsky, LLP into Getaround, Inc. regarding potential shareholder concerns [1] - The investigation aims to determine whether Getaround's board of directors breached their fiduciary duties to shareholders [1] - Shareholders are encouraged to contact the law firm for more information about the investigation and their rights [1]

Promissory Note Details - Getaround, Inc. has issued a promissory note with a principal amount of $97,842,573.57, which is due on November 12, 2024[1]. - The repayment amount on the note is set at 108.000% of the principal, including all capitalized amounts and accrued interest[1]. - The maturity date for the obligations under the note is August 7, 2026[17]. - The note is secured by collateral as defined in the security documents, which includes all assets of the borrower[7]. - The note has not been registered under the Securities Act of 1933, indicating it may not be offered or sold unless registered or exempt[1]. - The outstanding principal amount under the Note will accrue interest at a rate of 15.00% per annum starting from November 11, 2024[31]. - Accrued interest will be capitalized and added to the principal balance on the 15th of each month, starting August 15, 2024[32]. - In the event of default, the unpaid principal and any owed interest will bear a default interest rate of 17.00% per annum[33]. - The Borrower may prepay the Repayment Amount at any time, with certain conditions regarding net proceeds from asset sales[38]. Borrower Obligations - The borrower is subject to the terms of the Convertible Notes Indenture, which governs its 8.00% / 9.50% Convertible Senior Secured PIK Toggle Notes due 2027[9]. - The borrower must comply with various definitions and obligations as outlined in the note documents, including the Guarantee Agreement dated September 8, 2023[11]. - The borrower is required to maintain certain financial conditions, including a minimum Tier 1 capital of $1,000,000,000 for the banks involved[5]. - The Borrower is required to guarantee obligations under the Note through its subsidiaries, ensuring compliance with the Guarantee Agreement[39]. - The Borrower must execute and deliver Security Documents to create effective junior priority liens within 30 days of the Note date[47]. - The Borrower is prohibited from selling or assigning its rights under the Note without the Holder's consent[54]. - The Borrower waives presentment and notice requirements related to the enforcement of the Note[56]. - The Borrower must comply with all obligations under the Note and related documents to avoid events of default[51]. - The Borrower and each Guarantor reaffirm their payment obligations under the Note and related documents[69]. Legal Provisions - The Note is governed by the laws of the State of New York, with any legal actions to be brought in New York County or the Southern District of New York[58]. - Each party irrevocably waives the right to a jury trial in any legal proceeding related to the Note[59]. - The records of the Holder serve as prima facie evidence of amounts owed under the Note, including adjustments to the principal amount[62]. - No term of the Note may be waived or amended except in writing signed by both the Borrower and the Holder[63]. - The Note embodies the entire agreement between the parties and supersedes all prior conflicting agreements[70]. - Notices under the Note must be in writing and can be delivered via personal delivery, electronic mail, overnight courier, or certified mail[65]. - The parties consent to service of process in accordance with the specified notice provisions[58]. Collateral and Security - The note includes provisions for events of default and the associated default rate[10]. - Liens in favor of the Holder must remain valid for collateral valued over $5,000,000, or a default will occur[51]. - The note is part of a broader financing strategy that may include additional subscription agreements and security agreements[25]. - The Note includes provisions to conform to applicable usury laws, ensuring interest does not exceed legal limits[68]. - The Borrower is located at P.O. Box 24173, Oakland, California, while the Holder is at 527 Madison Avenue, New York, NY[73].

Company Overview - As of September 30, 2024, Getaround's platform supports approximately 2.2 million unique guests and has around 66,000 active cars in over 1,000 cities across 8 countries[148]. - The Company incurred cumulative losses from inception through September 30, 2024, and expects to continue incurring losses for the foreseeable future[161]. - Getaround's revenue model includes fees charged to guests and subscriptions charged to hosts, with a significant majority of revenue depending on Powerhosts, defined as hosts with three or more active cars[163]. Financial Performance - Total Revenues for Q3 2024 were $22.387 million, a decrease of 5.9% from $23.799 million in Q3 2023[190]. - Net Loss for Q3 2024 was $15.524 million, compared to a net loss of $27.346 million in Q3 2023[190]. - Comprehensive Loss for Q3 2024 was $3.141 million, significantly improved from a comprehensive loss of $13.829 million in Q3 2023[190]. - Total revenues for the nine months ended September 30, 2024, increased by $4.2 million, or 8%, to $58.1 million compared to $53.9 million in the same period of 2023[231]. - Loss from operations improved to $(63.1) million for the nine months ended September 30, 2024, compared to $(74.1) million in the prior year[234]. Revenue Breakdown - Service Revenue accounted for 99% of Total Revenues in Q3 2024, down from 98% in Q3 2023[192]. - Service revenue rose by $4.4 million, or 8%, primarily due to incremental revenue from the 2023 Business Combination, despite a suspension of operations in New York State[232]. - Lease revenue decreased by $0.2 million, or 21%, mainly due to the suspension of operations in New York State[233]. Expenses - Sales and Marketing expenses increased to $5.197 million in Q3 2024, representing 23% of Total Revenues compared to 17% in Q3 2023[192]. - Operations and Support expenses were $15.255 million in Q3 2024, accounting for 68% of Total Revenues, down from 71% in Q3 2023[192]. - General and administrative expenses decreased by $1.7 million, or 4%, primarily due to a reduction in bad debt and office-related expenses[240][242]. Cash Flow and Financing - Cash and cash equivalents as of September 30, 2024, totaled $30.8 million, consisting of institutional money market funds and similar instruments[269]. - Net cash provided by financing activities was $60.9 million during the nine months ended September 30, 2024, primarily from the issuance of the Mudrick Super Priority Note[277]. - Cash flows used in operating activities for the nine months ended September 30, 2024, were $44.8 million, compared to $44.0 million in 2023[274]. Market and Operational Challenges - The Company has experienced a delisting from the NYSE effective August 16, 2024, due to not meeting the continued listing standard of maintaining an average global market capitalization of at least $15 million[160]. - The company expects to incur additional losses for the foreseeable future, impacting its ability to fund operations beyond current cash reserves[271]. - The company has sought additional sources of capital due to insufficient funds to continue operations as a going concern[270]. Valuation and Fair Value - The fair value of the company's common stock was determined using an option pricing method (OPM) that incorporates both income and market approaches, weighted by the probability of a business combination transaction or remaining private[286]. - The fair value of the warrant liability was estimated using a Black-Scholes calculation and the OPM, reflecting potential initial public offering scenarios and alternative exit events[289]. - Significant unobservable inputs for the common stock warrants included projected future cash flows, timing of potential events, and discount rates, which could materially affect estimated fair value[290]. Internal Controls and Compliance - As of September 30, 2024, the company's disclosure controls and procedures were deemed ineffective due to material weaknesses in internal control over financial reporting[295]. - The company has not reported any material changes in its controls and procedures since the last Annual Report[296].

Company Operations - As of June 30, 2024, Getaround's platform supports approximately 2.2 million unique guests and has around 72,000 active cars in over 1,000 cities across 8 countries[118]. - The suspension of carsharing operations in New York State is expected to reduce annualized service revenue by $5 million to $7 million, while improving annualized trip contribution profit by an estimated $2 million[121]. - Getaround has incurred cumulative losses from inception through June 30, 2024, and anticipates continued operating losses and negative cash flows for the foreseeable future[134]. - The company received a notice from the NYSE regarding the suspension of trading of its common stock due to not meeting the continued listing standard of maintaining an average global market capitalization of at least $15 million[133]. - The company appointed Mr. Eduardo Iniguez as CEO and transitioned part of its executive team in early 2024[120]. - The Getaround Connect Cloud Platform enables a contactless booking, pickup, and return experience for guests, enhancing user convenience[119]. - The company has a broad network of loyal hosts and guests, benefiting from low entry costs and dynamic pricing algorithms informed by data analytics[119]. Financial Performance - Service revenue for Q2 2024 was $18,307, compared to $18,224 in Q2 2023, reflecting a slight increase of 0.5%[154]. - Total revenues for Q2 2024 were $18,584, down from $18,620 in Q2 2023, indicating a decrease of 0.2%[154]. - Net loss for Q2 2024 was $12,025, compared to a net loss of $30,269 in Q2 2023, showing an improvement of 60.2%[154]. - Total revenues for the six months ended June 30, 2024, increased by $5.6 million, or 19%, to $35.74 million compared to $30.14 million in the same period of 2023[191]. - The net loss for the six months ended June 30, 2024, was $42.99 million, an improvement from a net loss of $53.07 million in the same period of 2023[190]. - Contribution profit increased by $2.7 million, or 93%, to $5.6 million for the three months ended June 30, 2024, due to a decrease in variable operating expenses[181]. - Trip Contribution Profit was $9.7 million, an increase of $1.8 million, or 23%, from the previous year, attributed to a decrease in Trip support costs[184]. - Adjusted EBITDA loss for the three months ended June 30, 2024, was $11.4 million, an improvement of $10.9 million, or 49%, from a loss of $22.4 million in the same period last year[187]. Revenue and Expenses - Getaround generates revenue primarily from fees charged to guests and subscriptions from hosts, with a significant portion dependent on Powerhosts, defined as hosts with three or more active cars[135]. - The average commission charged to hosts is approximately 40%, with hosts retaining 60% of the Trip Price[138]. - Cost of revenue (exclusive of depreciation and amortization) for Q2 2024 was $1,660, down from $1,730 in Q2 2023, a decrease of 4.0%[154]. - Sales and marketing expenses for Q2 2024 were $5,736, a decrease of 25.7% from $7,728 in Q2 2023[154]. - Operations and support expenses decreased to $12,680 in Q2 2024 from $16,024 in Q2 2023, a reduction of 21.5%[154]. - Total operating expenses decreased to $82.39 million for the six months ended June 30, 2024, from $85.12 million in the prior year, reflecting a reduction in various expense categories[191]. - Sales and marketing expenses decreased by $2.4 million, or 21%, to $8.97 million, attributed to cost control measures and a shift in focus towards improving unit economics[194]. - General and administrative expenses decreased by $1.1 million, or 4%, to $27.45 million, largely due to reductions in office-related expenses and bad debt[198]. Cash Flow and Financing - Cash and cash equivalents as of June 30, 2024, totaled $30.9 million, consisting of institutional money market funds and similar instruments[223]. - Net cash provided by financing activities was $41.1 million during the six months ended June 30, 2024, entirely from the issuance of the Mudrick Super Priority Note[229]. - Operating activities used cash of $24.5 million for the six months ended June 30, 2024, compared to $28.6 million in the same period in 2023[227]. - Cash flows used in investing activities were $0.9 million for the six months ended June 30, 2024, down from $10.5 million in the prior year[228]. Market and Valuation - The fair value adjustment for convertible promissory notes increased by $13.6 million, or 606%, for the three months ended June 30, 2024, compared to the prior year[165]. - The valuation of common stock warrants is sensitive to changes in unobservable inputs, which could materially affect estimated fair value[241]. - The company utilized a market-based approach for valuing Mudrick Convertible Notes and Super Priority Note Payable, incorporating unobservable inputs[240]. - Significant unobservable inputs for the valuation model include timing of potential events, guideline public company multiples, and projected future cash flows[240]. Legal and Compliance - The company reported material weaknesses in internal control over financial reporting as of June 30, 2024, affecting the effectiveness of disclosure controls and procedures[244]. - Legal proceedings are discussed in "Note 12: Commitments and Contingencies" of the condensed consolidated financial statements[246].

Financial Data and Key Metrics Changes - Total net revenue for Q2 2024 was $18.6 million, consistent with the same period in 2023, while gross booking value fell by 1% to $53 million [7][9] - Adjusted EBITDA loss improved by 49% year-over-year to $11.4 million, compared to a loss of $22.4 million in the same period last year [7][10] - Gross margin from service revenue reached 88% in Q2 2024, an improvement of 300 basis points year-over-year [9] Business Line Data and Key Metrics Changes - Trips for Q2 2024 totaled 235,000, down from 257,000 in Q2 2023, primarily due to the suspension of operations in New York [9] - Trip contribution profit increased by 23% year-over-year to $9.7 million, driven by reductions in support costs [9] Market Data and Key Metrics Changes - The company suspended operations in New York, one of its largest markets, impacting overall trip numbers and revenue [7][9] - The acquisition of HyreCar assets in May 2023 contributed positively to revenue and expanded the Drive with Uber program [8] Company Strategy and Development Direction - The company is focusing on improving margins and has streamlined operations to lower costs, including suspending operations in unprofitable markets [5][7] - There is a renewed focus on strategic partnerships with OEM automakers and enhancing technology offerings, such as the Connect technology for remote management of bookings [5][6] - The company aims to balance cost optimization with profitable growth, targeting a serviceable market estimated at over $100 billion [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledges ongoing operational and financial challenges but emphasizes a commitment to transforming the company into a sustainable operational model [11] - The company is optimistic about future growth opportunities, particularly in profitable geographic markets and segments [12] Other Important Information - The company has secured $50 million in additional financing, with $40 million already secured to support its business plan [5] - The cash position at the end of Q2 2024 was $30.9 million, with efforts underway to improve this position [10] Q&A Session Summary Question: Why did the company withdraw the appeal to the New York Stock Exchange? - The company has not been compliant with NYSE listing requirements for some time and plans to continue as a public company while focusing on operational improvements [11] Question: What are the near-term and mid-term opportunities for growth? - The company is focused on balancing cost optimization with profitable growth, targeting segments aligned with its business model and enhancing technology to drive customer loyalty [12] Question: How does Getaround differentiate itself from competitors? - The company differentiates through its Connect technology, TrustScore for risk management, a global platform, and a strong internal talent pool [13][14] Question: How is the company leveraging AI capabilities? - The company is exploring AI to improve customer experience, risk management, and operational efficiency, indicating a commitment to leveraging data for competitive advantage [15]

Core Insights - Getaround, Inc. reported a quarterly loss of $0.12 per share, better than the Zacks Consensus Estimate of a loss of $0.18, and an improvement from a loss of $0.33 per share a year ago, resulting in an earnings surprise of 33.33% [1] - The company posted revenues of $18.58 million for the quarter ended June 2024, missing the Zacks Consensus Estimate by 4.80%, and showing a slight decline from $18.62 million in the same quarter last year [2] - Getaround's shares have decreased approximately 69.7% since the beginning of the year, contrasting with a 12% gain in the S&P 500 [3] Earnings Outlook - The future performance of Getaround's stock will largely depend on management's commentary during the earnings call and the company's earnings outlook, including current consensus earnings expectations for upcoming quarters [4] - The current consensus EPS estimate for the next quarter is -$0.18 on revenues of $20.56 million, and for the current fiscal year, it is -$0.76 on revenues of $80 million [7] Industry Context - The Technology Services industry, to which Getaround belongs, is currently ranked in the top 38% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Another company in the same industry, Sprinklr, is expected to report quarterly earnings of $0.07 per share, reflecting a year-over-year decline of 30%, with revenues projected to be $194.58 million, up 9% from the previous year [9]

Financial Performance - GAAP net loss for Q2 2024 was $12.0 million, a significant improvement from a net loss of $30.3 million in the same period last year[1] - Adjusted EBITDA loss improved by 49% to $11.4 million from a loss of $22.4 million year-over-year[1] - Total revenues for Q2 2024 were $18.6 million, flat compared to the same period last year[3] - Net Loss for Q2 2024 was $12,025,000, a significant improvement from a Net Loss of $30,269,000 in Q2 2023, representing a reduction of approximately 60%[16] - Adjusted EBITDA for Q2 2024 was $(11,413,000), compared to $(22,353,000) in Q2 2023, indicating a year-over-year improvement of about 49%[16] Revenue and Margins - Gross Booking Value decreased by 1% to $53.0 million[3] - Gross margin from Service Revenue expanded to 88%, an increase of 286 basis points year-over-year[3] - Trip Contribution Margin increased to 53%, up 980 basis points compared to the previous year[3] Financing and Cash Position - The company secured an additional $50 million in financing during the quarter[2] - Cash and cash equivalents increased to $30.9 million from $15.6 million at the end of 2023[7] Governance and Strategy - New leadership team appointed three independent board members to enhance governance and strategy[2] - The company aims to maintain positive momentum with margin improvement and growth in profitable markets for the remainder of 2024[2] Expenses and Adjustments - The company recorded a fair value adjustment of $(11,356,000) related to warrant liability and convertible promissory notes in Q2 2024, contrasting with a gain of $2,060,000 in Q2 2023[16] - Stock-based compensation increased to $4,112,000 in Q2 2024 from $2,840,000 in Q2 2023, reflecting a rise of approximately 45%[16] - Depreciation and amortization expenses were $2,772,000 in Q2 2024, down from $3,297,000 in Q2 2023, showing a decrease of about 16%[16] - Interest and other income (expense), net, improved to $1,322,000 in Q2 2024 from $(263,000) in Q2 2023, marking a positive turnaround[16] - The company incurred $3,774,000 in expenses not incurred in the regular course of business in Q2 2024, compared to only $190,000 in Q2 2023[16] - Income tax benefit decreased slightly to $(12,000) in Q2 2024 from $(208,000) in Q2 2023[16]