Serve Robotics Inc.(SERV) - 2024 Q2 - Quarterly Results

Executive Summary & CEO Outlook Serve Robotics reported strong Q2 2024 results, continuing a 30-month trend of double-digit month-over-month growth in operational metrics, commenced manufacturing for its 2,000-robot fleet, and bolstered its cash position through equity offerings, with the CEO outlining plans for significant fleet expansion and substantial future run-rate revenue - Serve Robotics announced strong Q2 2024 results, extending a 30-month track record of double-digit month-over-month growth and improvements in key operational metrics[2] - Manufacturing activities commenced on the 2,000-robot fleet deployment following agreements with Magna and Ouster[1][6] - Cash position bolstered by $40 million equity offering and a post-quarter $15 million private placement[1][3] - The company completed the design of its third-generation robot and plans to deploy at least 250 additional robots in Los Angeles by the end of Q1 2025[2] - Full utilization of the 2,000 robots under the Uber Eats agreement is expected to generate $60 to $80 million in run-rate revenue annually[2] Operational and Strategic Highlights Serve Robotics achieved significant operational and strategic milestones in Q2 2024, including successful capital raises, substantial improvements in robot deployment and utilization, expansion into new markets, and securing key manufacturing and supply agreements to scale its fleet Public Offering & Capital Raise Public Offering & Capital Raise | Transaction Type | Gross Proceeds (USD) | Date | | :--------------- | :------------------- | :--- | | Public Equity Offering | $40.0 million | April 18, 2024 | | Private Placement | $15.0 million | Post Q2-end (July 2024) | Operational Performance Metrics Operational Performance Metrics | Metric | Q2 2024 | YoY Change | QoQ Change | | :------------------ | :------ | :--------- | :--------- | | Daily Supply Hours | 385 | +106% | +28% | | Daily Active Robots | 48 | +85% | +23% | Market Expansion & Manufacturing Agreements - Expanded delivery operations into Koreatown, Los Angeles, in June 2024, onboarding new local merchants via Uber Eats partnership[5] - Commenced manufacturing activities for the 2,000-robot fleet, with Magna International Inc. becoming the contract manufacturer[6] - Expanded supply agreement with Ouster Inc. to equip next-generation robots with upgraded sensors[6] Q2 2024 Financial Summary Serve Robotics reported Q2 2024 revenue of $0.47 million, primarily from software services, and ended the quarter with a significantly bolstered cash position of $28.8 million, also providing updated figures for shares outstanding Q2 2024 Financial Summary | Metric | Q2 2024 | | :-------------------- | :------ | | Total Revenue | $0.47 million | | Software Service Revenue | $0.30 million | | Cash and Cash Equivalents (as of June 30, 2024) | $28.8 million | - No material software services revenue is anticipated in Q3 2024 as the services contract with Magna was significantly completed in Q2[7] Shares Outstanding | Metric | As of June 30, 2024 (Shares) | Post July 2024 Private Placement (Shares) | | :-------------------------- | :--------------------------- | :---------------------------------------- | | Common Stock Outstanding | 36.5 million | N/A | | Fully Diluted Shares Outstanding | 42.6 million | Approximately 48.2 million | Supplemental Financial Information This section provides additional insights into Serve Robotics' business performance through detailed operational metrics and a breakdown of revenue streams, highlighting consistent growth in robot deployment and utilization Operational Key Performance Indicators Table 1: Key Metrics | Key Metrics | June 30, 2024 (Unaudited) | March 31, 2024 (Unaudited) | June 30, 2023 (Unaudited) | Six Months Ended June 30, 2024 (Unaudited) | Six Months Ended June 30, 2023 (Unaudited) | | :------------------ | :------------------------ | :------------------------- | :------------------------ | :----------------------------------------- | :----------------------------------------- | | Daily Active Robots | 48 | 39 | 23 | 44 | 25 | | Daily Supply Hours | 385 | 300 | 152 | 342 | 169 | Detailed Revenue Streams Table 2: Revenue | Revenue Type | June 30, 2024 (USD) | March 31, 2024 (USD) | June 30, 2023 (USD) | Six Months Ended June 30, 2024 (USD) | Six Months Ended June 30, 2023 (USD) | | :---------------- | :------------------ | :------------------- | :------------------ | :----------------------------------- | :----------------------------------- | | Software services | $296,035 | $851,101 | $- | $1,147,136 | $- | | Delivery services | $75,540 | $51,760 | $32,467 | $127,300 | $57,719 | | Branding fees | $96,800 | $43,850 | $29,542 | $140,650 | $44,542 | | Total Revenue | $468,375 | $946,711 | $62,009 | $1,415,086 | $102,261 | Corporate Information This section provides an overview of Serve Robotics' mission and history, along with important disclaimers regarding forward-looking statements and contact information for investor relations About Serve Robotics - Serve Robotics develops advanced, AI-powered, low-emissions sidewalk delivery robots for sustainable and economical delivery[10] - Spun off from Uber in 2021, Serve has completed tens of thousands of deliveries for partners like Uber Eats and 7-Eleven[10] - Holds scalable multi-year contracts, including an agreement to deploy up to 2,000 delivery robots on the Uber Eats platform across multiple U.S. markets[10] Forward-Looking Statements Disclaimer - Press release contains 'forward-looking statements' identifiable by terms like 'believes,' 'plans,' 'expects,' and 'estimates,' which are not historical facts or guarantees of future performance[16] - Actual results may differ materially due to risks and uncertainties, including those described in SEC filings (Form 10-K, Form 10-Q)[16][17] - The company disclaims any obligation to update forward-looking statements, except as required by law[18] Investor Relations Contact Information - Contact information for Aduke Thelwell, Head of Communications & Investor Relations, and general Investor Relations inquiries[19] Unaudited Condensed Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements, including the Balance Sheets, Statements of Operations, and Statements of Cash Flows, providing a detailed view of the company's financial position, performance, and liquidity for the reported periods Unaudited Condensed Consolidated Balance Sheets Balance Sheets | ASSETS (as of) | June 30, 2024 (USD) | December 31, 2023 (USD) | | :-------------------------- | :------------------ | :---------------------- | | Cash | $28,780,034 | $6,756 | | Total current assets | $30,882,450 | $1,461,029 | | Total assets | $32,766,496 | $2,804,549 | | LIABILITIES (as of) | | | | Total current liabilities | $4,267,525 | $6,237,224 | | Total liabilities | $4,302,755 | $6,837,955 | | STOCKHOLDERS' EQUITY (DEFICIT) (as of) | | | | Total stockholders' equity (deficit) | $28,463,741 | $(4,033,406) | Unaudited Condensed Consolidated Statements of Operations Statements of Operations | Metric | Three Months Ended June 30, 2024 (USD) | Three Months Ended March 31, 2024 (USD) | Three Months Ended June 30, 2023 (USD) | Six Months Ended June 30, 2024 (USD) | Six Months Ended June 30, 2023 (USD) | | :----------------------------------- | :------------------------------------- | :-------------------------------------- | :------------------------------------- | :----------------------------------- | :----------------------------------- | | Revenues | $468,375 | $946,711 | $62,009 | $1,415,086 | $102,261 | | Cost of revenues | $326,013 | $352,438 | $391,367 | $678,451 | $758,628 | | Gross profit (loss) | $142,362 | $594,273 | $(329,358) | $736,635 | $(656,367) | | Total operating expenses | $8,698,049 | $8,305,722 | $3,772,288 | $17,003,771 | $7,672,493 | | Loss from operations | $(8,555,687) | $(7,711,449) | $(4,101,646) | $(16,267,136) | $(8,328,860) | | Net loss | $(9,037,367) | $(9,037,971) | $(4,966,256) | $(18,075,338) | $(10,104,378) | | Net loss per common share - basic and diluted | $(0.27) | $(0.37) | $(0.74) | $(0.62) | $(1.51) | Unaudited Condensed Consolidated Statements of Cash Flows Statements of Cash Flows | Cash Flow Activity (Six Months Ended June 30) | 2024 (USD) | 2023 (USD) | | :------------------------------------------ | :----------- | :----------- | | Net cash used in operating activities | $(9,820,242) | $(6,590,205) | | Net cash used in investing activities | $(798,322) | $- | | Net cash provided by financing activities | $39,391,842 | $3,893,398 | | Net change in cash and cash equivalents | $28,773,278 | $(2,696,807) | | Cash and cash equivalents at end of period | $28,780,034 | $18,912 | - Proceeds from issuance of common stock pursuant to offering, net of offering costs, contributed $35,849,136 to financing activities in H1 2024[22]