ROBO.AI INC.

Robo.ai Inc. is undergoing a significant business transformation, shifting its focus from primarily developing smart electric vehicles (EVs) to building a decentralized, AI-powered intelligent asset platform that connects AI terminals across sectors. The company's mission is to create a global AI asset platform that integrates smart vehicles, robotics, and blockchain, aiming to empower users with intelligent infrastructure and reshape value creation and exchange worldwide. This strategic pivot involves substantial changes to its business model, technology architecture, and target markets, including expansion into AI-driven intelligent mobility, decentralized computing, and smart logistics, areas where the company has limited operating experience. The company's financial statements have been prepared on a going concern basis, but it faces significant uncertainty due to recurring operating losses of approximately US$157.1 million ⁴ in 2025, US$95.4 million ⁵ in 2024, and US$212.0 million ⁶ in 2023, coupled with negative operating cash flows of US$5.1 million ⁷ in 2025 and US$138.0 million ⁸ in 2023, and an accumulated deficit of US$904.4 million ⁹ as of December 31, 2025.

The company's core business model is transitioning from EV sales to an AI-powered intelligent asset platform. Historically, revenue was generated from sales of smart electric vehicles and auto parts and materials. The company aims to leverage an asset-light manufacturing model through strategic partnerships to reduce initial capital expenditures and efficiently scale production and commercialization. Primary customer segments are individual and corporate customers, with a focus on building brand recognition and loyalty among technology-innovative, design-conscious, and luxury-seeking individuals, and offering smart mobility solutions to corporate fleets, travel companies, and luxury hotels.

Robo.ai's product portfolio includes MUSE, GHIATH, and Astra. MUSE is planned as a full-sized Special Purpose Vehicle (SPV) with Level 2.5 autonomous driving technology and a passenger-centric ecosystem, integrating hardware and software with an open cloud platform. GHIATH is a purpose-built vehicle tailored for public service and law enforcement, developed in collaboration with Dubai Police. Astra is a commercial-grade driverless vehicle designed for intelligent logistics, automatic delivery, and shared travel solutions, targeting markets in the Middle East, Asia, and smart transportation hubs globally. The company also previously engaged in Semi-Knockdown (SKD) production of NWONE (SUV), Rabdan One (SUV), and Rabdan Seven (MPV) vehicles in the UAE, sourcing components from China. However, the Rabdan branded vehicle line was discontinued in March 2024 due to a directive from UAE authorities, leading to a workforce restructuring plan that reduced 222 employees and incurred US$1.7 million ¹⁰ in severance charges in 2024.

For the fiscal year ended December 31, 2025, Robo.ai reported net revenue of US$950 thousand ¹¹, a significant decrease of 92.1% ¹² from US$11.995 million ¹³ in 2024. Cost of revenues also decreased by 96.2% ¹⁴ to US$356 thousand ¹⁵ in 2025 from US$9.327 million ¹⁶ in 2024. The company recorded a gross profit of US$594 thousand ¹⁷ in 2025, down from US$2.668 million ¹⁸ in 2024. Operating expenses totaled US$157.704 million ¹⁹ in 2025, compared to US$98.044 million ²⁰ in 2024. General and administrative expenses increased by US$66.0 million ²¹, or 72.6% ²², to US$156.964 million ²³ in 2025, primarily due to a US$117.0 million ²⁴ increase in share-based compensation expenses. Selling expenses decreased by US$1.9 million ²⁵, or 74.1% ²⁶, to US$676 thousand ²⁷ in 2025. Research and development expenses decreased by US$4.4 million ²⁸, or 98.6% ²⁹, to US$64 thousand ³⁰ in 2025. The net loss for 2025 was US$167.567 million ³¹, compared to US$172.726 million ³² in 2024. Cash and cash equivalents and restricted cash at the end of 2025 were US$5.327 million ³³.

Year-over-year comparisons show a substantial decline in net revenue, decreasing by US$11.0 million ³⁴ in 2025 compared to 2024, and by US$25.3 million ³⁵ in 2024 compared to 2023. Gross profit decreased from US$2.668 million ³⁶ in 2024 to US$594 thousand ³⁷ in 2025, and from a loss of US$11.681 million ³⁸ in 2023 to a profit in 2024. Operating losses were US$157.110 million ³⁹ in 2025, US$95.376 million ⁴⁰ in 2024, and US$211.994 million ⁴¹ in 2023. The significant increase in general and administrative expenses in 2025 was largely driven by share-based compensation, while the decrease in R&D expenses reflects reduced vehicle development activities.

Significant operational developments during the period include the cessation of the Rabdan branded vehicle line in March 2024, leading to a workforce restructuring and re-badging of approximately 320 vehicles ⁴². In January 2025, Robo.ai entered into a joint venture agreement with W Motors to establish a company for automobile modification, customizations, vehicle distribution, and after-sales services, with Robo.ai holding a 51% ⁴³ stake and contributing intellectual property valued at US$100 million ⁴⁴. In October 2025, a partnership agreement with W Motors Dubai Branch was formed for joint development and deployment of electric and autonomous vehicle solutions, with a commitment from W Motors Dubai Branch to procure 30,000 vehicles ⁴⁵ over five years. In August 2025, Robo.ai entered an asset contribution and share issuance agreement with JW International LLC-FZ to acquire exclusive operational rights to a manufacturing facility in Pakistan with an annual production capacity of 50,000 vehicles ⁴⁶, in exchange for 10,000,000 restricted Class B ordinary shares ⁴⁷. In September 2025, a joint venture with JW Global Holding L.L.C-FZ and Ferox Investment L.L.C. was established to create "Robo.AI Industrial City" for premium intelligent vehicles, eVTOL production, and smart logistics hardware, with Robo.ai holding 51% ⁴⁸ equity. Another joint venture with JW Global Holding L.L.C-FZ was formed in September 2025 for commercial vehicle import, marketing, and sales in Pakistan and the Gulf region, with Robo.ai holding 51% ⁴⁹. A cooperation agreement with EVT Aerotechnics (Nanjing) Co., Ltd. was signed in September 2025 to establish a joint venture for global sales and manufacturing of eVTOLs under the "RoVtol" brand, with Robo.ai holding 51% ⁵⁰. Strategic investments include the acquisition of 16.58% ⁵¹ of Aitos.io Pte. Ltd. for US$8.29 million ⁵² in September 2025, and the acquisition of Astra Mobility Meta (Cayman Islands) Limited in August 2025, making it a wholly-owned subsidiary. In December 2025, Robo.ai entered into a convertible note facility for up to US$80 million ⁵³ and an equity purchase facility for up to US$100.0 million ⁵⁴ with institutional investors. Post-period, in February 2026, Robo.ai entered into a share purchase agreement to acquire 51% ⁵⁵ of Chinasky Car Trading FZE for US$1,000,000 ⁵⁶ in Class B ordinary shares, and joint venture agreements with DaBoss.AI Inc. and Tachyon9 Corporation for an Embodied AI Data Collection Center and data center facilities, respectively.

Management's specific revenue, margin, or EPS guidance for the upcoming period is not explicitly stated in the filing. However, the company's financial statements have been prepared on a going concern basis, acknowledging significant uncertainty due to recurring operating losses and negative cash flows. Management intends to obtain additional financing and reduce expenditures to address liquidity needs and improve its financial position.

One major growth vector explicitly described is the strategic shift towards building a decentralized, AI-powered intelligent asset platform that integrates smart vehicles, robotics, and blockchain. This platform aims to connect AI terminals across industries, empowering users with intelligent infrastructure and reshaping value creation globally. The company is systematically expanding into smart mobility solutions, including autonomous logistics and eVTOLs, supported by its evolving AI and digital technology capabilities. The planned MUSE SPV will feature Level 2.5 autonomous driving technology and an AI-NAS ecosystem, while Astra is a commercial-grade driverless vehicle for intelligent logistics and delivery. The joint venture with EVT Aerotechnics (Nanjing) Co., Ltd. for eVTOLs under the "RoVtol" brand, with Robo.ai holding 51% ⁵⁷ equity, is a key part of this expansion, including global sales and establishing an SKD/CKD factory in the UAE.

Another growth area is the expansion of manufacturing and market presence through strategic partnerships. The joint venture with W Motors, where Robo.ai holds a 51% ⁵⁸ stake and contributes US$100 million ⁵⁹ in intellectual property, aims to engage in automobile modification, customizations, vehicle distribution, and after-sales services. The partnership with W Motors Dubai Branch includes joint development and deployment of electric and autonomous vehicle solutions, with a commitment to procure 30,000 vehicles ⁶⁰ over five years. The asset contribution and share issuance agreement with JW International LLC-FZ provides exclusive operational rights to a manufacturing facility in Pakistan with an annual production capacity of 50,000 vehicles ⁶¹, and access to JW's sales networks to facilitate the sale of no less than 50,000 passenger and commercial vehicles ⁶² over four years. The joint venture with JW Global Holding L.L.C-FZ and Ferox Investment L.L.C. to establish "Robo.AI Industrial City" will focus on premium intelligent vehicles, eVTOL production, smart logistics, and other smart devices, with Robo.ai holding 51% ⁶³ equity. Additionally, a joint venture with JW Global Holding L.L.C-FZ for commercial vehicle import, marketing, and sales in Pakistan and the Gulf region, with Robo.ai holding 51% ⁶⁴ equity, further supports market expansion.

Operationally, the company plans to scale up both its in-house R&D and collaboration with external R&D partners to enhance and commercialize its products and technologies. R&D efforts are focused on vehicle design, product engineering, manufacturing engineering, intelligent seating design, intelligent network, vehicle body engineering, vehicle safety engineering, data and data security, supply quality engineering, CAD, and supply chain management. The company is building a dedicated R&D team for autonomous driving and actively seeking external partners. The asset-light manufacturing model, through strategic partnerships with W Motors and other suppliers, is intended to lower initial capital expenditures and efficiently ramp up production. The planned facility in the UAE is expected to have a full EV production capacity of 100,000 vehicles ⁶⁵ annually.

Planned capital allocation includes continued investment in R&D activities, which were US$0.1 million ⁶⁶ in 2025, representing 0.04% ⁶⁷ of total operating expenses. The company expects to scale up these investments. In December 2025, Robo.ai secured potential access to up to US$100.0 million ⁶⁸ through an equity purchase facility with SZOP Opportunities I LLC and up to US$80.0 million ⁶⁹ through a convertible note facility with JAK Mobility Ventures II LLC. The company's dividend policy states that it has never declared or paid any cash dividend and currently intends to retain any future earnings, not expecting to pay dividends in the foreseeable future.

Management has explicitly flagged several structural headwinds and execution risks to its growth plan. The ongoing business transformation and limited operating history make it difficult to evaluate prospects and challenges, particularly in new areas like AI-driven intelligent mobility, decentralized computing, and smart logistics. The cessation of the Rabdan branded vehicle line has materially and adversely affected the business, and failure to effectively manage changes in existing and new businesses may hinder capitalizing on new opportunities. The ability to develop, manufacture, and deliver high-quality vehicles on schedule and at scale is unproven and evolving, with risks including funding shortages, supply chain disruptions, quality control deficiencies, and cost overruns. Delays in launching new models like MUSE, GHIATH, and Astra could adversely affect growth prospects. The company is dependent on single-source suppliers for certain components, and any disruption could halt production. Furthermore, the proposed transaction to acquire operational rights to a facility in Pakistan exposes the company to substantial counterparty and regional risks, including volatile macroeconomic conditions and political instability.

Geographic, regulatory, or macro factors identified as constraints include international trade policies, tariffs, and treaties, particularly China's export restrictions on rare earth elements and neodymium-iron-boron magnets, which may impair sourcing critical EV components. Geopolitical tensions in the Middle East and Southwest Asia could lead to market disruptions, supply chain interruptions, and increased cyber-attacks. Uncertainties with the UAE legal system and changes in laws and regulations, including the implementation of a 9% ⁷⁰ corporate tax on profits exceeding AED 375,000 (approximately US$100,000 ⁷¹), could adversely affect the business. The economies of several Gulf Cooperation Council markets are highly dependent on the oil and gas industry, making them susceptible to oil price fluctuations. Escalating geopolitical tensions in the Middle East may also adversely affect potential government procurement contracts for GHIATH vehicles. Operations in Mainland China are subject to complex and rapidly evolving laws and regulations, including significant government oversight, data privacy and security laws (PRC Cyber Security Law, Data Security Law, Auto Data Rules, PIPL), and restrictions on offshore investment activities by residents. The company's insurance coverage may be inadequate or unavailable to cover losses from geopolitical instability and armed conflict in the Middle East.

Robo.ai faces material risks across several categories. Macroeconomic and geopolitical risks include volatility and disruption from the ongoing Russia-Ukraine conflict and escalating conflicts in the Middle East and Southwest Asia, which could lead to market disruptions, commodity price volatility, supply chain interruptions, and increased cyber-attacks. China's export restrictions on rare earth elements and neodymium-iron-boron magnets, effective April 4, 2025, pose a significant supply chain risk, potentially halting EV motor production and increasing costs. The economies of key markets in the Gulf Cooperation Council region are highly dependent on the oil and gas industry, making them vulnerable to oil price fluctuations that could reduce consumer confidence and purchasing power. The proposed acquisition of operational rights to a facility in Pakistan exposes the company to substantial counterparty and regional risks, including volatile macroeconomic conditions, currency devaluation, and shifting foreign investment regulations. The company's insurance policies typically exclude war-related risks, leaving it exposed to uninsured losses from physical damage or supply chain disruptions in the Middle East. Operationally, the company's ongoing business transformation and limited operating history make it difficult to evaluate future prospects, and the cessation of the Rabdan branded vehicle line has materially impacted the business. The ability to develop, manufacture, and deliver high-quality vehicles on schedule and at scale is unproven, with risks of funding shortages, supply chain disruptions, quality control deficiencies, and cost overruns. Dependence on single-source suppliers for critical components could lead to production delays. Regulatory risks include uncertainties in the UAE legal system, changes in laws and regulations (e.g., the 9% ⁷² corporate tax on profits exceeding AED 375,000 ⁷³), and the complex and rapidly evolving legal and regulatory environment in Mainland China, particularly concerning data privacy and security (PRC Cyber Security Law, Data Security Law, Auto Data Rules, PIPL) and foreign investment. Non-compliance with these regulations could result in significant fines, revocation of licenses, or criminal sanctions. The company has identified material weaknesses in its internal control over financial reporting, including a lack of sufficient competent financial reporting personnel, inadequate period-end financial closing policies, deficient internal file management, and insufficient expenditure approval processes, which could lead to inaccurate financial reporting and adversely affect investor confidence.

Management's message to shareholders conveys a strategic pivot towards a decentralized, AI-powered intelligent asset platform, integrating smart vehicles, robotics, and blockchain, with a vision to pioneer an intelligent future through an AI-powered smart mobility, smart device, and smart asset ecosystem. Despite acknowledging significant financial challenges, including recurring operating losses and negative cash flows, management expresses intentions to obtain additional financing and reduce expenditures to improve liquidity. The company has secured potential access to up to US$100.0 million ⁷⁴ through an equity purchase facility and up to US$80.0 million ⁷⁵ through a convertible note facility. Key strategic priorities emphasized for the period ahead include: (1) accelerating the development and commercialization of new AI-driven intelligent mobility products like MUSE, GHIATH, and Astra, leveraging an asset-light manufacturing model through strategic partnerships; (2) expanding global market presence, particularly in the Middle East, Africa, Europe, and Southeast Asia, through reputable local partners and joint ventures for vehicle production, distribution, and after-sales services; and (3) enhancing in-house and external R&D capabilities, focusing on advanced technologies such as autonomous driving, AI-NAS ecology, and high-density battery systems, while ensuring compliance with evolving data privacy and security regulations.