Key Points There was no news out on Serve Robotics, but general enthusiasm for emerging technology stocks seems to be giving it a boost. Tesla CEO Elon Musk said most of the company's business will come from its Optimus autonomous robot. Serve is still bringing in less than $1 million per quarter in revenue. 10 stocks we like better than Serve Robotics › Shares of Serve Robotics (NASDAQ: SERV), a maker of food delivery robots, were moving higher for the second day in a row today, even though ther ...

Voysys’ platform-agnostic video streaming and data connectivity strengthens Serve’s technology stack and provides enhanced connection reliability at scaleVoysys will continue to operate as a standalone entity to support new and existing customers SAN FRANCISCO, Sept. 09, 2025 (GLOBE NEWSWIRE) -- Serve Robotics Inc. (Nasdaq: SERV), a leading autonomous sidewalk delivery company (“Serve”), today announced its acquisition earlier this year of the assets of Phantom Auto Inc. and its subsidiary, Voysys AB, a Swe ...

A positive rating from an analyst highlighted the growth potential at the company this week.Shares in Serve Robotics (SERV -2.44%) rose by 15.7% in the week through Friday morning, driven higher by the initiation of coverage by Wedbush Securities, whose analyst Dan Ives slapped a $15 price target on the stock and gave it an "outperform" rating. Given that the price target represents a 33% premium to the stock price at the time of writing, it's not too late to buy in if you have confidence in the analyst's e ...

Group 1 - The article suggests that there are opportunities in undervalued stocks that are mispriced by the market as of the end of August [1] - It encourages readers to consider joining a platform for insights on these investment opportunities [1] Group 2 - The article does not provide specific company or industry analysis, focusing instead on general investment advice [2][3][4]

智通财经APP获悉，Wedbush Securities首予Serve Robotics(SERV.US)"跑赢大盘"评级，目标价15美元。 该公司认为Serve Robotics正在建立一个开创性的自主配送平台，其独特的优势在于能够充分利用人工 智能驱动的最后一公里配送车辆日益普及的趋势。 分析师Dan Ives指出，该公司的平台能够让其机器人车队安全地在城市街道和人行道上行驶，并提供可 靠且无需用户具备技术知识的非接触式服务。此外，还提到这家位于雷德伍德城的公司与主要行业参与 者和商家平台密切合作，以定制部署方案并优化工作流程。 Ives补充道："Serve Robotics正在通过构建多条收入渠道来在行业内占据一席之地，这些渠道包括配 送、软件服务和广告，从而为实现稳定的营收增长提供了多种途径，同时还能充分利用企业对将商业行 业自动化化的日益增长的需求。该公司计划在 2025 年底将自动机器人车队规模扩大至 2000 台，并建立 新的合作伙伴关系，同时在监管环境有利的其他城市开展业务运营。随着对自动化、运营效率和可持续 配送解决方案的需求不断增长，Serve Robotics市场地位将得到有力巩固。" ...

Core Viewpoint - Serve Robotics (SERV.US) stock price increased over 15%, reaching $11.94, following a "buy" rating from Wedbush analyst Daniel Ives with a target price of $15, highlighting the company's unique advantage in the growing demand for automated last-mile delivery vehicles [1] Company Summary - Serve Robotics' stock performance shows a significant rise, indicating positive market sentiment and investor interest [1] - The company is positioned favorably within the automated delivery vehicle sector, which is experiencing increasing demand [1] Industry Summary - The last-mile delivery vehicle market is expanding, creating opportunities for companies like Serve Robotics to capitalize on this trend [1]

Core Viewpoint - The recent launch of NVIDIA's Jetson Thor is seen as a significant advancement in robotics, enhancing AI computing power and enabling higher capabilities in humanoid robots [1] Group 1: Stock Performance - Several US robotics stocks experienced notable gains, with Serve Robotics rising over 15%, Richtech Robotics increasing nearly 14%, and iRobot up more than 3% [1] Group 2: Technological Advancements - NVIDIA's Jetson Thor features a Blackwell GPU and 128 GB of memory, achieving 2070 FP4 TFLOPS of AI computing power, which is 7.5 times that of the previous Jetson Orin model [1] - This technological leap allows robots to process large amounts of sensory data and large language models (LLM) in real-time, enhancing their ability to see, think, and act [1]

Nvidia (NVDA 0.94%) recently became the world's first $4 trillion company. Demand continues to outstrip supply for its data center chips, which are the best in the world for developing artificial intelligence (AI) models. With all the added revenue pouring in, Nvidia has been looking for ways to put it to use. One way is by investing in smaller AI companies, equipping them with the financial resources and technical expertise they need to commercialize their products. Between 2022 and 2024, the chip giant in ...

Core Insights - Serve Robotics Inc. has acquired Vayu Robotics, enhancing its position in the autonomous delivery market and leveraging Vayu's AI navigation technology [1][5][11] - The acquisition aims to combine Serve's real-world data with Vayu's AI models to improve navigation capabilities and accelerate deployment in new markets [2][7] Company Overview - Serve Robotics develops AI-powered, low-emission sidewalk delivery robots and has completed tens of thousands of deliveries for partners like Uber Eats and 7-Eleven [12] - Vayu Robotics specializes in urban robot navigation using large-scale AI models and aims to democratize robotics for widespread adoption [11] Strategic Implications - The merger is expected to enhance Serve's autonomy training capabilities and expand its operational environments, potentially increasing revenue and customer growth [7][8] - The integration of Vayu's technology is anticipated to improve safety, reliability, and speed, thereby reducing operational costs [7] Financial Details - The acquisition includes an initial consideration of 1,696,069 shares of Serve's common stock, with a potential future earnout of 560,000 shares based on performance milestones [8][9] - Additional warrants for 4,000,000 shares at an exercise price of $10.36 per share were issued to Khosla Ventures, a key investor in Vayu [8] Leadership and Expertise - Vayu's team, including founders with extensive experience in AI and robotics, will join Serve, bringing valuable insights and expertise [3][4] - Vinod Khosla, a prominent Silicon Valley technologist and Vayu's lead investor, will join Serve's Advisory Board to support its growth [4][6]

PART I - FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, changes in stockholders' equity, and cash flows, along with detailed notes explaining accounting policies, significant transactions, and financial position [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This table presents the company's financial position, detailing assets, liabilities, and stockholders' equity as of June 30, 2025, and December 31, 2024 **Condensed Consolidated Balance Sheets (in thousands)** | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Total Assets | $214,315 | $139,601 | | Cash and cash equivalents | $116,700 | $123,266 | | Short-term marketable securities | $66,631 | $- | | Total Liabilities | $7,109 | $7,920 | | Total Stockholders' Equity | $207,206 | $131,681 | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This table outlines the company's revenues, costs, gross profit, operating expenses, and net loss for the three and six months ended June 30, 2025 and 2024 **Condensed Consolidated Statements of Operations (in thousands)** | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenues | $642 | $468 | $1,082 | $1,415 | | Cost of revenues | $3,501 | $326 | $5,410 | $678 | | Gross profit (loss) | $(2,859) | $142 | $(4,328) | $737 | | Total operating expenses | $19,785 | $8,698 | $33,323 | $17,003 | | Net loss | $(20,850) | $(9,038) | $(34,068) | $(18,075) | [Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity%20(Deficit)) This table details changes in stockholders' equity, including stock issuances, warrant exercises, stock-based compensation, and net loss for the six months ended June 30, 2025 **Changes in Stockholders' Equity (in thousands) for Six Months Ended June 30, 2025** | Item | Amount | | :-------------------------------------------------------------------------------- | :----- | | Balances at December 31, 2024 | $131,681 | | Issuance of common stock, net of offering costs | $75,847 | | Issuance of common stock under 2025 Equity Distribution Agreement, net of offering costs | $13,521 | | Exercise of warrants | $(411) | | Stock-based compensation | $4,398 | | Net loss | $(20,850) | | Balances at June 30, 2025 | $207,206 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This table summarizes cash flows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 **Condensed Consolidated Statements of Cash Flows (in thousands) for Six Months Ended June 30** | Activity | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Net cash used in operating activities | $(25,426) | $(9,820) | | Net cash used in investing activities | $(81,934) | $(798) | | Net cash provided by financing activities | $100,795 | $39,392 | | Net change in cash and cash equivalents | $(6,565) | $28,774 | | Cash and cash equivalents at end of period | $116,700 | $28,781 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations of the accounting policies, significant transactions, and financial position supporting the unaudited condensed consolidated financial statements [1. Nature of Operations, History, Organization and Business](index=12&type=section&id=1.%20Nature%20of%20Operations,%20History,%20Organization%20and%20Business) Serve Robotics Inc. is developing next-generation robots for last-mile delivery services. The company completed a reverse merger in July 2023, becoming a public reporting company, and subsequently completed a public offering and uplisted to Nasdaq in April 2024 - Company's core business: Developing next-generation robots for **last-mile delivery services**[25](index=25&type=chunk) - Reverse Merger: Completed on **July 31, 2023**, with Serve becoming a wholly-owned subsidiary of Patricia Acquisition Corp., which then changed its name to Serve Robotics Inc[26](index=26&type=chunk) - Public Offering & Nasdaq Listing: Completed on **April 17, 2024**, raising approximately **$35.8 million net proceeds**, and commenced trading on Nasdaq under "SERV" beginning on April 18, 2024[27](index=27&type=chunk) [2. Summary of Significant Accounting Policies](index=12&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This section details the company's accounting policies, including its basis of presentation, single operating segment, liquidity and going concern considerations, and revenue recognition. It highlights significant customer concentration and outlines recently adopted and new accounting pronouncements - Basis of Presentation: Unaudited condensed consolidated financial statements prepared in accordance with SEC rules and GAAP, including normal recurring adjustments[29](index=29&type=chunk) - Liquidity and Going Concern: As of June 30, 2025, principal liquidity sources were **$183.3 million** in cash and marketable securities; the company expects to fund its operations for at least the next twelve months[32](index=32&type=chunk) **Customer Revenue Concentration** | Customer | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Magna | 39% | 63% | 46% | 81% | | Uber | 31% | 30% | 29% | 13% | - Revenue Recognition: Revenue is disaggregated into software services and fleet services, recognized when control of goods or services is transferred to customers[70](index=70&type=chunk)[74](index=74&type=chunk) - Recently Adopted Accounting Pronouncements: Adopted ASU No. 2023-07, Segment Reporting, during the fourth quarter of December 31, 2024[84](index=84&type=chunk) [3. Acquisition](index=20&type=section&id=3.%20Acquisition) On April 1, 2025, the Company acquired a foreign entity for approximately $5.75 million in cash, resulting in preliminary goodwill of $4.33 million. The acquisition included identifiable intangible assets such as developed technology, customer relationships, and trade names - Acquisition Date: **April 1, 2025**[87](index=87&type=chunk) - Purchase Consideration: Approximately **$5.75 million** of cash consideration[90](index=90&type=chunk) - Preliminary Goodwill: **$4.33 million**, attributed to expected synergies and other benefits[90](index=90&type=chunk) **Preliminary Fair Values of Identified Intangible Assets Acquired (in thousands)** | Intangible Assets | Useful life (in years) | Preliminary fair value at acquisition | | :---------------- | :--------------------- | :---------------------------------- | | Developed technology | 15 | $980 | | Customer relationships | 25 | $255 | | Trade names | 10 | $135 | | Total | | $1,370 | [4. Goodwill and Intangible Assets, Net](index=23&type=section&id=4.%20Goodwill%20and%20Intangible%20Assets,%20Net) Goodwill increased to $4.59 million as of June 30, 2025, primarily due to the recent acquisition and foreign currency translation effects. Intangible assets, net, totaled $1.43 million, consisting of developed technology, customer relationships, and trade names, amortized over 10-25 years **Goodwill Carrying Amount (in thousands)** | Metric | Amount | | :-------------------------- | :----- | | Balance as of December 31, 2024 | $— | | Acquisition | $4,327 | | Effects of foreign currency translation | $261 | | Balance as of June 30, 2025 | $4,588 | **Intangible Assets, Net (in thousands) as of June 30, 2025** | Intangible Assets | Weighted-Average Remaining Useful Life (in years) | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | | :---------------- | :---------------------------------------------- | :------------------- | :----------------------- | :----------------- | | Developed technology | 14.8 | $1,039 | $17 | $1,022 | | Customer relationships | 24.8 | $270 | $3 | $267 | | Trade names | 9.8 | $144 | $4 | $140 | | Total | | $1,453 | $24 | $1,429 | **Estimated Future Amortization Expense of Intangible Assets (in thousands)** | Year Ending December 31, | Amortization Expense | | :----------------------- | :------------------- | | Remainder of 2025 | $47 | | 2026 | $94 | | 2027 | $94 | | 2028 | $94 | | 2029 | $94 | | Thereafter | $1,006 | | Total | $1,429 | [5. Fair Value Measurements](index=23&type=section&id=5.%20Fair%20Value%20Measurements) As of June 30, 2025, the company held $172.6 million in cash equivalents and short-term marketable securities measured at fair value, primarily classified as Level 1 and Level 2. The derivative liability related to convertible notes was converted to additional paid-in capital in April 2024 **Fair Value Measurements as of June 30, 2025 (in thousands)** | Asset Type | Level 1 | Level 2 | Level 3 | Total | | :-------------------------- | :------ | :------ | :------ | :------ | | Money market funds | $97,318 | $— | $— | $97,318 | | Commercial Paper (cash equiv.) | $6,481 | $— | $— | $6,481 | | U.S. Treasury securities (cash equiv.) | $2,201 | $— | $— | $2,201 | | Commercial paper (short-term) | $— | $31,732 | $— | $31,732 | | Corporate bonds | $— | $27,492 | $— | $27,492 | | U.S. Treasury securities (short-term) | $— | $7,407 | $— | $7,407 | | Total | $106,000 | $66,631 | $— | $172,631 | - Derivative Liability: The related derivative liability was converted into additional paid-in capital in connection with the conversion of the underlying January Notes upon the Offering in **April 2024**[103](index=103&type=chunk) [6. Marketable Securities](index=24&type=section&id=6.%20Marketable%20Securities) As of June 30, 2025, the company held $172.6 million in cash equivalents and marketable securities. Unrealized losses of $45k were recorded on short-term marketable securities, but no credit loss allowance was deemed necessary as the company intends to hold these securities until maturity or recovery of cost basis **Marketable Securities Summary (in thousands) as of June 30, 2025** | Asset Type | Cost or Amortized Cost | Unrealized Gains | Unrealized Losses | Estimated Fair Value | | :-------------------------- | :--------------------- | :--------------- | :---------------- | :------------------- | | Money market funds | $97,318 | $— | $— | $97,318 | | Commercial Paper (cash equiv.) | $6,481 | $— | $— | $6,481 | | U.S. Treasury securities (cash equiv.) | $2,201 | $— | $— | $2,201 | | Commercial paper (short-term) | $31,748 | $— | $(16) | $31,732 | | Corporate bonds | $27,515 | $— | $(23) | $27,492 | | U.S. Treasury securities (short-term) | $7,413 | $— | $(6) | $7,407 | | Total | $172,676 | $— | $(45) | $172,631 | - For marketable securities with unrealized losses, the Company does not intend to sell them and expects to hold them until maturity or recovery of cost basis; no allowance for credit losses was recorded[105](index=105&type=chunk) [7. Property and Equipment, Net](index=25&type=section&id=7.%20Property%20and%20Equipment,%20Net) Property and equipment, net, increased to $18.59 million as of June 30, 2025, from $11.96 million at December 31, 2024, primarily due to a significant increase in robot assets. Depreciation expense also increased substantially **Property and Equipment, Net (in thousands)** | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Office equipment | $373 | $332 | | Robot assets | $12,948 | $4,610 | | Construction-in-progress | $7,069 | $7,826 | | Tooling | $2,111 | $1,799 | | Total | $22,501 | $14,567 | | Less: accumulated depreciation | $(3,908) | $(2,604) | | Property and equipment, net | $18,593 | $11,963 | - Depreciation expense for the six months ended June 30, 2025, was **$1,269 thousand**, a significant increase from **$28 thousand** in the same period of 2024[106](index=106&type=chunk) [8. Note Payable](index=25&type=section&id=8.%20Note%20Payable) A related party note payable was fully repaid in January 2024. January 2024 convertible notes totaling $5.0 million were converted into 2,104,562 shares of common stock in April 2024 upon the public offering, eliminating related interest expense and derivative liability - Related Party Note Payable: **$70 thousand**, fully repaid on **January 3, 2024**[107](index=107&type=chunk) - January 2024 Convertible Notes: **$5.0 million** aggregate, converted into **2,104,562 shares of common stock** at a conversion price of **$2.42 per share** upon the closing of the Offering in **April 2024**[108](index=108&type=chunk)[109](index=109&type=chunk) - Derivative Liability: A derivative liability with a fair value of **$1.7 million** was reclassified to additional paid-in capital upon the conversion of the January Notes in **April 2024**[110](index=110&type=chunk) [9. Stockholders' Equity (Deficit)](index=26&type=section&id=9.%20Stockholders'%20Equity%20(Deficit)) The company's common stock outstanding increased significantly due to various equity transactions, including a $40.0 million public offering in April 2024, private placements totaling $32.3 million in July and August 2024, an $80 million registered direct offering in January 2025, and 'at-the-market' offerings raising $77.6 million in 2024 and $13.5 million in H1 2025 - Common Stock Outstanding: **59,333,332 shares** as of June 30, 2025, compared to **51,288,566 shares** as of December 31, 2024[16](index=16&type=chunk) - April 2024 Public Offering: Issued **10,000,000 shares** for gross proceeds of **$40.0 million**[115](index=115&type=chunk) - July 2024 Private Placement: Sold pre-funded warrants and investor warrants for net proceeds of **$13.7 million**[117](index=117&type=chunk) - August 2024 Private Placement: Sold pre-funded warrants and investor warrants for net proceeds of **$18.6 million**[118](index=118&type=chunk) - January 2025 Registered Direct Offering: Issued **4,210,525 shares** for approximately **$80 million gross proceeds**[119](index=119&type=chunk) - 2024 At-the-Market (ATM) Offering: Sold **5,698,992 shares**, raising **$77.6 million net proceeds** during the twelve months ended December 31, 2024[131](index=131&type=chunk) - 2025 At-the-Market (ATM) Offering: Sold **1,125,706 shares**, raising **$13.5 million net proceeds** during the six months ended June 30, 2025[132](index=132&type=chunk) - Magna Warrant: Issued on **February 7, 2024**, to purchase up to **2,145,000 shares** at **$0.01 per share**, fully exercised by June 30, 2025[127](index=127&type=chunk)[128](index=128&type=chunk) [10. Stock-Based Compensation](index=29&type=section&id=10.%20Stock-Based%20Compensation) The 2023 Equity Incentive Plan was amended in June 2025, increasing authorized shares by 2,280,000. Stock-based compensation expense for the six months ended June 30, 2025, was $8.28 million, an increase from $7.74 million in the prior year, primarily allocated to research and development, and general and administrative expenses - 2023 Equity Incentive Plan: Amended in **June 2025**, increasing the number of shares authorized by **2,280,000 additional shares**[134](index=134&type=chunk) **Stock-Based Compensation Expense (in thousands)** | Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | General and administrative | $2,061 | $428 | $3,885 | $434 | | Operations | $96 | $138 | $176 | $144 | | Research and development | $2,158 | $2,861 | $4,087 | $7,101 | | Sales and marketing | $83 | $53 | $129 | $56 | | Total | $4,398 | $3,480 | $8,277 | $7,735 | - Unrecognized compensation cost related to non-vested stock option awards amounted to approximately **$166 thousand** as of June 30, 2025, to be recognized over a weighted average period of **1.31 years**[140](index=140&type=chunk) [11. Commitments and Contingencies](index=31&type=section&id=11.%20Commitments%20and%20Contingencies) The company has operating leases for office, warehouse space, and cargo vans, with total undiscounted future minimum payments of $2.75 million. A finance lease for robot assets was settled in April 2025 with the purchase of assets for $2.25 million. No material legal proceedings are pending **Future Annual Minimum Payments Under Operating Leases (in thousands) as of June 30, 2025** | Year | Amount | | :----------------------- | :----- | | Remainder of 2025 | $605 | | 2026 | $1,123 | | 2027 | $869 | | 2028 | $155 | | 2029 | $— | | Total undiscounted future cash flows | $2,752 | | Less: imputed interest | $(177) | | Total operating lease liabilities | $2,575 | - Finance Lease: The Company exercised the option to purchase robot assets at the end of the lease for **$2.25 million** in **April 2025**, with no outstanding liability as of June 30, 2025[145](index=145&type=chunk) - Contingencies: There are no pending, threatened, or actual material legal proceedings in which the Company or any of its subsidiaries is a party[146](index=146&type=chunk)[225](index=225&type=chunk) [12. Segment Information](index=32&type=section&id=12.%20Segment%20Information) The company operates as a single operating and reportable segment, with the Chief Executive Officer reviewing financial information on a consolidated basis for decision-making - The Company has **one operating and reportable segment**[147](index=147&type=chunk) - The Chief Executive Officer serves as the Chief Operating Decision Maker (CODM) and reviews financial information on a consolidated basis[147](index=147&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an overview of Serve Robotics Inc.'s business, recent developments, financial performance for the three and six months ended June 30, 2025, key operational metrics, and an analysis of its liquidity and capital resources, along with critical accounting estimates and company status [Company Overview](index=33&type=section&id=Company%20Overview) This section outlines the company's mission, core technology in AI-powered robotics for last-mile delivery, and the market opportunity it addresses - Mission: To deliver a sustainable future by transforming how goods move among people[151](index=151&type=chunk) - Core Technology: Advanced, **AI-powered robotics mobility platform**, with last-mile delivery in cities as its first application[151](index=151&type=chunk) - Market Opportunity: Servicing the growing on-demand delivery market, where approximately **half of all deliveries are less than 2.5 miles** and well-suited to delivery by sidewalk robots[159](index=159&type=chunk) [Recent Developments](index=34&type=section&id=Recent%20Developments) This section highlights key corporate actions including a technology acquisition, a registered direct offering, Nasdaq uplisting, and a strategic partnership with Magna - Acquisition of Technology Company: On **April 1, 2025**, the Company acquired all of the issued and outstanding equity of a foreign entity[160](index=160&type=chunk) - Securities Purchase Agreement: On **January 7, 2025**, the Company issued and sold **4,210,525 shares of common stock** in a registered direct offering for approximately **$80 million gross proceeds**[161](index=161&type=chunk) - Public Offering and Uplisting to Nasdaq: On **April 17, 2024**, the Company completed a public offering, raising approximately **$35.8 million net proceeds**, and commenced trading on The Nasdaq Capital Market on **April 18, 2024**[162](index=162&type=chunk) - Strategic Partnership with Magna: Entered into a License and Services Agreement (**Feb 20, 2024**) and a Master Services Agreement (**Feb 1, 2024**) for technology licensing, development services, and robot assembly assistance[163](index=163&type=chunk)[164](index=164&type=chunk)[166](index=166&type=chunk) [Outlook And Challenges Facing Our Business](index=35&type=section&id=Outlook%20And%20Challenges%20Facing%20Our%20Business) This section discusses factors influencing the business, such as demand for last-mile delivery, customer concentration, inflation, supply chain constraints, and regulatory conditions - Overall Demand for Last-Mile Delivery: Growth depends significantly on continued demand on partner platforms, which can fluctuate based on market cycles, weather, health conditions, and competitive dynamics[168](index=168&type=chunk) - Customer Concentration: A significant portion of revenue is concentrated with **Magna (39% of Q2 2025 revenue)** and **Uber (31% of Q2 2025 revenue)**, posing risks if these customers are lost[169](index=169&type=chunk)[170](index=170&type=chunk)[171](index=171&type=chunk) - Inflation and Market Considerations: Discretionary consumer spending is susceptible to economic conditions; inflation could reduce demand but also accelerate the adoption of automated robotic last-mile delivery as labor costs rise[172](index=172&type=chunk) - Supply Chain Constraints: Potential global supply chain shortages could impact future robot build plans, leading to higher costs or delays[174](index=174&type=chunk) - Governmental and Regulatory Conditions: Growth depends on continued permission and acceptance by local governments; changes in regulations could reduce or limit the ability to generate revenues[175](index=175&type=chunk) [Components of Results of Operations](index=36&type=section&id=Components%20of%20Results%20of%20Operations) This section defines the company's revenue streams, cost of revenue, and categories of operating expenses - Revenue: Consists of **software services revenues** and **fleet services revenues**[176](index=176&type=chunk) - Cost of Revenue: Primarily includes depreciation on robot assets, personnel time, and costs related to data and software for robot functionality[177](index=177&type=chunk) - Operating Expenses: Categorized into Operations (facility leases, field personnel), Research and Development (product design, hardware, software), Sales and Marketing (personnel, advertising), and General and Administrative (executive, finance, legal, HR, corporate expenses)[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk) [Financial Overview](index=37&type=section&id=Financial%20Overview) This section provides a high-level summary of the company's revenues, net loss, and accumulated deficit as of June 30, 2025 - Revenues for the three months ended June 30, 2025, were **$642 thousand**[182](index=182&type=chunk) - Net loss for the three months ended June 30, 2025, was **$20.8 million**[182](index=182&type=chunk) - Accumulated deficit as of June 30, 2025, was **$141.6 million**[182](index=182&type=chunk) [Results of Operations - Three Months Ended June 30, 2025 and 2024](index=37&type=section&id=Results%20of%20Operations%20-%20Three%20Months%20Ended%20June%2030,%202025%20and%202024) This section analyzes the company's financial performance, including revenues, costs, gross profit, operating expenses, and net loss, for the three months ended June 30, 2025 and 2024 **Operating Results (in thousands) for Three Months Ended June 30** | Metric | 2025 | 2024 | Change | Change % | | :-------------------------- | :----- | :----- | :----- | :------- | | Revenues | $642 | $468 | $174 | 37% | | Cost of revenues | $3,501 | $326 | $3,175 | 974% | | Gross profit (loss) | $(2,859) | $142 | $(3,002) | (2109)% | | Total operating expenses | $19,785 | $8,698 | $11,087 | 127% | | Net loss | $(20,850) | $(9,038) | $(11,812) | 131% | - Revenues increased by **$0.17 million (37%)** primarily due to a larger fleet, leading to a **$0.16 million increase in fleet services revenues**[184](index=184&type=chunk) - Cost of revenues increased by **$3.18 million (974%)** due to costs related to the scale-up of the fleet and launch-related costs in new markets[185](index=185&type=chunk) [Results of Operations - Six Months Ended June 30, 2025 and 2024](index=39&type=section&id=Results%20of%20Operations%20-%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) This section analyzes the company's financial performance, including revenues, costs, gross profit, operating expenses, and net loss, for the six months ended June 30, 2025 and 2024 **Operating Results (in thousands) for Six Months Ended June 30** | Metric | 2025 | 2024 | Change | Change % | | :-------------------------- | :----- | :----- | :----- | :------- | | Revenues | $1,082 | $1,415 | $(333) | (24)% | | Cost of revenues | $5,410 | $678 | $4,732 | 697% | | Gross profit (loss) | $(4,328) | $737 | $(5,065) | (688)% | | Total operating expenses | $33,323 | $17,003 | $16,320 | 96% | | Net loss | $(34,068) | $(18,075) | $(15,993) | 88% | - Revenues decreased by **$0.33 million (24%)** primarily due to a decrease in software services revenue, despite an increase in fleet services revenues of **$0.27 million**[191](index=191&type=chunk) - Cost of revenues increased by **$4.73 million (697%)** due to costs related to the scale-up of the fleet and launch-related costs in new markets[192](index=192&type=chunk) [Key Metrics](index=40&type=section&id=Key%20Metrics) This section presents key operational metrics such as Daily Active Robots and Daily Supply Hours, reflecting fleet utilization and operational capacity **Key Business Metrics** | Metric | Three Months Ended June 2025 | Three Months Ended June 2024 | Six Months Ended June 2025 | Six Months Ended June 2024 | | :------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Daily Active Robots | 160 | 48 | 116 | 44 | | Daily Supply Hours | 1,723 | 385 | 1,189 | 342 | - Daily Active Robots: The average number of robots performing daily deliveries, reflecting the operation team's capacity[198](index=198&type=chunk) - Daily Supply Hours: The average number of hours robots are ready to accept offers and perform daily deliveries, indicating fleet utilization potential[199](index=199&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's principal sources of liquidity, accumulated deficit, and a summary of cash flows from operating, investing, and financing activities - Principal Sources of Liquidity (June 30, 2025): **$183.33 million**, consisting of **$116.70 million** in cash and cash equivalents and **$66.63 million** in marketable securities[200](index=200&type=chunk) - Accumulated Deficit: **$141.59 million** as of June 30, 2025, reflecting significant operating losses[201](index=201&type=chunk) **Summary of Cash Flows (in thousands) for Six Months Ended June 30** | Activity | 2025 | 2024 | Change | | :-------------------------------- | :----- | :----- | :----- | | Net cash (used in) provided by: | | | | | Operating activities | $(25,426) | $(9,820) | $(15,606) | | Investing activities | $(81,934) | $(798) | $(81,136) | | Financing activities | $100,795 | $39,392 | $61,403 | | Increase (decrease) in cash and cash equivalents | $(6,565) | $28,774 | $(35,339) | - Net cash used in investing activities increased by **$81.14 million**, primarily due to the purchase of short-term marketable securities (**$66.3 million**) and the acquisition of a new business (**$5.6 million**)[205](index=205&type=chunk) - Net cash provided by financing activities increased by **$61.40 million**, primarily from proceeds from common stock issuances[206](index=206&type=chunk) [Off-Balance Sheet Transactions](index=42&type=section&id=Off-Balance%20Sheet%20Transactions) This section confirms the absence of off-balance sheet financing arrangements or relationships with unconsolidated entities during the reporting periods - The Company did not have any off-balance sheet financing arrangements or relationships with unconsolidated entities during the periods presented[209](index=209&type=chunk) [Critical Accounting Estimates](index=42&type=section&id=Critical%20Accounting%20Estimates) This section states that there have been no material changes to the critical accounting policies previously disclosed in the annual report - There have been no material changes in critical accounting policies from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[210](index=210&type=chunk) [Emerging Growth Company and Smaller Reporting Company Status](index=42&type=section&id=Emerging%20Growth%20Company%20and%20Smaller%20Reporting%20Company%20Status) This section clarifies the company's status as an emerging growth company and smaller reporting company, including its election for an extended transition period for accounting standards - The Company is an "emerging growth company" and a "smaller reporting company"[211](index=211&type=chunk)[212](index=212&type=chunk) - The Company has elected to use the extended transition period for complying with new or revised financial accounting standards[211](index=211&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Serve Robotics Inc. is not required to provide quantitative and qualitative disclosures about market risk for this reporting period - The Company is a smaller reporting company and is not required to provide the information for this item[213](index=213&type=chunk) [Item 4. Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025, due to identified material weaknesses in internal control over financial reporting, including an ineffective control environment, lack of segregation of duties, inadequate accounting policies, and ineffective IT general controls. A remediation plan is in place [Disclosure Controls and Procedures](index=42&type=section&id=Disclosure%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of June 30, 2025, due to material weaknesses in internal control over financial reporting - Management concluded that disclosure controls and procedures were **not effective** as of June 30, 2025[217](index=217&type=chunk) - Ineffectiveness is due to **material weaknesses** in internal control over financial reporting[217](index=217&type=chunk) [Material Weaknesses in Internal Control Over Financial Reporting](index=43&type=section&id=Material%20Weaknesses%20in%20Internal%20Control%20Over%20Financial%20Reporting) Identified material weaknesses include an ineffective control environment, lack of segregation of duties, inadequate accounting policies, and ineffective IT general controls - Identified material weaknesses include an **ineffective control environment** due to insufficient resources, lack of effective segregation of duties, inadequate comprehensive and formalized accounting and financial reporting policies, and ineffective IT general controls[223](index=223&type=chunk) - These material weaknesses did not result in a misstatement to any of the Company's previously issued consolidated financial statements but could result in future material misstatements[219](index=219&type=chunk) [Status of Remediation Plan](index=43&type=section&id=Status%20of%20Remediation%20Plan) Management has established a remediation plan for 2025 to address identified material weaknesses by implementing robust processes and effective financial reporting controls - Management has established a remediation plan for **2025** to address material weaknesses, focusing on establishing more robust processes, designing and implementing effective financial reporting controls, and ensuring accurate documentation and timely support[220](index=220&type=chunk) - Full remediation will require completion and effective operation of these steps over a sufficient period of time[221](index=221&type=chunk) [Changes in Internal Control over Financial Reporting](index=43&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2025 - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[222](index=222&type=chunk) PART II - OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits [Item 1. Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) There are no pending, threatened, or actual material legal proceedings involving Serve Robotics Inc. or its subsidiaries - There are no pending, threatened or actual material legal proceedings in which the Company or any of its subsidiaries is a party[225](index=225&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024 - There have been no material changes to the risk factors as disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[226](index=226&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report for this period - None[227](index=227&type=chunk) [Item 3. Defaults Upon Senior Securities](index=44&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report for this period - None[228](index=228&type=chunk) [Item 4. Mine Safety Disclosures](index=44&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to Serve Robotics Inc.'s operations - Not applicable[229](index=229&type=chunk) [Item 5. Other Information](index=44&type=section&id=Item%205.%20Other%20Information) Evan Dunn (General Counsel) and Euan Abraham (Chief Hardware and Manufacturing Officer) each entered into Rule 10b5-1 trading plans in May and June 2025, respectively, for the potential sale of common stock, with sales not to commence before September 2025. No shares have been sold under these plans as of the report date - Evan Dunn, General Counsel, entered into a Rule 10b5-1 trading plan on **May 20, 2025**, for the potential sale of up to **15,000 shares of common stock**, with sales not to commence prior to **September 1, 2025**[230](index=230&type=chunk) - Euan Abraham, Chief Hardware and Manufacturing Officer, entered into a Rule 10b5-1 trading plan on **June 2, 2025**, for the potential sale of up to **50,000 shares of common stock**, with sales not to commence prior to **September 2, 2025**[231](index=231&type=chunk) - As of the date of this report, none of the shares were sold under these trading plans[230](index=230&type=chunk)[231](index=231&type=chunk) [Item 6. Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including amendments to the equity incentive plan, certifications of principal officers, and various XBRL documents - Exhibits include an amendment to the 2023 Equity Incentive Plan, certifications of the Principal Executive Officer and Principal Financial Officer, and Inline XBRL documents[233](index=233&type=chunk) [Signatures](index=46&type=section&id=Signatures) The report is duly signed on August 7, 2025, by Ali Kashani, Chief Executive Officer, and Brian Read, Chief Financial Officer - The report was signed on **August 7, 2025**, by Ali Kashani, Chief Executive Officer, and Brian Read, Chief Financial Officer[239](index=239&type=chunk)