Canoo (GOEV) - 2022 Q2 - Quarterly Report

Financial Performance - Total current assets decreased from $291,306 thousand as of December 31, 2021, to $70,566 thousand as of June 30, 2022, representing a decline of approximately 75.8%[26] - Cash and cash equivalents dropped significantly from $224,721 thousand at the end of 2021 to $33,799 thousand by June 30, 2022, a decrease of about 85%[26] - The net loss for the three months ended June 30, 2022, was $164,392 thousand, compared to a net loss of $112,554 thousand for the same period in 2021, indicating a worsening of 46.1%[29] - Net loss for the six months ended June 30, 2022, was $289.8 million, compared to a net loss of $127.8 million for the same period in 2021[41] - The company reported no revenue for the three and six months ended June 30, 2022, consistent with the same periods in 2021[29] Expenses - Research and development expenses surged to $115,460 thousand for the three months ended June 30, 2022, compared to $57,638 thousand for the same period in 2021, reflecting an increase of 100.5%[29] - Selling, general and administrative expenses rose to $55,152 thousand for the three months ended June 30, 2022, compared to $44,625 thousand for the same period in 2021, an increase of 23.5%[29] - Total costs and operating expenses for Q2 2022 reached $173.5 million, a 66% increase compared to $104.3 million in Q2 2021[135] - Salary and related benefits expenses rose by $32.9 million, or 95.8%, to $67.2 million for the six months ended June 30, 2022, compared to $34.3 million for the same period in 2021[139] - The total stock-based compensation expense for the three months ended June 30, 2022, was $20.8 million, down from $25.5 million in the same period of 2021, representing a decrease of approximately 18.4%[89] Cash Flow - Cash used in operating activities for the six months ended June 30, 2022, was $237.6 million, an increase from $108.8 million in the prior year[41] - The company has incurred negative cash flow from operating activities of $237.6 million for the six months ended June 30, 2022[49] - Net cash used in investing activities was approximately $35.0 million for the six months ended June 30, 2022[162] - Net cash provided by financing activities was $92.6 million for the six months ended June 30, 2022, mainly due to proceeds from the PIPE agreement ($50.0 million) and SEPA agreement ($32.5 million)[164] Liabilities and Equity - Total liabilities increased from $179,075 thousand as of December 31, 2021, to $209,168 thousand as of June 30, 2022, marking a rise of approximately 16.8%[27] - The total stockholders' equity decreased from $343,999 thousand as of December 31, 2021, to $188,345 thousand as of June 30, 2022, a decline of approximately 45.5%[27] - The accumulated deficit reached $981.9 million as of June 30, 2022[155] Future Outlook - The company expects to continue incurring net losses and negative cash flows from operating activities, with significant increases in capital and operating expenditures anticipated[49] - The company has raised concerns about its ability to continue as a going concern due to substantial doubt about obtaining sufficient additional funding[178] - The company expects a substantial portion of its initial revenue to come from Walmart, which poses a risk if the relationship is not maintained[184] Agreements and Contracts - The company entered into an Electric Vehicle Fleet Purchase Agreement with Walmart, agreeing to sell at least 4,500 EVs, with an option for an additional 5,500 EVs[100] - The company has secured a Pre-Paid Advance Agreement with Yorkville for up to $300 million, with an initial advance of $49.5 million received[118][119] - The company has an At-the-Market Offering Agreement to sell shares of Common Stock with an aggregate sales price of up to $200.0 million[104] Stock and Shares - The weighted-average shares outstanding increased from 226,928 for the three months ended June 30, 2021, to 242,772 for the same period in 2022, an increase of about 7%[29] - As of June 30, 2022, there were 23,755,069 public warrants outstanding, each entitling the holder to purchase one share of Common Stock at $11.50 per share[95] - The company issued 14.2 million shares of Common Stock to Yorkville for cash proceeds of $32.5 million during the six months ended June 30, 2022[44] Legal and Regulatory Matters - The company is involved in ongoing legal proceedings, including a SEC investigation related to its initial public offering and merger activities, but does not consider these matters to be material to its business[70][73] - The company re-qualified as a "smaller reporting company" as of June 30, 2022, which may result in reduced disclosure requirements and potentially make its Common Stock less attractive to investors[196] Market Conditions - The company is facing challenges due to macroeconomic conditions, including supply chain issues and semiconductor chip shortages[127][128] - The automotive market is highly competitive, and exclusivity granted to Walmart may limit access to other significant customers[187]