Exhibit 99.1
ROBO.AI INC.
INTERIM REPORT FOR THE SIX MONTHS ENDED JUNE 30, 2025
PRELIMINARY NOTE
Our unaudited condensed consolidated financial statements as of and for the six months ended June 30, 2025 and June 30, 2024, included herein, are prepared in accordance with accounting principles generally accepted in the United States of America. These should be read in conjunction with our audited financial statements as of and for the year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission (the “SEC”) on our annual report on Form 20-F on June 10, 2025 (the “2024 Annual Report”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the 2024 Annual Report.
FORWARD-LOOKING STATEMENTS
This document contains statements that are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management’s beliefs and expectations as well as on assumptions made by and data currently available to management, appear in a number of places throughout this document and include statements regarding, amongst other things, results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which we operate. The use of words “expects,” “intends,” “anticipates,” “estimates,” “predicts,” “believes,” “should,” “potential,” “may,” “preliminary,” “forecast,” “objective,” “plan,” or “target,” and other similar expressions are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to a number of risks and uncertainties that could cause actual results to differ materially, including, but not limited to statements regarding our intentions, beliefs or current expectations concerning, among other things, results of operations, financial condition, liquidity, prospects, growth, strategies, future market conditions or economic performance and developments in the capital and credit markets and expected future financial performance, and the markets in which we operate.
Forward-looking statements involve a number of risks, uncertainties and assumptions, and actual results or events may differ materially from those projected or implied in those statements. Important factors that could cause such differences include, but are not limited to:
| ● | the ability to maintain the listing of Robo.ai Inc.’s securities on the Nasdaq Capital Market; |
| ● | our market opportunity and our ability to acquire new customers and retain existing customers; |
| ● | our ability to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, and changing client needs, requirements or preferences; |
| ● | the timing and impact of our growth initiatives on our future financial performance; |
| ● | the occurrence of one or more high profile accidents by autonomous driving vehicles that result in lower customer demand or more stringent regulations in one or more jurisdictions in which we intend to operate; |
| ● | our ability to execute our business model, including market acceptance of our planned products and services and achieving sufficient production volumes at acceptable quality levels and prices; |
| ● | alternative autonomous driving products and technological improvements by our peers and competitors; |
| ● | our ability to raise capital; |
| ● | the possibility that we may be adversely affected by other economic, business and/or competitive factors, which might be beyond our control; |
| ● | changes in applicable laws or regulations; and |
| ● | all other risks and uncertainties described in “Item 3. Key Information —D. Risk Factors” and “Item 5. Operating and Financial Review and Prospects” in our 2024 Annual Report. |
In addition to the foregoing factors, you should also carefully consider the other risks and uncertainties described under “Item 3. Key Information – D. Risk Factors” in our 2024 Annual Report, as well as in other documents filed by us from time to time with the SEC.
We operate in a rapidly evolving environment. New risks emerge from time to time and it is impossible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking statement.
2
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the related notes contained in our 2024 Annual Report. This report, including the discussion below, concerns our unaudited condensed consolidated financial information as of June 30, 2025 and for the six months ended June 30, 2025 and 2024. The discussion of our financial information for the years ended December 31, 2024, 2023 and 2022 is included in our 2024 Annual Report. The following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs that involve risks and uncertainties. See the section titled “Forward-looking Statements” in this document for cautions about forward-looking statements.
Results of Operations
The following tables set forth a summary of the Company’s unaudited condensed consolidated results of operations for the periods presented. The operating results in any period are not necessarily indicative of the results that may be expected for any future period.
| For the Six
Months Ended | ||||||||
| June 30, | ||||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| (In USD in thousands) | ||||||||
| Net revenue | $ | 864 | $ | 7,117 | ||||
| Cost of revenues | (1,549 | ) | (8,265 | ) | ||||
| Gross loss | (685 | ) | (1,148 | ) | ||||
| Operating expenses: | ||||||||
| General and administrative expenses | (5,324 | ) | (12,850 | ) | ||||
| Selling expenses | (315 | ) | (865 | ) | ||||
| Research and development expenses | (34 | ) | (2,133 | ) | ||||
| Total operating expenses | (5,673 | ) | (15,848 | ) | ||||
| Loss from operations | (6,358 | ) | (16,996 | ) | ||||
| Other loss, net: | ||||||||
| Other income (expenses), net | 6,603 | (557 | ) | |||||
| Interest (expense) income, net | (2,551 | ) | 21 | |||||
| Financial expenses | - | (15,000 | ) | |||||
| Changes in fair value of derivative warrant liabilities | (45 | ) | (153 | ) | ||||
| Total other income (loss) | 4,007 | (15,689 | ) | |||||
| Loss before income tax provision | (2,351 | ) | (32,685 | ) | ||||
| Income tax provision | - | - | ||||||
| Net loss | $ | (2,351 | ) | $ | (32,685 | ) | ||
Comparison of the Six Months Ended June 30, 2025 and 2024
Net Revenue
Net revenue for the six months ended June 30, 2025 and 2024 were US$0.9 million and US$7.1 million, respectively, with a decrease of US$6.2 million, or 87.9%, primarily due to discontinuation of our Rabdan-branded vehicle line and intense market competition.
3
Cost of Revenues
Our cost of revenues decreased by US$6.8 million, or 81.3%, from US$8.3 million for the six months ended June 30, 2024 to US$1.5 million for the six months ended June 30, 2025, primarily attributable to the decrease of revenue.
General and Administrative Expenses
The Company’s general and administrative expenses decreased by approximately 58.6%, from US$12.9 million for the six months ended June 30, 2024, to US$5.3 million for the six months ended June 30, 2025. This decrease was primarily attributable to the overall downsizing of the Company’s operations, resulting in (i) a reduction of US$5.7 million in payroll expenses, (ii) a decrease of US$0.7 million in office expenses, and (iii) a decrease of US$0.6 million in rental expenses, partially offset by (iv) a reversal of credit losses of US$0.4 million recognized for the six months ended June 30, 2025.
Selling Expenses
Our selling expenses decreased by US$0.6 million, or 63.6%, from US$0.9 million for the six months ended June 30, 2024 to US$0.3 million for the six months ended June 30, 2025, primarily attributable to our business downsizing in 2025 resulting in the decrease in payroll expenses, freight expenses and marketing and promotional expenses.
Research and Development Expenses
The Company’s research and development expenses decreased by approximately 98.4%, from US$2.1 million for the six months ended June 30, 2024 to US$33,985 for the six months ended June 30, 2025, primarily due to lower expenses related to vehicle development, as well as a decrease in R&D related payroll expenses as result of decrease in the number of R&D staffs during the period.
Loss from Operations
As a result of the foregoing, the Company’s loss from operations increased by approximately 62.6%, from US$17.0 million for the six months ended June 30, 2024 to US$6.4 million for the six months ended June 30, 2025.
Other Income (expenses), net
The Company recorded net other income of US$6.6 million for the six months ended June 30, 2025, primarily due to a gain of approximately US$5.8 million arising from the resolution of a legal dispute. In comparison, the Company recorded net other expenses of US$0.6 million for the six months ended June 30, 2024, mainly attributable to interest accrued on enforcement payments and expenses recognized in connection with legal disputes.
Interest (expense) income, net
Our net interest expense was US$2.6 million for the six months ended June 30, 2025, compared with a net interest income of approximately US$0.02 million for the same period in 2024, primarily due to interest accrued on overdue loans from a third party in 2025.
Financial Expenses
Financial expenses were nil and US$15.0 million for the six months ended June 30, 2025 and 2024, which represented a 15% guaranteed annual return on a PIPE investment that be obligated by several shareholders of the Company. Please see Note 7 PIPE Escrow Account to our unaudited condensed consolidated financial statements in this report for details.
4
Net Loss
As a result of the foregoing, the Company incurred a net loss of US$2.4 million and US$32.7 million for the six months ended June 30, 2025 and 2024, respectively, representing a decrease in net loss of approximately 92.8%.
Going Concern
The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. For the six months ended June 30, 2025 and 2024, the Company incurred significant and recurring operating losses of US$2.4 million and US$32.7 million, and the negative cash flows from operating activities of approximately US$1.0 million and US$21.4 million, respectively. Additionally, the Company reported an accumulated deficit of approximately US$739.3 million as of June 30, 2025, as compared to US$737.0 million as of December 31, 2024.
In addition to the deteriorating cash position and ongoing losses, the Company remains dependent on external sources of financing, which may not be available on acceptable terms or in sufficient amounts, if at all. Furthermore, the Company is exposed to unresolved litigation and guarantee obligations that may further strain its limited financial resources.
While management has disclosed intentions to secure additional financing and reduce expenditures, no definitive arrangements have been executed, and no viable pathway to financial stability has been demonstrated. In light of these conditions and absent the successful execution of a comprehensive restructuring or financing strategy in the near term, the Company does not appear to have the ability to meet its obligations as they become due within one year after the date the financial statements are issued. Accordingly, substantial doubt about the Company’s ability to continue as a going concern is not alleviated.
The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
5
ROBO.AI INC.
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
F-1
ROBO.AI
INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In U.S. dollars in thousands, except for share and per share data, or otherwise noted)
| As of | ||||||||
| June 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Advance to suppliers | ||||||||
| Inventories, net | ||||||||
| Prepaid expenses and other current assets, net | ||||||||
| Total current assets | ||||||||
| Non-current assets: | ||||||||
| Property and equipment, net | ||||||||
| Intangible assets, net | ||||||||
| Operating lease right-of-use asset | ||||||||
| Total non-current assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| Liabilities | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | ||||||||
| Advance from customers | ||||||||
| Loans from a third party | ||||||||
| Warrant liabilities | ||||||||
| Amounts due to related parties | ||||||||
| Accrued expenses and other current liabilities | ||||||||
| Lease liabilities, current | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities: | ||||||||
| Lease liabilities, non-current | ||||||||
| Total non-current liabilities | ||||||||
| TOTAL LIABILITIES | ||||||||
| Shareholders’ equity | ||||||||
| Class A Ordinary shares* (par value of US$ | ||||||||
| Class B Ordinary Shares* (par value of US$ | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Robo.ai Shareholders’ equity | ( | ) | ( | ) | ||||
| Non-controlling interests | ( | ) | ( | ) | ||||
| Total Shareholders’ equity | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-2
ROBO.AI
INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS
(In U.S. dollars in thousands, except for share and per share data, or otherwise noted)
| For
the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| Net revenue | $ | $ | ||||||
| Cost of revenues | ( | ) | ( | ) | ||||
| Gross loss | ( | ) | ( | ) | ||||
| Operating expenses: | ||||||||
| General and administrative expenses | ( | ) | ( | ) | ||||
| Selling expenses | ( | ) | ( | ) | ||||
| Research and development expenses | ( | ) | ( | ) | ||||
| Total operating expenses | ( | ) | ( | ) | ||||
| loss from operations | ( | ) | ( | ) | ||||
| Other loss, net: | ||||||||
| Other income (expenses), net | ( | ) | ||||||
| Interest income, net | ( | ) | ||||||
| Financial expenses | ( | ) | ||||||
| Changes in fair value of derivative warrant liabilities | ( | ) | ( | ) | ||||
| Total other income (loss) | ( | ) | ||||||
| Loss before income tax provision | ( | ) | ( | ) | ||||
| Income tax provision | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Less: Net loss contributed to noncontrolling interests from continuing operations | ( | ) | ( | ) | ||||
| Net loss attributable to shareholders | ( | ) | ( | ) | ||||
| Other comprehensive loss | ||||||||
| Foreign currency translation loss | ( | ) | ( | ) | ||||
| Total comprehensive loss | $ | ( | ) | $ | ( | ) | ||
| Loss per ordinary share attributable to shareholders | ||||||||
| Basic and Diluted | ( | ) | ( | ) | ||||
| Weighted average number of ordinary shares outstanding | ||||||||
| Basic and Diluted | ||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-3
ROBO.AI INC.
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN
SHAREHOLDERS’ EQUTY (DEFICIT)
(In U.S. dollars in thousands, except for share and per share data, or otherwise noted)
| Class A Ordinary shares | Class B Ordinary shares | Additional paid-in | Accumulated | Accumulated other comprehensive | Total Company’s equity | Non-controlling | Total shareholders’ equity | |||||||||||||||||||||||||||||||||
| Share | Amount | Share | Amount | capital | deficit | loss | (deficit) | interests | (deficit) | |||||||||||||||||||||||||||||||
| Balance as of December 31, 2023 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||||||||||
| Net loss | - | - | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Foreign currency translation | - | - | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Contribution from shareholders | - | - | ||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2024 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | ( | ) | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Foreign currency translation | - | - | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | ( | ) | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-4
ROBO.AI
INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. dollars in thousands, except for share and per share data, or otherwise noted)
| For
the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Amortization of operating lease right-of-use asset | ||||||||
| Changes in fair value of warrant liabilities | ||||||||
| Disposal loss of property and equipment | ||||||||
| Inventory write-downs | ||||||||
| Reversal of expected credit losses | ( | ) | ||||||
| Impairment loss | ||||||||
| Financial expenses on PIPE | ||||||||
| Interests on loans from a third party | ||||||||
| Loss of early termination of operating lease | ||||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable, current | ( | ) | ||||||
| Advance to supplier | ||||||||
| Inventories | ||||||||
| Prepaid expenses and other current assets | ( | ) | ||||||
| Amounts due from/due to related parties | ||||||||
| Operating lease | ( | ) | ( | ) | ||||
| Accounts payable | ( | ) | ( | ) | ||||
| Accrued expenses and other current liabilities | ( | ) | ( | ) | ||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Purchases of property and equipment | ( | ) | ||||||
| Proceeds from disposal of property and equipment | ||||||||
| Loan to related parties | ( | ) | ||||||
| Net cash provided by (used in) investing activities | | ( | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Loan proceeds from related parties | ||||||||
| Repayments of loan from related parties | ( | ) | ||||||
| Loan proceeds from a third party | ||||||||
| Net cash provided by financing activities | | |||||||
| Effect of exchange rate changes | | |||||||
| Net increase (decrease) in cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents and restricted cash, at beginning of the period | ||||||||
| Cash and cash equivalents and restricted cash, at end of the period | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURE OF NON CASH FLOW INFORMATION: | ||||||||
| Expenses paid by a third party on behalf of the Company | ||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Interest paid | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-5
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
1. ORGANIZATION AND PRINCIPAL ACTIVITIES
ICONIQ HOLDING LIMITED (“ICONIQ”) was incorporated under the laws of the Cayman Islands on March 11, 2021 as an exempted company with limited liability.
On April 15, 2022, ICONIQ entered into a business combination agreement, as amended on September 28, 2022 (the “Business Combination Agreement”), with (i) East Stone Acquisition Corporation, a British Virgin Islands business company (“East Stone”), (ii) Navy Sail International Limited, a British Virgin Islands company, in the capacity as the representative of East Stone and the shareholders of East Stone immediately prior to Closing (as defined below) from and after the Closing, (iii) Robo.ai Inc. (“Robo.ai,” formerly known as NWTN Inc., the “Company” or “Pubco”), an exempted company incorporated with limited liability in the Cayman Islands, (iv) Muse Merger Sub I Limited, an exempted company incorporated with limited liability in the Cayman Islands and a wholly-owned subsidiary of the Pubco (the “First Merger Sub”), and (v) Muse Merger Sub II Limited, a British Virgin Islands business company and a wholly-owned subsidiary of Pubco (the “Second Merger Sub”).
Pursuant to the Business Combination Agreement, subject to the terms and conditions set forth therein, at the closing of the transactions contemplated by the Business Combination Agreement (the “Closing”), (a) the First Merger Sub will merge with and into the Company (the “First Merger”), with the Company surviving the First Merger as a wholly-owned subsidiary of Pubco and the outstanding shares of the Company being converted into the right to receive shares of Pubco; and (b) the Second Merger Sub will merge with and into East Stone (the “Second Merger”, and together with the First Merger, the “Mergers”), with East Stone surviving the Second Merger as a wholly-owned subsidiary of the Pubco and the outstanding securities of East Stone being converted into the right to receive substantially equivalent securities of the Pubco (the Mergers together with the other transactions contemplated by the Business Combination Agreement and other ancillary documents, the “Transactions”).
The Company and its subsidiaries primarily engage in smart electric vehicles design and development through its direct or indirectly owned subsidiaries (collectively, the “Group”) in the People’s Republic of China (“PRC” or “China”).
Reverse recapitalization
On November 11, 2022 (the “Closing Date”), East stone and NWTN consummated the closing of the Transaction of East Stone and NWTN, following the approval at a Special Meeting of the shareholders on November 10, 2022. Following the consummation of the Transaction, ICONIQ as a wholly-owned subsidiary of NWTN and the outstanding shares of ICONIQ being converted into the right to receive shares of NWTN, the combined company will retain the NWTN name.
ICONIQ
was determined to be the accounting acquirer given ICONIQ effectively controlled the combined entity after the transaction. The transaction
is not a business combination because East Stone was not a business. The transaction is accounted for as a reverse recapitalization,
which is equivalent to the issuance of shares by ICONIQ for the net monetary assets of the Company, accompanied by a recapitalization.
ICONIQ is determined as the accounting acquirer and the historical financial statements of ICONIQ became the Company’s historical
financial statements, with retrospective adjustments to give effect of the reverse recapitalization. All of the Class A ordinary shares
of ICONIQ that were issued and outstanding immediately prior to the First Merger were cancelled and converted into an aggregate of
The
par value of ordinary shares remained US$
F-6
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
1. ORGANIZATION AND PRINCIPAL ACTIVITIES (cont.)
History of the Group and Reorganization
The Company commenced its operations through Tianjin Tianqi Group Co., Ltd (“Tianqi Group”) in 2017.
In preparation for its IPO, the Group completed a reorganization (the “Reorganization”) on January 19, 2022, which involved the following steps:
| ● | Formation of ICONIQ, ICONIQ Motors Limited, ICONIQ Global Limited, ICONIQ (Tianjin) Investment Co. Ltd (“WFOE”), ICONIQ Green Technology FZCO (“FZCO”), ICONIQ (Tianjin) Motors Ltd. and |
| ● | WFOE obtaining |
The shareholders and their respective equity interests in the entities remain similar immediately before and after the capital injection in Tianqi Group. Accordingly, the Reorganization has been treated as a corporate restructuring (reorganization) of entities under common control and thus the current capital structure has been retroactively presented in prior periods as if such structure existed at that time, the entities under common control are presented on a combined basis for all periods to which such entities were under common control.
As of June 30, 2025, the details of the Company’s subsidiaries are as follows.
| Name | Date of Incorporation | Place of incorporation | Percentage of ownership | Principal Activities | ||||
| ICONIQ | ||||||||
| FZCO | ||||||||
| NWTN Technology USA INC. | ||||||||
| NWTN Automobile Cars Trading Sole Proprietary LLC | ||||||||
| NWTN Technologies Industries Solo Proprietorship L.L.C. | ||||||||
| ICONIQ Motors Limited | ||||||||
| ICONIQ Global Limited | ||||||||
| Suez Top Ventures Limited | ||||||||
| ICONIQ (Tianjin) Investment Co. Ltd (“WFOE”) | ||||||||
| ICONIQ (Tianjin) Motors Co., Ltd. | ||||||||
| NWTN (Zhejiang) Motors Limited (“NWTN Zhejiang”) | ||||||||
| NWTN Smart Motors Shenzhen New Technology Limited | ||||||||
| Tianqi Group | ||||||||
| Shanghai Zunyu Automobile Sales Co., Ltd. (“Shanghai Zunyu”) | ||||||||
| Shanghai ICONIQ New Energy Development Co., Ltd. (“Shanghai ICONIQ”) | ||||||||
| Tianjin Tianqi New Energy Automobile Co., Ltd. (“Tianjin Tianqi”) | ||||||||
| East Stone |
F-7
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
2. GOING CONCERN
The
accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a
going concern. For the six months ended June 30, 2025 and 2024, the Company incurred significant and recurring operating losses of
US$
In addition to the deteriorating cash position and ongoing losses, the Company remains dependent on external sources of financing, which may not be available on acceptable terms or in sufficient amounts, if at all. Furthermore, the Company is exposed to unresolved litigation and guarantee obligations that may further strain its limited financial resources.
While management has disclosed intentions to secure additional financing and reduce expenditures, no definitive arrangements have been executed, and no viable pathway to financial stability has been demonstrated. In light of these conditions and absent the successful execution of a comprehensive restructuring or financing strategy in the near term, the Company does not appear to have the ability to meet its obligations as they become due within one year after the date the financial statements are issued. Accordingly, substantial doubt about the Company’s ability to continue as a going concern is not alleviated.
The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
| (a) | Basis of presentation and principles of consolidation |
The unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. Certain information and footnote disclosures normally included in financial statements prepared in conformity with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these statements should be read in conjunction with the Company’s audited consolidated financial statements for the years ended December 31, 2024 and 2023.
In the opinion of the management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which are necessary for a fair presentation of financial results for the interim periods presented. The Company believes that the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements have been prepared using the same accounting policies as used in the preparation of the Company’s consolidated financial statements for the year ended December 31, 2024. The results of operations for the six months ended June 30, 2025 are not necessarily indicative of the results for the full year.
Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors.
All intercompany transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.
A non-controlling interest is recognized to reflect the portion of the subsidiaries’ equity which is not attributable, directly or indirectly, to the Group. Non-controlling interests are presented as a separate component of equity on the consolidated balance sheet and net income and other comprehensive income are attributed to controlling and non-controlling interests respectively.
| (b) | Use of estimates |
The preparation of the unaudited condensed consolidated financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, related disclosures of contingent assets and liabilities at the balance sheet date, and the reported revenues and expenses during the reported periods in the unaudited condensed consolidated financial statements and accompanying notes. Significant accounting estimates include, but not limited to, assessment for impairment of long-term investments, long-lived assets and intangible assets, write-down for inventories, allowance for expected credit loss, warrant liabilities, as well as the realization of deferred income tax assets. Changes in facts and circumstances may result in revised estimates. Actual results could differ from those estimates, and as such, differences may be material to the unaudited condensed consolidated financial statements.
| (c) | Inventories |
Inventories, consisting of smart electric vehicles and auto parts and materials purchased by the Group, are stated at the lower of cost or net realizable value, with net realized value represented by estimated selling prices in the ordinary course of business, less reasonably predictable costs of disposal and transportation. Cost of inventory is determined using the weighted average cost method. Adjustments are recorded to write down the cost of inventory to the estimated net realizable value due to slow-moving merchandise and damaged products, which is dependent upon factors such as historical and forecasted consumer demand, as well as the aging of inventory.
F-8
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| (d) | Property and equipment, net |
Property
and equipment are stated at cost less accumulated depreciation and impairment, if any, and depreciated on a straight-line basis over
the estimated useful lives of the assets. Cost represents the purchase price of the asset and other costs incurred to bring the asset
into its intended use.
| Category | Estimated useful lives | |
| Electronic equipment | ||
| Vehicles | ||
| Production facilities | ||
| Battery and charging swap infrastructure | ||
| Furniture | ||
| Leasehold improvement |
Repair and maintenance costs are charged to expenses as incurred, whereas the cost of renewals and betterment that extends the useful lives of property and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the costs, accumulated depreciation and impairment with any resulting gain or loss recognized in the unaudited condensed consolidated statements of operations and comprehensive loss.
| (e) | Impairment of long-lived assets |
The Group reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. When these events occur, the Group measures impairment by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group would recognize an impairment loss, which is the excess of carrying amount over the fair value of the assets, using the expected future discounted cash flows.
| (f) | Fair value measurement |
Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.
Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs are:
| ● | Level 1 — Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. |
| ● | Level 2 — Include other inputs that are directly or indirectly observable in the marketplace. |
| ● | Level 3 — Unobservable inputs which are supported by little or no market activity. |
Accounting guidance also describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach, (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities.
The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset.
F-9
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
The Group’s financial assets and liabilities primarily include cash and cash equivalent, other receivables (included in prepayments and other current assets), equity investments, accounts payable, loan from a third party, warrant liabilities, amounts due to related parties, and other payables (included in accrued expenses and other current liabilities).
The warrant liabilities and certain equity investments are measured at fair value on a recurring basis using significant unobservable inputs and are therefore classified within Level 3 of the fair value hierarchy in accordance with ASC 820.
The Group’s non-financial assets, such as property and equipment as well as intangible assets, would be remeasured at fair value only if they were determined to be impaired.
The following table details the fair value measurements of liabilities that were measured at fair value on a recurring basis based on the following three-tiered fair value hierarchy per ASC 820, Fair Value Measurement, as of June 30, 2025 and December 31, 2024.
| Fair Value Measurement using | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total
fair value | |||||||||||||
| Warrant liabilities: | ||||||||||||||||
| As of June 30, 2025 | $ | |||||||||||||||
| As of December 31, 2024 | $ | $ | $ | $ | ||||||||||||
As
of June 30, 2025 and December 31, 2024, the fair value of the Private Warrants were US$
| Private Warrants | Representative Warrants | |||||||
| Fair value as of December 31, 2024 | ||||||||
| Change in fair value | ||||||||
| Fair value as of June 30, 2025 | ||||||||
F-10
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| (g) | Warrants |
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks.
Management evaluates all of its financial instruments, including issued warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and ASC 815-15. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. In accordance with ASC 825-10 “Financial Instruments”, offering costs attributable to the issuance of the warrant liabilities are recognized in the unaudited condensed consolidated statements of operations and comprehensive loss as incurred.
The
Group issued
(h) Current expected credit loss
On January 1, 2023, the Group adopted ASC 326, Financial Instruments—Credit Losses, which requires recognition of allowances upon origination or acquisition of financial assets at an estimate of expected credit losses over the contractual term of the financial assets (the current expected credit loss or the “CECL” model) using the modified retrospective transition method.
The Group’s financial assets subject to the CECL model mainly include accounts receivable, amounts due from related parties and prepaid expenses and other current assets.
For accounts receivable, the Group estimates the loss rate based on historical experience, the age of the receivable balances, credit quality of its customers, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect its ability to collect from customers. For advances to suppliers, amounts due from related parties and prepaid expenses and other current assets, we review them on a periodic basis and make allowances on an individual basis when there is doubt as to the collectability. These amounts are written off after all collection efforts have been exhausted.
For the six months ended June 30, 2025, reversal of expected credit losses made by the Group were shown as follows:
| For
the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Allowance for expected credit losses for accounts receivable, current | $ | $ | ||||||
| Reversal of expected credit losses for amounts due from related parties | ( | ) | ||||||
| Total | $ | ( | ) | $ | ||||
| (i) | Commitments and contingencies |
In the normal course of business, the Group is subject to commitments and contingencies, including operating lease commitments, legal proceedings and claims arising out of its business that relate to a wide range of matters, such as government investigations and tax matters. The Group recognizes a liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Group may consider many factors in making these assessments on liability for contingencies, including historical and the specific facts and circumstances of each matter.
F-11
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| (j) | Revenue recognition |
Effective January 1, 2023, the Group adopted Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606), using the modified retrospective method. As the Group did not have any revenue transactions in periods prior to adoption, there was no impact on the historical financial statements and no cumulative adjustment to the opening balance of retained earnings.
The Group’s revenues are generated from sales of smart electric vehicles and auto parts and materials.
The Group recognizes revenues pursuant to ASC 606, Revenue from Contracts with Customers (“ASC 606”). In accordance with ASC 606, revenues from contracts with customers are recognized when control of the promised goods or services is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those goods or services, reduced by value added tax (“VAT”). To achieve the core principle of this standard, the Group applies the following five steps:
| 1. | Identification of the contract, or contracts, with the customer; |
| 2. | Identification of the performance obligations in the contract; |
| 3. | Determination of the transaction price; |
| 4. | Allocation of the transaction price to the performance obligations in the contract; and |
| 5. | Recognition of the revenue when, or as, a performance obligation is satisfied. |
The Group recognizes revenues pursuant to ASC 606, Revenue from Contracts with Customers (“ASC 606”). In accordance with ASC 606, revenues from contracts with customers are recognized when control of the promised smart electric vehicles is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those products net of business tax and value added tax. Revenue recognition policy for the revenue stream is as follows:
Sales of smart electric vehicles
The Group generates revenue from sales of smart electric vehicles through purchase orders. The Group identified only one performance obligation to provide customers with vehicles, at a fixed price stated in the purchase orders. Full prepayment is required before or upon the Group’s delivery of the vehicles. Revenue is recognized at a point of time upon the customer’s acceptance of the smart electric vehicles. The Group is deemed as the principal, recognizing revenue on a gross basis as the Group is primary responsible for fulfilling the contract, bears the inventory risk, and has the discretion in establishing the sales price.
In the normal course of business, the Group’s warranties are required by the law and related to the risk of purchasing defective products. In addition, the Group would not sell a warranty separately. Accordingly, warranty costs are treated as a cost of fulfillment subject to accrual, rather than a performance obligation. The Group recognize the warranty when actual repair or replacement incur as the amount of loss cannot be reasonably estimated due to the very short experience in sales of vehicles.
In the instance that a customer selects to pay by installments for vehicles under an auto financing program provided to the customers by the Group, such arrangement contains a significant financing component and as a result, the transaction price is adjusted to reflect the impact of time value of the transaction price using an applicable discount rate (i.e. the interest rates of the loan reflecting the credit risk of the borrower). Interest income from such arrangements with a significant financing component is presented as other income. Receivables related to the vehicle installment payment are expected to be repaid by customers beyond one year of the dates of the financial statements are recognized as non-current assets. The difference between the gross receivable and the respective present value is recorded as unearned interest income. Interest income from such arrangements with a significant financing component is presented separately from revenue from contracts with customers.
Sales of auto parts and materials
The Group generates revenue from sales of auto parts and materials through purchase orders. The Group considers that there is only one performance obligation to provide customers the specific materials explicitly stated in a sales contract under ASC 606. The transaction price is explicitly agreed on contracts and fixed without any variable consideration. The Group recognizes revenues at a point in time when the control of the auto parts and materials is transferred to the customer upon the customer’s pickup and acceptance of auto parts and materials.
F-12
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| (k) | Income taxes |
The Group accounts for income taxes under ASC 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.
The
provisions of ASC 740-10-25, “Accounting for Uncertainty in Income Taxes,” prescribe a more-likely-than-not threshold
for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This
interpretation also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred
income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The
Group’s operating subsidiaries in PRC are subject to examination by the relevant tax authorities. According to the PRC Tax Administration
and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computational errors made by
the taxpayer or the withholding agent. The statute of limitations is extended to five years under special circumstances, where the
underpayment of taxes is more than RMB
The
Group accrued income tax payable of US$
| (l) | Foreign currency transactions and translations |
The functional and reporting currency of the Company is the United States Dollar (“US$”). The Company’s operating subsidiaries in China, Dubai and the United States use their respective currencies Renminbi (“RMB”), United Arab Emirates Dirham (“AED”), and US$ as their functional currencies.
The results of operations and the unaudited condensed consolidated statements of cash flows denominated in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currency is translated at the historical rate of exchange at the time of capital contribution. Because cash flows are translated based on the average translation rate, amounts related to assets and liabilities reported on the unaudited condensed consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the unaudited condensed consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive loss included in unaudited condensed consolidated statements of changes in shareholders’ equity/(deficit). Gains and losses from foreign currency transactions are included in the financial expenses in unaudited condensed consolidated statements of operations and comprehensive loss.
The following table outlines the currency exchange rates that were used in creating the unaudited condensed consolidated financial statements:
| As of June 30, | As of December 31 | |||||||
| Balance sheet items, except for equity accounts | 2025 | 2024 | ||||||
| US$ against RMB | ||||||||
| US$ against AED | ||||||||
F-13
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| For
the six months ended June 30, |
||||||||
| Items in the statements of operations and comprehensive loss, and statements of cash flows | 2025 | 2024 | ||||||
| US$ against RMB | ||||||||
| US$ against AED | ||||||||
No representation is made that the RMB and AED amounts could have been, or could be, converted into U.S. dollars at the rates used in translation.
| (m) | Loss per share |
Basic loss per share is computed by dividing net loss attributable to ordinary shareholders, taking into consideration the deemed dividends to preferred shareholders (if any), by the weighted average number of ordinary shares outstanding during the year using the two-class method. Under the two-class method, net income is allocated between ordinary shares and other participating securities based on their participating rights. Shares issuable for little to no consideration upon the satisfaction of certain conditions are considered as outstanding shares and included in the computation of basic loss per share as of the date that all necessary conditions have been satisfied. Net losses are not allocated to other participating securities if based on their contractual terms they are not obligated to share the losses.
Diluted loss per share is calculated by dividing net loss attributable to ordinary shareholders, as adjusted for the effect of dilutive ordinary equivalent shares, if any, by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the year. Ordinary equivalent shares consist of ordinary shares issuable upon the conversion of the preferred shares, using the if-converted method, and shares issuable upon the exercise of share options using the treasury stock method. Ordinary equivalent shares are not included in the denominator of the diluted loss per share calculation when inclusion of such share would be anti-dilutive.
| (n) | Segment reporting |
The
Group uses the management approach in determining its operating segments. The Group’s chief operating decision maker (“CODM”)
identified as the Group’s Chief Executive Officer, relies upon the consolidated results of operations as a whole when making decisions
about allocating resources and assessing the performance of the Group. As a result of the assessment made by CODM, the Group has only
Geographic information
The
majority of the Group’s long-lived assets as of June 30, 2025 and December 31, 2024, were located in the Mainland China, the United
States, the United Arab Emirates.
| As of | ||||||||
| June 30, 2025 | December 31, 2024 | |||||||
| (Unaudited) | ||||||||
| The United States | $ | $ | ||||||
| The United Arab Emirates | ||||||||
| Mainland China | ||||||||
| Total | $ | $ | ||||||
Long-lived assets as presented above include property and equipment, intangible assets, and right-of-use assets. The disclosure also includes certain non-tangible and financial assets (e.g., PIPE escrow account) for informational purposes, although these are not classified as long-lived assets under ASC 280.
F-14
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)
| (o) | Recent accounting pronouncements |
The Group is an “emerging growth company” (“EGC”) as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, EGC can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies.
In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” The amendments in this ASU are intended to improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. This ASU requires disclosure of significant segment expenses that are regularly provided to the chief operating decision mark (CODM), an amount for other segment items by reportable segment and a description of its composition, all annual disclosures required by FASB ASU Topic 280 in interim periods as well, and the title and position of the CODM and how the CODM uses the reported measures. Additionally, this ASU requires that at least one of the reported segment profit and loss measures should be the measure that is most consistent with the measurement principles used in an entity’s combined financial statements. Lastly, this ASU requires public business entities with a single reportable segment to provide all disclosures required by these amendments in this ASU and all existing segment disclosures in Topic 280. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied retrospectively. The adoption of ASU 2023-07 did not have a material impact on the Group’s unaudited condensed consolidated financial statements and related disclosures.
In December 2023, the FASB issued ASU 2023-09, Income taxes (Topic 740), Improvements to Income Tax Disclosures, which provides guidance on the requirements such as the requirement that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. For public business entities (PBEs), the new requirements will be effective for annual periods beginning after December 15, 2024. For entities other than public business entities (non-PBEs), the requirements will be effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The ASU should be applied prospectively. Retrospective application is permitted. The adoption of ASU 2023-09 did not have a material impact on the Group’s unaudited condensed consolidated financial statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income (Topic 220-40): Expense Disaggregation Disclosures (“ASU 2024-03”). This update requires, among other things, more detailed disclosure about types of expenses in commonly presented expense captions such as cost of sales and selling, general, and administrative expenses, and is intended to improve the disclosures about an entity’s expenses including purchases of inventory, employee compensation, depreciation and amortization. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The adoption of ASU 2023-09 did not have a material impact on the Group’s unaudited condensed consolidated financial statements and related disclosures.
In January 2025, the Financial Accounting Standards Board (“FASB”) updated 2025-01: Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. Public business entities must adopt the guidance in Update 2024-03 for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The update clarifies that all public business entities should initially adopt the disclosure requirements in the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. The Group is evaluating the impact the updated guidance will have on its unaudited condensed consolidated financial statements and disclosures.
Other accounting standards that have been issued by FASB that do not require adoption until a future date are not expected to have a material impact on the unaudited condensed consolidated financial statements upon adoption. The Group does not discuss recent standards that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.
F-15
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
4. INVENTORIES
Inventories consisted of the following:
| As of | ||||||||
| June
30, 2025 | December 31, 2024 | |||||||
| (Unaudited) | ||||||||
| Smart electric vehicles | $ | $ | ||||||
| Auto parts and other materials | ||||||||
| Total | $ | $ | ||||||
During
the six months ended June 30, 2025 and 2024, the Group recognized inventory write-downs of US$
5. PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets consisted of the following:
| As of | ||||||||
| June
30, 2025 | December 31,
2024 | |||||||
| (Unaudited) | ||||||||
| Amounts due from export agent (i) | $ | $ | ||||||
| Prepaid expenses (ii) | ||||||||
| Deductible input VAT (iii) | ||||||||
| Deposit (iv) | ||||||||
| Advance to staff | ||||||||
| Others | ||||||||
| Less: impairment loss | ( | ) | ( | ) | ||||
| Total | $ | $ | ||||||
| (i) |
F-16
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
5. PREPAID EXPENSES AND OTHER CURRENT ASSETS (cont.)
| (ii) |
| (iii) |
| (iv) |
6. PROPERTY AND EQUIPMENT, NET
Property and equipment, net, consisted of the following:
| As of | ||||||||
| June
30, 2025 | December 31,
2024 | |||||||
| (Unaudited) | ||||||||
| Vehicles held for use | $ | $ | ||||||
| Production facilities | ||||||||
| Electronic equipment | ||||||||
| Furniture | ||||||||
| Leasehold improvement | ||||||||
| Battery and charging swap infrastructure | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Less: impairment of property and equipment | ( | ) | ( | ) | ||||
| Property and equipment, net | $ | $ | ||||||
Depreciation
expenses were US$
| Amounts | ||||
| Balance as of December 31, 2023 | $ | |||
| Impairment made during the period | ||||
| Effect of exchange rate differences | ( | ) | ||
| Balance as of December 31, 2024 | $ | |||
| Effect of exchange rate differences | ( | ) | ||
| Balance as of June 30, 2025 | $ | |||
F-17
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
7. PIPE ESCROW ACCOUNT
In
September 2022, NWTN and Al Ataa Investment LLC (“PIPE Investor” or the “Pledgee”), a company incorporated in
Abu Dhabi Global Market entered into a PIPE Subscription Agreement for PIPE Investor investing US$
| (a) |
| (b) | To award Pledgee’s PIPE investment in NWTN by guaranteeing the Pledgee a minimum |
In
addition, NWTN, FIRST ABU DHABI BANK PJSC (the “Escrow Agent”), and an affiliate entity of PIPE Investor entered into an
Escrow Agreement. Pursuant to the Escrow Agreement, NWTN should open an account (the “Escrow Account”) and credit the sum
of US$
Key terms of Escrow Agreement were as follows:
| (a) | Escrow Account is a non-interest-bearing account. |
| (b) | Escrow Amount would be transferred a minimum |
| (c) |
F-18
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
7. PIPE ESCROW ACCOUNT (cont.)
| (d) | 3 months after (b) above is executed, the escrow account will be reviewed. If the market value of NWTN’s shares has recovered, funds over the needed US$ |
| (e) | Escrow Agent shall release the Escrow Amount and transfer such amount less any amounts which Escrow Agent is entitled to retain to NWTN in 3 business days after November 9, 2024. |
In
accordance with Codification of Staff Accounting Bulletins Topic 5: Miscellaneous Accounting – T. Accounting for Expenses or Liabilities
Paid by Principal Stockholder(s) (SAB 5T), as the Pledgor is obligated to pay the
For
the
On
September 7, 2023, Mr. Alan Wu, the former CEO of the Company, the Group, and the investor entered into a loan agreement under which
the Company was permitted to withdraw $
On
July 1, 2024, an addendum was signed to restructure the original loan agreement. Under the revised terms, the Group agreed to transfer
$
After evaluating the collectability of these amounts, the Group recorded a full provision for the amounts due from the Pledgors in 2025 and 2024. See Note 15 Related Party Transactions, for further details.
F-19
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
8. LOANS FROM A THIRD PARTY
As
of June 30, 2025 and December 31, 2024, loans from a third party consisted of the principal and legal fees for the loans from Tianjin
Yizhong Jinshajiang Equity Investment Fund Partnership (“Yizhong”). In 2016 and 2017, Tianqi Group entered into two convertible
debt agreements with Yizhong. According to the agreements, Yizhong provided loans of US$
In
2022, Yizhong and the Group reached an instalment plan which allowed the Group to repay the outstanding obligations totaling US$
Tianqi
Group executed the instalment plan and repaid the accrued interests and part of the legal fees in the amount of US$
Pursuant to the supplemental settlement agreement dated August 8, 2025, a third-party guarantor provided a joint and several liability guarantee for the Group’s repayment obligations under the instalment plan to Yizhong.
9. WARRANTS
In
connection with the Business Combination, the Company assumed
Common
Stock Warrants became exercisable on the later of (a) the completion of the Business Combination or (b) 12 months from the closing of
the initial public offering (“IPO”) (February 19, 2020). The common stock warrants will expire
Public Warrants
As
of June 30, 2025 and December 31, 2024, the Company had
The Company
may redeem the Public Warrants in whole and not in part, at a price of US$
| ● | at any time while the Warrants are exercisable, |
| ● | upon not less than |
F-20
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
9. WARRANTS (cont.)
| ● | if, and only if, the reported last sale price of the ordinary shares equals or exceeds US$ |
| ● | if, and only if, there is a current registration statement in effect with respect to the issuance of the ordinary shares underlying such Warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. |
If the Company calls the warrants for redemption as described above, management will have the option to require all holders that wish to exercise the warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of ordinary shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the trust account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the trust account with respect to such warrants. Accordingly, the warrants may expire worthless.
Detail related to Public Warrant activity for the six months ended June 30, 2025, was as follows:
| Public Warrants | Number of Warrants | Weighted Average Exercise Price ($) | ||||||
| Balances as of December 31, 2024 | $ | |||||||
| Exercised | ||||||||
| Balances as of June 30, 2025 | $ | |||||||
For
the six months ended June 30, 2025, Public Warrants were exercised and were paid in full with the gross proceeds of US$
Warrant liabilities
As
of June 30, 2025 and December 31, 2024, the Company had
The
Private Warrants are identical to the Public Warrants underlying the Units being sold in the IPO, except that the Private Warrants and
the ordinary shares issuable upon the exercise of the Private Warrants will not be transferable, assignable or salable until
The
Representative Warrants are different from Public and Private Warrants. The exercise price of Representative Warrants is US$
As
of June 30, 2025, the remaining contractual term for the outstanding Private Warrants and Representative Warrants to purchase our ordinary
shares were
F-21
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
10. ACCRUED EXPENSES AND OTHER LIABILITIES
Accrued expenses and other liabilities consisted of the following:
| As of | ||||||||
| June
30, 2025 | December 31, 2024 | |||||||
| (Unaudited) | ||||||||
| Contingent liabilities of Jinghong Dispute (i) | $ | $ | ||||||
| Contingent liabilities of Loop Dispute (ii) | ||||||||
| Lawsuit provision (iii) | ||||||||
| Payroll payable | ||||||||
| Accrued expense | ||||||||
| Output VAT | ||||||||
| Warranty provisions | ||||||||
| Borrowing from a third party | ||||||||
| Others | ||||||||
| Total | $ | $ | ||||||
| (i) |
| (ii) |
| (iii) |
| (iv) | The amounts of output VAT cannot be offset against input tax, since they are arising from different legal entities. |
11. LEASES
The balances for the operating leases where the Company is the lessee are presented as follows:
| As of | ||||||||
| June
30, 2025 | December 31,
2024 | |||||||
| (Unaudited) | ||||||||
| Operating lease right-of-use assets | $ | $ | ||||||
| Lease liabilities – current | $ | ( | ) | $ | ( | ) | ||
| Lease liabilities – non-current | ( | ) | ( | ) | ||||
| Total operating lease liabilities | $ | ( | ) | $ | ( | ) | ||
F-22
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
11. LEASES (cont.)
The components of operating lease expense are as follows:
| For
the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| Operating lease expense | $ | $ | ||||||
| Short-term lease expense | ||||||||
| Lease termination expense | ||||||||
| Total lease expense | $ | $ | ||||||
Short-term leases included lease of Tianjin offices, warehouse and others with a term of 12 months or less, which were excluded from the recognition of right-of-use assets or lease liabilities.
Both operating lease expense, short-term lease expense and termination expense are recognized as general and administrative expenses and other expense.
Other information related to operating leases where the Company is the lessee is as follows:
| As of June 30, 2025 | ||||
| Weighted-average remaining lease term (in years) | ||||
| Weighted-average discount rate | % | |||
Because most of the leases do not provide an implicit rate of return, the Company used the incremental borrowing rate based on the information available at lease commencement date in determining the present value of lease payments.
The following is a schedule of future minimum payments under the Company’s operating leases as of June 30, 2025:
| For the years ended December 31, | Amount | |||
| Remainder of 2025 | $ | |||
| 2026 | ||||
| Total lease payments | ||||
| Less: imputed interest | ( | ) | ||
| Total operating lease liabilities, net of interest | $ | |||
F-23
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
12. TAXATION
Cayman Islands
The Company was incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, the Company is not subject to income or capital gains taxes. In addition, dividend payments are not subject to withholdings tax in the Cayman Islands.
British Virgin Islands
The Company’s subsidiaries incorporated in the British Virgin Islands are not subject to taxation in the British Virgin Islands.
United Arab Emirates
The Company’s subsidiaries incorporated in United Arab Emirates (the “UAE”) are currently not subject to taxation in United Arab Emirates, as companies operating in the designated free zones of the UAE and not conducting business activities in the UAE mainland are exempt from corporate taxes or customs duty.
Hong Kong
The
Company’s subsidiaries incorporated in Hong Kong are subjected to Hong Kong profits tax. With effect from April 1,
2018, a two-tiered profits tax rate regime applies. The profits tax rate for the first Hong Kong dollars (“HKD”)
F-24
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
12. TAXATION (cont.)
Mainland China
Generally,
the Company’s WFOE and subsidiaries, which are considered PRC resident enterprises under PRC tax law, are subject to enterprise
income tax on their worldwide taxable income as determined under PRC tax laws and accounting standards at a rate of
United States
The
Company’s subsidiary, which incorporated in United States in 2022, is subject to statutory U.S. Federal corporate income tax at
a rate of
For the six months ended June 30, 2025 and 2024, the Group recognized income tax benefit.
The following table sets forth reconciliation between the statutory income tax rate and the effective tax rates:
| For
the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Statutory income tax rate in PRC | % | % | ||||||
| Tax effect of non-deductible items | ( | )% | ||||||
| Tax effect of undeclared expenses | ( | )% | ||||||
| Tax effect of fair value changes | % | |||||||
| Tax effect of income tax rate differences in jurisdictions other than the PRC | ( | )% | ( | )% | ||||
| Tax effect of net operating loss not applicable to carryforwards | ( | )% | % | |||||
| Change in valuation allowance | % | ( | )% | |||||
| Effective tax rate | ||||||||
The
Group does not file combined or consolidated tax returns, therefore, losses from individual subsidiaries of the Group may not be used
to offset other subsidiaries’ earnings within the Group. Valuation allowance is considered on each individual subsidiary basis.
Full valuation allowance of US$
13. ORDINARY SHARES
The
Company is authorized to issue a total of
In
October 2023, the performance condition of delivering 12 vehicles is achieved and the Earnout Shares of
In
April 2023, the Company issued
As
of June 30, 2025 and December 31, 2024,
F-25
ROBO.AI INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
14. NON-CONTROLLING INTERESTS
As a result of the Reorganization of the Company that was completed on January 19, 2022 (see Note 1), Tianqi Group and its subsidiaries’ financial statements have been prepared on a consolidated basis by applying the pooling of interests method as if the Reorganization had been completed at the beginning of the earliest reporting period, and the equity interests held by the original shareholders are recognized as non-controlling interests as if the Capital Increase were occurred on January 1, 2020.
As
of December 31, 2020, the non-controlling interests consisted of (i) the
On
November 24, 2021, Tianqi Group acquired the
In
2021, Tianqi Group entered into a series of supplemental agreements (the “new supplemental agreements”) with Taizhou Puluo
New Energy Automobile Equity Investment Enterprise (Limited Partnership) (“Puluo”), Guozhong Tianhong Asset Management (Tianjin)
Co., LTD (“Guozhong Tianhong”, or the new investor), and Tianjin Tuoda Enterprise Management Service Co., LTD (“Tianjin
Tuoda”) which is the shareholder of the Tianqi Group. Under the supplemental agreements, Guozhong Tianhong agreed to repay the
investment subscription of US$
Each
of Mr. Nan Wu and ICONIQ has provided guarantee liability for Tianjin Tuoda’s repayment to Puluo and ICONIQ has provided guarantee
for Guozhong Tianhong’s repayment to Puluo. The Group would assume joint guarantee obligations arising from Guozhong Tianhong or
Tianjin Tuoda’s default on the Puluo Debts, and the guarantee is valid until two years after the due date of performance of repayment
obligations In addition, each of eight shareholders of the Group, representing an aggregated holding interest of
Although there is a contingency term which related to the success of SPAC merger transaction, as of December 31, 2021, the Puluo Debts was de-recognized by the Company, and the equity interests owned by Guozhong Tianhong through the conversion of debts were recognized as non-controlling interests.
In
2022, there was a subscribed capital contribution of US$
As
of June 30, 2025 and December 31, 2024, the non-controlling interests were
As
of June 30, 2025 and December 31, 2024, non-controlling interests in the consolidated balance sheet was US$
F-26
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
15. RELATED PARTY TRANSACTIONS
(a)
| No. | Name of Related Parties | Relationship | ||
| 1 | My Car (Shenzhen) Technology Co., Ltd. (“My Car”) | |||
| 2 | Shenzhen Yinghehuicheng Investment Center (Limited Partnership) (“Shenzhen Yinghehuicheng”) | |||
| 3 | Tianjin Tuoda Enterprise Management Service Co., Ltd. (“Tianjin Tuoda”) | |||
| 4 | Mr. Alan Nan Wu | |||
| 5 | Vision Path Holdings Limited (“Vision Path”) | |||
| 6 | Shanghai OBS Culture and Technology Co., Ltd. (“Shanghai OBS”) | |||
| 7 | Al Ataa | |||
| 8 | Mr. Benjamin Zhai |
(b)
| For
the six months ended June 30, | ||||||||
| Nature | 2025 | 2024 | ||||||
| (Unaudited) | ||||||||
| Loan proceeds from related parties | ||||||||
| – Mr. Benjamin Zhai | $ | $ | - | |||||
| – Mr. Alan Nan Wu (i) | ||||||||
| Repayments of Mr.Nan Wu loan | ||||||||
| – Mr. Alan Nan Wu (i) | ||||||||
| Loan to related parties | ||||||||
| – Shanghai OBS | ||||||||
| – Tianjin Tuoda (ii) | ||||||||
| Accrued financial expenses to PIPE Investor | ||||||||
| – Al Ataa (see Note 7 PIPE escrow account for details) | ||||||||
F-27
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
15. RELATED PARTY TRANSACTIONS (cont.)
(c)
| As of | ||||||||
| June 30, 2025 | December 31, 2024 | |||||||
| (Unaudited) | ||||||||
| Amounts due from related parties: | ||||||||
| – Tianjin Tuoda (ii) | $ | $ | ||||||
| – Mr. Alan Nan Wu (i) | ||||||||
| – Shanghai OBS | ||||||||
| – The Pledgor (see Note 7 PIPE escrow account for details) | ||||||||
| Subtotal | $ | $ | ||||||
| Less: Allowance for expected credit loss (see Note 7 PIPE escrow account for details) | ( | ) | ( | ) | ||||
| Amount due from related parties, net | $ | $ | ||||||
| Amounts due to related parties, current: | ||||||||
| – Vision Path (iii) | $ | $ | ||||||
| – Shenzhen Yinghehuicheng | ||||||||
| – Mr. Benjamin Zhai | ||||||||
| Total | $ | $ | ||||||
| (i) | In 2022, My Car paid loan and expenses on behalf of the Group totaled US$
In 2022, Mr. Nan Wu paid loan and expenses on behalf of the Group totaled US$ |
| (ii) |
The
Group paid US$
During
the six months ended June 30, 2023, the Group provided interest-free loans totaled US$
| (iii) |
As of June 30, 2025 and December 31, 2024, the Group recorded full credit losses for amounts due from related parties based on the management’ estimation of the collectability.
F-28
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
16. COMMITMENTS AND CONTINGENCIES
Contingencies
The Group is, from time to time, subject to claims and disputes arising in the normal course of business. In the opinion of the management, while the outcome of any such claims and disputes cannot be predicted with certainty, its ultimate liability in connection with these matters is not expected to have a material adverse effect on the Group’s results of operations.
Through the issuance date of this report, Tianjin Geological Engineering Survey and Design Institute Co., Limited filed proceedings with the Group, see Note 18 Subsequent events for details. Except for the above and the following Disputes, the Group is not aware of any pending or threatened claims and litigation as of June 30, 2025 and through the issuance date of these unaudited condensed consolidated financial statements.
Puluo Debt
During
2018, Tianqi Group entered into a series of agreements with Taizhou Puluo New Energy Automobile Equity Investment Enterprise (Limited
Partnership) (“Puluo”) and had received several loans from Puluo totaled RMB
In
December 2021, to settle the Puluo Debts, Tianqi Group entered into a series of supplemental agreements (the “New Agreements”)
with Puluo, Guozhong Tianhong Asset Management (Tianjin) Co., LTD (“Guozhong Tianhong”), and Tianjin Tuoda. Under the New
Agreements, Guozhong Tianhong acquired the Puluo Debts from Puluo, resulting in a payment obligation of RMB
According to the New Agreements, in the event that the Group fails to obtain approval from the SEC and complete a business combination before December 31, 2022, Guozhong Tianhong is obligated to transfer both the Puluo Debts and its equity interest of Tianqi Group to Tianjin Tuoda. Subsequently, on January 1, 2023, Tianjin Tuoda would assume responsibility for repaying the Puluo Debts to Puluo while also acquiring the equity interests of Tianqi Group. However, the consummation of a business combination before December 31, 2022 would require Guozhong Tianhong to pay back Puluo Debts in two installments within a period of two years from the date of the business combination. Additionally, within this same timeframe following completion of the business combination, Tianjin Tuoda will make two installment payments towards indemnifying Puluo (referred to as “Indemnification”). On November 11, 2022, the Company consummated the business combination with East Stone.
According to the New Agreements, the Group assumed joint and several liability (the “Joint and Several Liability”) for both the repayment of the Puluo Debts and the Indemnification from Guozhong Tianhong or Tianjin Tuoda (the “Co-obligator”) to Puluo. Additionally, Mr. Alan Nan Wu assumed joint and several liability for the repayment of the Indemnification from Tianjin Tuoda to Puluo.
In 2022, eight shareholders of the Group signed letters of support to demonstrate their commitment to providing financial support to Tianjin Tuoda for its indebtedness in the event that the Group fails to complete a business combination, as well as assuming joint and several liability of the Group for the repayment of both the Puluo Debts and the Indemnification. In 2023, (i) two shareholders of the Group signed letters of support to commit their financial support to Tianjin Tuoda and Guozhong Tianhong for the indebtedness, as well as assuming the joint and several liability for the repayment of both the Puluo Debts and the Indemnification, and (ii) Guozhong Tianhong signed a letter to commit its repayment of the debt to Puluo (collectively, the “Shareholders’ Support”).
As
of June 30, 2025 and December 31, 2024, the Puluo Debts payable by Guozhong Tianhong were US$
F-29
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
16. COMMITMENTS AND CONTINGENCIES (cont.)
Pursuant to a supplemental agreement entered into in 2025, Vision Path was added as a new co-obligor and Long Hope Holdings Limited was introduced as an additional guarantor, both jointly undertaking the relevant joint and several guarantee obligations. The parties further acknowledged that, except in the case of acceleration events, the creditors will not seek to enforce the Group’s joint and several guarantee obligations under the termination agreement before December 31, 2027.
The management assessed the Joint and Several Liability in accordance with ASC 405-40. As of June 30, 2025 and December 31, 2024, considering that the arrangement did not specify the Company’s payment obligations, no additional payments are anticipated on behalf of the co-obligator with the Shareholders’ Support. Consequently, no liability was recognized as of June 30, 2025 and December 31, 2024.
Tiancheng Dispute
In
January 2023, NWTN Zhejiang invited the Tiancheng Coating System Changzhou Co., Ltd. (“Tiancheng”) to bid for the coating
production line project, specifying technical requirements and payment terms. Tiancheng submitted bids, including a final offer of RMB
Xingjing Dispute
Xingjing
(Guangzhou) Technology Co., Ltd. (“Xingjing”) alleged that after signing a RMB
F-30
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
16. COMMITMENTS AND CONTINGENCIES (cont.)
Longchuang Dispute
In
January 2025, Shanghai Longchuang Automotive Design Co., Ltd. (“Longchuang”) filed a lawsuit against NWTN Zhejiang alleging
a contract dispute over unpaid project fees. Longchuang claimed the NWTN Zhejiang owed RMB
Canshi Dispute
On
July 31, 2021, Shanghai Canshi Investment Management Co., Ltd. (“Canshi”), Tianjin Tuoda, the Group, and Mr. Alan Nan Wu
entered into a supplementary settlement agreement. Under this agreement, the Group agreed to provide a joint and several guarantee for
Tuoda’s repayment of a RMB
The
Group completed its listing on November 14, 2022, and the compensation became due on May 14, 2023. The Group, however, failed to make
the payment. On April 28, 2025, Canshi filed a civil complaint with the Shanghai No. 1 Intermediate People’s Court against the
Group, Mr. Alan Nan Wu, and Mr. Fu Xing, claiming (i) compensation of RMB
According to the legal opinion dated September 25, 2025, the relevant clause of the agreement has been deemed invalid and is unlikely to be upheld by the courts. As a result, no compensation is expected to be payable under this claim, and the estimated liability arising from this litigation is nil. The Group does not expect any material adverse impact from this matter.
Other Business Lawsuits
Other than the disputes discussed above, as of June 30, 2025 and the issuance date of the unaudited condensed consolidated financial statements, there were still two on-going and eleven closed lawsuits against the Group for unpaid claim amount, penalty and accrued interests in the total estimated amount of RMB3.9 million. These lawsuits were initiated by Anfeirui Engineering Technology (Chengdu) Co., Ltd., Tianjin Geological Engineering Survey & Design Institute Co., Ltd., Shanghai Nanyang Wanbang Software Technology Co., Ltd., Shanghai Zhuolun International Logistics Co., Ltd., Hangzhou Yarui Standard Technology Services Co., Ltd., Shanghai Mechanical & Electrical Design and Research Institute Co., Ltd., Shanghai Bishi Human Resources Co., Ltd., Shanghai Luanming Automobile Technology Co., Ltd., Beijing Beiwei Beehive IoT Technology Co., Ltd., Shanghai Zhenqi Construction (Group) Co., Ltd., Transn United (Beijing) Information Technology Co., Ltd., Shanghai Xundao New Energy Technology Co., Ltd. and Henan Chebang Automotive Products Manufacturing Co., Ltd.
F-31
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
17. SEGMENT REPORTING
The
Group operates in a single operating segment and has
The table below provides information about Group’s segment (in thousands):
| For
the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Revenues | $ | $ | ||||||
| Less: | ||||||||
| Cost of revenues | ( | ) | ( | ) | ||||
| Segment gross loss | ( | ) | ( | ) | ||||
| Less: | ||||||||
| Depreciation and amortization | ( | ) | ( | ) | ||||
| Reversal of expected credit losses | ||||||||
| Salary expenses | ( | ) | ( | ) | ||||
| Rental expenses | ( | ) | ( | ) | ||||
| Other operating expenses | ( | ) | ( | ) | ||||
| Interest (expenses) income, net | ( | ) | ||||||
| Other income (expenses), net | ( | ) | ||||||
| Segment loss | $ | ( | ) | $ | ( | ) | ||
18. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through the date of issuance of the unaudited condensed consolidated financial statements. Except for the events mentioned below, the Company did not identify any subsequent events with material financial impact on the Company’s unaudited condensed consolidated financial statements.
Joint Venture Agreement
On
September 19, 2025, the Company entered into a joint venture agreement with JW Global Holding L.L.C.-FZ (“JW”) to establish
RJ Investment L.L.C.-FZ in the United Arab Emirates (subject to registration and regulatory approval). The joint venture will focus on
the import, marketing, and sale of commercial vehicles and related aftersales services in Pakistan and the Gulf and Arabian Peninsula
region. The Company will hold
Entry into a Share Purchase Agreement
On
September 18, 2025, the Company entered into a share purchase agreement with Mobius Technology Co., Limited, Dreamwork International
Investments Ltd. (together, the “Sellers”), and Mobius Technology Limited (the “Core Team”). Pursuant to the
agreement, the Company agreed to acquire from the Sellers an aggregate of
Joint Venture Agreement
On
September 4, 2025, the Company’s subsidiary, NWTN Investment L.L.C.-FZ, entered into a joint venture agreement with JW Global Holding
L.L.C-FZ (“JW”) and Ferox Investment L.L.C. to establish a limited liability company in the United Arab Emirates under the
proposed name “Robo.AI Industrial City.” The Company will hold
F-32
ROBO.AI
INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In U.S. dollars in thousands, except share and per share data)
18. SUBSEQUENT EVENTS (cont.)
Equity Acquisition Agreement
On
August 29, 2025, the Company completed the acquisition of Astra Mobility Meta (Cayman Islands) Limited (“Astra”) pursuant
to a share exchange acquisition agreement (as supplemented, the “Astra Agreement”) entered into with Astra and its shareholders.
Under the Astra Agreement, the Company agreed to issue
Cooperation Agreement
On
September 6, 2025, the Company entered into a cooperation agreement with EVT Aerotechnics (Nanjing) Co., Ltd. to establish a joint venture
in the United Arab Emirates for the global sales, distribution and localized development of electric vertical take-off and landing (“eVTOL”)
aircraft, as well as the potential establishment of an assembly facility in the UAE. The Company will hold a
Entry into a Standby Equity Purchase Agreement
On
September 3, 2025, the Company entered into a standby equity purchase agreement with YA II PN, Ltd. (“Yorkville”), under
which the Company may, at its discretion, issue and sell up to $
Change of Company Name and Ticker Symbol
On August 12, 2025, the Company’s shareholders approved a change of the Company’s name from NWTN Inc. to Robo.ai Inc., which became effective on August 15, 2025. The Company’s Class B ordinary shares began trading on Nasdaq under the new name and ticker symbol “AIIO” on August 26, 2025.
Entry Into a Material Definitive Agreement
On
August 8, 2025, the Company entered into an Asset Contribution & Share Issuance Agreement with JW International LLC-FZ, pursuant
to which JW will contribute exclusive four-year usage rights to its CKD automotive assembly facility in Pakistan and access to its nationwide
sales and distribution network. In exchange, the Company will issue
Issuance of Shares to New Investors and Service Providers
On
August 5, 2025 and September 8, 2025, the Company issued an aggregate of approximately
F-33