In November 2023, the Company made an investment in 700,440 shares of preferred stock of a private company for a cash consideration of $5.0 million, which is classified as non-marketable equity investment. The Company’s investment in the private company represents less than 1% of total capitalization. The Company neither has significant influence over the private company nor does the investment amount to a controlling financial interest in the private company. The Company elected to apply the measurement alternative, and as such, records the investment at cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes in orderly transactions. During the period ended June 30, 2026, the Company did not identify any impairment or significant observable price changes for this non-marketable equity investment.
Note 9. Other current liabilities
Other current liabilities consisted of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
December 31, |
|
|
|
2026 |
|
|
2025 |
|
Deferred revenue |
|
$ |
529 |
|
|
$ |
284 |
|
Other current liabilities |
|
|
2,664 |
|
|
|
2,204 |
|
Total other current liabilities |
|
$ |
3,193 |
|
|
$ |
2,488 |
|
Note 10. Financing transactions
Private Investment - Sylebra
On November 8, 2023, the Company entered into Subscription Agreements (the “Sylebra Subscription Agreements”) with entities affiliated with Sylebra Capital Limited (“Sylebra”) and Adage Capital Management, providing for the purchase of an aggregate of 7,360,460 shares of the Company’s common stock, $0.0001 par value per share (the “PIPE Shares”), at a price of $2.90 per PIPE Share for an aggregate purchase price of approximately $21.4 million (the “Private Placement”). The PIPE Shares are recorded as outstanding common stock.
Standby Equity Purchase Agreement - Sylebra
On November 8, 2023, the Company also entered into a Standby Equity Purchase Agreement (as amended from time to time, the “Facility Agreement”) with entities affiliated with Sylebra, pursuant to which the Company will have the right, but not the obligation to sell to Sylebra up to $125 million of its shares of convertible redeemable non-voting preferred stock, subject to satisfaction of certain conditions, by November 8, 2026. Each sale the Company requests under the Facility Agreement (each, an “Advance” and collectively, the “Advances”) may be for a number of shares of preferred stock with an aggregate value of at least $25.0 million but not more than $50.0 million (except with Sylebra’s consent).
When and if issued, the preferred stock will be issued at a price per share of $10,000. Holders of the preferred stock will be entitled to a quarterly dividend at the rate of 7.0% per annum payable in cash or in kind at the option of the Company. The preferred stock will have an initial liquidation preference of $12,000 per share, plus accrued dividends. The preferred stock will have no voting rights as a class or series except in such instances as required by Delaware law or certain matters enumerated in the Facility Agreement related to the protection of the preferred stock.
The preferred stock will be convertible at the option of the holders into the number of shares of common stock equal to $10,000 divided by the then-applicable conversion price. At any time after the two year anniversary of any issuance of any series of preferred stock, the Company will have the option to convert all (but not less than all) of any series of then-outstanding preferred stock by paying a make-whole payment, in either stock or cash, equal to three years of dividends, provided that the closing price of the common stock exceeds 250% of the then-applicable conversion price for at least 20 out of 30 consecutive trading days prior to the date of conversion. To the extent, if any, a conversion would result in the holder thereof becoming the beneficial owner of more than 16,428,553 shares of the Company’s outstanding common stock, the Company will issue to such holder a pre-funded warrant in the form attached to the Facility Agreement. The preferred stock will be subject to customary pre-emptive rights.
The Company’s right to request Advances is conditioned upon the Company achieving a minimum of one new passenger auto-original equipment manufacturer (“OEM”) or commercial OEM program award with at least a 50,000 unit volume, the trading price of the common stock being below $38.00 at the time of the Advance request and other customary conditions. As of June 30, 2026, all conditions to request an Advance under the Facility Agreement were met.
Any preferred stock issued in connection with the Facility Agreement will rank senior to common stock upon the Company’s liquidation, dissolution or winding up. Any such preferred stock will be entitled to priority cumulative dividends which shall accrue daily from and after the original issue date of such preferred stock and shall compound on a quarterly basis on each dividend payment date. The accrued dividends shall in all cases be payable upon liquidation.
The Company shall pay dividends on each share of preferred stock in cash or in kind through issuance of shares of common stock with an aggregate value equal to the amount of the dividend to have been paid divided by the dividend conversion price. The board of directors of the Company may at its sole discretion elect to pay the dividends in cash in lieu of shares of common stock. The preferred stock has no voting rights
unless it is converted into shares of common stock. Additionally, upon the occurrence of a change of control, the holders of preferred stock shall be entitled to receive in full a liquidating purchase in cash and in the amount per share of the preferred stock equal to the sum of (i) the liquidation preference plus (ii) accrued dividends with respect to such shares of preferred stock.
In connection with this financing, the Company also paid the entities affiliated with Sylebra, (a) a facility fee in the amount of $2.5 million, (b) an origination fee in the amount of $0.6 million, (c) an administrative fee in the amount of $0.3 million and (d) fees and expenses of Sylebra and its counsel, of approximately $0.4 million. The issuance costs related to the Facility Agreement were expensed as incurred as it failed to meet the equity classification guidance under ASC 815-40, and were deemed to be a derivative asset. The fair value of the derivative asset was not material as of and for the period ended June 30, 2026.
In addition, upon receipt of stockholder approval in December 2023, the Company issued to Sylebra 3,000,000 Series A Warrants to purchase shares of common stock at an exercise price of $5.00. The Company analyzed the Series A Warrants and determined that they are freestanding and do not exhibit any of the characteristics within ASC 480, and as such do not meet the characteristics of a liability under ASC 480. However, Series A Warrants do not meet all requirements for equity classification under ASC 815, and therefore are classified as a liability on the Company’s condensed consolidated balance sheets.
As of June 30, 2026, the Company had 3,000,000 Series A Warrants outstanding. The Series A Warrants were issued as consideration for entering into the Facility Agreement as discussed above. Each Series A Warrant is currently exercisable and expires in December 2027. Holders shall not have the right to exercise the Series A Warrants to the extent such person would beneficially own in excess of 16,428,553 shares of the Company’s outstanding common stock as adjusted immediately after giving effect to such exercise.
The exercise price and number of shares of common stock issuable upon exercise of the Series A Warrants may be adjusted in certain circumstances including in the event of a stock dividend or split, subsequent rights offerings, pro rata purchases, merger, reorganization, recapitalization, or spin-off. However, the Series A Warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices. The Series A Warrants do not entitle the holders to any voting rights, dividends or other rights as a stockholder of the Company prior to being exercised for common stock.
Share Subscription Agreement - LGIT
On May 13, 2025, the Company entered into a strategic collaboration with LG Innotek Co., Ltd. (“LGIT”). In connection with this partnership, the parties entered into a LG Subscription Agreement, and a JDA, (collectively referred to as the “LGIT Transaction”).
Pursuant to the LG Subscription Agreement, LGIT agreed to make a strategic investment in the Company of $32.5 million (the “LG Private Placement”) in exchange for common shares. LGIT agreed to pay a fixed price per share of $9.26 at closing (i.e., the “Long Forward”) or a price per share equal to the volume weighted average price (“VWAP”) if the VWAP for 10 days preceding the record date is less than $7.41 per share (the “Barrier Put Option”). Notwithstanding the foregoing, LGIT’s share ownership is subject to an ownership limit of 9.9% such that the price per share paid at closing would be adjusted to ensure the share ownership limit is not exceeded. The record date represents the earlier of two months following contract inception or satisfaction of all closing conditions.
The Long Forward and Barrier Put Option instrument required recognition as liability on the consolidated balance sheet because the instrument was determined not to be indexed to the Company’s common stock, as the total number of shares to be issued was not fixed. The Company recognized the instrument at fair value at contract inception and at each reporting date until settlement at closing of the LG Private Placement. The Company re-measured the fair value of the LG Private Placement as of the closing and accordingly recorded an associated gain of $1.7 million for the year ended December 31, 2025, upon issuance of its common stock.
The LG Private Placement closed on August 20, 2025. Accordingly, the Company issued 3,509,719 shares of common stock to LGIT at a price of $9.26 per share upon receipt of gross proceeds of $32.5 million.
Pursuant to the JDA, the Company agreed to provide non-recurring engineering services to LGIT in exchange for a total consideration of $7.5 million. However, based on the contract analysis, JDA and LG Subscription Agreement were determined to be a combined contract in which all the proceeds were allocated to the LG Subscription Agreement and no proceeds were allocated to the JDA, accordingly no revenue shall be recognized for non-recurring engineering services to be provided under the JDA. See Note 1 to these condensed consolidated financial statements for details on provision for anticipated losses recognized on the JDA.
Convertible Notes
In November 2025, the Company issued $100.0 million aggregate principal amount of 4.375% Convertible Senior Notes due 2032 (the “Convertible Notes”) in a private placement transaction. The proceeds from the issuance of the Convertible Notes, net of debt issuance costs, were $96.7 million.
The Convertible Notes are senior unsecured obligations of the Company and will mature on November 15, 2032, unless earlier converted, redeemed, or repurchased. The Convertible Notes are governed by an indenture dated November 6, 2025 (the “Indenture”). Interest on the Convertible Notes accrues at a rate of 4.375% per annum and is payable semiannually on May 15 and November 15. The Company pursuant to satisfaction of interests conditions may elect to pay interest on the Convertible Notes (i) by paying an amount in cash (“Cash Interest”) on such interest payment date equal to all interest accrued from, and including, the immediately preceding date on the principal amount (the “Interest Amount”) or (ii) by the issuance of a number of shares of the Company’s common stock equal to the Interest Amount based on the daily VWAP (as defined in the Indenture) for the eight trading days prior to the date two trading days prior to the relevant interest payment date (“Share Interest”) or (iii) any combination of Cash Interest and Share Interest. The effective interest rate of the Convertible Notes is 4.95%.
The Convertible Notes are convertible at an initial conversion rate of 63.0348 shares of the Company’s common stock per $1,000 principal amount of the Convertible Notes, which is equivalent to an initial conversion price of approximately $15.8643 per share, subject to adjustment upon the occurrence of certain events as described in the Indenture. Holders may convert their Convertible Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, the Company may pay or deliver cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s common stock, at its election.
The Company may redeem for cash all or any portion of the Convertible Notes, at its option, on or after November 20, 2028, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption. The redemption price will be equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The Company may redeem for cash all of the Notes, at a redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon, if at any time less than 10% of the aggregate principal amount of the Notes initially issued on the date of the Indenture remain outstanding. The conversion rate on any Notes that are converted following a notice of redemption will be subject to a “make-whole” adjustment pursuant to the terms of the Indenture. No sinking fund is provided for the Convertible Notes.
Subject to certain administrative conditions set forth in the Indenture, upon the occurrence of a Fundamental Change (as defined in the Indenture), each of the Holders shall have the right at such Holder’s option to require the Company to repurchase in cash all of such Holder’s Notes or any portion of the principal amount thereof which is equal to $1,000 or an integral multiple of $1,000 at a repurchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest thereon.
The net carrying amount of the Convertible Notes was as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
December 31, |
|
|
|
2026 |
|
|
2025 |
|
Principal |
|
$ |
100,000 |
|
|
$ |
100,000 |
|
Unamortized debt discount and issuance costs |
|
|
3,104 |
|
|
|
3,307 |
|
Net carrying amount |
|
$ |
96,896 |
|
|
$ |
96,693 |
|
The Company made its first semiannual interest payment on the Convertible Notes on May 15, 2026, by issuing 149,037 shares of its common stock.
Public offering
On June 3, 2026 we filed a registration statement on Form S-3ASR (File No. 333-296469) (the “Shelf Registration Statement”) and a related prospectus with the Securities and Exchange Commission. Pursuant to the Shelf Registration Statement we may offer, from time to time, common stock, preferred stock, debt securities and warrants. On June 4, 2026, we filed a prospectus and prospectus supplement with the Securities and Exchange Commission. The prospectus and prospectus supplement registered the offer and sale of up to 5,168,539 shares of our common stock, including the full exercise of the underwriters’ option to purchase an additional 674,157 shares of common stock, pursuant to the Shelf Registration Statement, at a public offering price of $22.25 per share. On June 5, 2026, we completed the sale of all 5,168,539 shares of our common stock registered under the Shelf Registration Statement, at a public offering price of $22.25 per share, for an aggregate offering price of approximately $115.0 million. We received net proceeds of $108.8 million from the offering after deducting underwriters’ discounts and commissions of $5.8 million and offering costs of $0.4 million.
Note 11. Capital Structure
As of June 30, 2026, the Company was authorized to issue up to 422,000,000 shares of common stock, each with a par value of $0.0001 per share.
Preferred Stock
The Company is authorized to issue up to 10,000,000 shares of preferred stock, each with a par value of $0.0001 per share. As of June 30, 2026 and December 31, 2025, no shares of preferred stock were issued and outstanding.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion of Aeva’s results of operations and financial condition should be read in conjunction with the information set forth in the unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q. This discussion may contain forward-looking statements based upon Aeva’s current expectations, estimates, and projections that involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements due to, among other considerations, the matters discussed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”) under the heading “Risk Factors” and “Special Note Regarding Forward-Looking Statements.” Unless the context otherwise requires, all references in this section to “we,” “our,” “us” “the Company” or “Aeva” refer to the business of Aeva Technologies, Inc., a Delaware corporation, and its subsidiaries.
Overview
Our vision is to bring perception to broad applications. Through our Frequency Modulated Continuous Wave ("FMCW") sensing technology, we believe we are introducing the world’s first 4D LiDAR-on-chip that, along with our proprietary software applications, has the potential to enable the adoption of LIDAR across broad applications.
Founded in 2017 by former Apple engineers Soroush Salehian and Mina Rezk and led by a multidisciplinary team of engineers and operators experienced in the field of sensing and perception, Aeva’s mission is to bring the next wave of perception technology to broad applications from automated driving to industrial automation, consumer device, and security applications. Our 4D LiDAR-on-chip combines silicon photonics technology that is proven in the telecom industry with precise instant velocity measurements and long-range performance for commercialization.
As a development stage company, we work closely with our customers on the development and commercialization of their programs and the utilization of our products in such programs. Thus far, typically our customers have purchased products and engineering services from us for use in research and development programs, pilot and evaluation programs. We are expanding our manufacturing capacity through third-party manufacturers to meet our customers’ anticipated demand for the production of our products.
Unlike legacy 3D LiDAR, which relies on Time-of-Flight (“ToF”) technology and measures only depth and reflectivity, Aeva’s solution leverages a proprietary FMCW technology to measure velocity in addition to depth, reflectivity and inertial motion. We believe the ability of Aeva’s solution to measure instant velocity for every pixel is a major advantage over ToF-based sensing solutions. Furthermore, Aeva’s technology is free from interference from other LiDAR and sunlight, and our core innovations within FMCW are intended to enable autonomous vehicles to see at significantly higher distances of up to 500 meters.
We believe Aeva is uniquely positioned to provide a superior solution with the potential to enable higher level of automation for vehicles. Furthermore, we believe the advantages of our 4D LiDAR-on-chip allow us to provide the first LiDAR solution that is fully integrated onto a chip with superior performance at scale, with the potential to drive new categories of perception across industrial automation, consumer devices, and security applications.
Key Factors Affecting Aeva’s Operating Results
We believe that Aeva's future performance and success depends to a substantial extent on our ability to capitalize opportunities, which in turn is subject to significant risks and challenges, including those discussed in Part I, Item 1A of the 2025 Form 10-K under the heading “Risk Factors.”
Pricing, Product Cost and Margins. Our pricing and margins will depend on the volumes and the features, as well as specific market applications of the solutions we provide to our customers. We have customers with technologies in various stages of development across different market segments. We anticipate that our prices will vary by market and application due to market-specific product and commercial requirements, supply and demand dynamics and product lifecycles.
Our future performance will depend on our ability to deliver on economies of scale. Our customers will require that our perception solutions be manufactured and sold at per-unit prices that are competitive. Our ability to compete in key markets will depend on the success of our efforts to efficiently and reliably produce cost-effective perception solutions that are competitively priced and affordable for our commercial-stage customers.
Additionally, the macroeconomic conditions in the industry, the growing emergence of competition in advanced assisted driving sensing and software technologies globally can negatively impact pricing, margins and market share. Our business is impacted by various macroeconomic factors, including inflation, interest rates, levels of consumer confidence and consumer debt, fuel and energy costs, and other economic conditions. In addition, we are susceptible to supply chain disruptions, which may be exacerbated by changes to tariffs and trade policies. Given the nature of these macroeconomic factors, we cannot predict whether or for how long certain trends will continue, nor can we predict to what degree these trends will impact us in the future. If we do not generate the margins we expect upon commercialization of our perception solutions, we may be required to raise additional debt or equity capital, which may not be available or may only be available on terms that are onerous to Aeva’s stockholders.
Commercialization of LiDAR-based Applications. We expect that our results of operations, including revenue and gross margins, will fluctuate on a quarterly basis for the foreseeable future as our customers continue on research and development projects and begin to commercialize advanced driver assist, autonomous and industrial automation solutions that rely on LiDAR technology. The development cycles of our products with new customers varies widely depending on the application, market, customer and the complexity of the product, and can vary from several months to years depending on the industry. These development cycles result in us investing our resources prior to realizing any revenue from the commercialization or obtaining any firm commitments of pricing, volume or timing of purchases of our products by our customers. As customers reach the commercialization phase and as the market for LiDAR solutions matures, these fluctuations in our operating results may become less pronounced.
Sales Volume. Each product program will have an expected range of sales volumes, depending on the end market demand for our customers’ products as well as market application. This can depend on several factors, including market penetration, product capabilities, size of the end market that
the product addresses and our end customers’ ability to sell their products. In addition to end market demand, sales volumes also depend on whether our customer is in the development or production phase. In certain cases, we may provide volume discounts or strategic customer pricing on sales of our solutions, which may or may not be offset by lower manufacturing costs related to higher volumes which in turn could adversely impact our gross margins. Our ability to ultimately achieve profitability is dependent upon progression of existing relationships to production and our ability to meet required volumes and required cost targets and gross margins. Delays in our current and future customers’ programs could result in us being unable to achieve our revenue targets and profitability in the time frame we anticipate. Such delays could result in us requiring to raise additional debt or equity capital, which may not be available or may only be available on terms that are onerous to Aeva’s stockholders.
Basis of Presentation
Our condensed consolidated financial statements include the accounts of our wholly owned subsidiaries. We currently conduct our business through one operating segment.
Components of Results of Operations
Revenue
Revenue consists of sales of perception solutions or sensing systems and non-recurring engineering services.
Aeva is engaged in design, manufacturing and sale of LiDAR sensing systems and related perception and autonomy-enabling software solutions serving customers in automotive, industrial, and other markets. Under our customer agreements, Aeva delivers a specified number of sensing systems at a fixed price under customary terms and conditions. The sensing system units sold under these agreements are typically products that are used by the customer for its research, development, evaluation, pilot and testing purposes. We also enter into non-recurring engineering service arrangements with certain of our customers to customize Aeva’s perception solution to meet customer specific requirements.
Cost of revenue and gross profit
Cost of revenue principally includes direct material, direct labor and allocation of overhead associated with manufacturing operations, including inbound freight charges and depreciation expense. Cost of revenue also includes the direct cost and appropriate allocation of overhead involved in execution of non-recurring engineering services. Aeva’s gross profit equals total revenue less total cost of revenue.
Operating expenses
Research and development expenses
Aeva’s research and development efforts are focused on enhancing and developing additional functionality for our existing products and on new product development. Research and development expenses consist primarily of:
•Personnel-related expenses, including salaries, benefits, and stock-based compensation expense, for personnel in our research and engineering functions; and
•Expenses related to materials, software licenses, supplies, and third-party services.
Aeva recognizes research and development expenses as incurred.
General and administrative expenses
General and administrative expenses consist of personnel and personnel-related expenses, including salaries, benefits, and stock-based compensation expense of our executive, finance, information systems, human resources, and legal, as well as legal and accounting fees for professional and contract services.
Selling and marketing expenses
Selling and marketing expenses consist of personnel and personnel-related expenses, including salaries, benefits, and stock-based compensation expense of our business development team as well as advertising and marketing expenses. These include the cost of trade shows, promotional materials, and public relations.
Interest income
Interest income consists primarily of income earned on our cash equivalents and investments in marketable securities. Interest income varies based on our cash equivalents and marketable securities balance and changes in the interest rates.
Fair value of warrant liability
Fair value of warrant liability consist of changes in the fair value of Series A warrants and fair value oft private placement warrants which expired in March 2026. The change in fair value of the warrants is due to the change in the stock price of the Company.
Other income and expense
Other income and expense primarily consist of and foreign currency transaction gains and losses, as well as realized gains and losses on marketable securities.
Interest expense
Interest expense consists of interest expense on convertible notes.
Results of Operations
The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this Quarterly Report on Form 10-Q.
Comparison of the Three Months Ended June 30, 2026, and 2025
The following table sets forth our results of operations data for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
|
|
|
|
|
|
|
|
2026 |
|
|
2025 |
|
|
Change
$ |
|
|
Change
% |
|
|
|
(in thousands, except percentages) |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Product |
|
$ |
2,546 |
|
|
$ |
4,203 |
|
|
|
(1,657 |
) |
|
|
(39 |
)% |
Professional service |
|
|
3,590 |
|
|
|
1,308 |
|
|
|
2,282 |
|
|
|
174 |
% |
Total revenues |
|
|
6,136 |
|
|
|
5,511 |
|
|
|
625 |
|
|
|
11 |
% |
Cost of revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Product |
|
|
2,614 |
|
|
|
3,992 |
|
|
|
(1,378 |
) |
|
|
(35 |
)% |
Professional service |
|
|
1,333 |
|
|
|
4,239 |
|
|
|
(2,906 |
) |
|
|
(69 |
)% |
Total cost of revenues |
|
|
3,947 |
|
|
|
8,231 |
|
|
|
(4,284 |
) |
|
|
(52 |
)% |
Gross profit |
|
|
2,189 |
|
|
|
(2,720 |
) |
|
|
4,909 |
|
|
|
(180 |
)% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses |
|
|
24,889 |
|
|
|
22,841 |
|
|
|
2,048 |
|
|
|
9 |
% |
General and administrative expenses |
|
|
10,216 |
|
|
|
7,969 |
|
|
|
2,247 |
|
|
|
28 |
% |
Selling and marketing expenses |
|
|
1,644 |
|
|
|
1,393 |
|
|
|
251 |
|
|
|
18 |
% |
Total operating expenses |
|
|
36,749 |
|
|
|
32,203 |
|
|
|
4,546 |
|
|
|
14 |
% |
Loss from operations |
|
|
(34,560 |
) |
|
|
(34,923 |
) |
|
|
363 |
|
|
|
(1 |
)% |
Interest income |
|
|
893 |
|
|
|
619 |
|
|
|
274 |
|
|
|
44 |
% |
Change in fair value of warrant liabilities |
|
|
(44,700 |
) |
|
|
(88,478 |
) |
|
|
43,778 |
|
|
|
(49 |
)% |
Fair value loss on share subscription liability |
|
|
— |
|
|
|
(69,996 |
) |
|
|
69,996 |
|
|
|
|
Interest expense |
|
|
(1,196 |
) |
|
|
— |
|
|
|
(1,196 |
) |
|
|
100 |
% |
Other income (expense), net |
|
|
(3 |
) |
|
|
106 |
|
|
|
(109 |
) |
|
|
(103 |
)% |
Net loss before taxes |
|
|
(79,566 |
) |
|
|
(192,672 |
) |
|
|
43,110 |
|
|
|
(22 |
)% |
Income tax provision |
|
|
58 |
|
|
|
70 |
|
|
|
(12 |
) |
|
|
(17 |
)% |
Net loss |
|
$ |
(79,624 |
) |
|
$ |
(192,742 |
) |
|
$ |
43,122 |
|
|
|
(22 |
)% |
Revenue
Product
Product revenue decreased by $1.7 million, or 39%, to $2.5 million during the three months ended June 30, 2026, from $4.2 million for the three months ended June 30, 2025. This decrease was primarily due to a lower average selling price of units sold in the three months ended June 30, 2026 as compared to the three months ended June 30, 2025, partially offset by higher number of units sold in the three months ended June 30, 2026 as compared to the three months ended June 30, 2025.
Professional Service
Professional services revenue increased by $2.3 million, or 174%, to $3.6 million during the three months ended June 30, 2026, from $1.3 million for the three months ended June 30, 2025. The increase was primarily due to a higher development activity for non-recurring engineering services during the three months ended June 30, 2026.
Cost of revenue
Cost of product revenue decreased by $1.4 million, or 35%, during the three months ended June 30, 2026, from the three months ended June 30, 2025. The decrease was primarily due to a lower material cost and manufacturing overheads related to the units sold.
Cost of professional service revenues decreased by $2.9 million, or 69%, during the three months ended June 30, 2026, from the three months ended June 30, 2025. The decrease was primarily due to a $3.8 million loss recognized on a joint development agreement during three months ended June 30, 2025, partially offset by an increase in the non recurring engineering revenue during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025.
Operating expenses
Research and development expenses
Research and development expenses increased by $2.0 million, or 9%, to $24.9 million for the three months ended June 30, 2026, from $22.8 million for the three months ended June 30, 2025. The increase was primarily due to a $1.5 million increase in stock based compensation expense, a $0.9 million increase in research and development expense, a $0.8 million increase in software license subscription expense, a $0.3 million increase in consulting expense, partially offset by a $1.4 million decrease in payroll related expense.
General and administrative expenses
General and administrative expenses increased by $2.2 million, or 28%, to $10.2 million for the three months ended June 30, 2026, from $8.0 million for the three months ended June 30, 2025. The increase was primarily due to a $0.8 million increase in payroll related expense, a $0.6 million increase in stock based compensation expense and a $0.8 million increase in professional service expense.
Selling and marketing expenses
Selling and marketing expenses increased by $0.3 million, or 18%, to $1.6 million for the three months ended June 30, 2026, from $1.4 million for the three months ended June 30, 2025. The increase was primarily due to a $0.3 million increase in stock based compensation expense, a $0.2 million increase in travel expense, partially offset by a $0.2 million decrease in marketing expense.
Interest income
Interest income increased by $0.3 million, or 44%, during the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was due to an increase in the overall balance of interest-bearing cash equivalents and marketable securities.
Change in fair value of warrant liability
The change during the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, was due to change in the fair value of Series A warrants resulting from change in the stock price of the company at the end of the each period.
Fair value loss on share subscription liability
The fair value loss on share subscription liability of $70.0 million during the three months ended June 30, 2025 was a non cash charge due to change in fair value of common stock to be issued under the LG Subscription Agreement.
Interest expense
Interest expense increased by $1.2 million during the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, due to interest expense related to the convertible notes.
Comparison of the Six Months Ended June 30, 2026, and 2025
The following table sets forth our results of operations data for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, |
|
|
|
|
|
|
|
|
2026 |
|
|
2025 |
|
|
Change
$ |
|
|
Change
% |
|
|
(in thousands, except percentages) |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Product |
|
$ |
4,973 |
|
|
$ |
6,684 |
|
|
$ |
(1,711 |
) |
|
(26)% |
Professional service |
|
|
7,425 |
|
|
|
2,195 |
|
|
|
5,230 |
|
|
238% |
Total revenues |
|
|
12,398 |
|
|
|
8,879 |
|
|
|
3,519 |
|
|
40% |
Cost of revenues: |
|
|
|
|
|
|
|
|
|
|
|
Product |
|
|
5,651 |
|
|
|
6,575 |
|
|
|
(924 |
) |
|
(14)% |
Professional service |
|
|
2,617 |
|
|
|
4,714 |
|
|
|
(2,097 |
) |
|
(44)% |
Total cost of revenues |
|
|
8,268 |
|
|
|
11,289 |
|
|
|
(3,021 |
) |
|
(27)% |
Gross profit (loss) |
|
|
4,130 |
|
|
|
(2,410 |
) |
|
|
6,540 |
|
|
(271)% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
47,715 |
|
|
|
44,410 |
|
|
|
3,305 |
|
|
7% |
General and administrative expenses |
|
|
22,568 |
|
|
|
15,186 |
|
|
|
7,382 |
|
|
49% |
Selling and marketing expenses |
|
|
3,543 |
|
|
|
3,335 |
|
|
|
208 |
|
|
6% |
Total operating expenses |
|
|
73,826 |
|
|
|
62,931 |
|
|
|
10,895 |
|
|
17% |
Loss from operations |
|
|
(69,696 |
) |
|
|
(65,341 |
) |
|
|
(4,355 |
) |
|
7% |
Interest income |
|
|
1,770 |
|
|
|
1,626 |
|
|
|
144 |
|
|
9% |
Change in fair value of warrant liabilities |
|
|
(44,250 |
) |
|
|
(93,878 |
) |
|
|
49,628 |
|
|
(53)% |
Fair value loss on share subscription liability |
|
|
— |
|
|
|
(69,996 |
) |
|
|
69,996 |
|
|
(100)% |
Interest expense |
|
|
(2,379 |
) |
|
|
— |
|
|
|
(2,379 |
) |
|
(100)% |
Other income (expense), net |
|
|
42 |
|
|
|
107 |
|
|
|
(65 |
) |
|
(61)% |
Net loss before taxes |
|
|
(114,513 |
) |
|
|
(227,482 |
) |
|
|
112,969 |
|
|
(50)% |
Income tax provision |
|
|
90 |
|
|
|
127 |
|
|
|
(37 |
) |
|
(29)% |
Net loss |
|
$ |
(114,603 |
) |
|
$ |
(227,609 |
) |
|
$ |
112,932 |
|
|
(50)% |
Revenue
Product
Product revenue decreased by $1.7 million, or 26%, to $5.0 million during the six months ended June 30, 2026, from $6.7 million for the six months ended June 30, 2025. This decrease was primarily due to a lower average selling price of units sold in the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, partially offset by higher number of units sold in the six months ended June 30, 2026 as compared to the six months ended June 30, 2025.
Professional Service
Professional services revenue increased by $5.2 million, or 238%, to $7.4 million during the six months ended June 30, 2026, from $2.2 million for the six months ended June 30, 2025. The increase was primarily due to a higher development activity for non-recurring engineering services during the six months ended June 30, 2026 for a new development agreement signed in second half of year ended December 31, 2025.
Cost of revenue
Cost of product revenue decreased by $0.9 million, or 14%, during the six months ended June 30, 2026, from the six months ended June 30, 2025. The decrease was primarily due to a lower material cost and manufacturing overheads related to the units sold.
Cost of professional service revenues decreased by $2.1 million, or 44%, during the six months ended June 30, 2026, from the six months ended June 30, 2025. The decrease was primarily due to a $3.8 million loss recognized on a joint development agreement during six months ended June 30, 2025, partially offset by increase in the non recurring engineering revenue during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025.
Operating expenses
Research and development expenses
Research and development expenses increased by $3.3 million, or 7%, to $47.7 million for the six months ended June 30, 2026, from $44.4 million for the six months ended June 30, 2025. The increase was primarily due to a $2.6 million increase in stock based compensation expense, a $2.5 million
increase in research and development service expense, a $0.9 million increase in software license subscription expense, a $0.4 million increase in consulting expense, partially offset by a $3.1 million decrease in payroll related expense.
General and administrative expenses
General and administrative expenses increased by $7.4 million, or 49%, to $22.6 million for the six months ended June 30, 2026, from $15.2 million for the six months ended June 30, 2025. The increase was primarily due to a $4.3 million increase in stock based compensation expense, a $1.3 million increase in payroll related expense, a $1.7 million increase in legal and professional expense and a $0.1 million increase in consulting expense.
Selling and marketing expenses
Selling and marketing expenses increased by $0.2 million, or 6%, to $3.5 million for the six months ended June 30, 2026, from $3.3 million for the six months ended June 30, 2025. The increase was primarily due to a $0.2 million increase in stock based compensation expense, a $0.2 million increase in travel expense, partially offset by a $0.2 million decrease in marketing expense.
Interest income
Interest income increased by $0.1 million, or 9%, during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The increase was due to an increase in the overall balance of interest-bearing cash equivalents and marketable securities.
Change in fair value of warrant liability
The change during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, was due to an increase in the fair value of the Series A warrants issued in connection with the Facility Agreement.
Fair value loss on share subscription liability
The fair value loss on share subscription liability of $70.0 million during the three months ended June 30, 2025 was a non cash charge due to change in fair value of common stock to be issued under the LG Subscription Agreement.
Interest expense
Interest expense increased by $2.4 million during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, due to interest expense related to the convertible notes.
Liquidity and Capital Resources
Sources of Liquidity
Our capital requirements will depend on many factors, including production capacity and sales volume, the timing and spending to support research and development efforts, investments in information technology, the expansion of sales and marketing activities, and market adoption of new and enhanced products and features.
On November 8, 2023, we entered into subscription agreements providing for the purchase of common stock resulting in net proceeds of $20.6 million. Also on November 8, 2023, we entered into a Standby Equity Purchase Agreement (as amended from time to time, the “Facility Agreement”) with entities affiliated with Sylebra. Pursuant to the Facility Agreement, we have the right, but not the obligation, to sell to Sylebra up to $125.0 million of shares of preferred stock, at our request until November 8, 2026, subject to the terms of the Facility Agreement and the satisfaction of certain conditions as described in Note 10 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Each sale we request under the Facility Agreement may be for a number of shares of preferred stock with an aggregate value of at least $25.0 million but not more than $50.0 million (except with Sylebra’s consent). We paid Sylebra a facility fee of $2.5 million, an origination fee of $0.6 million, and an administrative fee of $0.3 million and reimbursed $0.4 million to Sylebra for its fees and expenses. In addition, we issued to Sylebra Series A warrants to purchase 3,000,000 shares of common stock at an exercise price of $5.00.
On July 2, 2024, Aeva and the parties to the Delaware Stockholder Litigation entered into a term sheet, and on December 6, 2024 entered into a formal settlement agreement, which was approved by the court, to fully and finally resolve the Delaware Stockholder Litigation. In connection with the settlement, we agreed to pay a total settlement cost of $14.0 million in exchange for a release of all claims. The settlement was paid pursuant to our indemnification obligations and from available director and officer insurance policies. As of June 30, 2026, we have paid in full the $14.0 million previously accrued in connection with the settlement of the Delaware Stockholder Litigation. We have also recovered $2.5 million from an insurance carrier.
On May 13, 2025, we entered into a subscription agreement with LGIT, a company organized under the laws of the Republic of Korea, pursuant to which we agreed to sell and issue to LGIT in a private placement an aggregate of 3,509,719 shares of common stock for aggregate gross proceeds of approximately $32.5 million. In connection with the private placement, we entered into a joint development agreement with LGIT, and intend to form a strategic partnership with LGIT to bring Aeva’s 4D LiDAR into new industrial and consumer markets. The private placement closed on August 20, 2025. Accordingly, we issued 3,509,719 shares of common stock to LGIT at a price of $9.26 per share on receipt of gross proceeds of $32.5 million.
On November 4, 2025, we entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain funds affiliated with Apollo Global Securities, LLC relating to the sale of our 4.375% Convertible Senior Notes (the “Notes”) in an aggregate principal amount of $100 million due in 2032. The Notes are guaranteed by Aeva, Inc., a wholly owned subsidiary of ours. The transactions contemplated by the Securities Purchase Agreement closed on November 6, 2025. The Notes were issued pursuant to an indenture, dated as of November 6, 2025, by and among the Company, Aeva, Inc., as guarantor, and U.S. Bank Trust Company, National Association, as trustee and are senior, unsecured obligations of the Company. Interest on the Notes began accruing on the Closing Date and is payable semi-annually in arrears on May 15 and November 15 of each year, beginning on May 15, 2026, at a rate of 4.375% per year.
On June 5, 2026, we completed a public offering of 5,168,539 shares of our common stock, including 674,157 shares sold pursuant to the underwriters’ exercise of their option to purchase additional shares at a public offering price of $22.25 per share. Upon completion of our public offering, we received net proceeds of $108.8 million, after deducting underwriting discounts and commissions and offering expenses.
To date, we have incurred negative cash flows from operating activities and incurred losses from operations as reflected in our accumulated deficit of $871.9 million as of June 30, 2026. We expect to continue to incur operating losses due to continued investments that we intend to make in our business, including development of products. As of June 30, 2026, we had cash and cash equivalents and marketable securities totaling $177.9 million. We also have the ability to draw on the Facility Agreement up to $125.0 million through November 8, 2026 in exchange for the issuance of preferred shares, and we intend to draw down on the Facility Agreement if and as required by our capital needs. As of June 30, 2026, all conditions to draw under the Facility Agreement were met. We believe that our sources of liquidity, including financing available to us through the Facility Agreement will be sufficient to fund our operating and capital expenditure for at least 12 months from the date of issuance of the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Cash Flow Summary
The following table summarizes our cash flows for the periods presented:
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|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
|
(in thousands) |
|
Cash used in operating activities |
|
$ |
(57,015 |
) |
|
$ |
(60,616 |
) |
Cash (used in) provided by investing activities |
|
|
(86,516 |
) |
|
|
53,955 |
|
Cash provided by (used in) financing activities |
|
|
114,475 |
|
|
|
(460 |
) |
Net decrease in cash and cash equivalents |
|
$ |
(29,056 |
) |
|
$ |
(7,121 |
) |
Operating Activities
For the six months ended June 30, 2026, net cash used in operating activities was $57.0 million, attributable to a net loss of $114.6 million and a net change in operating assets and liabilities of $9.7 million, partially offset by non-cash charges of $67.3 million. Non-cash charges primarily consisted
of a $44.3 million change in the fair value of warrant liability, $17.9 million in stock-based compensation, $2.3 million for issuance of shares for convertible note interest payment, $2.6 million in depreciation and amortization expense, $1.1 million in amortization of right of use assets and $0.2 million in accretion for convertible notes, partially offset by a $1.0 million in accretion of discount on available for sale securities. The change in net operating assets and liabilities was primarily due to a $10.0 million decrease in accrued employee costs, a $0.8 million decrease in lease liability, a $2.6 million decrease in accrued liabilities, and a $0.4 million increase in accounts receivable, partially offset by a $2.0 increase in accounts payable, a $0.7 million increase in other current liabilities, a $0.6 million decrease in other current asset and a $0.6 million decrease in other noncurrent assets.
Investing Activities
For the six months ended June 30, 2026, net cash used in investing activities was $86.5 million, attributable to purchase of investments of $148.1 million and purchase of property, plant and equipment of $2.4 million, partially offset by proceeds from maturities of available-for-sale investments of $64.0 million.
Financing Activities
For the six months ended June 30, 2026, net cash provided by financing activities was $114.5 million, attributable to $109.2 million of cash received in from public offering net of expense paid and $5.5 million of cash received in connection with our joint development agreement with LGIT, partially offset by a $0.3 million payment of issuance cost for convertible notes.
Contractual Obligations and Other Commitments
Our commitments relate to leases of real estate. For more information, see Note 15 to our condensed consolidated financial statements located elsewhere in this Quarterly Report on Form 10-Q.
Off-Balance Sheet Arrangements
As of June 30, 2026, we have not engaged in any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.
Critical Accounting Estimates
We prepare our financial statements in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates, assumptions and judgments that can significantly impact the amounts Aeva reports as assets, liabilities, revenue, costs and expenses and the related disclosures. We base our estimates on historical experience and other assumptions that we believe are reasonable under the circumstances. Aeva’s actual results could differ significantly from these estimates under different assumptions and conditions. We believe that the accounting policies discussed below are critical to understanding our historical and future performance as these policies involve a greater degree of judgment and complexity.
For the three months ended June 30, 2026 there were no significant changes to our critical accounting estimates as noted below. For a more detailed discussion of our critical accounting policies and estimates, refer to our Annual Report on Form 10-K for the year ended December 31, 2025 and Note 1 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Warrants and Share Subscriptions
We account for warrants and other equity-linked contracts (i.e., share subscriptions) as equity or liability-classified instruments based on an assessment of the instrument’s specific terms and applicable authoritative guidance in FASB ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 815-40, Derivatives and Hedging – Contract in Entity’s Own Equity (“ASC 815-40”).
We first assess whether a freestanding equity-linked instrument should be classified as a liability pursuant to ASC 480 when the instrument is mandatorily redeemable, obligates the issuer to settle an instrument or the underlying shares by paying cash or other assets, or must or may require settlement by issuing variable number of shares and such settlement scenario is predominantly likely to occur.
If an equity-linked instrument does not trigger liability classification under ASC 480, we assess whether the instrument meets all requirements for equity classification under ASC 815-40, including whether the instrument is indexed to our own common stock, among other conditions for equity classification. If not, the instrument is classified as a liability and is further analyzed to determine whether the instrument represents a derivative in its entirety. This assessment requires the use of professional judgment and requires reassessment of an instrument’s classification at each reporting period while the instrument remains outstanding.
Equity-linked instruments that meet all equity classification conditions are recorded as a component of additional paid-in capital at issuance. Equity-linked instruments accounted for as liabilities are recognized and measured at fair value at inception and each reporting period the instrument remains outstanding. Any excess fair value over proceeds to be realized from the equity-linked instruments entered into at arm’s length, along with any changes in fair value, as determined at each reporting period, are recorded as a component of fair value loss on share subscription liability on the consolidated statements of operations and comprehensive loss. Changes in fair value are reported on the consolidated statements of cash flows as a non-cash reconciling item between net loss and net cash flows from operating activities.
Provision for Anticipated Losses on Contracts
When estimated contract costs exceed expected consideration under contracts with a customer, we evaluate whether the nature of the contract is in the scope of Accounting Standards Codification (“ASC”) 605-35, Revenue Recognition - Construction-Type and Production-Type Contracts(“ASC
605-35”). If ASC 605-35 applies, we recognize a provision for the entire anticipated losses on contracts as soon as the loss becomes evident. In determining the anticipated losses, we consider the principles in ASC 606-10-32-2 through 32-27 (except for the guidance in paragraphs 606-10-32-11 through 32-13 on constraining estimates of variable consideration) to determine the transaction price, adjusted to reflect the effects of the customer's credit risk. The costs used in arriving at the estimated loss on a contract shall include all costs of the type allocable to contracts under paragraphs 340-40-25-5 through 25-8.
The Private Placement closed on August 20, 2025. Accordingly, we issued 3,509,719 shares of common stock to LGIT at a price of $9.26 per share on receipt of gross proceeds of $32.5 million. See Note 2 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for details on the provision for anticipated losses recognized on the JDA contract.
Recent Accounting Pronouncements
See Note 1 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for recently issued accounting pronouncements not yet adopted as of the date of this Quarterly Report on Form 10-Q.