Nature of Business and Organization, Basis of Presentation, and Summary of Significant Accounting Policies (Policies) |
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| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Principles of Consolidation | The Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and include the accounts of the Company, its wholly owned subsidiaries, and all other entities in which the Company has a controlling financial interest. This includes any variable interest entities (“VIEs”) for which the Company is the primary beneficiary, in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation. All intercompany transactions and balances have been eliminated in consolidation. These Unaudited Condensed Consolidated Financial Statements do not include all disclosures required by GAAP for complete annual financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on March 31, 2026, (the “Form 10-K”). Accordingly, the Unaudited Condensed Consolidated Balance Sheet as of June 30, 2026, was prepared from the Company’s books and records, beginning with the audited consolidated balances as of December 31, 2025 and reflecting transactions and other activity through June 30, 2026, but does not contain all of the footnote disclosures required for complete annual financial statements. The Company believes that the disclosures included in this Quarterly Report on Form 10-Q (this “Form 10-Q”) are adequate to make the information presented not misleading. In the opinion of management, the Unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary to fairly state the Company’s financial position, results of operations, and cash flows for the periods presented. The accounting policies used in the preparation of these Unaudited Condensed Consolidated Financial Statements are the same as those disclosed in the audited consolidated financial statements for the year ended December 31, 2025, included in the Form 10-K, except as described below. The Company’s annual reporting period is the calendar year. The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the full year ending December 31, 2026 or any future periods.
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| Basis of Presentation | Basis of Presentation
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| Use of Estimates and Judgments | Use of Estimates and Judgments The preparation of the Company’s Unaudited Condensed Consolidated Financial Statements in conformity with GAAP and in accordance with the rules and regulations of the SEC requires management to make estimates and assumptions that affect the reported amounts included in the Unaudited Condensed Consolidated Financial Statements. Estimates are based on historical experience, where applicable, and other assumptions that management believes are reasonable under the circumstances. On an ongoing basis management evaluates its estimates, including those related to long-lived asset impairment assessments. Such estimates often require the selection of appropriate valuation methodologies and financial models and may involve significant judgment in evaluating ranges of assumptions and financial inputs. Actual results may differ from those estimates under different assumptions, financial inputs, or circumstances. Given the global economic climate, estimates are subject to additional volatility. As of the date of filing this Quarterly Report on Form 10-Q, the Company is not aware of any specific event or circumstance that would require updating its estimates or judgments or revising the carrying value of its assets or liabilities. However, these estimates and judgments may change as new events occur and additional information is obtained, which may result in changes being recognized in the Company’s Unaudited Condensed Consolidated Financial Statements in future periods. Actual results could differ from those estimates and any such differences may have a material impact on the Company’s Unaudited Condensed Consolidated Financial Statements.
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| Reverse Stock Splits and Recasting of Per-Share Amounts | Reverse Stock Splits and Recasting of Per-Share Amounts On July 23, 2026, the Company filed a twelfth amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, with the Secretary of State of the State of Delaware to effect a reverse stock split of its Class A common stock and Class B common stock, each par value $0.0001 per share (collectively, the "Common Stock"), at a ratio of 1 for 150. At 5:00 p.m. Eastern Time on July 24, 2026 (the “Effective Time”), every 150 shares of the issued and outstanding shares of the Company’s Class A common stock were automatically combined and converted into one share of Common Stock of the same class, without any change in par value per share. No fractional shares of Common Stock were issued as a result of the Reverse Stock Split. Stockholders who would otherwise have received a fractional share were instead issued a full share in lieu of such fractional share. The number of authorized shares of Common Stock remained unchanged. All share and per share amounts in the accompanying Unaudited Condensed Consolidated Financial Statements and related notes have been retroactively adjusted to give effect to the reverse Stock Split for all periods presented. Proportionate adjustments were also made to the number of shares of Class A Common Stock underlying the Company’s outstanding stock-based compensation awards, convertible debt securities and warrants, and to the related exercise and conversion prices. The Company’s Public Warrants and Private Warrants, which were outstanding as of June 30, 2026 and are reflected on a split-adjusted basis in the periods presented, expired in accordance with their terms on July 21, 2026, prior to the Effective Time of the Reverse Stock Split.
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| Variable Interest Entity | Variable Interest Entity In accordance with ASC Topic 810, Consolidation (“ASC 810”), the Company assesses whether it has a variable interest in legal entities in which it has a financial relationship and, if so, whether those entities are variable interest entities (“VIEs”). For those entities that qualify as VIEs, ASC 810 requires the Company to determine if the Company is the primary beneficiary of the VIE, and if so, to consolidate the VIE.
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| Segments | Segments The Company has three operating segments—AI Electric Vehicle (“AIEV”), Robotics and AIXC — each of which meets the criteria for separate reporting under ASC 280. The Company’s Global Chief Executive Officer (“CEO”), serves as the Chief Operating Decision Maker (“CODM”), and regularly evaluates the Company’s financial performance using consolidated and segment-level financial information, including consolidated loss from operations, cash flows, liquidity, and strategic initiatives. The AIXC segment is focused on developing programmable systems at the intersection of real-world asset (“RWA”) tokenization and Embodied Artificial Intelligence (“EAI”), including blockchain-enabled infrastructure for traditional assets and AI-enabled physical systems. Management has identified Loss from operations, as presented in the Company's Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss, as the primary measure used by the CODM to evaluate the performance of the business and allocate resources. Loss from operations is the measure of segment profit or loss that is most consistent with the measurement principles used in measuring the corresponding amounts in the Company’s unaudited condensed consolidated financial statements. This measure reflects the Company’s focus on managing operating performance, cash outflows, and liquidity, particularly given that the timing of cash inflows is influenced by external financing activities. The Company defines “significant segment expense” as controllable operating costs that are regularly provided to and reviewed by management. Refer to Note 17,Segment Information for further detail on the components of “loss from operations” and the additional Robotics gross profit measure reviewed by the CODM. Management closely tracks the Company’s expenditures on these key expense categories through regular reviews of cash balances, near‑term cash flow projections, monthly management reports, and project management reports. The CODM, works in close collaboration with the Company’s business leaders to establish critical operational targets, set project timelines, and adjust spending plans. These leaders are responsible for implementing the Company’s strategic plans and revising targets and deadlines based on continuous internal communications and review meetings, thereby ensuring that any deviations from target spending or project timelines are promptly addressed. During the three months ended June 30, 2026, the CODM began reviewing enhanced segment-level management reports. The Company is developing and implementing an enhanced segment reporting framework, including methodologies for allocating certain shared costs and resources among its segments. Because these allocation methodologies were not fully implemented during the periods presented, the enhanced reports supplement the existing management reporting process and do not change the segment measures or allocation practices disclosed herein. While loss from operations is the primary measure used to evaluate overall Company performance and to allocate resources across segments, management also evaluates the Robotics segment using gross profit as an additional performance measure, as this segment is in the early stages of commercialization and focuses on product-level profitability. Gross profit is defined as revenue less cost of revenues. At this time, general and administrative, research and development, and sales and marketing expenses are not allocated to the Robotics segment. These costs continue to be managed on a consolidated basis and are primarily reflected within the AIEV segment. Gross profit is not used as the primary measure of segment profit or loss for AIEV or AIXC. This oversight supports the Company’s strategic objectives to prioritize the commercialization of the FX Series vehicles and Robotics products, while continuing to support production, sales, and leasing activities for its FF 91 vehicles, the planned FF 92 upgrade program, and AIXC’s RWA tokenization, digital asset and EAI infrastructure initiatives.
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| Restricted Cash | Restricted Cash Cash and cash equivalents are classified as restricted cash when their withdrawal or use is contractually restricted. Restricted cash includes proceeds from financing transactions deposited into accounts subject to deposit account control agreements and related security arrangements that provide the applicable lender or noteholder control over the disposition of the funds, grant a first-priority security interest in the accounts, and limit the Company’s ability to withdraw or use the funds. Amounts are released from the controlled accounts in accordance with the applicable financing documents, including following qualifying conversions or exchanges of the related notes and satisfaction of the applicable release conditions. Amounts may also be applied directly from the controlled accounts to satisfy the related secured obligations, and any remaining restrictions lapse when the related secured obligations and security interests are terminated. Restricted cash is classified as current when the related restrictions are expected to lapse, or the funds are expected to be released or applied against the related obligations, within twelve months of the balance sheet date. Restricted cash that does not meet these criteria is classified as noncurrent. The classification is reassessed at each reporting date based on the contractual terms of the applicable financing arrangements, the maturity and classification of the related obligations, and management’s reasonable and supportable expectations regarding the timing and satisfaction of applicable release conditions. Restricted cash may be classified partly as current and partly as noncurrent when the related amounts are expected to be released or applied at different times. Restricted cash is included with cash and cash equivalents in the reconciliation of beginning and ending amounts presented in the Company’s Unaudited Condensed Consolidated Statements of Cash Flows.
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| Digital Assets | Digital Assets In December 2023, FASB issued ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets. ASU 2023-08 requires crypto assets within the scope of ASC 350-60 to be measured at fair value each reporting period, with changes in fair value recognized in net income. The guidance also requires crypto assets measured at fair value to be presented separately from other intangible assets in the balance sheet, and changes from the remeasurement of crypto assets to be presented separately from changes in the carrying amounts of other intangible assets in the statement of operations. The Company determines the fair value of its digital assets based on quoted prices in active markets for identical assets in accordance with ASC 820, Fair Value Measurement. Accordingly, the Company classifies its digital assets within Level 1 of the fair value hierarchy under ASC 820. The Company utilizes observable market prices from active trading exchanges and evaluates the principal market for each digital asset in determining fair value. The Company measures digital assets at fair value as of UTC+0:00 on the final day of each reporting period. The Company does not currently recognize revenue from contracts with customers related to digital assets. Cash flows arising from purchases and sales of digital assets are presented as investing activities in the Company’s Unaudited Condensed Consolidated Statements of Cash Flows. The table below summarizes the units held, cost basis, and fair value of the Company’s digital assets as of June 30, 2026 (amounts shown in thousands, except for units held, which are presented in whole numbers):
Digital Asset Activity The following table summarizes digital asset activity for the period indicated, including purchases, sales, net gains and losses recognized, other activity, and the fair value of digital assets held as of June 30, 2026 (amounts shown in thousands).
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| Short-term notes receivable | Short-term notes receivable Short-term notes receivable are measured in accordance with ASC 326-20 (Current Expected Credit Losses, “CECL”), which requires recognition of expected credit losses over the life of the receivable based on historical experience, current conditions, and reasonable and supportable forecasts. The Company, through its acquisition of AIXC, holds short-term notes receivable from Marizyme, Inc. (“Marizyme”) arising from cash advances made by AIXC to Marizyme prior to the Company’s acquisition of AIXC. These notes bear interest at 18% per annum, are payable on demand, and may be prepaid at any time without penalty. Because AIXC has limited loss history for similar exposures, expected credit losses are estimated using a probability-weighted model that considers multiple settlement scenarios, including potential recovery through acquisition, liquidation, or other realizations of the debtor’s assets. The resulting allowance for expected credit losses reflects an assessment of Marizyme’s financial condition, estimated recoverable amounts, and the likelihood of each outcome. The allowance is reassessed each reporting period and updated as new information becomes available.
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| Inventory | Inventory Inventory is stated at the lower of cost or net realizable value and consists of raw materials, work in progress, and finished goods. The Company primarily computes cost using standard cost, which approximates cost on the first-in, first-out basis. Net realizable value is the estimated selling price of inventory in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company assesses the valuation of inventory and periodically adjusts its value for estimated excess and obsolete inventory based upon expectations of future demand and market conditions, as well as damaged or otherwise impaired goods. Inventory is classified as a current asset when it is expected to be sold, consumed, or used in production within twelve months or the operating cycle, whichever is longer. Inventory that is not expected to be realized or used within twelve months or the operating cycle is classified as a non-current asset within Other non-current assets on the Unaudited Condensed Consolidated Balance Sheets. This includes, for example, spare parts, service parts, or production parts held for future models or to fulfill warranty obligations on products
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| Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment, including land are stated at cost less accumulated depreciation and amortization. Land is not depreciated. Expenditures for major renewals and betterments are capitalized, while minor replacements, maintenance and repairs, which do not extend the assets lives, are charged to operating expense as incurred. Upon sale or disposition, the cost and related accumulated depreciation or amortization are removed from the Unaudited Condensed Consolidated Balance Sheets and any gain or loss is included in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. Depreciation and amortization on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets and for building improvements, over the term of the lease, if shorter.
Construction in process (“CIP”) consists of the construction activities related to the FF aiFactory California production facility in plant and tooling, machinery and equipment being built to serve the manufacturing of production vehicles. These assets are depreciated once put into service. The amounts capitalized in CIP that are held at vendor sites relate to the completed portion of work-in-progress of tooling, machinery and equipment built based on the Company’s specific needs. The Company may incur storage fees or interest fees related to CIP which are expensed as incurred. CIP is presented within in the Unaudited Condensed Consolidated Balance Sheets.
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| Capitalized Software | Capitalized Software The Company accounts for costs incurred in developing its product offerings under ASC 350-40, Internal-Use Software. In accordance with ASC 350-40, the Company capitalizes qualifying costs incurred in connection with the development of the Company’s product offerings during the application development stage. Costs incurred during the preliminary project and post-implementation stages are expensed as incurred. Costs incurred in connection with maintenance activities, including training or bug fixes are also expensed as incurred. The Company stops capitalizing qualifying costs once development activities are completed and the project is ready for its intended use. Capitalized software costs are amortized on a straight-line basis over a 36-month useful life beginning on the date when the product is ready for its intended use. Management tests the capitalized software costs for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable in accordance with ASC 360. During the three and six months ended June 30, 2026 the Company recognized impairment charge of no impairment charge and $0.2 million, respectively, related to capitalized software costs. During the three and six months ended June 30, 2025 the Company recognized no impairment charge, related to capitalized software costs.
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| Business Combination | Business Combination The Company accounts for business combinations in accordance with ASC 805, Business Combinations, which requires management to use significant judgment in determining the fair value of assets acquired and liabilities assumed and in evaluating whether an acquired set meets the definition of a business. See Note 3, Goodwill Associated with Business Acquisition to the Unaudited Condensed Consolidated Financial Statements for further information.
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| Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill Goodwill represents the excess of the purchase price over the fair value of the identifiable net assets acquired in a business combination. The Company tests goodwill for impairment at the reporting unit level at least annually, or more frequently if events or changes in circumstances indicate that the carrying amount of a reporting unit may exceed its fair value. The Company acquired goodwill in connection with its acquisition of AIXC and assigned all of the associated goodwill to its AIXC reporting unit. The Company tests goodwill for impairment annually as of October 1, or between annual tests if an event occurs or circumstances change that would indicate that the carrying amount may be impaired. Based on a quantitative assessment, the Company concluded that the carrying amount of the AIXC reporting unit exceeded its estimated fair value. Accordingly, the Company recorded goodwill impairment charges of zero and $2.1 million for the three and six months ended June 30, 2026, respectively, of which $0.9 million was attributable to noncontrolling interest. The impairment charge is included in Impairment of Impairment of intangible assets, including goodwill in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. The portion attributable to noncontrolling interest is reflected in net loss attributable to noncontrolling interest. No goodwill impairment was recognized during the three and six months ended June 30, 2025.
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| Noncontrolling Interest | Noncontrolling Interest Where our ownership interest is less than 100%, but greater than 50%, the noncontrolling ownership interest is reported on our Unaudited Condensed Consolidated Balance Sheets. Non-controlling interest represents the portion of the net assets of a subsidiary attributable to interests that are not owned by the Company. The non-controlling interest is presented in the Unaudited Condensed Consolidated Balance Sheets, separately from equity attributable to the shareholders of the Company. Non-controlling interest’s operating result is presented on the face of the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss as an allocation of the total income for the year between non-controlling shareholders and the shareholders of the Company.
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| Revenue Recognition | Revenue Recognition The following table disaggregates our revenue by major source:
Automotive Sales Revenue The Company recognizes automotive sales revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers. Automotive sales revenue includes cash deliveries of new vehicles, and specific other features and services including home charger, charger installation, twenty-four-seven roadside assistance, over-the-air (“OTA”) software updates, internet connectivity and destination fees that meet the definition of a performance obligation under ASC 606. As part of the first step in applying ASC 606, the Company assesses whether multiple contracts entered into with the same customer—such as a vehicle sale and a co-creation agreement—should be combined. When these contracts are negotiated together and are economically interdependent, they are accounted for as a single arrangement. This evaluation ensures that the revenue recognition reflects the substance of the transaction. Refer to the subsequent section of this note for a detailed discussion of the co-creation arrangements with customers and their impact on revenue recognition under ASC 606. Revenue is recognized when control of the vehicle transfers upon delivery to the customer. Payments are typically received at the point control transfers or according to payment terms customary to the business as specified in the sales contract. Vehicle contracts do not contain a significant financing component. For obligations related to automotive sales, transaction prices are allocated among performance obligations based on relative standalone selling prices, determined using market prices, estimated internal costs, and comparable third-party offerings. The transaction price is allocated among the performance obligations in proportion to the standalone selling price of its performance obligations. Other features and services as discussed above are provisioned upon transfer of control of the vehicle and are required to be recognized on a straight-line basis over the performance period, as the Company has a stand-ready obligation to deliver such services to the customer. However, due to immateriality, revenue from other features and services are combined with the vehicle performance obligation and recognized upon the transfer of the vehicle. The Company provides certain customers with a residual value guarantee which may or may not be exercised in the future. Residual value guarantees provided to customers had an immaterial impact on revenue for the three and six months ended June 30, 2026. Automotive Leasing Revenue The Company accounts for its automotive leasing revenue program under ASC 606 and ASC Topic 842, Leases (“ASC 842”). Operating Leasing Program: The Company offers a vehicle operating leasing program in the U.S., allowing qualifying customers to lease a vehicle directly from the Company for a lease term of up to 36 months. At the end of the lease term, customers are generally required to return the vehicle to the Company, at which point the Company may either sell or re-lease the returned vehicle. Leasing revenue from operating leases is recognized on a straight-line basis over the lease term, as long as collectability is probable in accordance with ASC 842. If collectability of lease payments is not probable at lease commencement, lease income is recognized on a cash basis, meaning payments received are recorded as revenue only when collected. Depreciation expense related to leased vehicles is recorded in cost of automotive leasing revenue on a straight-line basis over the lease term, reflecting the expected residual value of the vehicles at lease termination. Upfront payments related to lease agreements are deferred and recognized as revenue on a straight-line basis over the respective lease term. Taxes collected from customers in connection with automotive leasing transactions are excluded from the transaction price and reported separately in accordance with ASC 606. As part of the revenue recognition process, the Company evaluates whether a lease contract should be combined with other agreements—such as co-creation arrangements—under ASC 606 when the contracts are negotiated together and are economically interdependent. Refer to the subsequent section of this note for a detailed discussion of the co-creation arrangements with customers and their impact on revenue recognition under ASC 606. Sales-Type Leasing Program: The Company enters into sales-type lease arrangements in accordance with ASC 842, under which customers generally have the option to purchase the leased vehicle at the end of the lease term, which is typically 36 months. The lease is classified as a sales-type lease when the Company concludes that the customer is reasonably certain to exercise the purchase option and, as a result, the Company expects the customer to obtain title to the vehicle upon completion of all contractual payments. At lease commencement, if collectability of the lease payments is probable, the Company derecognizes the leased vehicle and recognizes: •Automotive leasing revenue for the present value of lease payments and any guaranteed residual value; and •Automotive leasing cost of revenue for the carrying value of the leased vehicle. If collectability is not deemed probable at lease commencement, revenue recognition is deferred, and lease payments received are recorded as a deposit liability. The leased vehicle remains on the Company’s balance sheet until collectability becomes probable, at which point revenue recognition is triggered. The Company recognizes a net investment in sales-type leases, which includes both the lease receivable and the unguaranteed residual asset. The unguaranteed residual asset represents the estimated fair value of the leased vehicle at the end of the lease term that is not guaranteed by the lessee or any third party. As of June 30, 2026, the carrying amount of unguaranteed residual assets included in the net investment in sales-type leases, and presented within accounts receivable, was approximately $0.2 million. The estimate of unguaranteed residual value reflects management’s judgment, informed by historical residual value experience, current market conditions, and the anticipated future utility of the leased assets. Robotics The Company recognizes robotics revenue in accordance with ASC 606. Robotics revenue primarily consists of sales of the Company’s robotic products, including humanoid robots, quadruped robots and other robotics products. Robotics sales contracts may include the delivery of one or more robots. Each robot is capable of providing benefit to the customer on a standalone basis and is separately identifiable within the context of the contract; accordingly, each robot represents a separate performance obligation. The transaction price is allocated to each performance obligation based on the relative standalone selling prices of the individual robots, which are determined using observable market prices for those products when available. Revenue allocated to each robot is recognized at a point in time when control of the respective robot transfers to the customer, which generally occurs upon delivery or acceptance, as applicable, in accordance with the terms of the applicable sales contract. When robots are delivered at different times, revenue is recognized separately for each robot upon the transfer of control. As part of applying ASC 606, the Company evaluates whether multiple contracts entered into at or near the same time with the same customer, such as a robot purchase agreement and a related co-creation or consulting agreement, should be combined and accounted for as a single arrangement. When such contracts are negotiated together and are economically interdependent, they are combined for accounting purposes. Payments made by the Company to customers under co-creation or similar arrangements are evaluated to determine whether they represent consideration payable to a customer and, when applicable, are accounted for as a reduction of the transaction price for the related robot sale unless the payment is in exchange for a distinct good or service received from the customer. Payments are generally received prior to or substantially concurrent with the transfer of control of the robots. Accordingly, the Company’s robotics sales arrangements do not generally include a significant financing component. Customer deposits and other advance payments are recorded as contract liabilities until the related revenue recognition criteria are satisfied. The Company sells robotic products through direct sales, dealers, resellers, demo-unit programs, and e-commerce or marketplace channels. The Company identifies the customer and transaction price based on the enforceable order-level terms and the substance of the arrangement. When an intermediary facilitates a sale but does not purchase the product for its own account, the end customer is generally the Company’s customer. When a dealer, distributor, reseller, or other counterparty purchases the product for its own account, that purchasing counterparty is generally the Company’s customer. Revenue is measured at the applicable contract price, net of customer discounts, credits, refunds, rebates, incentives, concessions, and expected returns, and excludes amounts collected on behalf of third parties (e.g., sales taxes remitted to government authorities). Amounts paid or credited to a customer reduce the transaction price unless the payment is in exchange for a distinct good or service received from the customer, while commissions or referral payments to a party that is not the customer are generally recognized as expenses. For sales that provide a right of return, the Company recognizes revenue only for the consideration to which it expects to be entitled and records a refund liability for expected returns and an asset for the right to recover products expected to be returned. These estimates are updated at each reporting date subject to the variable consideration constraint under ASC 606. Co-creation Arrangements As part of the Company’s Futurist Product Officers (“FPO”) Co-Creation Delivery program, the Company has entered into co-creation agreements with certain customers. These arrangements leverages select sales and leasing customers to provide data, insights, marketing, and brand awareness for the Company’s vehicles and robots. In exchange for these services, the Company compensates customers through a one-time consulting fee, consulting fees paid in installments or a discount on their lease payments. The Company evaluates the economic substance of both the sale or lease contract and the co-creation agreement to determine whether they should be combined under the contract combination guidance in ASC 606. When the contracts meet the applicable contract combination criteria, the Company accounts for them as a single arrangement. Amounts paid or credited to a customer under a co-creation agreement are evaluated as consideration payable to a customer. Such amounts are accounted for as a reduction of the transaction price and revenue unless the payment is in exchange for a distinct good or service received from the customer. When the Company receives a distinct good or service, the payment is recognized as an expense based on the fair value of the good or service received, and any amount paid in excess of that fair value is recognized as a reduction of revenue. For the three months ended June 30, 2026, and 2025, the Company recognized immaterial and no co-creation fees as reduction of revenues, respectively. The Company recognized no and $0.2 million, respectively, in co-creation fees as marketing expenses, for the same periods. For the six months ended June 30, 2026 and 2025, the Company recognized $0.2 million and $0.3 million, respectively, in co-creation fees as a reduction of revenue. The Company recognized $0.2 million and $0.3 million, respectively, in co-creation fees as marketing expenses, for the same periods. Customer Deposits As of June 30, 2026, the Company held approximately $4.1 million in customer deposits, compared to $4.4 million as of December 31, 2025. These deposits relate to vehicle and robotics reservations under both business and consumer programs. Business-to-business (“B2B”) reservations are made through pre-order deposit agreements and require fixed, non-refundable deposits that may be applied toward the purchase of a limited number of vehicles. These programs are designed to incentivize volume interest by allowing the deposits to be applied toward the purchase of a limited number of vehicles under future purchase agreements. Business-to-consumer (“B2C”) reservations are typically submitted on a one-to-one basis for a specific vehicle or robotics product, or upon other resolution of the reservations and generally involve refundable or promotional deposits. Customer deposits are recorded in Accrued expenses and other current liabilities on the Company’s Unaudited Condensed Consolidated Balance Sheets. Deposits remain recorded as liabilities until they are refunded, applied toward a purchase, forfeited, or otherwise resolved in accordance with the applicable terms. Deposits applied toward a purchase are recognized as revenue when control of the related vehicle or robotics product transfers to the customer and the applicable revenue recognition criteria are satisfied.
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| Cost of Revenue | Cost of Revenue Automotive Sales Revenue Cost of automotive sales revenue includes direct and indirect materials, labor costs, manufacturing overhead, including depreciation costs of tooling and machinery, shipping and logistic costs, vehicle connectivity costs, inventory reserve and reserves for estimated warranty expenses. Cost of automotive sales revenues also includes adjustments to warranty expense. Cost of services and other revenue includes costs associated with providing non-warranty after-sales services, costs for retail merchandise, and costs to provide vehicle insurance. Cost of services and other revenue also includes direct parts and material. Cost of services and other revenue was insignificant for the three months ended June 30, 2026, and 2025. Automotive Leasing Program Cost of automotive leasing revenue includes the depreciation of operating lease vehicles, cost of goods sold associated with direct sales-type leases and warranty expenses related to leased vehicles. Robotics Cost of Robotics revenue includes the product costs, freight, import fees and warranty costs.
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| Warranties | Warranties The Company provides a manufacturer’s warranty on all vehicles sold. The warranty covers the repair, replacement, or adjustment of faulty parts or components. The warranty does not cover normal wear and tear. This assurance-type warranty does not create a performance obligation separate from the vehicle. Estimated vehicle warranty costs are accrued when the related revenue is recognized and are recorded in cost of goods sold with a corresponding warranty liability. The Company reassesses its estimated warranty obligations at each reporting date based on available claims experience and other relevant information. The Company also provides an assurance-type warranty on robotics products sold. This warranty does not create a performance obligation separate from the robotics product. Estimated robotics warranty costs are accrued when the related revenue is recognized and are recorded in cost of goods sold with a corresponding warranty liability. Because Company-specific robotics warranty history is limited, the estimate is based on available actual warranty experience and relevant industry benchmark data. The Company reassesses the warranty accrual at each reporting date as additional claims data become available
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| Income Taxes | Income Taxes The Company accounts for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and income tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years when those temporary differences are anticipated to reverse. A valuation allowance is established if it is more likely than not that some or all of the deferred tax assets will not be realized. The carrying value of deferred tax assets is adjusted to reflect the amount that is more likely than not to be realized. As of June 30, 2026 and December 31, 2025, the Company maintained a full valuation allowance against its net deferred tax assets, based on the conclusion that it is more likely than not the assets will not be realized. The Company applies the guidance in ASC 740-10, Income Taxes, to account for uncertain tax positions. This guidance requires a two-step approach: (1) determine whether it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation; and (2) measure the tax benefit as the largest amount that is more likely than not to be realized upon settlement. The Company evaluates its tax positions based on a number of factors and may update its assessments as facts and circumstances change. The Company is subject to taxation in the U.S. federal jurisdiction, the state of California, China, and U.A.E. The income tax provision for each period represents the aggregate estimated tax expense or benefit for these jurisdictions.
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| Recent Accounting Pronouncements | Recent Accounting Pronouncements The Financial Accounting Standards Board (“FASB”) has issued accounting standards updates (“ASUs”) that are not yet adopted by the Company. As a December 31 year-end filer and a Smaller Reporting Company (“SRC”), the Company will adopt these ASUs in accordance with the effective dates applicable to the Company. The Company is currently evaluating the impact of these ASUs on the Company’s financial statements and related disclosures. The following is a summary of recently issued accounting pronouncements not yet adopted by the Company: Recently issued accounting pronouncements not yet adopted In December 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires public business entities to disclose additional details about certain expenses in the notes to financial statements, such as inventory purchases, employee compensation, depreciation, and intangible asset amortization. This update is effective for the Company for annual reporting periods beginning January 1, 2027 (fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027) and will first apply to the Company’s December 31, 2027 Form 10-K for annual disclosures, with interim disclosures first required in the Company’s March 31, 2028 Form 10-Q (as a public business entity, including SRCs). Early adoption is permitted. In May 2025, the FASB issued ASU 2025-04, Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer. This ASU (a) revises the master-glossary definition of ‘performance condition’ to include customer-based targets; (b) eliminates the forfeiture-policy election for awards granted to customers unless exchanged for a distinct good or service; and (c) clarifies that the variable-consideration constraint in ASC 606 does not apply to share-based consideration payable to a customer. This update is effective for the Company beginning January 1, 2027 (fiscal year and interim periods beginning after December 15, 2026) and will first apply to the Company’s December 31, 2027 Form 10-K (as a public business entity, including SRCs). Early adoption is permitted. In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40). The new Update removes all references to prescriptive and sequential software development stages and establishes new criteria for the capitalization of internal-use software costs. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606). This Update addresses stakeholders’ concerns about (1) the application of derivative accounting to contracts with features based on the operations or activities of one of the parties to the contract and (2) the diversity in accounting for share-based noncash consideration from a customer that is consideration for the transfer of goods or services. The amendments are expected to (a) reduce the cost and complexity of evaluating whether contracts with features based on the operations or activities of one of the parties to the contract are derivatives, (b) better portray the economics of those contracts in the financial statements, and (c) reduce diversity in practice resulting from the broad application of the current guidance and changing business environment. The amendments also are expected to reduce diversity in practice by clarifying the applicability of Topic 606, Revenue from Contracts with Customers, to share-based noncash consideration from a customer for the transfer of goods or services. This update is effective for the Company beginning January 1, 2027 (fiscal year and interim periods beginning after December 15, 2026) and will first apply to the Company’s December 31, 2027 Form 10-K (as a public business entity, including SRCs). Early adoption is permitted. In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) to improve the navigability of the required interim disclosures and clarifying when that guidance is applicable. The amendments also provide additional guidance on what disclosures should be provided in interim reporting periods. This will result in a comprehensive list of interim disclosures that are required by GAAP. The amendments add to Topic 270 a principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The objective of the amendments is to provide clarity on the current interim reporting requirements. The amendments in this Update are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, for public business entities. This Update will first apply to the Company’s March 31, 2028 Form 10-Q. In May 2026, the FASB issued ASU 2026-02, Environmental Credits and Environmental Credit Obligations (Topic 818). This ASU establishes recognition, measurement, presentation, and disclosure requirements for environmental credits and related environmental credit obligations.The amendments apply to entities that generate, purchase or receive transferable environmental credits, as well as entities that have regulatory compliance obligations that may be settled with environmental credits. The amendments require qualifying environmental credits to be recognized as assets based on their intended use and require environmental credit obligations arising from activities occurring on or before the reporting date to be recognized as liabilities. The amendments are intended to improve the comparability and understandability of financial reporting for environmental credits and related obligations and reduce diversity in practice. This Update is effective for the Company beginning January 1, 2028 (fiscal years and interim periods beginning after December 15, 2027) and will first apply to the Company’s March 31, 2028 Form 10-Q. Early adoption is permitted.
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