v3.26.1
ACQUISITIONS
 6 Months Ended
Jun. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
ACQUISITIONS ACQUISITIONS
Fiscal 2026 Acquisitions
Vebu, Inc. Acquisition
On February 17, 2026 (the “Vebu Closing Date”), the Company completed its acquisition of Vebu, Inc. (“Vebu”), which specializes in developing advanced automation solutions and robotic systems that streamline food preparation and kitchen workflows across the food supply chain. Pursuant to the Agreement and Plan of Merger, dated February 5, 2026, by and among Serve, Vebu and Serve Kitchen Robotics Inc., a Delaware corporation and direct wholly-owned subsidiary of the Company, and James Buckly Jordan, an individual, solely in his capacity as the representative of the indemnifying securityholders (the “Vebu Merger Agreement”), the Company acquired all of the issued and outstanding equity of Vebu (the “Vebu Acquisition”).
Pursuant to the terms of the Vebu Merger Agreement, the aggregate consideration paid by the Company to the Vebu stockholders at the closing of the Vebu Acquisition had an aggregate value of $3.7 million of cash, common stock, and earnout contingent consideration. The consideration includes $2.3 million paid in cash to satisfy the net debt adjustment and a potential earnout which may be earned upon the achievement of certain milestones set forth in the Vebu Merger Agreement. After giving effect to such adjustments as set forth in the Vebu Merger Agreement, the Company issued 147,445 shares of the Company’s common stock to the Vebu stockholders.
In addition, as set forth in the Vebu Merger Agreement, Vebu stockholders may be entitled to receive additional earnout consideration consisting of a number of shares of the Company’s common stock equal to 33% of the net proceeds generated during the earnout period, divided by the volume-weighted average price of the Company’s common stock over the earnout period (the “Earnout Consideration”). The Earnout Consideration is classified as a liability in accordance with ASC 480 because the Company is obligated to issue a variable number of shares. As of June 30, 2026, the fair value of the contingent consideration was deemed to be $5.0 thousand. The contingent consideration liability will be recognized at the point that the earnout is deemed probable. At the time it is recorded, it will be classified in the consolidated balance sheets based on the expected timing of settlement. Refer to Note 6. Fair Value Measurements for information regarding the subsequent measurement of the contingent consideration liability at fair value.
The total preliminary fair value of consideration paid in connection with the acquisition of Vebu consisted of the following:
SharesPer ShareTotal Consideration
(in thousands)
Cash consideration paid for outstanding shares of Vebu common and preferred stock$2,305 
Company common shares issuable to Vebu preferred stockholders147,445 $9.27 1,367 
Fair value of contingent consideration issuable to Vebu preferred stockholders5 
Total purchase price consideration$3,677 

At the closing, each outstanding share of Vebu common stock and preferred stock was automatically cancelled and converted into the right to receive shares of the Company’s common stock (including any escrow releases and earnout consideration), as set forth in the Vebu Merger Agreement. Each restricted stock unit held by a continuing employee immediately prior to the closing was assumed and converted by the Company into a Company RSU on a 1:1 basis and on substantially identical terms and conditions. The Company assumed 500,000 restricted stock units held by continuing employees of Vebu.

The Company allocated the fair value of the purchase price consideration to the tangible assets acquired and liabilities assumed, based on estimated fair values. The excess purchase price over those fair values is recorded as goodwill. The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates with respect to intangible assets. The acquired company’s intangible asset is comprised of developed technology. The estimated fair value of the developed technology was determined using the relief from royalty method under the income-based approach. This method estimates the fair value of the subject intangible asset based on the present value of royalty payments that would be paid if the subject intangible asset was not owned but accessed through a license agreement.

The preliminary goodwill of $2.0 million arising from the acquisition is attributed to the expected synergies, including innovation synergies, and other benefits expected to be generated. Substantially all of the goodwill recognized is not expected to be deductible for tax purposes.

Certain data necessary to complete the purchase price allocation remains preliminary. The Company expects to complete the purchase price allocation within 12 months of the Vebu Closing Date, at which time the purchase price allocation set forth herein may be revised. Any such revisions or changes may be material. The Company utilized widely accepted income-based, market-based, and cost-based valuation approaches to perform the preliminary purchase price allocation.
The Company’s preliminary allocation of the purchase price, based on the estimated fair value of the assets acquired and liabilities assumed as of the Vebu Closing Date, is as follows (in thousands):
February 17, 2026
Total purchase price consideration$3,677 
Assets acquired:
Cash and cash equivalents396 
Accounts receivable140 
Prepaid expenses133 
Property and equipment42 
Intangible assets1,030 
Operating lease right-of-use assets62 
Other assets226 
Total identified assets acquired2,029 
Liabilities assumed:
Accounts payable(240)
Accrued liabilities(69)
Operating lease liabilities(64)
Total identified liabilities(373)
Fair value of identifiable assets, net of identifiable liabilities assumed$1,656 
Goodwill$2,021 
The following table sets forth the preliminary components of intangible assets acquired (in thousands) and their estimated useful life as of the date of acquisition (in years):
Weighted Average Useful LifeFebruary 17, 2026
Developed technology6$1,030 
The Company recorded $0.2 million and $0.6 million of acquisition related costs in the three and six months ended June 30, 2026, respectively, representing professional fees and other direct acquisition costs. These costs are recorded within general and administrative expense in our unaudited condensed consolidated statements of operations and comprehensive loss.
Diligent Robotics, Inc. Acquisition
On January 27, 2026 (the “Diligent Closing Date”), the Company completed its acquisition of Diligent Robotics, Inc. (“Diligent”), a provider of AI-powered robot assistants for the healthcare industry. Pursuant to the Agreement and Plan of Merger, dated January 19, 2026, by and among the Company, Delight Merger Sub, Inc., a Delaware corporation and direct wholly-owned subsidiary of the Company, Diligent, and Andrea Thomaz, an individual, solely in her capacity as the representative of the indemnifying securityholders (the “Diligent Merger Agreement”), the Company acquired all of the issued and outstanding equity of Diligent (the “Diligent Acquisition”).
Pursuant to the terms of the Diligent Merger Agreement, the aggregate consideration paid by the Company to the Diligent stockholders at the closing of the Diligent Acquisition had an aggregate fair value of $25.7 million of cash, common stock, and earnout contingent consideration. After giving effect to the adjustments as set forth in the Diligent Merger Agreement, the Company issued 197,472 shares of the Company’s common stock to the Diligent stockholders with a fair value of $2.5
million based on the Company’s closing stock price as of the date of acquisition. In addition, up to 366,332 shares of the Company’s common stock may be issued in the future upon achievement of certain milestones set forth in the Diligent Merger Agreement, of which 274,749 shares relate to the contingent consideration included in the consideration transferred. The remaining 91,583 shares of the Company’s common stock to be issued upon achievement of certain future milestones as set forth in the Diligent Merger Agreement are attributed to certain employees and subject to a continuous service-condition. Refer to Note 10. Stockholders’ Equity and Stock-Based Compensation for additional information regarding the earnout consideration arrangements.
The total preliminary fair value of consideration paid in connection with the acquisition of Diligent consisted of the following:

SharesPer ShareTotal Consideration
(in thousands)
Cash consideration paid$20,095 
Fair value of Serve’s common shares issuable to Diligent stockholders (including escrow amounts)
197,472 $12.77 2,522 
Fair value of contingent earnout consideration274,749 $11.25 3,090 
Total purchase price consideration$25,707 

At the closing, each outstanding share of Diligent common stock, all Diligent options, and all Diligent warrants were automatically cancelled for no consideration and each outstanding share of Diligent preferred stock was automatically cancelled and converted into the right to receive shares of the Company’s common stock, including any escrow releases and earnout consideration, as set forth in the Diligent Merger Agreement. Each Diligent restricted stock unit held by a continuing employee immediately prior to the closing was assumed and converted into a restricted stock unit on a 1:1 basis and on substantially identical terms and conditions. The Company assumed 1,319,151 restricted stock units held by continuing employees of Diligent.

The Company allocated the fair value of the purchase price consideration to the tangible and intangible assets acquired and liabilities assumed, based on estimated fair values. The excess purchase price over those fair values is recorded as goodwill. The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates with respect to intangible assets. The acquired company’s intangible assets are comprised of developed technology and trade name. The estimated fair values of the developed technology and trade name were determined using the relief from royalty method under the income-based approach. This method estimates the fair value of the intangible asset based on the present value of royalty payments that would be paid if the subject intangible asset was not owned but paid to a third-party for the use of the asset.

The preliminary goodwill of $10.4 million arising from the acquisition is attributed to the expected synergies, including innovation synergies, synergies related to the assembled workforce, and other benefits expected to be generated. Substantially all of the goodwill recognized is not expected to be deductible for tax purposes.

Certain data necessary to complete the purchase price allocation remains preliminary. The Company expects to complete the purchase price allocation within 12 months of the Diligent Closing Date, at which time the purchase price allocation set forth herein may be revised. Any such revisions or changes may be material. The Company utilized widely accepted income-based, market-based, and cost-based valuation approaches to perform the preliminary purchase price allocation.
The Company’s preliminary allocation of the purchase price, based on the estimated fair value of the assets acquired and liabilities assumed as of the Diligent Closing Date, is as follows (in thousands):

January 27, 2026
Total purchase price consideration$25,707 
Assets acquired:
Cash and cash equivalents557 
Accounts receivable564 
Prepaid expenses388 
Property and equipment12,474 
Intangible assets6,000 
Capitalized software2,238 
Other assets128 
Total identified assets acquired22,349 
Liabilities assumed:
Accounts payable(2,010)
Accrued liabilities(2,327)
Deferred revenue(1,925)
Deferred tax liability(740)
Other liabilities(88)
Total identified liabilities(7,090)
Fair value of identifiable assets, net of identifiable liabilities assumed$15,259 
Goodwill$10,448 
The following table sets forth the preliminary components of intangible assets acquired (in thousands) and their estimated useful life as of the date of acquisition (in years):
Intangible AssetsWeighted Average Useful LifeJanuary 27, 2026
Developed technology6$5,300 
Trade names4700 
Total fair value of intangible assets$6,000 
The Company recorded $0.2 million and $1.4 million of acquisition related costs in the three and six months ended June 30, 2026, respectively, representing professional fees and other direct acquisition costs. These costs are recorded
within general and administrative expense in our unaudited condensed consolidated statements of operations and comprehensive loss.
The amounts of revenue and loss from Diligent included in the Company’s unaudited condensed consolidated statements of operations and comprehensive loss from January 27, 2026 to the period ended June 30, 2026 were $2.9 million and $14.0 million, respectively.
Pro forma results (unaudited)
The following pro forma information assumes the Diligent Acquisition occurred as of the beginning of the year immediately preceding the transaction. The pro forma information contains the actual operating results of the Company combined with the results of Diligent prior to acquisition dates, adjusted to reflect the pro forma impact of the acquisitions occurring as of January 1, 2025. The pro forma adjustments primarily consist of $2.0 million to remove interest expense recorded on debt paid off at close and adjustments for a total $3.3 million in transaction costs incurred. This pro forma presentation does not include any impact of transaction synergies.
The following table presents the unaudited pro forma consolidated revenue and net loss for the combined company as a result of the Diligent Acquisition (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Revenues$3,238 $3,166 $6,722 $5,969 
Net Loss$(63,971)$(27,482)$(114,601)$(45,860)
The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the Diligent Acquisition been consummated as of January 1, 2025.
Fiscal 2025 Acquisitions

Vayu Acquisition

On August 14, 2025 (the “Vayu Closing Date”), the Company entered into an Agreement and Plan of Merger by and among the Company, Valencia Merger Sub I Inc., a Delaware corporation and the Company’s direct wholly-owned subsidiary (“Valencia Merger Sub I”), Valencia Merger Sub II LLC, a Delaware limited liability company and the Company’s direct wholly-owned subsidiary (“Valencia Merger Sub II”), Vayu Robotics, Inc. (“Vayu”) and certain of Vayu’s securityholders (the “Vayu Merger Agreement”).

Pursuant to the Vayu Merger Agreement, on August 15, 2025, (i) Valencia Merger Sub I merged with and into Vayu, with Vayu surviving as a direct wholly-owned subsidiary of the Company and (ii) Vayu subsequently merged with and into Valencia Merger Sub II, with Valencia Merger Sub II surviving the merger. In connection with the closing of the transactions contemplated by the Vayu Merger Agreement, the Company acquired all of the issued and outstanding equity of Vayu, which was accounted for under the acquisition method of accounting. Vayu is a pioneer in urban robot navigation using large-scale AI models, and the Company’s acquisition of Vayu supports the adoption of advanced AI-driven autonomy by integrating Vayu’s foundation model technology and simulation capabilities.
The total fair value of consideration paid in connection with the acquisition of Vayu consisted of the following:

SharesPer ShareTotal Consideration
(in thousands)
Cash paid for outstanding shares of Vayu common and preferred stock$1,875 
Net working capital adjustment310 
Company common shares issuable to Vayu common and preferred stockholders1,539,906$9.71 14,952 
Company warrants issued to Vayu SAFE holder, Khosla Ventures4,000,000$5.41 21,640 
Replacement equity awards attributable to pre-combination service— — 734 
Total purchase price consideration$39,511 

The Company allocated the fair value of the purchase price consideration to the tangible assets acquired and liabilities assumed, based on estimated fair values. The excess purchase price over those fair values is recorded as goodwill. The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates with respect to intangible assets. The acquired company’s intangible assets are comprised of developed technology. The estimated fair value of the developed technology was determined using the cost method, which estimates the value of an asset based on the current cost to replace or reproduce it, adjusted for physical deterioration, functional obsolescence, and economic factors. This method reflects the amount a market participant would need to invest to create an asset of comparable utility, considering current technology and development costs.

The total purchase consideration was approximately $39.5 million of cash, common stock, warrant, and replacement equity awards. The goodwill of $11.2 million arising from the acquisition is attributed to the expected synergies, including innovation synergies, and other benefits expected to be generated. Substantially all of the goodwill recognized is not expected to be deductible for tax purposes. The estimated fair value of the warrants was determined using the Black-Scholes model. The estimated fair value of the replacement equity awards attributable to pre-combination service was determined using the binomial lattice model.

In connection with the Vayu Merger Agreement, the Company granted performance-based RSUs (“PRSUs”). 880,001 PRSUs were granted to certain employees and 560,000 PRSUs were granted to certain shareholders. All PRSUs will vest or commence vesting upon achievement of a specified operational target (the “Milestone”) by December 31, 2026 (the “Milestone Date”). In addition, the PRSUs are subject to a continuous service condition.

Certain data necessary to complete the purchase price allocation remains preliminary. The Company expects to complete the purchase price allocation within 12 months of the Vayu Closing Date, at which time the purchase price allocation set forth herein may be revised. The Company does not expect these revisions to be material. The Company utilized widely accepted income-based, market-based, and cost-based valuation approaches to perform the preliminary purchase price allocation.
The Company’s preliminary allocation of the purchase price, based on the estimated fair value of the assets acquired and liabilities assumed as of the Vayu Closing Date, is as follows (in thousands):

August 15, 2025
Total purchase price consideration$39,511 
Assets acquired:
Cash and cash equivalents6 
Other current assets57 
Intangible assets32,439 
Total identifiable assets acquired32,502 
Liabilities assumed:
Accounts payable(366)
Other current liabilities(44)
Deferred tax liability(3,784)
Total identifiable liabilities assumed(4,194)
Fair value of identifiable assets, net of identifiable liabilities assumed$28,308 
Goodwill$11,203 

The following table sets forth the preliminary components of intangible assets acquired (in thousands) and their estimated useful life as of the date of acquisition (in years):

Weighted Average Useful LifeAugust 15, 2025
Developed technology5$32,439 
The Company recorded zero and $0.2 million of acquisition related costs in the three and six months ended June 30, 2026, respectively, representing professional fees and other direct acquisition costs. These costs are recorded within general and administrative expense in our unaudited condensed consolidated statements of operations and comprehensive loss.
Voysys AB Acquisition

On April 1, 2025 (the “Voysys Closing Date”), the Company acquired from Phantom Auto Inc., a Delaware corporation (“Phantom”) (i) all of the issued and outstanding equity of Voysys AB, a limited liability company duly incorporated and organized under the laws of Sweden (“Voysys”) and (ii) certain intellectual property, including registered patents, of Phantom. The acquisition was accounted for under the acquisition method of accounting. Voysys is a Swedish pioneer in ultra-low latency video streaming, connectivity, and teleoperation technology. The Company’s acquisition of Voysys enhances Serve’s technology stack to support its rapidly growing fleet of autonomous delivery robots.

The Company allocated the fair value of the purchase price consideration to the tangible assets, liabilities, and intangible assets acquired, based on their estimated fair values. The excess of the purchase price over those fair values is recorded as goodwill. The Company’s valuation assumptions of acquired assets and assumed liabilities require significant estimates, particularly for intangible assets. The acquired company’s intangible assets consist of customer relationships, trade name, and developed technology. The estimated fair value of customer relationships, trade name, and developed technology were determined using the multi-period excess earnings method and the relief from royalty method. Both methods require forward-looking estimates that are discounted to determine the fair value of the intangible asset using a risk-adjusted discount rate that is reflective of the level of risk associated with future estimates associated with the asset group, which could be affected by future economic and market conditions. The estimated fair value of the developed technology is also dependent on the selection of the royalty rate used in the valuation method.

The total purchase consideration was approximately $5.7 million in cash consideration. The goodwill of $4.3 million arising from the acquisition is attributed to the expected synergies, including future cost savings, and other benefits expected to be generated. Substantially all of the goodwill recognized is not expected to be deductible for tax purposes.

The Company’s allocation of the purchase price, based on the estimated fair value of the assets acquired and liabilities assumed as of the Voysys Closing Date, is as follows (in thousands):

April 1, 2025
Cash consideration paid$5,170 
Escrow amount575 
Purchase price5,745 
Assets acquired:
Cash and cash equivalents111 
Other current assets73 
Other assets17 
Intangible assets, net1,370 
Total identifiable assets acquired
1,571 
Liabilities assumed:
Current liabilities(153)
Total identifiable liabilities assumed(153)
Fair value of identifiable assets, net of identifiable liabilities assumed$1,418 
Goodwill$4,327 

The following table sets forth the components of intangible assets acquired (in thousands) and their estimated useful life as of the date of acquisition (in years):

Intangible AssetsWeighted Average Useful LifeApril 1, 2025
Developed technology15$980 
Customer relationships25255 
Trade names10135 
Total fair value of intangible assets$1,370 
Acquisition related costs represent costs incurred for professional fees and other direct acquisition costs. These costs are recorded within general and administrative expense in our unaudited condensed consolidated statements of operations and comprehensive loss. In connection with the acquisition of Voysys, the Company recorded zero acquisition-related costs in the three and six months ended June 30, 2026.