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What changed in Serve Robotics Inc. /DE/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Serve Robotics Inc. /DE/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+538 added−499 removedSource: 10-K (2026-03-12) vs 10-K (2025-03-06)

Top changes in Serve Robotics Inc. /DE/'s 2025 10-K

538 paragraphs added · 499 removed · 326 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeImpact of Robotic Delivery As automation decreases the cost of last-mile delivery and leads to increased adoption, we anticipate opportunities for impact over the long term: • Reduced Greenhouse Gas Emissions: We believe robots and drones can reduce emissions caused by large vehicles used today for moving small packages. • Lower Delivery Costs: While all automated delivery vehicles still require a certain amount of human involvement (e.g., loading & unloading, maintenance, remote supervision), we believe labor is leveraged more efficiently resulting in more deliveries per unit of human effort.
Biggest changeAll of our robots that operate outdoors are also equipped with redundant real-time location tracking systems as well as alarm and communication features to deter attempts at vandalism and enable quick recovery of assets in the unlikely event of theft. 2 Table of Contents Impact of Robotic Automation If automation decreases the cost of last-mile delivery and leads to increased adoption, we anticipate opportunities for impact over the long term, such as: • Reduced Greenhouse Gas Emissions : We believe the use of robots and drones will reduce overall emissions caused by the use of large vehicles for moving small packages. • Lower Delivery Costs : While all automated delivery robots still require a certain amount of human involvement (e.g., loading and unloading, maintenance, remote supervision), we believe labor is leveraged more efficiently, resulting in more deliveries and tasks per unit of human effort.
Moreover, unauthorized parties and our competitors may either attempt to copy aspects of our products or obtain and use information that we regard as proprietary, or independently develop technology that is similar to ours thereby rendering our protected products less valuable, if the design is favorably received in the marketplace.
Moreover, unauthorized parties and our competitors may attempt to copy aspects of our products or obtain and use information that we regard as proprietary, or independently develop technology that is similar to ours thereby rendering our protected products less valuable if the design is favorably received in the marketplace.
It is also possible that any patent issued to us may not provide us with any competitive advantages, or that the patents of others will harm or altogether preclude our ability to do business.
It is also possible that any patent issued to us may not provide us with any competitive advantages, or that the patents of others may harm or altogether preclude our ability to do business.
Our granted patents will expire between May 2029 and June 2039, assuming that all maintenance fees are paid, no portion of the patent has been terminally disclaimed and the patent has not been invalidated. In certain jurisdictions, and in certain circumstances, patent terms can be extended or shortened.
Our granted patents will expire between May 2029 and June 2042, assuming that all maintenance fees are paid, no portion of the patent has been terminally disclaimed and the patent has not been invalidated. In certain jurisdictions, and in certain circumstances, patent terms can be extended or shortened.
For example, customers of food delivery platforms often experience missing items, mistaken orders, and lost or missed deliveries altogether.
For example, customers of food delivery platforms often experience missing items, mistaken orders, and lost or missed deliveries.
We expect the cost of cameras, GPU processors, electric motors, batteries, and advanced sensors such as LIDAR to continue to decrease, while mobile networks will become faster and more reliable with higher bandwidth and geographic coverage, which will lead to a downward trend in the cost of building and operating robots.
We expect the cost of cameras, GPU processors, electric motors, batteries, and advanced sensors such as LiDAR to continue to decrease, while mobile networks are expected to become faster and more reliable with higher bandwidth and geographic coverage, which we believe will lead to a downward trend in the cost of building and operating robots.
We are subject to the informational requirements of the Exchange Act and file or furnish reports, proxy statements, and other information with the Securities and Exchange Commission (the “SEC"). Such reports and other information filed by us with the SEC will be available free of charge on our website at www.serverobotics.com when such reports are available on the SEC’s website.
We are subject to the informational requirements of the Exchange Act and file or furnish reports, proxy statements, and other information with the SEC. Such reports and other information filed by us with the SEC will be available free of charge on our website at www.serverobotics.com when such reports are available on the SEC’s website.
Upon acceptance of any such order, the robot navigates to the pick-up location, waits outside, and notifies merchant staff, often through their existing delivery tablets or point-of-sale devices. Once the merchant staff load the package into the robot, it navigates to its drop-off destination.
Upon acceptance of an order, the robot navigates to the pick-up location, waits outside, and notifies merchant staff, often through their existing delivery tablets or point-of-sale devices. Once the merchant staff load the package into the robot, it navigates to its drop-off destination.
In less frequent occasions, if a robot requires physical assistance, such as when a robot is too low on battery to return home or if it has been damaged, a nearby employee is dispatched to repair or return the robot. Throughout the day, each robot receives a series of delivery orders from partnered merchants and delivery platforms.
On less frequent occasions, if a robot requires physical assistance, such as when a robot is too low on battery to return home or if it has been damaged, a nearby team member is dispatched to repair or return the robot. Throughout the day, each robot receives a series of delivery orders from partnered merchants and delivery platforms.
Creating fully autonomous machines that are safe and reliable without any human intervention requires substantially more time and capital investment than creating 3 Table of Contents machines that are mostly automated but can rely on occasional human support, especially when it comes to high consequence safety-critical decisions. 2.
Creating fully autonomous machines that are safe and reliable without any human intervention requires substantially more time and capital investment than creating machines that are mostly automated but can rely on occasional human support, especially when it comes to high consequence safety-critical decisions. 2.
Employees and Human Capital Resources Our employees are our greatest assets. We value and support hiring exceptional talent to develop our core technology and drive our business growth. We strive to meet these objectives by offering competitive pay and benefits in a diverse, inclusive, and safe workplace.
Human Capital Management We strongly believe our employees are our greatest assets. We value and support hiring exceptional talent to develop our core technology and drive our business growth. We strive to meet these objectives by offering competitive pay and benefits in a diverse, inclusive, and safe workplace.
It is possible that our current patents, or patents we later acquire, may be successfully challenged or invalidated in whole or in part. It is also possible 6 Table of Contents that we may not obtain issued patents for our pending patent applications or other inventions we seek to protect.
It is possible that our current patents, or patents we may later acquire, may be successfully challenged or invalidated in whole or in part. It is also possible that we may not obtain issued patents for our pending patent applications or other inventions we seek to protect.
While an ever-growing share of consumers is shopping online and demanding faster deliveries, a number of factors have contributed to keeping last-mile costs high: • Labor shortages caused by the aging population and the COVID-19 pandemic have led to wage inflation. • On-demand delivery companies in many jurisdictions are battling regulatory pressures to classify gig workers as employees, which would in turn increase labor costs. • More recently, cities across the United States have introduced maximum limits on how much delivery platforms can charge restaurants and merchants, highlighting the need to lower underlying delivery costs.
While an ever-growing share of consumers is shopping online and demanding faster deliveries, a number of factors have contributed to keeping last-mile costs high: • labor shortages caused by the aging population have led to wage inflation; 1 Table of Contents • on-demand delivery companies in many jurisdictions are facing regulatory pressures to classify gig workers as employees, which would in turn increase labor costs; and • cities across the United States have introduced maximum limits on how much delivery platforms can charge restaurants and merchants, highlighting the need to lower underlying delivery costs.
While costs associated with compliance with laws and regulations have increased as the number and scope of regulations have increased, the total costs incurred have not had, and are not expected to have, a material effect on our capital expenditures, results of operations or competitive position.
While costs associated with compliance with laws and regulations have increased as the number and scope of regulations have increased, the total costs incurred have not had, and are not currently expected to have, a material effect on our capital expenditures, results of operations or competitive position. See Part I, Item 1A.
We believe reducing delivery costs could make home delivery services affordable to more people. • Easier Reverse Logistics: We believe reducing the cost for last-mile transportation is likely to increase adoption of reverse logistics applications as well (e.g., more convenient package returns). • More Local Commerce: We believe that the increased adoption of home delivery will result in more commerce for local businesses. • Increased Local Jobs: We believe increased delivery and local commerce activities resulting from reduction in cost of delivery could lead to more local jobs, ranging from increased staffing of local businesses, logistics operators who enable automated delivery networks to function, and human couriers who perform deliveries that automated services cannot perform. • Higher Delivery Quality: Like most automated systems, robots are less prone to error.
We believe reducing delivery costs could make home delivery services affordable to more people. • Easier Reverse Logistics : We believe reducing the cost of last-mile transportation will also encourage increased adoption of reverse logistics applications (e.g., more convenient package returns). • More Local Commerce : We believe that increased adoption of home delivery will result in more commerce for local businesses. • Increased Local Jobs : We believe increased delivery and local commerce activities resulting from a reduction in delivery costs could lead to more local jobs, ranging from increased staffing of local businesses, logistics operators who enable automated delivery networks to function, and human couriers who perform deliveries that automated services cannot perform. • Higher Delivery Quality : Like most automated systems, robots are less prone to certain types of errors.
Available Information We are a public company, and our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to such reports are filed with the SEC.
Available Information We are a public company, and our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to such reports are filed with the Securities and Exchange Commission (the “SEC").
In addition, we benchmark our compensation and benefits packages periodically to remain competitive with our peers and attract and retain talent throughout our organization. Employee Recruitment, Retention, and Development We believe our corporate culture, competitive compensation and benefits programs, and career growth and development opportunities promote longer employee tenure and reduce turnover.
In addition, we benchmark our compensation and benefits packages periodically to remain competitive with our peers and attract and support our talent acquisition and retention efforts. Employee Recruitment, Retention, and Development We believe our corporate culture, competitive compensation and benefits programs, and career growth and development opportunities promote employee tenure and retention and reduce employee turnover.
By primary job function, about 45% of our employees have engineering or product roles, 45% are in operations and 10% have business development or other administrative roles. None of our employees are represented by a labor union or covered by a collective bargaining agreement. We consider our relationship with our employees to be good.
By primary job function, approximately 38% of our employees have engineering or product roles, 49% are in operations, and 13% have business development or other administrative roles. None of our employees are represented by a labor union or covered by a collective bargaining agreement. We consider our relationship with our employees to be in good standing.
Further, our references to the URLs for these websites are intended to be inactive textual references only. 7 Table of Contents
Further, our references to the URLs for these websites are intended to be inactive textual references only.
Labor-Optimized : We believe the cost of advanced sensors and hardware will continue to decrease over the coming years, and optimizing against such costs can be premature and an investment with diminishing long-term returns.
Labor-Optimized : We believe the cost of advanced sensors and hardware will continue to decrease over the coming years, and optimizing against such costs can be premature and may yield diminishing long-term 3 Table of Contents returns.
See “Risk Factors” in Item 1A for discussion of risks relating to federal, state, local and international laws and regulations applicable to our business. Intellectual Property Our success and ability to compete are significantly dependent on our core technology and intellectual property.
“ Risk Factors ” for discussion of risks relating to federal, state, local and international laws and regulations applicable to our business. Intellectual Property Our success and ability to compete are significantly dependent on our core technology and intellectual property.
Although we currently primarily operate within the United States, the laws of some foreign countries do not protect our proprietary rights to as great an extent as domestic laws, and many foreign countries do not enforce these laws as diligently as government agencies and private parties in the United States.
However, these laws, agreements, and procedures provide only limited protection for our technology. 6 Table of Contents Although we currently primarily operate within the United States, the laws of some foreign countries do not protect our proprietary rights to as great an extent as domestic laws, and many foreign countries do not enforce these laws as diligently as government agencies and private parties in the United States.
Business Strategy After seven years of research and development investment in AI, autonomy, safety, and efficiency of our robots, we are in a leading position to partner with the world’s largest food delivery platforms, restaurants, retailers, and convenience brands to augment their last-mile human delivery capabilities.
Business Strategy After more than eight years of research and development investment in AI, autonomy, safety, and efficiency of our robots, we are in a leading position to partner with some of the world’s largest food delivery platforms, restaurants, retailers, healthcare systems, and convenience brands to augment their logistics and delivery capabilities with autonomous robotics solutions.
Glossary of Terms and Abbreviations The following is a glossary of technical terms used in this annual report: AI — Artificial Intelligence AV — Autonomous Vehicle GPS — Global Positioning System GPU — Graphical Processing Unit IMU — Inertial Measurement Unit LIDAR — A digital sensor for measuring distance to objects which uses the principle of radar, but uses light from a laser ODD — Operating Design Domain describes the specific operating conditions in which the automated driving system is designed to properly operate, including but not limited to roadway types, speed range, and environmental conditions Reverse Logistics — A type of supply chain management that moves goods from customers back to the sellers or manufacturers Company Overview We are shaping the future of sustainable, self-driving delivery.
Glossary of Terms and Abbreviations The following is a glossary of technical terms used in this Annual Report on Form 10-K: GPU — Graphical Processing Unit LiDAR — A digital sensor for measuring distance to objects which uses the principle of radar, but uses light from a laser ODD — Operating Design Domain describes the specific operating conditions in which the automated driving system is designed to properly operate, including but not limited to roadway types, speed range, and environmental conditions Reverse Logistics — A type of supply chain management that moves goods from customers back to the sellers or manufacturers Company Overview We are engaged in developing technologies intended to enable sustainable, autonomous robotic solutions for public and commercial spaces.
We seek to protect our intellectual property and proprietary rights, including our proprietary technology and software, by relying on a combination of federal, state, and common law rights in the United States and other countries, as well as on contractual measures. However, these laws, agreements, and procedures provide only limited protection. Legal protections afford only limited protection for our technology.
We seek to protect our intellectual property and proprietary rights, including our proprietary technology and software, by relying on a combination of federal, state, and common law rights in the United States and other countries, as well as on contractual measures.
A similar sequence of events results in customers meeting the robot at the curb, unlocking its cargo using their delivery app or on-screen instructions, and retrieving their package. At night, robots return to their central depot to be recharged, maintained, upgraded when necessary, and prepared for next morning’s deployment.
Upon arrival, customers meet the robot at the curb, unlock its cargo using their delivery app or on-screen instructions, and retrieve their package. At night, robots return to their central depot to be recharged, maintained, upgraded when necessary, and prepared for next morning’s deployment.
There are many factors that contribute to pedestrian and bicyclist fatalities and injuries, including: speeding, distracted driving, drunk driving, and aggressive driving. Delivery robots weigh significantly less and move at lower speeds than cars; as a result, on average, a single car carries over a thousand times more kinetic energy than a single robot.
There are many factors that contribute to pedestrian and bicyclist fatalities and injuries as a result of motor vehicle accidents, including: speeding, distracted driving, drunk driving, and aggressive driving. Sidewalk delivery robots weigh significantly less and move at lower speeds than cars.
Government Regulations In the United States, delivery robots are generally allowed to operate on most sidewalks by default. Over twenty states and a number of cities have put in place legal frameworks to explicitly permit the use of delivery robots. The instances of cities welcoming delivery robots far exceed the few examples in which their operations were banned.
Over twenty-five states and a number of cities have put in place legal frameworks to explicitly permit the use of sidewalk delivery robots. The instances of cities welcoming sidewalk delivery robots exceed the examples in which their operations were banned.
Through frequent software updates, Serve’s AI models are continuously improved. We believe that over the coming years, we can steadily increase our robots’ autonomous capabilities using new and improved AI models and more training data including new edge cases encountered every day by our operating fleet.
We believe that over the coming years, we can steadily increase our robots’ autonomous capabilities using new and improved AI models and more training data including new edge cases encountered every day by our operating fleet. Safety Achieving Level 4 autonomy requires our robots to uphold rigorous safety standards.
We have enjoyed high employee retention since becoming an independent company in 2021 and monitor employee turnover rates as our success depends upon retaining and investing in our highly skilled technical staff. Diversity, Equity, and Inclusion We value the uniqueness that an inclusive and diverse team brings to our company.
We have maintained high employee retention since becoming an independent company in 2021 and continue to monitor employee turnover rates closely, as our success depends on retaining and investing in our highly skilled technical staff. Diversity, Equity, and Inclusion We are committed to fostering a diverse, equitable, and inclusive workplace.
In addition, we provide opportunities for our employees to grow and develop their careers. As of December 31, 2024, we have 110 employees in the United States and 11 employees in Canada through our wholly-owned Canadian subsidiary, 120 of which are full-time employees.
In addition, we provide opportunities for our employees to grow and develop their careers. As of December 31, 2025, we employed a total of 370 full-time and 10 part-time employees globally, of which 359 employees were based in the United States, and 21 employees were based in Canada through our wholly-owned Canadian subsidiary.
Removing unnecessary car trips can make cities safer for pedestrians and cyclists. • Robots Reduce Emissions: Many cities have established targets for reducing carbon emissions, and robots can help advance their environmental initiatives. • Robots Reduce Congestion: Deliveries often originate in high traffic regions where restaurants and shops tend to be located.
Replacing unnecessary car trips with robotic delivery can make cities safer for pedestrians and cyclists. • Robots Reduce Emissions: Many cities have established targets for reducing carbon emissions, and robots can help advance these environmental initiatives by offering a more sustainable delivery option that produces a fraction of the emissions associated with personal vehicles. • Robots Reduce Congestion: Deliveries often originate in high-traffic areas where restaurants and shops tend to be located.
As a result, removing delivery car traffic can reduce congestion and parking issues in cities. • Robots Reduce Delivery Cost for Local Merchants: Recently, a number of cities have implemented restrictions on how much delivery platforms can charge restaurants for their services. Robots can offer a cheaper alternative to help local restaurants and merchants reduce their delivery costs.
Shifting these trips from cars to robots can reduce traffic congestion and ease parking challenges in urban areas. • Robots Reduce Delivery Cost for Local Merchants: Recently, a number of cities have implemented restrictions on how much delivery platforms can charge restaurants for their services.
Just as automation has done in the past, it is expected that this will reduce delivery costs. • Increased On-Demand Adoption: On-demand services are largely luxuries afforded by affluent consumers today.
Just as automation has done in the past, we expect a continued reduction of delivery costs over time. • Increased On-Demand Adoption : On-demand services are largely luxuries afforded by affluent consumers today.
Humans and Machines : We believe that the most effective way to quickly unleash the benefits of AI and autonomy in our lives is by designing solutions that leverage both human and machine intelligence in ways that collaborate and complement each other.
Technology Our robotic technology has been developed based on the following key principles: 1. Humans and Machines : We believe that the most effective way to quickly realize the benefits of AI and autonomy in our lives is by designing solutions that leverage both human and machine intelligence in ways that are collaborative and complementary.
This positive regulatory momentum for delivery robots may be due to a number of factors: • Robots Inherently Safer: Cars carry over 1,000 times more kinetic energy than robots. As a result of having much lower kinetic energy, robots do not pose the same risk for injury or fatality that cars do.
This positive regulatory momentum for sidewalk delivery robots may be due to a number of factors: • Robots Inherently Safer: Cars carry more kinetic energy than sidewalk delivery robots and therefore pose a significantly greater risk of serious injury or fatality.
Item 1. Business All references to “Serve” refer to Serve Operating Co. (formerly known as Serve Robotics Inc.), a privately held Delaware corporation and our direct, wholly-owned subsidiary. Unless otherwise stated or the context otherwise indicates, references to the “Company,” “we,” “our,” “us” or similar terms refer to Serve Robotics Inc.
Item 1. Business Unless otherwise stated or the context otherwise indicates, all references to “Serve,” the “Company,” “we,” “our,” “us,” or similar terms refer to Serve Robotics Inc. together with its wholly-owned subsidiaries. Serve Operating Co. is our direct, wholly-owned subsidiary and holds all material assets and conducts all business activities and operations of Serve.
They are supervised through mobile connectivity and video streaming by remote human operators who can assist robots when necessary, such as at intersection crossings or when robots are unable to navigate certain conditions.
Robot Operations Our robots start each day at a central depot located near their operating area. The fleet is monitored through mobile connectivity and video streaming by remote human supervisors who can assist robots when necessary, such as at intersection crossings or when robots are unable to navigate certain conditions.
Robots promise to reduce such errors, creating a better experience for customers and merchants alike. • Safer Roads: According to a study by the National Highway Traffic Safety Administration (the “NHTSA”) from December 2023, there were 7,388 pedestrians and 966 cyclists killed in motor vehicle crashes in 2021 in the United States.
An increased reliance on robotic technology may reduce such errors, creating a better experience for customers and merchants alike. • Safer Roads : According to a report by the Governors Highway Safety Administration (the “GHSA”) published in July 2025, there were 7,148 pedestrians killed in motor vehicle crashes in 2024 in the United States and 1,166 cyclists killed in motor vehicle crashes in 2023.
Specifically, Serve robots are capable of driving autonomously on certain sidewalks without a remote human supervisor having to oversee their movement. This capability makes it possible to operate our robots at lower cost than remotely operated robots used by our competitors, because it enables a single remote operator to simultaneously perform multiple deliveries.
This capability makes it possible to operate our robots at lower cost than remotely operated robots used by our competitors, because it enables a single remote supervisor to oversee multiple deliveries simultaneously. Through frequent software updates, Serve’s AI models are continuously improved.
Level 4 Autonomy — In January 2022, we announced the deployment of a new generation of delivery robots capable of operating at Level 4 autonomy. Level 4 autonomous robots can drive without humans in the loop for periods of time while they are operating in their intended operating environments (also known as “ODDs”).
Level 4 autonomous robots can operate without humans in the loop for periods of time while they are operating in their intended operating environments (also known as “ODDs”). Specifically, our robots are capable of driving autonomously in certain environments without a remote human supervisor having to oversee their movement.
Currently, our AI models are used to perform a variety of tasks, including identification of sidewalk surfaces, intersections, traffic signals, obstacles, pedestrians and vehicles, and projecting the trajectory of other dynamic agents. For the last seven years of development, we have continued to create AI models with new capabilities, while improving the performance of existing models.
We use the latest AI methodologies to design, train and deploy a host of models on Serve robots. Currently, our AI models are used to perform a variety of tasks, including identification of sidewalk surfaces, intersections, doorways, elevators, traffic signals, obstacles, pedestrians and vehicles, and projecting the trajectory of other dynamic agents.
We are subject to various federal, state and local laws and regulations that govern aspects of our business operations.
Robots can offer a lower-cost alternative, helping merchants remain competitive while lowering their overall delivery expenses. We are subject to various federal, state and local laws and regulations that govern aspects of our business operations.
Their new drivetrain is equipped with suspension to drive smoother and faster while protecting food quality, and their improved water resistance expands the robots’ ability to maneuver confidently in a wider range of weather conditions. 2 Table of Contents Importantly, these hardware and software enhancements combine to extend Serve’s commitment to safety on the sidewalk.
They also feature an expanded 15 gallon (61 liter) cargo bin that holds four large 16-inch pizzas. Their new drivetrain is equipped with suspension to drive smoother and faster while protecting food quality, and their improved water resistance expands the robots’ ability to maneuver confidently in a wider range of weather conditions.
Robots Among People : We believe that building world-class hardware, software, AI and autonomy for robots to share spaces with people is how we are positioned to build market value and create a lasting legacy. 4. Robotic Platform : Our mission is to build a superior robotic platform that can accelerate the adoption of robotic solutions beyond last-mile delivery.
Instead, we have continued to innovate by designing highly capable hardware and software solutions that optimize against the largest cost of delivery and logistics: labor. 3. Robots Among People : We believe that building world-class hardware, software, AI and autonomy for robots to share spaces with people positions us to build market value and create a lasting legacy. 4.
The robots’ secure cargo compartment can only be unlocked through the delivery app’s interface or using a security code entered on the touch screen. Moreover, using encrypted communication protocols and data storage as well as secure authentication methods, the data and software onboard each robot is protected from unauthorized access.
Additionally, through the use of encrypted communication protocols and data storage as well as secure authentication methods, the data and software onboard each robot is protected from unauthorized access.
Serve’s third-generation robots are designed to carry more goods, enable more deliveries, and further reduce the cost of delivery. They can move roughly twice as fast, travel approximately twice as far on a single charge, and spend 6 more hours in the field each day compared to our prior generation.
Serve’s third-generation robots are designed to carry more goods, enable more deliveries, and further reduce the cost of delivery thanks to higher speeds and increased battery capacity. They can reach up to 11 miles per hour (18 kilometers per hour) and travel as far as 48 miles (77 kilometers) on a single charge.
The following are key highlights of our approach to technology development: Artificial Intelligence — AI empowers Serve robots to navigate city sidewalks and interact with their environment safely and efficiently. We use the latest AI methodologies to design, train and deploy a host of models on Serve robots.
Robotic Platform : Our mission is to build a superior robotic platform that can accelerate the adoption of robotic solutions beyond last-mile delivery. The following are key highlights of our approach to technology development: Artificial Intelligence AI empowers Serve robots to navigate outdoor and indoor environments and interact with their environment safely and efficiently.
We currently have 18 active patent matters in various jurisdictions: China (1 patent), the United States (12 patents), and Canada (5 patents). We have thus far been granted 11 of the 18 patents for which we have applied — 6 in the United States, 4 in Canada and 1 in China.
As of December 31, 2025, we have been granted 36 of the 62 patents for which we have applied — 4 in Canada, 1 in China, 2 in the European Patent Office and 29 in the United States.
We expect to continue developing increasingly more capable AI models to improve robots’ performance and differentiate Serve from alternative products and solutions. As the broader field of Artificial Intelligence advances, we expect to benefit from such advances by increasing efficiency and effectiveness of our robots.
Since we began development, we have continued to create AI models with new capabilities, while improving the performance of existing models. We expect to continue developing increasingly capable AI models to improve our robots’ performance and differentiate Serve from alternative products and solutions.
Tailwinds for Automation Despite technological innovations of the past few decades as well as growing adoption of online commerce and home delivery, last-mile delivery has remained costly.
We expect to leverage Diligent’s technology alongside our existing platform to enhance product capabilities, accelerate deployment opportunities, and support scalable, recurring revenue growth through Diligent’s established commercial relationships with healthcare systems and institutions. Tailwinds for Automation Despite technological innovations of the past few decades as well as increased adoption of online commerce and home delivery, last-mile delivery has remained costly.
However, certain highly complex components are obtained from single or limited sources that we may have to compete for with other participants in the robotics, consumer electronics, and automotive markets. Therefore, these components can be at times subject to industry-wide shortages, resulting in long lead times and significant pricing fluctuations.
Most components are widely commercially available or fabricated from raw materials using common manufacturing processes including machining, molding, stamping, and additive manufacturing from multiple sources. However, certain highly complex components are obtained from single or limited sources, and we may have to compete for access to such components against other participants in the robotics, consumer electronics, and automotive markets.
Therefore, we are focused on creating an environment that leverages the perspectives and contributions of each employee. Safety, Health, and Wellness We prioritize safe working conditions. We are committed to an injury-free workplace and provide comprehensive workplace training and support to reduce or eliminate health and safety risks.
Accordingly, we seek to cultivate a culture in which all employees are empowered to contribute meaningfully to the Company’s success. 7 Table of Contents Safety, Health, and Wellness We prioritize the safety, health, and well-being of our employees. We are committed to an injury-free workplace and provide comprehensive workplace training and support to reduce or eliminate health and safety risks.
To mitigate such supply risks, we routinely search for more available alternatives and/or enter into strategic partnerships and agreements to secure pricing and supply of components. Manufacturing and assembly of robots take place by a third-party contract manufacturer after component supply has been secured.
Key suppliers of single and limited source components include NVIDIA Corporation, Ouster, Inc., and other vendors providing cameras, ultrasonic sensors, electronic motors, and modems. To mitigate such supply risks, we routinely search for more available alternatives and/or enter into strategic partnerships and agreements to secure pricing and supply of components.
Under these circumstances and to maintain production schedules, it may be necessary to temporarily source alternate higher-priced compatible components. Key suppliers of single and limited source components include NVIDIA and Ouster, Inc., in addition to vendors providing cameras, ultrasonic sensors, electronic motors, and modems.
These components can at times be subject to industry-wide shortages, resulting in long lead times and significant pricing fluctuations. Under these circumstances and to maintain production schedules, it may be necessary to temporarily source alternate higher-priced compatible components.
We have platform-level integrations with Uber Eats, which means Serve robots can provide real-time presence and status updates on those platforms and receive requests to perform deliveries with respect to customer orders placed on those platforms as needed. 1 Table of Contents Because Serve started within a food delivery company, our team comes with a depth of expertise in food delivery.
As of December 31, 2025, Serve’s fleet consisted of over 2,000 sidewalk delivery robots. We maintain platform-level integrations with food delivery platforms, such as Uber Eats and DoorDash, that enable our robots to transmit real-time presence and status information and to receive delivery requests associated with customer orders placed on those platforms.
(“Uber”) in 2020, and in February of 2021, Uber’s leadership team agreed to contribute the intellectual property developed by the team and assets relating to this project. In return for this contribution and an investment of cash into the Company, Uber acquired a minority equity interest in our business.
Our core technology originated in 2017 as a specialized project within Postmates Inc. (“Postmates”), an on-demand delivery company in the United States. Following the acquisition of Postmates by Uber Technologies, Inc. (“Uber”) in 2020, Uber’s leadership approved the contribution of the intellectual property and related assets associated with this project to our company in February 2021.
Currently, this is our only large-scale commercial contract. We plan to continue growing our delivery operations and establish Serve as the global leader in automated last-mile delivery. Our growth will be facilitated by continued investment in our hardware, software and AI developments that increase the performance and efficiency of our fleet.
Our growth will be facilitated by continued investment in our hardware, software and AI developments that increase the performance and efficiency of our fleet. Looking ahead, we plan to increase utilization of our robot fleet by advancing performance, safety, and user experience; broadening use cases and partnerships; and expanding integration with third-party platforms and services.
Labor cost inflation and regulatory pressures serve as tailwinds that are expected to accelerate the adoption of automated robotic last-mile delivery. While labor costs typically increase over time, hardware and technology costs typically decrease.
Labor cost inflation and regulatory pressures serve as tailwinds that are expected to accelerate the adoption of automated robotic last-mile delivery. Similarly, the healthcare industry is experiencing significant labor shortages, particularly among nursing and clinical support staff, which has created demand for autonomous solutions that can perform routine logistical tasks and free clinical staff to focus on patient care.
Assuming the 2022 estimate by the Bureau of Transportation Statistics that 16.2% of car trips were taken for 5 Table of Contents shopping and errands, and our proprietary delivery data indicating half of all shopping trips can be completed by delivery robots, this suggests that the scaled use of robotic delivery could reduce global passenger car emissions of such trips from approximately 256 megatons to less than 10 megatons per year, which is a reduction of over 96% as estimated by a study published in Transportation Research Part D: Transport and Environment (Volume 85, August 2020, 102443).
If half of all shopping trips could be completed by sidewalk delivery robots, the scaled deployment of robotic delivery could reduce global passenger car emissions attributable to such trips from approximately 259 megatons to less than 10 megatons per year.
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(formerly named Patricia Acquisition Corp.) together with its wholly-owned subsidiary, Serve. Serve holds all material assets and conducts all business activities and operations of Serve Robotics Inc. Corporate History We were incorporated in the State of Delaware as Patricia Acquisition Corp. on November 9, 2020. On July 31, 2023, our wholly-owned merger sub merged with and into Serve (the “Merger”).
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Our activities include the design, engineering, deployment, and operation of low-emission robotic systems built on our proprietary AI-enabled mobility platform. Our systems are designed to operate safely and efficiently in real world environments.
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Following the Merger, Serve was the surviving entity and became our wholly-owned subsidiary, and all of the outstanding stock of Serve was converted into shares of our Common Stock. The business of Serve became our business as a result of the Merger.
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While food delivery remains our primary commercial application, we are expanding our platform into adjacent markets, customer segments, and operating environments where autonomous mobility can address labor constraints, improve service levels, and reduce emissions. We intend to leverage our core autonomy stack, fleet management infrastructure, and operational expertise to support additional use cases across both outdoor and indoor settings.
Removed
Following the consummation of the Merger, Serve changed its name to “Serve Operating Co.” and we changed our name to “Serve Robotics Inc.” Prior to the Merger, Patricia Acquisition Corp. was a “shell” company registered under the Exchange Act, with no specific business plan or purpose until it began operating the business of Serve following the closing of the Merger.
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In January 2026, subsequent to the period covered by this Annual Report on Form 10-K, we completed the acquisition of Diligent Robotics, Inc. (“Diligent”), a provider of AI-powered autonomous robot assistants for the healthcare industry. This acquisition extends our autonomy platform into indoor environments, initially into hospitals, and broadens our addressable market into healthcare and other commercial sectors.
Removed
We design, develop and operate low-emissions robots on our AI-powered robotics mobility platform, that serve people in public spaces, starting with food delivery. Starting in 2017, our core technology was developed by our co-founders and a majority of our product and engineering team in San Francisco, California as a special project within Postmates Inc.
Added
While labor costs typically increase over time, hardware and technology costs typically decrease.
Removed
(“Postmates”), one of the pioneering food delivery startups in the United States. By the end of 2020, the team had developed a fleet of sidewalk robots that had successfully performed over 10,000 commercial deliveries for Postmates in California, augmenting Postmates’ fleet of human couriers. Postmates was acquired by Uber Technologies, Inc.
Added
Importantly, these hardware and software enhancements support Serve’s commitment to safety on the sidewalk. In addition to market-leading safety capabilities, including fail-safe mechanical braking and autonomous collision avoidance, the third-generation robots feature enhanced emergency braking. Following our acquisition of Diligent in January 2026, we also operate Moxi robots in hospital environments to assist clinical staff with logistical tasks.
Removed
As of December 31, 2024, Serve’s fleet consisted of over 100 robots. We plan to deploy 2,000 robots by the end of 2025.
Added
Moxi robots operate throughout hospital facilities, navigating hallways, using elevators, accessing secured areas via badge readers, and entering patient care areas to deliver medications, lab samples, and lightweight equipment and supplies. Moxi robots operate autonomously within hospital environments, using onboard sensors and AI to navigate dynamic spaces.
Removed
Additionally, the engineering team has extensive experience in AI, automation and robotics. Our leadership team includes veterans from Uber, Instacart, Postmates, Waymo, Apple Inc., Blue Origin, LLC, GoPro, Inc., GoDaddy Inc., and Anki, Inc. We believe our expertise positions us to service the ever-growing on-demand delivery market, including food delivery.
Added
All of our robots are equipped with a number of security features designed to protect their cargo, data, and intellectual property from unauthorized access. The robots’ secure cargo compartment can only be unlocked through the delivery app’s interface or using a security code entered on the touch screen.
Removed
Based on our proprietary historical delivery data, approximately half of all delivery distances in the United States are less than 2.5 miles and well-suited to delivery by sidewalk robots. We provide a robotic delivery experience that delights customers, improves reliability for merchants and reduces traffic congestion and vehicle emissions.
Added
We believe that replacing cars with sidewalk delivery robots could result in safer cities for pedestrians and cyclists. • Improved Healthcare Efficiency and Patient Care : In healthcare settings, we believe robotic automation can address critical labor shortages by performing routine logistical tasks such as transporting supplies, medications, lab samples, linens, and equipment.
Removed
Moreover, at scale we expect our robots will complete deliveries at lower cost than human couriers, making on-demand delivery more affordable and accessible in the areas in which we operate. By eliminating unnecessary car traffic, and by reducing the cost of last-mile transportation, Serve aims to reshape cities into sustainable, safe, and people-friendly environments, with thriving local economies.
Added
Nurses may spend a significant portion of their shifts on non-clinical tasks, including walking to retrieve supplies and making deliveries. By allowing clinical staff to focus on direct patient care rather than non-clinical logistics, we believe autonomous robots like Moxi can improve both operational efficiency and patient outcomes.
Removed
Delivery Robot Operations Our sidewalk delivery robots start each day at a central depot located near their operating area. While most robots deploy to and return from their operating area automatically and without further vehicular assistance, some robots may be transported to and from operating areas that are further away in a human-driven vehicle.
Added
In addition, we have completed various acquisitions of businesses engaged in the development of AI models with novel and differentiated capabilities, with the intention of further expanding and enhancing the Company’s portfolio of AI technologies, accelerating innovation, and supporting the integration of advanced capabilities across its products and services.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

185 edited+133 added−91 removed105 unchanged
Biggest changeRisks Related to Our Business and Industry Because we are an early-stage company with minimal revenue and a history of losses and we expect to continue to incur substantial losses for the foreseeable future, we cannot assure you that we can or will be able to operate profitably. We are an early-stage company.
Biggest changeRisks Related to Ownership of Our Common Stock • the market price and trading volume of our common stock may be volatile and could decline significantly; and • our obligation to develop and maintain proper and effective internal control over financial reporting, and the presence of material weaknesses that increase the risk of material misstatement of our consolidated financial statements. 9 Table of Contents Risks Related to Our Business and Operations We are an early-stage company with minimal revenue, a history of losses, and a limited operating history, which may make it difficult to evaluate the future of our business and prospects, and we cannot assure you that we will be able to operate profitably.
Our directors may be engaged in a range of business activities that could result in conflicts of interest. We may be subject to various potential conflicts of interest because some of our officers and directors may be engaged in a range of business activities.
Our directors may be engaged in a range of business activities that could result in conflicts of interest. We may be subject to various potential conflicts of interest because some of our officers and directors may be engaged in a range of business activities that could result in conflicts of interest.
We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenues is less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter.
We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenues are less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter.
Should operational risks materialize, they may result in the personal injury to or death of workers, the loss of production equipment, damage to production facilities, monetary losses, delays and unanticipated fluctuations in production, environmental damage, administrative fines, increased insurance costs and potential legal liabilities, all which could have a material adverse effect on our business, prospects, financial condition and operating results.
Should these operational risks materialize, they may result in the personal injury to or death of workers, the loss of production equipment, damage to production facilities, monetary losses, delays and unanticipated fluctuations in production, environmental damage, administrative fines, increased insurance costs and potential legal liabilities, all which could have a material adverse effect on our business, prospects, financial condition and operating results.
These provisions: • establish a classified Board so that not all members of our board are elected at one time; • permit only the Board to establish the number of directors and fill vacancies on the board; • provide that directors may only be removed “for cause” and only with the approval of two-thirds of our stockholders; • require super-majority voting to amend some provisions in our amended and restated certificate of incorporation and amended and restated bylaws; • authorize the issuance of “blank check” preferred stock that our board could use to implement a stockholder rights plan; • eliminate the ability of our stockholders to call special meetings of stockholders; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; • prohibit cumulative voting; and 28 Table of Contents • establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
These provisions: • establish a classified Board so that not all members of our board are elected at one time; 34 Table of Contents • permit only the Board to establish the number of directors and fill vacancies on the board; • provide that directors may only be removed “for cause” and only with the approval of two-thirds of our stockholders; • require super-majority voting to amend some provisions in our amended and restated certificate of incorporation and amended and restated bylaws; • authorize the issuance of “blank check” preferred stock that our board could use to implement a stockholder rights plan; • eliminate the ability of our stockholders to call special meetings of stockholders; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; • prohibit cumulative voting; and • establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
If our supply chain fails to deliver products to us in sufficient quality and quantity on a timely basis, we will be challenged to meet our target production and development timelines and could incur significant additional expenses for expedited freight and other related costs.
If our supply chain fails to deliver products to us in sufficient quality or quantity on a timely basis, we will be challenged to meet our target production and development timelines and could incur significant additional expenses for expedited freight and other related costs.
Our management as a group has limited experience in operating a publicly traded company. Our management team may not successfully or effectively manage operating as a public company subject to significant regulatory oversight and reporting obligations under U.S. securities laws. Our executive officers as a group have limited experience in the management of a publicly traded company.
Our management team may not successfully or effectively manage operating as a public company subject to significant regulatory oversight and reporting obligations under U.S. securities laws. Our executive officers as a group have limited experience in the management of a publicly traded company.
Customers may resist or delay the adoption of our products and services for several reasons, including lack of confidence in autonomous and semi-autonomous delivery vehicles. If our customers resist or delay adoption of our robotic delivery services, our business, prospects, financial condition and operating results will be materially and adversely affected.
Customers may resist or delay the adoption of our products and services for several reasons, including lack of confidence in autonomous and semi-autonomous vehicles. If our customers resist or delay adoption of our robotic services, our business, prospects, financial condition and operating results will be materially and adversely affected.
We are a public company and are required, pursuant to Section 404(a) of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of its internal control over financial reporting on our annual report on Form 10-K.
We are a public company and are required, pursuant to Section 404(a) of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting on our Annual Report on Form 10-K.
Stock exchanges and quotation systems, including The Nasdaq Capital Market ("Nasdaq"), on which our common stock is listed or may be listed or quoted on in the future have from time to time experienced significant price and volume fluctuations.
Stock exchanges and quotation systems, including The Nasdaq Capital Market (“Nasdaq”), on which our common stock is listed or may be listed or quoted on in the future have from time to time experienced significant price and volume fluctuations.
Concerns over environmental pollution and climate change have produced significant legislative and regulatory efforts on a global basis, and we believe this will continue both in scope and in the number of countries participating.
Further, concerns over environmental pollution and climate change have produced significant legislative and regulatory efforts on a global basis, and we believe this will continue both in scope and in the number of countries participating.
We cannot guarantee that we will develop proprietary products that are patentable, and that, if issued, any patent will give us a competitive advantage or that such patent will not be challenged by third parties.
We cannot guarantee that we will develop proprietary products that are patentable, or that, if issued, any patent will give us a competitive advantage, or that such patent will not be challenged by third parties.
Some of our proprietary information may not be patentable, and there can be no assurance that others will not utilize similar or superior solutions to compete with us.
However, some of our proprietary information may not be patentable, and there can be no assurance that others will not utilize similar or superior solutions to compete with us.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Annual Report on Form 10-K and in our other public filings.
“ Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Annual Report on Form 10-K and in our other public filings.
We have incurred and expects to continue incurring significant expenses which will impact our profitability, including research and development expenses, procurement costs, business development, operation and integration expenses as we build and deploy our robotic fleet, and general and administrative expenses as we scale our operations, identify and commit resources to investigate new areas of demand and incur costs as a public company.
We have incurred and expect to continue incurring significant expenses which will impact our profitability, including research and development expenses, procurement costs, business development, operation and integration expenses as we build and deploy our robotic fleet, and general and administrative expenses as we scale our operations, identify and commit resources to investigate new areas of demand and incur costs as a public company.
Effective internal control over financial reporting is necessary for reliable financial reports and, together with adequate disclosure controls and procedures, such internal controls are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet its reporting obligations.
Effective internal control over financial reporting is necessary for reliable financial reports and, together with adequate disclosure controls and procedures, such internal controls are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations.
We are subject to cybersecurity risks to our operational systems, security systems, infrastructure, integrated software in our products and data processed by us or third-party vendors. Our business and operations involve the collection, storage, processing, and transmission of personal data and certain other sensitive and proprietary data of collaborators, customers, and others.
We are subject to cybersecurity risks to our robot fleet, operational systems, security systems, infrastructure, integrated software in our products and data processed by us or third-party vendors. Our business and operations involve the collection, storage, processing and transmission of personal data and certain other sensitive and proprietary data of collaborators, customers and others.
Such incidents could: materially disrupt our operational systems; result in loss of intellectual property, trade secrets or other proprietary or competitively sensitive information; compromise certain information of customers, employees, suppliers, or others; jeopardize the security of our facilities; or affect the performance of in-product technology and the integrated software in our units.
Such incidents could: materially disrupt our operational systems; result in loss of intellectual property, competitive advantage, trade secrets or other proprietary or competitively sensitive information; compromise certain information of customers, employees, suppliers, or others; jeopardize the security of our facilities; or affect the performance of in-product technology and the integrated software in our units.
Operational performance and costs can be difficult to predict and are often influenced by factors outside of our or any third-party manufacturing partners’ and suppliers’ control, such as, but not limited to, scarcity of natural resources, environmental hazards and remediation, costs associated with decommissioning of machines, labor 20 Table of Contents disputes and strikes, difficulty or delays in obtaining governmental permits, damages or defects in electronic systems, industrial accidents, fire, seismic activity and natural disasters.
Operational performance and costs can be difficult to predict and are often influenced by factors outside of our or any third-party manufacturing partners’ and suppliers’ control, such as, but not limited to, scarcity of natural resources, environmental hazards and remediation, costs associated with decommissioning of machines, labor disputes and strikes, difficulty or delays in obtaining governmental permits, damages or defects in electronic systems, industrial accidents, fire, seismic activity and natural disasters.
Our ability to become profitable in the future will not only depend on our ability to complete the design and development of our robots to meet projected performance metrics, identify and investigate new areas of demand and successfully market our robotic services, but also to sell, whether outright or through subscriptions, our systems at prices needed to achieve our expected margins and control our costs, including the risks and costs associated with operating, maintaining and financing our robots.
Our ability to become profitable in the future will not only depend on our ability to complete the design and development of our 17 Table of Contents robots to meet projected performance metrics, identify and investigate new areas of demand and successfully market our robotic services, but also to sell, whether outright or through subscriptions, our systems at prices needed to achieve our expected margins and control our costs, including the risks and costs associated with operating, maintaining and financing our robots.
Our management team will have broad discretion in making strategic decisions to execute their growth plans, and there can be no assurance that our management’s decisions will result in successful achievement of our business objectives or will not have unintended consequences that negatively impact our growth prospects.
Our management team has broad discretion in making strategic decisions to execute our growth plans, and there can be no assurance that our management’s decisions will result in successful achievement of our business objectives or will not have unintended consequences that negatively impact our growth prospects.
We cannot assure you that the market price of common stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others, the following: • the realization of any of the risk factors presented in this annual report; • actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, results of operations, level of indebtedness, liquidity or financial condition; • additions and departures of key personnel; • our ability to maintain the listing of our common stock on Nasdaq; • failure to comply with the Sarbanes-Oxley Act or other laws or regulations; • future issuances, sales, resales or repurchases or anticipated issuances, sales, resales or repurchases, of our common stock; • publication of research reports about us, or our industry; • the performance and market valuations of other similar companies; • broad disruptions in the financial markets, including sudden disruptions in the credit markets; • speculation in the press or investment community; • actual, potential or perceived control, accounting or reporting problems; and • changes in accounting principles, policies and guidelines.
We cannot assure you that the market price of our common stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others, the following: • the realization of any of the risk factors presented in this Annual Report on Form 10-K; 32 Table of Contents • actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, results of operations, level of indebtedness, liquidity or financial condition; • additions and departures of key personnel; • our ability to maintain the listing of our common stock on Nasdaq; • failure to comply with the Sarbanes-Oxley Act or other laws or regulations; • future issuances, sales, resales or repurchases or anticipated issuances, sales, resales or repurchases, of our common stock; • publication of research reports about us, or our industry; • the performance and market valuations of other similar companies; • broad disruptions in the financial markets, including sudden disruptions in the credit markets; • speculation in the press or investment community; • actual, potential or perceived control, accounting or reporting problems; and • changes in accounting principles, policies and guidelines.
We expect our expansion to include: • expanding the management, engineering, and product teams; • identifying and recruiting individuals with the appropriate relevant experience; 8 Table of Contents • hiring and training new personnel; • launching commercialization of new products and services; • forecasting production and revenue; • entering into relationships with one or more third-party design for manufacturing partners and third-party contract manufacturers and/or expanding our internal manufacturing capabilities; • controlling expenses and investments in anticipation of expanded operations; • carrying out acquisitions and entering into collaborations, in-licensing arrangements, joint ventures, strategic alliances or partnerships; • expanding and enhancing internal information technology, safety, and security systems; • conducting demonstrations; • expanding into new markets and geographies; • expanding our ODD into new environments; • entering into agreements with suppliers and service providers; and • implementing and enhancing administrative infrastructure, systems, and processes.
We expect our expansion to include: • expanding our management, engineering, and product teams; • identifying and recruiting individuals with the appropriate relevant experience; • launching commercialization of new products and services; • forecasting production and revenue; • entering into relationships with one or more third-party design for manufacturing partners and third-party contract manufacturers and/or expanding our internal manufacturing capabilities; • controlling expenses and investments in anticipation of expanded operations; • carrying out acquisitions and entering into collaborations, in-licensing arrangements, joint ventures, strategic alliances or partnerships; 10 Table of Contents • expanding and enhancing internal information technology, safety, and security systems; • conducting demonstrations; • expanding into new markets and geographies; • expanding our ODD into new environments; • entering into new agreements with suppliers, manufacturers and service providers; and • implementing and enhancing administrative infrastructure, systems, and processes.
Because techniques used to obtain unauthorized access to or to sabotage information systems change frequently and may not be known until launched against a target, we may be unable to anticipate or prevent these attacks, react in a timely manner, or implement adequate preventive measures, and may face delays in our detection or remediation of, or other responses to, security breaches and other privacy-and security-related incidents.
Because techniques used to obtain unauthorized access to or to sabotage information systems change frequently and may not be known until launched against a target, we may be unable to anticipate or prevent these attacks, react in a timely manner, or implement adequate preventive measures, and may face delays in our detection or remediation of, or other responses to, security breaches and other privacy-and security-related 23 Table of Contents incidents.
These factors may include adverse changes in companies’ interests in our robotic delivery and branding services, companies’ available dollars to invest on our services, general economic conditions, our ability to market our company to companies, headcount and other operating costs, and general industry and regulatory conditions and requirements.
These factors may include adverse changes in companies’ interests in our robotic and branding services, companies’ available dollars to invest in our services, general economic conditions, our ability to market our company to other companies, headcount and other operating costs, and general industry and regulatory conditions and requirements.
In some cases, our executive officers and directors may have fiduciary obligations associated with these business interests that interfere with their ability to devote time to our business and affairs and that could adversely affect our operations. These business interests could require significant time and attention of our executive officers and directors.
In some cases, our executive officers and directors may have fiduciary obligations associated with these business interests that interfere with their ability to devote time to our business and affairs and that could adversely affect our operations. These business interests could require significant time and attention from our executive officers and directors.
The development of any alternative technology that can compete with or supplant our products may materially and adversely affect our business, prospects, financial condition and operating results, including in ways we do not currently anticipate.
The development of any alternative technology that could compete with or supplant our products may materially and adversely affect our business, prospects, financial condition and operating results, including in ways we do not currently anticipate.
Management’s assessment of internal controls, when implemented, could detect problems with internal controls, and an independent assessment of the effectiveness of internal controls by our auditors could detect further problems that management’s assessment might not, and could result in the identification of material weaknesses that were not otherwise identified.
Management’s assessment of internal controls could detect problems with internal controls, and an independent assessment of the effectiveness of internal controls by our auditors could detect further problems that management’s assessment might not, and could result in the identification of material weaknesses that were not otherwise identified.
We conduct extensive testing of our units, in some instances in collaboration with our customers, to ensure that any such issues can be identified and addressed in advance of commercial launch of the products.
We conduct extensive testing of our robots, in some instances in collaboration with our customers, to ensure that any such issues can be identified and addressed in advance of commercial launch of the products.
Further, climate change laws, environmental regulations, and other similar measures may have an effect on the operating activities of our customers, which may, in turn, reduce the demand for our products and services.
Climate change laws, environmental regulations, and other similar measures may also have an effect on the operating activities of our customers, which may, in turn, reduce the demand for our products and services.
Ineffective internal controls could also cause investors to lose confidence in reported financial information, which could have a negative effect on the trading price of our common stock. 26 Table of Contents The report by management is required to include disclosure of any material weaknesses identified in internal control over financial reporting.
Ineffective internal controls could also cause investors to lose confidence in reported financial information, which could have a negative effect on the trading price of our common stock. The report by management is required to include disclosure of any material weaknesses identified in internal control over financial reporting.
Our business depends on discretionary spending patterns in the areas in which the restaurants on our partners’ platforms operate and in the economy at large. Economic downturns or other events (like coronavirus variants or similar widespread health/pandemic outbreaks) impacting the United States and global economy could materially adversely affect our results of operations.
Our business depends on discretionary spending patterns in the areas in which the restaurants on our partners’ platforms operate and in the economy at large. Economic downturns or other events (like widespread health/pandemic outbreaks) impacting the United States and global economy could materially adversely affect our results of operations.
Although there have been no allegations made to this effect, we cannot assure that we will not receive such correspondence from third parties or competitors in the future. Such assertions could lead to expensive and unpredictable litigation, diverting the attention of management and technical personnel.
Although there have been no allegations made to this effect, we cannot be sure that we will not receive such correspondence from third parties or competitors in the future. Such assertions could lead to expensive and unpredictable litigation, diverting the attention of management and technical personnel.
We may incur significant costs to attract and retain qualified personnel, including significant expenditures 10 Table of Contents related to salaries and benefits and compensation expenses related to equity awards, and we may lose new employees to our competitors or other companies before we realize the benefit of our investment in recruiting and training them.
We may incur significant costs to attract and retain qualified personnel, including significant expenditures related to salaries and benefits and compensation expenses related to equity awards, and we may lose new employees to our competitors or other companies before we realize the benefit of our investment in recruiting and training them.
Our management will have broad discretion in making strategic decisions to execute their growth plans and may devote time and company resources to new or expanded solution offerings, potential acquisitions, prospective customers or other initiatives that do not necessarily improve our operating results or contribute to our growth.
Our management team will have broad discretion in making strategic decisions to execute our growth plans and may devote time and company resources to new or expanded solution offerings, potential acquisitions, prospective customers or other initiatives that may not necessarily improve our operating results or contribute to our growth.
Our systems will be vulnerable to damage or interruption from, among others, physical theft, fire, terrorist attacks, natural disasters, power loss, war, telecommunications failures, viruses, denial or degradation of service attacks, ransomware, social engineering schemes, insider theft or misuse or other attempts to harm our systems.
Our systems are vulnerable to damage or interruption from, among others, physical theft, fire, terrorist attacks, natural disasters, power loss, war, telecommunications failures, viruses, denial or degradation of service attacks, ransomware, social engineering schemes, insider theft or misuse or other attempts to harm our systems.
Any actual or perceived security breach or security incident, or any systems outages or other disruption to systems used in our business, could interrupt our operations, result in loss or improper access to, or acquisition or disclosure of, data or a loss of intellectual property protection, harm our reputation and competitive position, reduce demand for our products, damage our relationships with customers, partners, collaborators, or others, or result in claims, regulatory investigations, and proceedings and significant legal, regulatory, and financial exposure, and any such incidents or any perception that our security measures are inadequate could lead to loss of confidence in us and harm to our reputation, any of which could adversely affect our business, financial condition, and results of operations.
Any actual or perceived security breach or security incident, or any systems outages or other disruption to systems used in our business, could interrupt our operations, result in loss or improper access to, or acquisition or disclosure of, data or a loss of intellectual property protection, harm our reputation and competitive position, reduce demand for our products, damage our relationships with consumers, partners, collaborators, or others, or result in claims, including class action litigation, regulatory investigations, and proceedings and significant legal, regulatory and financial exposure, and any such incidents or any perception that our security measures are inadequate could lead to loss of confidence in us and harm to our reputation, any of which could adversely affect our business, financial condition and results of operations.
We, any third-party manufacturing partners, and suppliers may rely on complex machinery for the production, assembly, repair, and maintenance of our robotic systems, which will involve a significant degree of uncertainty and risk in terms of operational performance and costs.
We, any third-party manufacturing partners and suppliers may rely on complex machinery for the production, assembly, repair and maintenance of our robotic systems, which involves a significant degree of uncertainty and risk in terms of operational performance and costs.
Regardless of the outcome, litigation may require significant attention from management and could result in significant legal expenses, settlement costs or damage awards that could have a material impact on our business, results of operation and financial condition.
Regardless of the outcome, such litigation may require significant attention from management and could result in significant legal expenses, settlement costs or damage awards that could have a material impact on our business, results of operations and financial condition.
Our operational facilities, and those of any third-party manufacturing partners and suppliers consist or are expected to consist of large-scale machinery combining many components. These components may suffer unexpected malfunctions from time to time and will depend on repairs and spare parts to resume operations, which may not be available when needed.
Our operational facilities, and those of any third-party manufacturing partners and suppliers, consist, or are expected to consist, of large-scale machinery combining many components. These components may suffer unexpected malfunctions from time to time and may require repairs and spare parts to resume operations, which may not be available when needed.
As a result, our and our customers’ proprietary information may be misappropriated, and we cannot predict the impact of any future incident.
As a result, our business confidential and our customers’ proprietary information may be misappropriated, and we cannot predict the impact of any future incident.
We are subject to evolving laws, regulations, standards, policies, and contractual obligations related to data privacy and security laws and regulations, and our actual or perceived failure to comply with such obligations could harm our reputation, subject us to significant fines and liability, or otherwise adversely affect our business, prospects, financial condition and operating results.
We are subject to evolving laws, regulations, standards, policies and contractual obligations related to privacy and security laws and regulations, and our actual or perceived failure to comply with such obligations could result in litigation, harm our reputation, subject us to significant fines and liability, or otherwise adversely affect our business, prospects, financial condition and operating results.
We cannot be sure that alternative technologies or improvements to artificial intelligence, industrial automation or other technologies, processes or industries will not match or exceed the benefits of our products or be more cost effective than our products.
We cannot be sure that alternative technologies or improvements to AI, industrial automation or other technologies, processes or industries will not match or exceed the benefits of our products or be more cost effective than our products.
For example, current, departing, or former employees or third parties could attempt to improperly use or access our computer systems and networks to copy, obtain, or misappropriate our proprietary information or otherwise interrupt our business.
For example, current, departing, or former employees or third parties could attempt to improperly use or access our facilities, robots, computer systems or networks to copy, obtain, or misappropriate our proprietary information or otherwise interrupt our business.
The IT and infrastructure used in our business may be vulnerable to cyberattacks or security breaches, and third parties may be able to access data, including personal data and other sensitive and proprietary data of us and our customers, collaborators and partners, our employees’ personal data, or other sensitive and proprietary data, accessible through those systems.
The IT, infrastructure, business processes and third-party service providers used in our business may be vulnerable to cyberattacks or security breaches, and third parties may be able to access data, including personal data and other sensitive and proprietary data of us and our customers, collaborators and partners, our employees’ personal data, or other sensitive and proprietary data, accessible through those systems.
The ability of the U.S. economy to handle this uncertainty is likely to be affected by many national and international factors that are beyond our control. These factors, including national, regional and local politics and economic conditions, continued impact of the COVID-19 pandemic, disposable consumer income and consumer confidence, also affect discretionary consumer spending.
The ability of the U.S. economy to handle this uncertainty is likely to be affected by many national and international factors that are beyond our control. These factors, including national, regional and local politics and economic conditions, disposable consumer income and consumer confidence, also affect discretionary consumer spending.
Any failure to comply with the Department of Transportation’s storage and transport requirements or the FCC’s regulations on wireless 13 Table of Contents communications could result in fines, loss of permits and licenses or other regulatory consequences, which could limit our ability to manufacture and deliver our robotic systems and negatively affect our business, prospects, financial condition, results of operations, and cash flows.
Any failure to comply with the DOT’s storage and transport requirements or the FCC’s regulations on wireless communications could result in fines, loss of permits and licenses or other regulatory consequences, which could limit our ability to manufacture and deliver our robotic systems and negatively affect our business, prospects, financial condition, results of operations and cash flows.
We are an “emerging growth company,” as defined in the JOBS Act, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including: • not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act; • reduced disclosure obligations regarding executive compensation in our periodic reports and annual report on Form 10-K; and • exemptions from the requirements of holding non-binding advisory votes on executive compensation and stockholder approval of any golden parachute payments not previously approved. 27 Table of Contents We could be an emerging growth company for up to five years following the completion of our initial public offering.
We are an “emerging growth company,” as defined in the JOBS Act, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including: • not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act; • reduced disclosure obligations regarding executive compensation in our periodic reports and Annual Report on Form 10-K; and • exemptions from the requirements of holding non-binding advisory votes on executive compensation and stockholder approval of any golden parachute payments not previously approved.
The FCPA and other applicable laws and regulations also require that we keep accurate books and records and maintain internal 24 Table of Contents controls and compliance procedures designed to prevent any such actions.
The FCPA and other applicable laws and regulations also require that we keep accurate books and records and maintain internal controls and compliance procedures designed to prevent any such actions.
Tariffs imposed by the United States and other countries, as well as changing trade relations, regional and international conflicts, and political conditions could have a material adverse effect on our business and results of operations.
Risks Related to our Regulatory Environment Tariffs imposed by the United States and other countries, as well as changing trade relations, regional and international conflicts, and political conditions could have a material adverse effect on our business and results of operations.
The fact that we have limited experience commercializing our delivery robotic systems on a large scale, coupled with the fact that our products represent a new product category in the commercial and delivery robotic market, means we have limited historical data on 16 Table of Contents the demand for our robotic systems.
The fact that we have limited experience commercializing our robotic systems on a large scale, coupled with the fact that our products represent a new product category in the commercial and robotic market, means we have limited historical data on the demand for our robotic systems.
Disruptions in the overall economy (including disruptions due to coronavirus or similar health/pandemic events), including high unemployment, inflation, rising gasoline prices, financial market volatility and unpredictability, and the related reduction in consumer confidence, could negatively affect food and beverage sales throughout the restaurant industry, including orders through our partners’ platforms.
Disruptions in the overall economy, including high unemployment, pandemic events, inflation, rising gasoline prices, financial market volatility and unpredictability, and the related reduction in consumer confidence, could negatively affect food and beverage sales throughout the restaurant industry, including orders through our partners’ platforms.
We may be subject to claims of infringement of third-party intellectual property rights. Our operating results may be adversely affected if third parties claim that our products infringed their patent, copyright, or other intellectual property rights. We cannot assure that our products do not, or will not in the future, infringe patents held by others.
Our operating results may be adversely affected if third parties claim that our products infringed their patent, copyright, or other intellectual property rights. We cannot assure that our products do not, or will not in the future, infringe patents held by others.
Unexpected malfunctions of these components may significantly affect the intended operational efficiency.
Unexpected malfunctions of these components may significantly affect the intended operational efficiency of such machinery.
Such adverse events could lead to unexpected failures in our products and could result, in certain cases, in the removal of our products from the market. A product recall could result in significant costs.
Such adverse events could lead to unexpected failures in our products and could result, in certain cases, in the removal of our products from the market, which could result in significant costs.
To date, for our limited number of robots, we have been able to run periodic OOH advertising campaigns with several brands in varying sectors including real estate, fashion and entertainment, with 16% and 22% of our revenues for the years ended December 31, 2024 and 2023, respectively, coming from OOH advertising.
To date, for our limited number of robots, we have been able to run periodic OOH advertising campaigns with several brands in varying sectors including real estate, fashion and entertainment. OOH advertising represented 15% and 16% of our revenues for the years ended December 31, 2025 and 2024, respectively.
However, for as long as we are an “emerging growth company” under the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act.
However, for as long as we are an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), our independent registered public accounting firm will not be required to attest to the effectiveness of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act.
The availability and effectiveness of our services depend on the continued operation of information technology and communications systems.
The availability and effectiveness of these products and services depend on the continued operation of information technology and communications systems.
We are at risk for interruptions, outages and breaches of our: (a) operational systems, including business, financial, accounting, product development, data processing or production processes, owned by us or our third-party vendors or suppliers; (b) facility security systems, owned by us or our third-party vendors or suppliers; (c) transmission control modules or other in-product technology, owned by us or our third-party vendors or suppliers; (d) the integrated software in our units; or (e) customer data that we processes or that our third-party vendors or suppliers process on our behalf.
We are at risk for interruptions, outages and breaches of our: (a) operational systems, including business, financial, accounting, product development, data processing or production processes, owned by us or our third-party vendors or suppliers; (b) facility security systems, owned by us or our third-party vendors or suppliers; (c) transmission control modules or other in-product technology, owned by us or our third-party vendors or suppliers; (d) the integrated software in our units; (e) customer data that we process or that our third-party vendors or suppliers process on our behalf; or (f) to describe the cybersecurity and operational risks that are related to outsourced overseas hardware and electronics supply chain manufacturers.
A “material weakness” is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is more than a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
A “material weakness” is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is more than a reasonable possibility that a material misstatement of our annual or interim financial statements will not be 33 Table of Contents prevented or detected on a timely basis. Refer to Part II, Item 9A.
Unfavorable changes in interest rates and foreign currency exchange rates may adversely affect our financial condition, liquidity, and results of operations. Fluctuations in interest rates and foreign exchange rates may negatively impact our business.
Risks Related to our Industry and External Environment Unfavorable changes in interest rates and foreign currency exchange rates may adversely affect our financial condition, liquidity and results of operations. Fluctuations in interest rates and foreign exchange rates may negatively impact our business.
We routinely implement improvements to our network security safeguards, and we are devoting increasing resources to the security of our information technology systems. However, we cannot assure that such system improvements will be sufficient to prevent or limit the damage from any future cyber-attack or network disruptions.
We routinely implement improvements to our facilities, robot fleet, computer and network security safeguards, and we are devoting increasing resources to the security of our information technology systems. However, we cannot be sure that such system improvements will be sufficient to deter, prevent or limit the damage from any physical threat, future cyber-attack, network or operational disruptions.
We may be unable to adequately control the costs associated with our operations. We will require significant capital to develop and grow our business, including developing and producing our commercial robotic systems and other products, establishing or expanding design, research and development, production, operations and maintenance and service facilities and building our brand and partnerships.
We will require significant capital to develop and grow our business, including developing and producing our commercial robotic systems and other products, establishing or expanding design, research and development, production, operations and maintenance and service facilities and building our brand and partnerships.
Our partners, such as Uber, require timely reporting of any material safety incidents, and if they are not able to ascertain our ability to maintain safe operations, 11 Table of Contents our commercial relationships may be jeopardized. To date, we have not experienced material safety incidents nor have our partners raised any concerns about our safety standards and track record.
Our partners require timely reporting of any material safety incidents, and if they are not confident in our ability to maintain safe operations, our commercial relationships may be jeopardized. To date, we have not experienced material safety incidents, nor have our partners raised any concerns about our safety standards and track record.
Many other jurisdictions globally are considering or have enacted legislation providing for local storage of data or otherwise imposing privacy, data protection and data security obligations in connection with the collection, use and other processing of personal data. We publish privacy policies and other documentation regarding our collection, processing, use and disclosure of personal information and/or other confidential information.
Many other jurisdictions globally are considering or have enacted legislation providing for local storage of data or otherwise imposing privacy, data protection and data security obligations in connection with the collection, use and other processing of personal data.
If we are unable to attract, integrate and retain suitably qualified individuals who can meet our technical, operational and managerial requirements, on a timely basis or at all, our business, results of operation and financial condition could be adversely affected.
If we are unable to attract, integrate and retain suitably qualified individuals who can meet our technical, operational and managerial requirements, on a timely basis or at all, our business, results of operations and financial condition could be adversely affected. A significant portion of our revenue is concentrated with a small number of customers.
Any failure by us to effectively and efficiently meet our obligations as a publicly traded company could have a material adverse effect on our business, prospects, financial condition and operating results and/or result in legal liability or other negative consequences.
Furthermore, deficiencies in our disclosures or controls could result in SEC inquiries, enforcement actions, shareholder litigation, or penalties. Any failure by us to effectively and efficiently meet our obligations as a publicly traded company could have a material adverse effect on our business, prospects, financial condition and operating results and/or result in legal liability or other negative consequences.
Furthermore, the cellular network and radio systems contained in our robots are regulated by the Federal Communications Commission (the “FCC”), which allocates cellular and wireless bandwidth to ensure minimal conflict between operators. And the battery packs within our robots use custom lithium-ion cells. The transportation and effective storage of lithium-ion batteries is tightly regulated by the U.S.
Federal Communications Commission (the “FCC”), which allocates cellular and wireless bandwidth to ensure minimal conflict between operators. And the battery packs within our robots use custom lithium-ion cells. The transportation and effective storage of lithium-ion batteries is tightly regulated by the U.S. Department of Transportation (the “DOT”) and other regulatory bodies.
Our largest stream of projected revenue comes from maximizing utilization of our robots to perform deliveries. We may be unable to maximize utilization due to a variety of reasons, including insufficient merchant participation, platform partner matching algorithms, failure to deliver a commercial grade product, and a lack of product acceptance by merchants and/or delivery recipients.
Our sidewalk delivery robots may be unable to maximize utilization due to a variety of reasons, including insufficient merchant participation, platform partner matching algorithms, failure to deliver a commercial grade product and a lack of product acceptance by merchants and/or delivery recipients.
Certain highly complex components used to manufacture our robots are obtained from single or limited sources that we may have to compete for with other participants in the robotics, consumer electronics, and automotive markets.
Certain highly complex components used to manufacture our robots are obtained from single or limited sources that we may have to compete for with other participants in the robotics, consumer electronics and automotive markets. Global supply chain problems directly impact our ability to obtain these components cost-effectively.
We may not be able to locate or attract qualified individuals for important positions, such as software engineers, robotics engineers, machine vision and machine learning experts and others, which could affect our ability to grow and expand our business.
Because of the innovative nature of our technology, we may struggle to locate or attract qualified individuals for important positions, such as software engineers, robotics engineers, machine vision and machine learning experts and others, which could affect our ability to grow and expand our business.
As a general policy, we do not share data with law enforcement, except in certain narrow circumstances where (1) we are required to share data when served with a warrant or subpoena, or (2) there are insurance claims, active incident investigations, or acts of armed violence or theft attempts involving our personnel or property.
We are also aware of certain media reports relating to the alleged use of our robots as elements in law enforcement surveillance efforts. 25 Table of Contents As a general policy, we do not share data with law enforcement, except in certain narrow circumstances where (1) we are required to share data when served with a warrant or subpoena, or (2) there are insurance claims, active incident investigations, or acts of armed violence or theft attempts involving our personnel or property.
If we cannot raise additional funds when we need or want them, we may be forced to curtail or abandon our growth plans, which could adversely impact the Company, its business, development, financial condition, operating results or prospects. We will be required to raise additional capital in order to develop our technology and scale our commercial delivery operations.
If we cannot raise additional funds when we need or want them, we may be forced to curtail or discontinue our operations or abandon our growth plans, which could adversely impact the Company, its business, development, financial condition, operating results or prospects.
The global data protection landscape is rapidly evolving, and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future. We may not be able to monitor and react to all developments in a timely manner. For example, California adopted the California Consumer Privacy Act (“CCPA”), which became effective in January 2020.
The global data protection landscape is rapidly evolving, and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future. We may not be able to monitor and react to all developments in a timely manner.
Any such claims or other proceedings could be expensive and time-consuming to defend and could result in adverse publicity. Any of the foregoing may have an adverse effect on our business, prospects, results of operations, and financial condition. We are subject to U.S. and foreign anti-corruption and anti-money laundering laws and regulations.
Any such claims or other proceedings could be expensive and time-consuming to defend and could result in adverse publicity. Any of the foregoing may have an adverse effect on our business, prospects, results of operations and financial condition.
Certain of our remote piloting services are currently provided by third-party vendors, and from service centers outside of the United States. Services provided pursuant to arrangements with these third-party vendors could be disrupted due to events outside of their control such as power failures, cybersecurity incidents, internet traffic congestion or increased latency, natural disasters, or deterioration in their economic condition.
Services provided pursuant to arrangements with these third-party vendors could be disrupted due to events outside of their control such as power failures, cybersecurity incidents, internet traffic congestion or increased latency, natural disasters, or deterioration in their economic condition.
As such, we believe labor inflation increases the cost of manual courier delivery and similar alternatives to robotic delivery more than it increases robotic delivery cost. However, we believe improvements in robot autonomy will continue to reduce the rate of labor usage.
As such, we believe labor inflation increases the cost of human labor and similar alternatives to robots more than it increases the cost of robots, and that improvements in robot autonomy will continue to reduce the rate of labor usage over time.
Any such occurrence could cause delay in market acceptance of our products, damage to our reputation, product recalls, increased service and warranty costs, product liability claims and loss of revenue relating to such hardware or software defects.
Any such occurrence could delay market acceptance of our products, damage our reputation, result in product recalls, increase service and warranty costs, lead to product liability claims and cause a loss of revenue.
If we cannot protect, maintain and, if necessary, enforce our intellectual property rights, our ability to develop and commercialize products may be adversely impacted. Our success, in large part, depends on our ability to protect and maintain the proprietary nature of our technology. We must prosecute and maintain our existing patents and obtain new patents.
Risks Related to Intellectual Property If we cannot protect, maintain and enforce our intellectual property rights, our competitive position and business could be adversely affected. Our success, in large part, depends on our ability to protect and maintain the proprietary nature of our technology. We must prosecute and maintain our existing patents and obtain new patents.
Our revenues and profits are subject to fluctuations. It is difficult to accurately forecast our revenues and operating results, and these could fluctuate in the future due to a number of factors.
As a company with a limited operating history, it is difficult to accurately forecast our revenues and operating results, and these could fluctuate in the future due to a number of factors.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe security and infrastructure teams are responsible for the continuous monitoring, reporting and response to threats and vulnerabilities discovered through the deployment and operation of these tools. As part of our risk management strategy, our cybersecurity team conducts routine vulnerability and risk assessments within our product operations and service environments.
Biggest changeOur security team is led by our VP of Security who has over 15 years of direct cybersecurity experience, including incident response, security operations and management. The VP of Security oversees our security and infrastructure teams, which are responsible for the continuous monitoring, reporting and response to threats and vulnerabilities discovered through the deployment and operation of these tools.
In the last three fiscal years, we are not aware of and have not experienced any material cybersecurity incidents and the expenses we have incurred from cybersecurity incidents were immaterial.
In the last three fiscal years, we have not experienced, and are not aware of, any material cybersecurity incidents and the expenses we have incurred from cybersecurity incidents were immaterial.
These technologies and processes include, but are not limited to, mobile device management, virtual private network security services, attack surface management services, cloud threat detection and response systems, cloud security posture management solutions, cloud-native security scanners and source code analysis tooling, continuous compliance monitoring and security awareness training solutions.
These technologies and processes include, but are not limited to, mobile device management, virtual private network security services, attack surface management services, cloud threat detection and response systems, cloud security posture management solutions, cloud-native security scanners and source code analysis tooling, continuous compliance monitoring, phishing simulation, and security awareness training solutions.
These reports include updates on the implementation of cybersecurity controls, data security, risk assessments, the status of internal cybersecurity projects, technology compliance, employee awareness training and any notable incidents and remediation that have occurred within the quarter.
These reports include updates on the implementation of cybersecurity controls, data security, risk assessments, the status of internal cybersecurity projects, technology compliance, employee awareness training and any notable incidents that have occurred within the quarter and related remediation efforts.
As part of routine security assessments, if any deficiencies relating to internal technology controls over financial reporting are discovered, the VP of Security is required to report them directly to the executive management team and internal steering committee without delay.
As part of routine security assessments, if any material deficiencies relating to IT general controls over financial reporting are discovered, the VP of Security is required to report them directly to the executive management team and internal steering committee without delay.
The internal steering committee makes decisions on the avoidance, transference, acceptance and mitigation of our overall cybersecurity risk exposure. Our steering committee, typically in joint session with the full board of directors, meets quarterly with Serve executive leadership to receive reports regarding our overall security posture.
The internal steering committee makes decisions on the avoidance, transference, acceptance and mitigation of our overall cybersecurity risk exposure. 36 Table of Contents Our steering committee, typically in joint session with the full board of directors, meets quarterly with the Company’s executive leadership to receive reports regarding our overall security posture.
Please see the risk factor entitled “We are subject to cybersecurity risks to our operational systems, security systems, infrastructure, integrated software in our products and data processed by us or third-party vendors..” in Part I, Item 1A. Risk Factors in this report for more information.
See the risk factor entitled “We are subject to cybersecurity risks to our robot fleet, operational systems, security systems, infrastructure, integrated software in our products and data processed by us or third-party vendors...” in Part I, Item 1A. “Risk Factors” in this report for more information.
The results of these reviews and any incidents identified by security tooling are reported to senior management and the internal steering committee as part of the quarterly reporting process.
Our VP of Security oversees these assessments and ensures the results of these reviews and any incidents identified by security tooling are reported to senior management and the internal steering committee as part of the quarterly reporting process.
As part of these processes, and to ensure confidentiality, integrity and availability of critical data and systems, we have implemented various technologies that aid in the prevention, detection, investigation, response and remediation of vulnerabilities, cybersecurity incidents and risks.
Our cybersecurity risk management program is integrated with our overall enterprise risk management program. As part of these processes, and to ensure confidentiality, integrity and availability of critical data and systems, we have implemented various technologies that aid in the prevention, detection, investigation, response and remediation of vulnerabilities, cybersecurity incidents and risks.
We have not been faced with any penalties or settlements related to cybersecurity. 30 Table of Contents Cybersecurity Governance Our internal steering committee and board of directors oversees our risk management strategies and processes, regarding risk assessment and risk management as they relate to cybersecurity.
For additional information about these risks, see Part I, Item 1A. “ Risk Factors. ” We have not incurred any penalties or entered into any settlements related to cybersecurity matters. Cybersecurity Governance Our internal steering committee and board of directors oversees our risk management strategies and processes, regarding risk assessment and risk management as they relate to cybersecurity.
Our security team is led by our VP of Security who has over 15 years of direct cybersecurity experience that includes incident response, security operations and management. The security and infrastructure teams are responsible for implementing and maintaining cybersecurity and data protection controls and practices for the protection of our robots, customer and company information, systems and data.
Our security and infrastructure teams are responsible for implementing and maintaining cybersecurity and data protection controls and practices for the protection of our robots, customer and company information, systems and data.
We perform diligence on third parties that have access to our systems, data or facilities that house such systems or data, and where necessary, we require those third parties that could introduce significant cybersecurity risk to us to agree by contract to manage their cybersecurity risks in specified ways, and to agree to be subject to cybersecurity audits, which we conduct as appropriate.
Where necessary, we require third parties that could introduce significant cybersecurity risk, to agree by contract to employ technical, administrative and physical security safeguards and to agree to be subject to cybersecurity audits, which we conduct as appropriate.
Removed
Evaluation and mitigation of Third-party risks are included within our broader overall risk assessment process.
Added
Evaluation and mitigation of third-party risks are included within our overall risk assessment process. We perform due diligence on third parties with access to our facilities, networks, systems, organization or client data to include third-party service providers who act as sub-processors assisting in the delivery and support of our services.
Added
As part of our risk management strategy, our cybersecurity team conducts routine vulnerability and risk assessments within our product operations and service environments.
Added
Our business strategy, results of operations and financial condition have not been materially affected by risks from cybersecurity threats, including as a result of previously identified cybersecurity incidents, but we cannot provide assurance that they will not be materially affected in the future by such risks or any future material incidents.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties Our current headquarters are located in Redwood City, California, where we lease 4,200 square feet of office and industrial space pursuant to a lease that expires in 2028. Our headquarters contain research and development, operations and selling, general and administrative functions as well as test tracks for our robots.
Biggest changeItem 2. Properties Our current headquarters are located in Redwood City, California, where we lease 4,200 square feet of office and industrial space. In 2026, we will be relocating our headquarters to 1360 and 1390 Bayport Avenue in San Carlos, California.
We also lease four other offices throughout the United States. We believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations.
We believe our facilities are adequate and suitable for our current needs, and additional or alternative space is expected to be available should it be required to accommodate our operations.
Added
Our headquarters contain research and development, operations and selling, general and administrative functions, as well as test tracks for our robots. We also lease fourteen other facilities throughout the United States, three of which are offices and eleven of which are depot locations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeHowever, we do not consider any such claims, lawsuits or proceedings that are currently pending, individually or in the aggregate, to be material to our business or likely to result in a material adverse effect on our future operating results, financial condition or cash flows. Item 4. Mine Safety Disclosures Not applicable. 31 Table of Contents Part II
Biggest changeHowever, we do not consider any such claims, lawsuits or proceedings that are currently pending, individually or in the aggregate, to be material to our business or likely to result in a material adverse effect on our future operating results, financial condition or cash flows. Item 4. Mine Safety Disclosures Not applicable. 37 Table of Contents Part II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePursuant to the August Purchase Agreement, on August 28, 2024, we sold 555,555 August Pre-Funded Warrants, with each August Pre-Funded Warrant exercisable for one share of our common stock, together with Common Warrants to purchase up to 555,555 shares of our common stock.
Biggest changePursuant to the August Purchase Agreement, on August 28, 2024, the Company sold 555,555 August Pre-funded Warrants exercisable for one share of common stock, together with the August Investor Warrants to purchase up to 555,555 shares of common stock.
Each August Pre-Funded Warrant and accompanying Common Warrant were sold together at a combined offering price of $8.9999, for aggregate consideration of $5 million. The August Pre-Funded Warrants are immediately exercisable, at a nominal exercise price of $0.0001, and may be exercised at any time until all of the August Pre-Funded Warrants are exercised in full.
Each August Pre-Funded Warrant and accompanying August Investor Warrants were sold together at a combined offering price of $8.9999, for aggregate consideration of $5 million. The August Pre-Funded Warrants are immediately exercisable, at a nominal exercise price of $0.0001, and may be exercised at any time until all of the August Pre-Funded Warrants are exercised in full.
(“Magna”), on February 7, 2024, the Company issued to Magna a warrant (the “Magna Warrant”) to purchase up to 2,145,000 shares of the Company’s common stock, par value $0.0001 per share (the “Magna Warrant Shares”), subject to adjustments as provided therein, at an exercise price per share of $0.01.
(“Magna”), on February 7, 2024, the Company issued to Magna a warrant (the “Magna Warrant”) to purchase up to 2,145,000 shares of the Company’s 39 Table of Contents common stock, par value $0.0001 per share (the “Magna Warrant Shares”), subject to adjustments as provided therein, at an exercise price per share of $0.01.
In addition, pursuant to the August Purchase Agreement, we agreed with the investor to exercise the Investor Warrants (as defined below) to purchase an aggregate of 2,500,000 shares of our common stock (the “Warrant Exchange”). The Investor Warrants were exercised at their exercise price of $6.00 per share.
In addition, pursuant to the August Purchase Agreement, we agreed with the investor to exercise the Investor Warrants (as defined below) to purchase an aggregate of 2,500,000 shares of our common stock (the “Warrant Exchange”). The Investor 38 Table of Contents Warrants were exercised at their exercise price of $6.00 per share.
Recent Sales of Unregistered Securities August PIPE On August 27, 2024, we entered into a Securities Purchase Agreement (the “August Purchase Agreement”) with a certain accredited and institutional investor for a private placement offering of pre-funded warrants (the “August Pre-Funded Warrants”) to purchase shares of our common stock and warrants exercisable for shares of our common stock (the “Common Warrants”).
August PIPE On August 27, 2024, we entered into a Securities Purchase Agreement (the “August Purchase Agreement”) with a certain accredited and institutional investor for a private placement offering of pre-funded warrants (the “August Pre-Funded Warrants”) to purchase shares of our common stock and warrants exercisable for shares of our common stock (the “Common Warrants”).
The Investor Warrants have an exercise price of 32 Table of Contents $6.00 per share (subject to adjustment as set forth in the Investor Warrant), are exercisable upon issuance and will expire five and a half years from the date of issuance.
The Investor Warrants have an exercise price of $6.00 per share (subject to adjustment as set forth in the Investor Warrant), are exercisable upon issuance and will expire five and a half years from the date of issuance.
As of December 31, 2024, the manufacturing milestone has been met and the second tranche is fully exercisable. The Magna Warrant Shares that may be issued pursuant to the exercise of the Magna Warrant were offered and sold in a transaction exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act.
As of December 31, 2024, the manufacturing milestone was met and the second tranche was fully exercisable. The Magna Warrant Shares that may be issued pursuant to the exercise of the Magna Warrant were offered and sold in a transaction exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act.
These transactions were exempt from registration under Section 4(a)(2) of the Securities Act as not involving any public offering or Regulation D promulgated thereunder. Item 6. [Reserved] 33 Table of Contents
These transactions were exempt from registration under Section 4(a)(2) of the Securities Act as not involving any public offering or Regulation D promulgated thereunder. Item 6. [Reserved]
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders The Company's common stock is quoted on Nasdaq under the symbol "SERV". As of December 31, 2024, there were approximately 135 stockholders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders The Company’s common stock is quoted on Nasdaq under the symbol “SERV”. As of December 31, 2025, there were approximately 126 stockholders of record of our common stock.
Any future determination to pay cash dividends will be at the discretion of our Board and will be dependent upon financial condition, results of operations, capital requirements and such other factors as the Board deems relevant.
Any future determination to pay cash dividends will be at the discretion of our Board and will be dependent upon financial condition, results of operations, capital requirements and such other factors as the Board deems relevant. Recent Sales of Unregistered Securities Vayu Robotics, Inc.
Added
Acquisition On August 15, 2025, the Company completed its acquisition of Vayu pursuant to the Agreement and Plan of Merger (the “Vayu Merger Agreement”), by and among the Company, Valencia Merger Sub I Inc., a Delaware corporation and the Company’s direct wholly-owned subsidiary, Valencia Merger Sub II LLC, a Delaware limited liability company and the Company’s direct wholly-owned subsidiary, Vayu and certain of Vayu’s securityholders, pursuant to which the Company issued 1,494,906 shares of its common stock in initial upfront consideration.
Added
The shares of the Company’s common stock were issued pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.
Added
In accordance with the terms of the Vayu Merger Agreement, up to 560,000 shares of the Company’s common stock may be issued in the future as earnout consideration to Vayu stockholders and debtholders, contingent upon the achievement of certain autonomy performance milestones as set forth in the Vayu Merger Agreement.
Added
Any such shares will be issued pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder. In accordance with the terms of the Vayu Merger Agreement, upon the closing of the transaction, the Company also issued 4,000,000 warrants to a certain Vayu securityholder (the “KV Warrants”).
Added
Each KV Warrant entitles the holder to purchase one share of the Company’s common stock, subject to adjustment thereunder, at an exercise price of $10.36 per share (which amount is equal to the 10-day volume-weighted average price of the common stock prior to the closing of the transaction).
Added
The KV Warrants contain customary terms and are exercisable at any time on or after August 15, 2029, and terminate on August 15, 2031. The KV Warrants were issued pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeWe are also a “smaller reporting company” meaning that the market value of our stock held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year.
Biggest changeWe are also a “smaller reporting company,” as defined in Item 10(f) of Regulation S-K, and we will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the prior June 30, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our common stock held by non-affiliates equals or exceeds $700 million as of the prior June 30.
Changes in regulations such as the imposition of a cap on the number of robots or technical requirements such as robot size and weight restrictions or limitations on autonomy within a certain geographic area could reduce or limit our ability to generate revenues and/or impact our unit economics in those markets.
Changes in regulations such as the imposition of a cap on the number of robots or technical requirements such as robot size and weight restrictions or limitations on autonomy within a certain geographic area could reduce or limit our ability to generate revenues or impact our unit economics in those markets.
Daily Supply Hours: We define daily supply hours as the average number of hours our robots are ready to accept offers and perform daily deliveries during the period. Supply hours represent the aggregate number of robot hours per day during which we can utilize our robots for delivery.
We define daily supply hours as the average number of hours our robots are ready to accept offers and perform daily deliveries during the period. Supply hours represent the aggregate number of robot hours per day during which we can utilize our robots for delivery.
Specifically, as a smaller reporting company we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.
Specifically, as a smaller reporting company we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K. Similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.
Expected dividend yield is based on the fact that we have never paid cash dividends on common stock and do not expect to pay any cash dividends in the foreseeable future. Determining the appropriate fair value of stock-based awards requires the input of subjective assumptions.
Expected dividend yield is based on the fact that we have never paid cash dividends on common stock and do not expect to pay any cash dividends in the foreseeable future. Determining the appropriate fair value of stock-based awards requires subjective assumptions.
Recent Developments Securities Purchase Agreement On January 7, 2025, the Company entered into a securities purchase agreement with a certain institutional investor pursuant to which the Company agreed to issue and sell, in a registered direct offering an aggregate of 4,210,525 shares of the Company’s common stock, $0.0001 par value per share at a price of $19.00 per Share.
Securities Purchase Agreement (January 2025) On January 7, 2025, the Company entered into a securities purchase agreement with a certain institutional investor pursuant to which the Company agreed to issue and sell, in a registered direct offering an aggregate of 4,210,525 shares of the Company’s common stock, $0.0001 par value per share at a price of $19.00 per share.
We measure all stock-based awards granted to employees, directors and non-employee consultants based on the fair value on the date of the grant and recognizes compensation expense for those awards, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award.
We measure all stock-based awards granted to employees, directors and non-employee consultants based on the fair value on the date of the grant and recognize compensation expense for those awards, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award.
Higher costs of components would impact our cash runway and delays in the manufacturing of our robots would push out our revenue forecasts. Governmental and Regulatory Conditions. Our potential for growth depends on continued permission and acceptance by local governments and municipalities where our robots perform deliveries.
Higher costs of components would affect our cash runway and delays in the manufacturing of our robots would push out our revenue forecasts. Governmental and Regulatory Conditions Our potential for growth depends on continued permission and acceptance by local governments and municipalities where our robots perform deliveries.
While we believe we have a strong patent portfolio and there is no actual or, to our knowledge, threatened litigation against us for patent-related matters, litigation or threatened litigation is a common method to effectively enforce or protect intellectual property rights. Such action may be initiated by or against us and would require significant management time and expenses.
While we believe we have a strong patent portfolio and there is, to our knowledge, no actual or threatened litigation against us for patent-related matters, litigation or threatened litigation is a common method to enforce or protect intellectual property rights. Such action may be initiated by or against us and would require significant management time and expense.
Further, we may in the future enter into arrangements to acquire or invest in businesses, products, services, and technologies. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all.
Further, we may in the future enter into arrangements to acquire or invest in businesses, products, services, and technologies. We may be required to seek additional equity or debt financing. If additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all.
Cost of revenue consists primarily of allocations of depreciation on robot assets used for revenue producing activities, personnel time related to revenue activities and costs related to data, software and similar costs that allow the robots to function as intended and for the Company to communicate with its robots while in service. Operations .
Cost of Revenue Cost of revenue consists primarily of allocations of depreciation on robot assets used for revenue producing activities, allocations of network costs, allocation of personnel time related to revenue activities, and costs related to data, software and similar costs that allow the robots to function as intended and for the Company to communicate with its robots while in service.
We have elected to use the extended transition period under the JOBS Act until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.
We have elected to use the extended transition period under the JOBS Act until the earlier of the date on which we (i) are no longer an emerging growth company or (ii) 48 Table of Contents affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.
We determine revenue recognition through the following steps: • Identification of a contract with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when or as the performance obligations are satisfied.
The Company determines revenue recognition through the following steps: • Identification of a contract with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when or as the performance obligations are satisfied.
We believe our existing cash and cash equivalents will be sufficient to meet our working capital and capital expenditures needs for at least the next 12 months.
We 45 Table of Contents believe our existing cash and cash equivalents will be sufficient to meet our working capital and capital expenditures needs for at least the next 12 months.
The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, stock-based compensation expenses could be materially different for future awards.
The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, stock-based compensation expenses could be materially different for future awards. Business Combinations The Company accounts for business combinations using the purchase method of accounting.
We consider most on-demand purchases as discretionary spending for consumers, and we are therefore susceptible to changes in discretionary spending patterns and economic slowdowns in the geographic areas in which merchants on our partners’ platforms operate and in the economy at large.
Inflation and Market Considerations; Availability of Materials, Labor & Services We consider most on-demand purchases as discretionary spending for consumers, and we are therefore susceptible to changes in discretionary spending patterns and economic slowdowns in the geographic areas in which merchants on our partners’ platforms operate and in the economy at large.
Critical Accounting Policies and Estimates Our consolidated financial statements and the related notes thereto included in this report are prepared in accordance with United States generally accepted accounting principles. The preparation of consolidated financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses, and related disclosures.
Critical Accounting Policies and Estimates Our consolidated financial statements and the related notes thereto included in this Annual Report on Form 10-K are prepared in accordance with U.S. GAAP. The preparation of consolidated financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses, and related disclosures.
Our most critical accounting estimates relate to impairment of long-lived assets and stock-based compensation. These estimates are critical as they require management judgment for inputs that are not observable. These estimates are developed based on historical experience and various other assumptions that we believe to be reasonable under the circumstances.
Our most critical accounting estimates relate to impairment of long-lived assets and stock-based compensation. These estimates require management’s judgment for inputs that are not observable. These estimates are developed based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual 46 Table of Contents results could differ significantly from our estimates.
Matching algorithms on these platforms as well as the extent of their merchant and end-customer participation in robotic delivery directly impacts the utilization rate of our robots, both of which can be challenging to predict. These uncertainties make demand difficult to forecast for us and our partners. Customer Concentration. We currently have a limited number of customers.
Matching algorithms on these platforms as well as the extent of their merchant and end-customer participation in robotic delivery directly impacts the utilization rate of our robots, both of which can be challenging to predict.
Supply Chain Constraints. We cannot be sure whether global supply chain shortages will impact our future robot build plans. In order to mitigate supply chain risks, we may need to incur higher costs to secure available inventory and place non-cancelable purchase commitments with our suppliers, which could introduce inventory risk if our forecasts and assumptions prove inaccurate.
In order to mitigate supply chain risks, we may need to incur higher costs to secure available inventory and place non-cancelable purchase 42 Table of Contents commitments with our suppliers, which could introduce inventory risk if our forecasts and assumptions prove inaccurate.
The expected term of our stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award.
The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award.
We have historically funded our operations from issuance of equity and debt securities, including our initial public offering in April 2024. To execute on our strategic initiatives to continue to grow our business, we may incur operating losses and generate negative cash flows from operations in the future, and as a result, we may require additional capital resources.
To execute on our strategic initiatives and continue growing our business, we may incur operating losses and generate negative cash flows from operations in the future, and as a result, we may require additional capital resources.
Daily active robots reflect our operation team’s capacity to have active robots in the field performing deliveries and/or generating branding revenues. We closely monitor and strive to increase our daily active robots efficiently as we improve our autonomy and resultant human-to-robot ratios and increase the number of merchants and brand advertisers on our platform.
We closely monitor and strive to efficiently increase our daily active robots as we improve our autonomy and resultant human-to-robot ratios and increase the number of merchants and brand advertisers on our platform. Daily Supply Hours .
As noted in our consolidated financial statements, as of December 31, 2024, we had an accumulated deficit of $107.53 million. 38 Table of Contents Results of Operations Comparison of Results of Operations for the Year ended December 31, 2024 and 2023 The following table summarizes our operating results as reflected in our statements of operations during the year ended December 31, 2024 and 2023, respectively, and provides information regarding the dollar and percentage increase (or decrease) during such periods.
Results of Operations Comparison of Results of Operations for the Years ended December 31, 2025 and 2024 The following table summarizes our operating results as reflected in our statements of operations during the years ended December 31, 2025 and 2024, respectively, and provides information regarding the dollar and percentage increase or decrease during such periods (in thousands).
Accordingly, these are the policies we believe are most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations. Revenue Recognition We account for revenue in accordance with ASC 606 – Revenue from Contracts with Customers (“ASC 606”).
We believe that the accounting policies described below involve a greater degree of judgment and complexity, and are most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations. Revenue Recognition The Company accounts for revenue in accordance with Accounting Standards Codification 606 , Revenue from Contracts with Customers (“ASC 606”).
As a practical expedient, we do not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less. To date, we have generated initial revenues from our delivery services as well as branding fees.
As a practical expedient, the Company does not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less. The Company recognizes revenue from its fleet services when the performance obligation is satisfied.
Key metrics We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions: Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Key Metrics (Unaudited) (Unaudited) (Unaudited) (Unaudited) Daily Active Robots 57 30 52 29 Daily Supply Hours 455 224 401 206 Daily Active Robots: We define daily active robots as the average number of robots performing daily deliveries during the period.
Key Metrics We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions: Three Months Ended December 31, Year Ended December 31, 2025 2024 2025 2024 Daily Active Robots 547 57 273 52 Daily Supply Hours 6,676 455 3,196 401 Daily Active Robots .
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion of the financial condition and results of operations of the Company should be read in conjunction with the financial statements and the notes to those statements included in this Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes included in Part II, Item 8. “ Financial Statements and Supplementary Data, ” of this Annual Report on Form 10-K.
We rely on patented and non-patented proprietary information relating to product development, manufacturing capabilities, and other core competencies of our business. Protection of intellectual property is critical. Therefore, steps such as additional patent applications, confidentiality, and non-disclosure agreements, as well as other security measures are important.
Protection of intellectual property is critical. Therefore, steps such as additional patent applications, confidentiality, and non-disclosure agreements, as well as other security measures are important.
Advertising costs are expensed as incurred and included in sales and marketing expenses. General and Administrative . General and administrative expenses primarily consist of personnel-related expenses for executive management and administrative functions, including finance and accounting, legal and human resources, as well as general corporate expenses and general insurance.
Research and Development Expenses Research and development expenses primarily consist of costs incurred by research and development functions. These costs are expensed as incurred. General and Administrative Expenses General and administrative expenses primarily consist of costs incurred by general and administrative functions, including executive management and administrative functions, including finance and accounting, legal and human resources.
It is important to note, however, that inflation can also serve as a tailwind that would accelerate the adoption of automated robotic last-mile delivery as labor becomes more expensive and drives up the cost of delivery by humans. Intellectual Property.
However, inflation can also serve as a tailwind that may accelerate the adoption of automated robotic last-mile delivery, as labor becomes more expensive and drives up the cost of delivery by humans. Intellectual Property We rely on patented and non-patented proprietary information relating to product development, manufacturing capabilities, and other core competencies of our business.
The gross proceeds to the Company from the Registered Direct Offering were approximately $80 million, before deducting the placement agents’ fees and other offering expenses payable by the Company. Public Offering and Uplisting to Nasdaq On April 17, 2024, we entered into an underwriting agreement with Aegis Capital Corp.
The gross proceeds to the Company from the Registered Direct Offering were approximately $80.0 million, before deducting the placement agents’ fees and other offering expenses payable by the Company.
For awards with service-based vesting conditions, we record the expense for using the straight-line method.
For awards with service-based vesting conditions, we record the expense using the straight-line method. For awards with performance-based vesting conditions, we record the expense if and when we conclude that it is probable that the performance condition will be achieved.
Inflation can lead to increased cost of material and labor for restaurants and merchants who may in turn raise prices on the item they sell and result in a reduction in demand for those items. To the extent inflation reduces economic activity and consumer demand for items we deliver, it could negatively impact our financial results.
Discretionary consumer spending can be impacted by general economic conditions, unemployment, consumer debt, inflation, gasoline prices, interest rates, consumer confidence and other macroeconomic factors. Inflation can lead to increased cost of material and labor for restaurants and merchants who may in turn raise prices on the items they sell and result in a reduction in demand for those items.
General and administrative expense increased $5.47 million to $10.09 million for the year ended December 31, 2024, compared with $4.62 million for the year ended December 31, 2023, due primarily to an increase in headcount of $0.85 39 Table of Contents million, stock-based compensation expense of $2.77 million, legal fees of $0.97 million and increased investor relations expenses of $0.39 million .
General and administrative expense increased by $27.0 million to $37.1 million for the year ended December 31, 2025, compared with $10.1 million for the year ended December 31, 2024, due primarily to an approximately 175% increase in 44 Table of Contents headcount, higher stock-based compensation expense, and increased professional fees largely related to acquisition activities.
Operations expense increased $0.72 million to $3.29 million for the year ended December 31, 2024, compared with $2.56 million for the year ended December 31, 2023, due primarily to an increase in headcount of $0.20 million and additional facility costs of $0.11 million.
Sales and marketing expenses increased by $2.3 million to $2.9 million for the year ended December 31, 2025, compared with $0.6 million for the year ended December 31, 2024. This increase was primarily due to an increase in headcount of approximately 365%.
For delivery services, we satisfy our performance obligation when the delivery is complete, which is the point in time control of the delivered product transfers to the customer. We recognize branding fees over time as performance obligations are completed over the term of the agreement. The Company recognizes revenue on its software services over time.
The fleet performs delivery services, branding services, and data monetization. For delivery services, the Company satisfies its performance obligation when the delivery is complete, which is the point in time control of the delivered product transfers to the customer.
Risk Factors of this report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
“Risk Factors,” for a discussion of factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this Annual Report on Form 10-K. Overview We are engaged in developing technologies intended to enable sustainable, autonomous robotic solutions for public spaces.
Actual results could differ significantly from the estimates made by management. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operation, and cash flows will be affected. We believe that the accounting policies described below involve a greater degree of judgment and complexity.
To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows may be affected.
Cost of revenues increased $0.16 million to $1.89 million for the year ended December 31, 2024, compared with $1.73 million for the year ended December 31, 2023, due primarily to an increase in headcount, partially offset by depreciation on robot assets in the prior year.
Cost of revenues increased by $16.1 million to $18.0 million for the year ended December 31, 2025, compared with $1.9 million for the year ended December 31, 2024, due primarily to the substantial expansion of our robot fleet, which drove an approximately 430% increase in headcount and an overall increase in scale-up related costs during the year.
The increase of $10.31 million was mainly due to robot build construction in-process. Financing Activities Net cash provided by financing activities was $155.12 million and $13.27 million for the years ended December 31, 2024 and 2023, respectively.
Financing Activities Net cash provided by financing activities was $261.2 million and $155.1 million for the years ended December 31, 2025 and 2024, respectively.
Research and development expense increased $14.31 million to $24.26 million for the year ended December 31, 2024, compared with $9.95 million for the year ended December 31, 2023, due primarily to an increase in stock-based compensation expense of $11.07 million and headcount of $2.21 million.
Research and development expense increased by $21.0 million to $45.3 million for the year ended December 31, 2025, compared with $24.3 million for the year ended December 31, 2024, due primarily to an increase in headcount of approximately 130%, higher software-related expenses driven by expanded cloud platform usage, and increased depreciation expense.
Financial Overview For the year ended December 31, 2024 and 2023, we generated revenues of $1.81 million and $0.21 million, respectively, and reported net loss of $39.19 million and $24.81 million, respectively.
Financial Overview For the year ended December 31, 2025 and 2024, we generated revenues of $2.7 million and $1.8 million, respectively, and reported net loss of $101.4 million and $39.2 million, respectively. As noted in our consolidated financial statements, as of December 31, 2025, we had an accumulated deficit of $208.9 million.
Cash Flows The following table summarizes our cash flows for the periods indicated: Twelve Months Ended December 31, 2024 2024 2023 Change Net cash (used in) provided by: Operating activities $ (21,542,229) $ (15,970,878) $ (5,571,351) Investing activities (10,317,987) (4,914) (10,313,073) Financing activities 155,119,897 13,266,829 141,853,068 (Decrease) increase in cash and cash equivalents $ 123,259,681 $ (2,708,963) $ 125,968,644 Operating Activities Net cash used in operating activities was $21.54 million and $15.97 million for the years ended December 31, 2024 and 2023, respectively.
Cash Flows The following table summarizes our cash flows for the periods indicated (in thousands): Year Ended December 31, 2025 2024 Change Net cash (used in) / provided by: Operating activities $ (80,241) $ (21,542) $ (58,699) Investing activities (197,999) (10,318) (187,681) Financing activities 261,212 155,120 106,092 (Decrease) / increase in cash and cash equivalents $ (17,028) $ 123,260 $ (140,288) Operating Activities Net cash used in operating activities was $80.2 million and $21.5 million for the years ended December 31, 2025 and 2024, respectively.
Interest expense, net increased $1.58 million to $0.68 million for the year ended December 31, 2024, compared with $2.26 million for the year ended December 31, 2023, due primarily to interest earned on bank deposits of $1.22 million and by the decrease of interest expense from the repayment of the outstanding notes.
Interest income increased by $6.0 million to $7.3 million for the year ended December 31, 2025, compared with $1.3 million for the year ended December 31, 2024, as a result of interest earned from cash on hand and marketable securities.
The increase in cash used for 2024 compared to 2023 was mainly due to the increase in net loss and increased stock based compensation. Investing Activities Net cash used in investing activities was $10.32 million and $0.00 million for the years ended December 31, 2024 and 2023, respectively.
Investing Activities Net cash used in investing activities was $198.0 million and $10.3 million for the years ended December 31, 2025 and 2024, respectively. The increase of $187.7 million was primarily due to $152.3 million of net purchases of marketable securities during the year, as well as, purchases of property and equipment related to fleet construction.
Starting in 2017, our core technology was developed by our co-founders and a majority of our product and engineering team in San Francisco, California as a special project within Postmates, one of the pioneering food delivery startups in the United States.
Our core technology originated in 2017 as a specialized project within Postmates, one of the pioneering food delivery startups in the United States. As of December 31, 2025, our fleet consisted of over 2,000 sidewalk delivery robots.
Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
Revenue is measured based on the consideration we expect to receive, which is based on the amount specified in the contract with our customer. Revenue is recognized when the performance obligations under the terms of the contract are satisfied, which generally occurs as control of the promised goods or services is transferred to customers.
The increase of $141.85 million was due to $77.60 million from Proceeds from issuance of common stock under the sales agreement and equity distribution agreement, net of offering costs, $35.85 million from proceeds of issuance of common stock pursuant to public offering, net of issuance costs, $17.12 million from proceeds from issuance of prefunded warrants to purchase common stock in connection with private placement, net of issuance costs, $22.45 million from proceeds from the exercise of warrants, partially offset by repayments of note payable and financinglease liability (as more fully described below).
The increase of $106.1 million was due to $170.8 million in proceeds from the issuance of common stock pursuant to a public offering, net of issuance costs, $78.7 million in proceeds from the issuance of pre-funded warrants to purchase common stock in connection with a private placement, net of issuance costs, and $11.4 million in proceeds from the exercise of warrants.
Cash and cash equivalents consisted of cash on deposit with banks as well as an institutional money market account. 40 Table of Contents We have generated significant operating losses from our operations as reflected in our accumulated deficit of $107.53 million as of December 31, 2024.
Liquidity and Capital Resources As of December 31, 2025, we had current assets of $241.1 million and current liabilities of $13.3 million, including $106.2 million in cash and cash equivalents. Cash and cash equivalents consisted of cash on deposit with banks as well as an institutional money market account.
For awards with performance-based vesting conditions, we record the expense if and when we conclude that it is probable that the performance condition will be achieved. 42 Table of Contents We classify stock-based compensation expenses in our statement of operations in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified.
We classify stock-based compensation expenses in our statements of operations in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model.
The increase of $5.57 million primarily consisted of a net loss of $39.19 million, adjusted for certain non-cash items, which primarily includes $14.55 million of non-cash stock-based compensation expense, $0.31 million of depreciation expense, and $1.68 million of amortization of debt discount.
The increase in cash used in operating activities of $58.7 million was primarily driven by a net loss of $101.4 million, adjusted for certain non-cash items, including $21.3 million of stock-based compensation expense, and $8.2 million of depreciation expense.
Factors and risks that could affect our results, future performance and capital requirements and cause them to materially differ from those contained in the forward-looking statements include those identified in the “Cautionary Note Regarding Forward-Looking Statements” and the Part 1, Item 1A.
In addition to our historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. You should review the sections titled “Cautionary Statement Regarding Forward-Looking Statements” and Part I, Item 1A.
The Company utilizes labor hours as a measure of progress to estimate the percentage of completion of the performance obligation at each reporting period. Service fees that have been invoiced or paid but performance obligations have not been met are recorded as deferred revenue. Stock-Based Compensation We account for stock-based compensation in accordance with ASC 718, Compensation - Stock Compensation.
The Company utilizes labor hours as a measure of progress to estimate the percentage of completion of the performance obligation at each reporting period. Due to the nature of certain performance obligations, the estimation of progress based on expected overall labor hours requires judgment. The consideration that we expect to receive may include both fixed and variable amounts.
Operations expenses primarily consist of costs for field operations personnel. Research and Development. Costs incurred in the research and development of the Company’s products are expensed as incurred. Research and development costs include product design, hardware and software costs. Sales and Marketing. Sales and marketing expenses include personnel costs and public relations expenses.
Operations Expenses Operations expenses primarily consist of costs incurred by field operations functions. Sales and Marketing Expenses Sales and marketing expenses primarily consist of costs incurred by sales and marketing functions.
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Some of the information contained in this discussion and analysis including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risk, uncertainties and assumptions. You should read Part I, Item 1A.
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Serve has developed an advanced, AI-powered robotics mobility platform that integrates proprietary hardware, AI, computer vision, and cloud-based fleet management software to enable autonomous operation in complex, real-world environments. We design, engineer, deploy, and operate low-emission robotic systems built on this platform. Serve is shaping the future of sustainable, self-driving delivery.
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Note about Forward-Looking Statements This Annual Report on Form 10-K includes statements that constitute “forward-looking statements.” These forward-looking statements are often characterized by the terms “may,” “believes,” “projects,” “intends,” “plans,” “expects,” or “anticipates,” and do not reflect historical facts.
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While food delivery remains our primary commercial application, we are expanding our platform into adjacent markets, customer segments, and operating environments where autonomous mobility can address labor constraints, improve service levels, and reduce emissions. We intend to leverage our core autonomy stack, fleet management infrastructure, and operational expertise to support additional use cases across both outdoor and indoor settings.
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Specific forward-looking statements contained in this portion of the report include, but are not limited to: (i) statements that are based on current projections and expectations about the markets in which we operate, (ii) statements about current projections and expectations of general economic conditions, (iii) statements about specific industry projections and expectations of economic activity, (iv) statements relating to our future operations, prospects, results, and performance, and (v) statements that the cash on hand and additional cash generated from operations together with potential sources of cash through issuance of debt or equity will provide the Company with sufficient liquidity for the next 12 months.
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We maintain platform-level integrations with major food delivery platforms, including Uber Eats and DoorDash, enabling real-time order dispatch, robot status updates, and operational coordination. In addition to delivery revenue, we are developing supplementary revenue streams, including on-robot advertising and branding, fleet data monetization, and software licensing opportunities.
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Forward-looking statements involve risks, uncertainties, and other factors, which may cause our actual results, performance, or achievements to be materially different from those expressed or implied by such forward-looking statements.
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We plan to extend our autonomous mobility platform into indoor environments, including healthcare and other commercial settings. These initiatives are intended to broaden our addressable market beyond outdoor food delivery and reflect our strategy to deploy our AI-enabled robotics platform across multiple verticals.
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Risk Factors in this report, as well as other factors that we are currently unable to identify or quantify, but that may exist in the future. In addition, the foregoing factors may generally affect our business, results of operations and financial position. Forward-looking statements speak only as of the date the statements were made.
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We expect to leverage complementary 40 Table of Contents technologies, domain expertise, and commercial relationships to enhance product capabilities, accelerate deployment opportunities, and support scalable, recurring revenue growth over time.
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We do not undertake and specifically decline any obligation to update any forward-looking statements. Any information contained on our website www.serverobotics.com or any other websites referenced in this report are not part of this report. Our Company We are on a mission to deliver a sustainable future by transforming how goods move among people.
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Recent Developments Securities Purchase Agreement (October 2025) On October 10, 2025, the Company entered into a securities purchase agreement with certain institutional investors pursuant to which the Company agreed to issue and sell, in a registered direct offering, an aggregate of 6,250,000 shares of the Company’s common stock, $0.0001 par value per share at a price of $16.00 per share.
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Serve has developed an advanced, AI-powered robotics mobility platform, with last-mile delivery in cities as its first application. We are an operating company which has experienced losses since our inception. Our sources of cash to date have been capital investments by stockholders. The following discussion contains forward-looking statements, as discussed above.
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The gross proceeds to the Company from the registered direct offering were approximately $100.0 million, before deducting the placement agents’ fees and other offering expenses payable by the Company. Acquisition of Vayu Robotics, Inc. On August 15, 2025, the Company acquired all of the issued and outstanding equity of Vayu, which was accounted for under the acquisition method of accounting.
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Please see the sections entitled “ Cautionary Note Regarding Forward-Looking Statements ” and Part I, Item 1A. Risk Factors in this report for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements.
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Refer to the “Liquidity and Capital Resources” section for discussion of the purchase price and the acquisition’s impact on the Company’s liquidity. Acquisition of Voysys AB On April 1, 2025, the Company acquired from Phantom Auto Inc. all of the issued and outstanding equity of Voysys AB (“Voysys”), which was accounted for under the acquisition method of accounting.
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Our principal offices are located at 730 Broadway, Redwood City, CA 94063, our telephone number is (818) 860-1352 and our corporate website (which does not form part of this report) is located at www.serverobotics.com. Overview On July 31, 2023, Patricia Acquisition Corp., Acquisition Sub, and Serve entered into a Merger Agreement.
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Refer to the “Liquidity and Capital Resources” section for discussion of the purchase price and the acquisition’s impact on the Company’s liquidity.
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Pursuant to the terms of the Merger Agreement, on the Closing Date, Acquisition Sub merged with and into Serve, with Serve continuing as the surviving corporation and our wholly owned subsidiary.
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These uncertainties make demand difficult to forecast for us and our partners. 41 Table of Contents Customer Concentration A significant portion of our revenue is concentrated with a limited number of customers.
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As a result of the Merger, we acquired the business of Serve and will continue the existing business operations of Serve as a public reporting company under the name Serve Robotics Inc. On the Closing Date, Serve’s predecessor was renamed Serve Operating Co.
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The following table represents the concentration of revenue for all customers that accounted for more than 10% of our revenues for the years ended December 31, 2025 and 2024: Year ended December 31, 2025 2024 Customer A sales as a percentage of total revenues 37 % 26 % Customer B sales as a percentage of total revenues 18 % 65 % A significant portion of our accounts receivable is concentrated with a limited number of customers.
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The Merger was treated as a recapitalization and reverse acquisition for us for financial reporting purposes, and Serve is considered the acquirer for accounting purposes.
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The following table represents the concentration of accounts receivable for all customers that account for more than 10% of our total accounts receivable as of December 31, 2025 and 2024: December 31, 2025 2024 Customer A receivables as a percentage of total accounts receivable 11 % 12 % Customer B receivables as a percentage of total accounts receivable N/A N/A Customer C receivables as a percentage of total accounts receivable 30 % N/A Customer D receivables as a percentage of total accounts receivable 18 % N/A Customer E receivables as a percentage of total accounts receivable N/A 86 % There are inherent risks whenever a large percentage of total revenues and accounts receivable are concentrated with a limited number of customers.
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As a result of the Merger and the change in our business and operations, a discussion of the past financial results of Patricia Acquisition Corp. is not pertinent, and under applicable accounting 34 Table of Contents principles, the historical financial results of Serve, the accounting acquirer, prior to the Merger are considered our historical financial results.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk We are a smaller reporting company, as defined in Rule 12b-2 under the Exchange Act, for this reporting period and are not required to provide the information required under this item. 43 Table of Contents
Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk We are a smaller reporting company, as defined in Rule 12b-2 under the Exchange Act, for this reporting period and are not required to provide the information required under this item. 49 Table of Contents

Other SERV 10-K year-over-year comparisons