Company: SERV
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001832483-25-000089
Chunk: 45

Company: Serve Robotics Inc. /DE/
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 1
Chunk 45
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Weighted-average remaining lease term (in years)2.422.65Weighted-average discount rate7.25 %7.24 %Future annual minimum payments under operating leases as of June 30, 2025, are as follows (in thousands):

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2025$605 20261,123 2027869 2028155 2029— Total undiscounted future cash flows2,752 Less: imputed interest(177)Total operating lease liabilities$2,575 Finance Lease – Failed Sales-LeasebackIn November 2022, the Company entered into a lease agreement with Farnam Capital for its robot assets. As per ASC 842-40-25, the transaction was considered a failed sales-leaseback and therefore the lease was accounted for as a financing agreement. There was no outstanding liability at June 30, 2025. In April 2025, the Company exercised the option to purchase the assets at the end of the lease for $2.25 million.ContingenciesThe Company may be subject to pending legal proceedings and regulatory actions in the ordinary course of business. The results of such proceedings cannot be predicted with certainty, but the Company does not anticipate that the final outcome, if any, arising out of any such matters will have a material adverse effect on its business, financial condition or results of operations.

12. SEGMENT INFORMATION

The Company has one operating and reportable segment. A description of how the Company derives revenues is included in Note 2. The Company’s Chief Executive Officer serves as the Company’s CODM, who reviews financial information on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. The CODM uses consolidated net loss as the sole measure of segment profit or loss to make key operating decisions such as the allocation of the budget and monitoring budget versus actual results. The CODM does not evaluate operating segments using asset information.Significant expenses within net loss include cost of revenue, general and administrative, operations, research and development, sales and marketing, which are each separately presented on the Company’s consolidated statements of operations. Stock-based compensation expense is also a significant expense within net loss. Refer to Note 10 for additional information about the Company’s stock-based compensation expense. Other segment items include interest income, interest expense, and provision for (benefit from) income taxes on the consolidated statements of operations.

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ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF