v3.25.1
Summary of Significant Accounting Policies (Policies)
3 Months Ended
Mar. 31, 2025
Accounting Policies [Abstract]  
Principles of Consolidation

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Urgent.ly Inc. and its wholly-owned subsidiaries Roadside Innovation Inc., Roadside Innovation (Arkansas) Inc., Urgently Canada Technologies ULC, and Otonomo Technologies Ltd. (“Otonomo”) and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

Basis of Presentation

Basis of Presentation

The accompanying condensed consolidated balance sheet as of March 31, 2025 and the condensed consolidated statements of operations and comprehensive loss, stockholders’ deficit, and cash flows for the three months ended March 31, 2025 and 2024 are unaudited. These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the financial information and footnotes required by U.S. GAAP for complete financial statements.

In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments, including normal recurring adjustments, necessary for the fair presentation of its financial position as of March 31, 2025 and its results of operations, changes in stockholders’ deficit, and cash flows for the three months ended March 31, 2025 and 2024.

The results for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for any subsequent quarter or for the fiscal year ending December 31, 2025. The condensed consolidated balance sheet at December 31, 2024 was derived from audited financial statements for the year ended December 31, 2024 included in the Annual Report but does not contain all of the footnote disclosures from the annual financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the fiscal years ended December 31, 2024 and 2023 included in the Annual Report.

Use of Estimates

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Concentrations of Credit Risk

Concentrations of Credit Risk

Financial instruments that subject the Company to credit risk consist primarily of cash, cash equivalents, restricted cash and accounts receivable. The Company places its cash, cash equivalents and restricted cash in an accredited financial institution and the balances are above federally insured limits. Management monitors the creditworthiness of its customers and believes that it has adequately provided for any exposure to potential credit losses.

During the three months ended March 31, 2025 and 2024, 53% and 54% of revenue was earned from two and three customers, respectively. At March 31, 2025 and December 31, 2024, 60% and 71% of accounts receivable was due from three customers, respectively.

Capitalized Software

Capitalized Software

The Company incurred costs to develop, modify, or implement software for internal use as it delivers on significant contracts for which its product offering has expanded. The Company’s objective is to enhance the functionality of the platform to accommodate multiple client applications and interfaces across different customer systems with varying degrees of complexity. Costs incurred for computer software developed or obtained for internal use are capitalized for application development activities and expensed as incurred for preliminary project activities and post-implementation activities. Capitalized costs include external direct costs of materials and services consumed in developing or obtaining internal-use software, payroll and payroll-related costs for employees who are directly associated with the internal-use software project, and interest costs incurred, when material, while developing internal-use software. Capitalized costs are amortized over the estimated useful asset life of three years. Capitalization of such costs ceases when the project is substantially complete and ready for its intended purpose. Costs for maintenance and training are expensed as incurred.

Modification of Debt Instruments

Modification of Debt Instruments

Modifications or exchanges of debt, which are not considered a troubled debt restructuring, are considered extinguishments if the terms of the new debt and the original instrument are substantially different. The instruments are considered substantially different when the present value of the cash flows under the terms of the new debt instrument are at least 10% different from the present value of the remaining cash flows under the terms of the original instrument. If the original and new debt instruments are substantially different, the original debt is derecognized and the new debt is initially recorded at fair value, with the difference recognized as an extinguishment gain or loss. During the three months ended March 31, 2025, the Company amended its term loans (see Note 7).

Segment Reporting

Segment Reporting

The Company has determined that its Chief Executive Officer is its chief operating decision maker (the “CODM”). The Company’s Chief Executive Officer reviews financial information presented on a consolidated basis for purposes of assessing performance and making decisions on how to allocate resources. Accordingly, the Company has determined that it operates in a single reportable segment: Mobility Assistance Services. The Mobility Assistance Services segment includes all products, services and software used to generate revenue under the Company’s commercial agreements. The CODM uses consolidated net income (loss) and operating income (loss) to measure segment profit or loss, allocate resources and assess performance. Further, the CODM reviews and utilizes departmental expenses (cost of revenue, research and development, sales and marketing, operations and support, and general and administrative) at the consolidated level to manage the Company’s operations. The measure of segment assets is reported on the consolidated balance sheet as total assets.

Equity Method Investment

The Company utilizes the equity method to account for investments when the Company possesses the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. The Company accounts for its equity method investment in The Floow Limited at cost, adjusted for the Company’s share of the investee’s earnings or losses, which are reflected within Other income (expense), net in the condensed consolidated statements of operations on a three-month lag. Equity method investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If it is determined that a loss in value of the equity method investment is other than temporary, an impairment loss is measured based on the excess of the carrying amount of an investment over its estimated fair value. As of March 31, 2025 and December 31, 2024, the carrying value of its equity method investment was $1,500 and $1,350, respectively, and is included in Other non-current assets in the condensed consolidated balance sheets.

Equity Method Investment

Equity Method Investment

The Company utilizes the equity method to account for investments when the Company possesses the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. The Company accounts for its equity method investment in The Floow Limited at cost, adjusted for the Company’s share of the investee’s earnings or losses, which are reflected within Other income (expense), net in the condensed consolidated statements of operations on a three-month lag. Equity method investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If it is determined that a loss in value of the equity method investment is other than temporary, an impairment loss is measured based on the excess of the carrying amount of an investment over its estimated fair value. As of March 31, 2025 and December 31, 2024, the carrying value of its equity method investment was $1,500 and $1,350, respectively, and is included in Other non-current assets in the condensed consolidated balance sheets.

New Accounting Pronouncement

New Accounting Pronouncement

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which provides for improvements to income tax disclosures primarily related to the effective tax rate reconciliation and income taxes paid information. This guidance is effective for annual periods beginning after December 15, 2024, and the adoption of this standard is not anticipated to have a significant impact on the Company’s consolidated financial statements other than adding new disclosures, which the Company is currently evaluating.