Knightscope, Inc.
For the period ended Mar 31, 2025. Filed May 14, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 14, 2025
KSCP$0.47+14.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-14.
0001558370-24-015747
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-14.
0001558370-25-007781
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 112 previous paragraphs and 65 current paragraphs.
24 unchanged; 22 reworded; 19 added; 63 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 18 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
Our core technologies are a unique combination of autonomy, robotics, artificial intelligence and electric vehicle technology:
Current report
Recent Developments
Current report
On August 16, 2024, stockholders approved a reverse stock split at a ratio between 1-for-5 and 1-for-50. On September 4, 2024, the Board set the final ratio at 1-for-50 for both Class A and Class B Common Stock. The split became effective on September 13, 2024, following the filing of an amendment to the Certificate of Incorporation in Delaware. No fractional shares were issued; instead, affected stockholders received a cash payment based on the September 13 closing price on Nasdaq, totaling approximately $78. All outstanding stock options were adjusted accordingly, and all share and per-share amounts in financial statements were retroactively updated to reflect the split.
Current report
**Increase in Authorized Shares -**On April 5, 2024, stockholders approved an amendment to double the authorized shares of Class A Common Stock from 114 million to 228 million. The increase provides flexibility for corporate purposes such as financings, stock splits or dividends, equity awards, conversions, and strategic initiatives, without needing further stockholder approval.
Current report
**Preferred Stock Conversion -**On May 15, 2024, all outstanding Super Voting and Ordinary Preferred Stock automatically converted into Class B and Class A Common Stock, respectively, per the Company’s Certificate of Incorporation. No preferred stock remains outstanding. The conversion supports Nasdaq compliance by aiding stockholder equity requirements.
Current report
**Authorization of Blank Check Preferred Stock -**On August 16, 2024, stockholders approved the authorization of 40 million shares of "blank check" preferred stock, allowing the Board of Directors to issue new preferred shares in one or more series with terms it sets, without further stockholder approval. Provisions related to previously issued preferred stock were removed, as they are no longer outstanding.
Current report
**Extinguishment of Warrants with Anti-Dilution Features -**On October 10, 2022, the Company issued senior secured convertible notes and warrants to purchase 22,768 Class A shares under a Securities Purchase Agreement with Alto Opportunity Master Fund. The warrants included anti-dilution provisions adjusting the exercise price and share quantity if lower-priced stock was later issued. A related registration rights agreement granted the holder registration rights under the Securities Act.
Current report
On August 1, 2024, the Company and the holder entered into a waiver agreement, canceling the 2022 warrants in exchange for a $3.0 million senior secured promissory note due July 1, 2025. The note is payable in two installments: $2.5 million in 11 equal monthly payments starting September 1, 2024, and $500,000 on the earlier of October 15, 2024, or upon a qualifying issuance of equity or debt. The note bears no interest unless an event of default occurs, in which case a 10% annual interest applies. As of May 13, 2025, approximately $0.5 million remains outstanding.
Current report
Operational Efficiency
Current report
Comparison ofthe Three Months Ended March 31, 2025 and 2024
Current report
Total revenue, net for the three months ended March 31, 2025 increased by approximately $0.7 million compared to the same period in the prior year due to a $0.4 million increase in service revenue and $0.2 million increase in product revenue.
Current report
Total cost of revenue, net of $3.6 million for the three months ended March 31, 2025 decreased approximately $0.1 million compared to the same period in the prior year. This decrease was primarily due to lower cost of revenue in services of $0.3 million partially offset by higher costs of revenues in product of $0.2 million.
Current report
Service cost of revenue, net came in $0.3 million lower as compared to the same period in 2024 due to $0.8 million in savings from one-time scrap fees in 2024 and $0.1 million in lower cellular fees partially offset by $0.5 million in higher third-party expenses.
Current report
Product cost of revenue, net for the three months ended March 31, 2025 of $0.8 million was $0.2 million higher than prior year due to $0.3 million in increased costs of materials partially offset by $0.1 million in lower payroll and $0.1 million in lower rent and utilities costs.
Current report
General and administrative expenses decreased by approximately $0.9 million or approximately 24% for the three months ended March 31, 2025, as compared to the same period in the prior year. The decrease was primarily due to $1.0 million lower investor relations fees that the Company spent in prior year to support its Public Infrastructure Bond Offering and $0.3 million lower third-party professional fees, primarily legal and finance services. These decreases were partially offset by $0.2 million higher costs across corporate insurance, franchise taxes and other items.
Current report
Total other income (expense) decreased by approximately $0.8 million, or 110% for the three months ended March 31, 2025 as compared to the same period in the prior year as non-cash income from change in the fair value of warrant and derivative liabilities in 2024 was not repeated in 2025. The Company extinguished its outstanding warrant liability in 2024.
Current report
Securities Purchase Agreement
Current report
On March 27, 2025, the Company entered into a securities purchase agreement with a certain institutional investor, pursuant to which the Company agreed to issue and sell in a registered direct offering, 625,000 shares of the Company’s Class A Common Stock, par value $0.001 per share, at a purchase price of $2.75 per share. The gross proceeds to the Company from the offering were approximately $1.7 million before deducting placement agent fees and other offering expenses payable by the Company.
Current report
proceeds from the issuance of common stock and pre-funded warrants of approximately $1.4 million, offset by repayments of debt obligations of $0.6 million. In the prior year period, our financing activities consisted primarily of net proceeds resulting from our at-the-market agreement with Wainwright of approximately $7.1 million and the issuance of our Public Safety Infrastructure Bonds of approximately $2.6 million.
Removed paragraphs (63)
Previous report
Our Autonomous Security Robots (“ASRs”) are designed to enhance perimeter security by acting as a force multiplier for security teams, providing improved situational awareness. The ASRs perform real-time, on-site video-audio data collection and provide incident alerts for security personnel via the Knightscope Security Operations Center (“KSOC”). The KSOC is a real-time dashboard connected to each K5 robot and K1 Hemisphere unit, allowing clients to access data for instant action or for investigative and evidence collection purposes.
Previous report
Our Emergency Communication Devices (“ECDs”) include the K1 Blue Light Tower, K1 E-Phone, and K1 Call Box. These devices provide emergency communication services using cellular and satellite networks. The towers, powered by solar energy, are highly visible, while the smaller E-Phones and Call Boxes offer the same communication capabilities with a more compact footprint, with options for solar or plug-in power.
Previous report
We offer our ASR and stationary security solutions under an annual subscription, Machine-as-a-Service (“MaaS”) model. This model includes the provision of the ASR unit, maintenance, support, data transfer, access to the KSOC, charging stations, and software, firmware, and hardware updates. Our ECD devices are sold to our clients either directly or through partners who also install and manage them. The ECDs also provide a recurring revenue opportunity through the Emergency Monitoring System platform.
Previous report
The Knightscope Emergency Monitoring System (“KEMS”), integrated into our ECDs, includes a self-diagnostic, alarm monitoring software solution that provides system owners with daily reports on the operational status of their emergency devices. The cloud-based application monitors the overall system's health, alerts users to operational issues, provides real-time error detection and diagnostics, and generates system performance reports.
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In the third quarter of 2024, the management team focused on regaining compliance with the listing standards of The Nasdaq Stock Market LLC (Nasdaq) while we continued to implement changes to deliver on the Company’s path to profitability.
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Nasdaq Listing Rules Compliance
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On October 26, 2023, the Company was listed on The Nasdaq Global Market and received written notice (the “Notice”) from Nasdaq indicating that the Company was no longer in compliance with Nasdaq Listing Rule 5450(a)(1) which requires that a company must maintain a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”)and had 180 calendar days, or until April 23, 2024, to regain compliance. Effective on March 4, 2024, the Company transferred to The Nasdaq Capital Market and was afforded the remainder of the compliance period to regain compliance.
Previous report
On April 24, 2024, the Company received a delisting determination letter (the “Delisting Determination Letter”) from the Nasdaq Listing Qualifications staff (the “Staff”) of Nasdaq indicating that the Company had not regained compliance with the Minimum Bid Price
Previous report
Requirement. On April 30, 2024, the Company appealed and requested a hearing before the Nasdaq Hearings Panel (“Panel”). Pursuant to Nasdaq Listing Rule 5815(a)(1)(B), the hearing request stayed the suspension of trading and delisting of the Company’s Class A Common Stock pending the conclusion of the hearing process.
Previous report
On June 4, 2024, the Panel granted the Company an exception until October 4, 2024, to regain compliance with the Minimum Bid Price Requirement, subject to certain milestones which included obtaining shareholder approval for a reverse stock split (“RSS”), effecting the RSS, and maintaining the Minimum Bid Price Requirement for a minimum of ten consecutive business days by October 4, 2024.
Previous report
On August 16, 2024, the Company held its annual meeting of stockholders (the “Annual Meeting”). At the Annual Meeting, the stockholders of the Company approved the RSS of the Company’s Class A and its Common B Common Stock at a ratio ranging from any whole number between 1-for-5 and 1-for-50.
Previous report
Subsequently, on September 4, 2024, the Company’s Board of Directors (the “Board”) approved a RSS of both the Class A Common Stock and the Class B Common Stock at a final ratio of 1-for-50. On September 13, 2024, the Company filed a Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware to effect the RSS, which became effective at 5:00 p.m. Eastern Time. The Class A Common Stock began trading on an as-adjusted basis on September 16, 2024.
Previous report
On October 1, 2024, Knightscope received written notice from the Nasdaq Office of General Counsel informing the Company that, from September 16, 2024 to September 30, 2024, the Company’s minimum bid price had been $1.00 per share or higher and, accordingly, it had regained compliance with the bid price requirement and that the matter was now closed.
Previous report
On August 16, 2024, the Company held an annual meeting of stockholders (the “Annual Meeting”) at which the Company’s stockholders approved, among other items, amendments to the Certificate of Incorporation, to effect a reverse stock split of the Company’s Class A Common Stock at a ratio ranging from any whole number between 1-for-5 and 1-for-50, as determined by the Company’s Board in its discretion, subject to the Board’s authority to abandon such amendments (the “Class A Reverse Stock Split Amendment”), and effect a reverse stock split of the Company’s Class B Common Stock at a ratio ranging from any whole number between 1-for-5 and 1-for-50 (which ratio shall be the same ratio as the reverse stock split determined by the Board with respect to the Class A Common Stock), as determined by the Board in its discretion, subject to the Board’s authority to abandon such amendments (the “Class B Reverse Stock Split Amendment” and, together with the Class A Reverse Stock Split Amendment, the “Reverse Stock Split Amendment”). On September 4, 2024, the Board selected a reverse stock split of the Class A Common Stock at a final ratio of 1-for-50 and a reverse stock split of the Class B Common Stock at a final ratio of 1-for-50 and abandoned all other reverse stock split amendments at different ratios. On September 13, 2024, the Company filed a Certificate of Amendment to the Certificate of Incorporation (the “Certificate of Amendment”) with the Secretary of State of the State of Delaware to effect the Amendments. The Reverse Stock Split Amendment became effective at 5:00 p.m. Eastern Time on the date of filing of the related Certificate of Amendment.
Previous report
**Increase in Authorized Shares -**On April 5, 2024, we held a special meeting of stockholders (the “Special Meeting”) at which the Company’s stockholders approved an amendment (the “Share Increase Amendment”) to the Certificate of Incorporation to increase the number of authorized shares of the Company’s Class A Common Stock, parvalue $0.001 per share from 114,000,000 to 228,000,000 shares. Our Board believes it is in the best interests of the Company and our stockholdersto have additional shares available for use as our Board deems appropriate or necessary. As such, the primary purpose of the Share Increase Amendment was to provide the Company with greater flexibility with respect to managing its Class A Common Stock in connection with such corporate purposes as may, from time to time, be considered advisable by our Board. These corporate purposes could include, without limitation, (i) financing activities, including the at-the-market offering program that we commenced in February 2023, as amended in August 2023, with H.C. Wainwright & Co., LLC as sales agent; (iii) stock dividends or splits; (iv) conversions of convertible securities; (v) issuance of stock options and other equity awards pursuant to our incentive plans; and (vi) establishing strategic relationships. Having an increased number of authorized but unissued shares of Class A Common Stock allows the Company to take prompt action with respect to corporate
Previous report
opportunities that develop, without the delay and expense of convening a special meeting of stockholders for the purpose of approving an increase in our capitalization. Our Board will determine whether, when and on what terms the issuance of shares of Class A Common Stock may be warranted in connection with any of the foregoing purposes.
Previous report
**Preferred Stock Conversion to Common -**On May 15, 2024 (the “Preferred Stock Conversion Date”), pursuant to the terms of the Certificate of Incorporation, each share of the Company’s Super Voting Preferred Stock was automatically converted into fully-paid, non-assessable shares of Class B common stock and each share of the Company’s Ordinary Preferred Stock (together with the Super Voting Preferred Stock, the “Preferred Stock”) was automatically converted into fully-paid, non-assessable shares of Class A common stock, in each case at the then effective applicable Conversion Rate, as a result of the receipt by the Company of a written request for such conversion from the holders of a majority of the voting power of the Preferred Stock then outstanding (the “Automatic Conversion”). As a result of the Automatic Conversion, no shares of previously authorized preferred stock remain outstanding. Management believes this change helps the Company maintain compliance with Nasdaq listing rules by helping the Company meet the minimum stockholders’ equity requirement under the Equity Standard for continued listing pursuant to Nasdaq Listing Rule 5550(b)(1) on The Nasdaq Capital Market.
Previous report
On August 16, 2024, at its Annual Meeting, the Company received stockholder approval to authorize 40,000,000 shares of “blank check” preferred stock, issuable in one or more series, and (ii) implement ancillary and conforming changes in connection with the authorization of “blank check” preferred stock and to remove provisions related to the Company’s former Super Voting Preferred Stock and Ordinary Preferred Stock, which are no longer outstanding. The term “blank check” preferred stock refers to preferred stock, the creation and issuance of which is authorized in advance by a company’s stockholders and the terms, rights and features of which are determined by the Board of Directors of a company without seeking further actions or vote of the stockholders.
Previous report
**Extinguishment of Warrants with Anti-Dilution Features -**On October 10, 2022, the Company entered into a Securities Purchase Agreement (the “2022 Purchase Agreement”) with Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B (the “Holder”), pursuant to which the Company issued and sold to the Holder in a private placement (i) senior secured convertible notes (the “2022 Notes”), and (ii) warrants (the “2022 Warrants”) to purchase up to 22,768 shares of the Company’s Class A common stock. The 2022 Warrants included an adjustment mechanism, whereby the exercise price and number of shares issuable upon the exercise of the 2022 Warrants (the “Warrant Exercise Price”) were subject to adjustment from time to time, such that immediately after an issuance of shares of Common Stock (a “Stock Issuance”) at any price per share of Common Stock that was lower than the then in effect Warrant Exercise Price (the “Reset Price”), the Warrant Exercise Price would be reduced to equal the Reset Price, and number of shares issuable upon the exercise of the 2022 Warrants would be increased to the number necessary to maintain the value of the 2022 Warrants immediately prior to such Stock Issuance. In connection with the entry into the 2022 Purchase Agreement, the Company and the Holder also entered into a registration rights agreement (the “2022 Registration Rights Agreement”), pursuant to which the Company agreed to provide the Holder with certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder. Capitalized terms not defined herein have the meaning assigned to them in the 2022 Purchase Agreement.
Previous report
On August 1, 2024 (the “Issuance Date”), the Company and the Holder entered into an Agreement and Waiver (the “Waiver”) pursuant to which, on the Issuance Date, the Company issued to the Holder a Senior Secured Promissory Note due on July 1, 2025, in an aggregate amount equal to $3.0 million (the “Principal”), in exchange for the cancellation of the Holder’s 2022 Warrants (the “August 2024 Note”) . The Company has agreed to pay the Principal in two separate installments: the first installment in an amount equal to $2,500,000 payable in 11 equal consecutive monthly installments beginning on September 1, 2024, and the second installment in an amount equal to $500,000, payable on the earlier of (x) October 15, 2024, and (y) upon any issuance by the Company or any of its subsidiaries of common stock or common stock equivalents for cash consideration, indebtedness or a combination of units thereof (other than pursuant to a customary at-the-market offering program and equity lines of credit). Upon the occurrence of a Change of Control (as defined in the August 2024 Note), the Holder may, at its option, require the Company to repay the Note in full, starting from the public announcement of such a Change of Control until 30 days after its completion. The August 2024 Note does not bear interest under normal circumstances; however, if an Event of Default occurs (as defined in the August 2024 Note), the outstanding principal will automatically bear interest at a rate of 10% per annum until the default is resolved or the Note is paid in full. As of November 13, 2024, approximately $1.8 million of the note is remaining.
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Financial Efficiency
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Comparison of the Three Months Ended September 30, 2024 and 2023
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Total revenue, net for the three months ended September 30, 2024 decreased by approximately $0.8 million compared to the same period in the prior year due to a $0.7 million decrease in product revenue and $0.1 million decrease in Service revenue. Product revenue decreased by approximately $0.7 million or approximately 52% in the three months ended September 30, 2024 compared to the same period in the prior year, primarily due to lower sales of ECD products which were impacted by the Company’s decision to move production from Irvine, CA to its headquarters location in Mountain View, CA. As a result, there were significant disruptions in our ability to build and deliver units to customers. The Company expects some disruptions to continue in the near future as it evaluates opportunities to optimize production and operations, which may include seeking a new, larger facility. Service revenue, net for the three months ended September 30, 2024 remained relatively flat compared to the same period in the prior year.
Previous report
In the first quarter of 2024, the Company made a strategic decision to outsource its ECD field services function to third-party service and maintenance organizations with technicians better able to efficiently support our clients. We expect that this outsourcing will allow the Company to better focus on its technology and innovation while reducing costs related to non-core business functions. However, we also expect that the short-term impact of these significant changes will result in higher costs and a decline in gross margin yield.
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Total cost of revenue, net of $3.2 million for the three months ended September 30, 2024 remained relatively flat compared to the same period in the prior year primarily due to $0.2 million in reduced headcount and $0.1 million of reduced cellular costs, partially offset by $0.4 million higher costs related to third party field services.
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Service cost of revenue, net for the three months ended September 30, 2024 decreased by approximately $0.1 million to approximately $2.4 million, compared to the three months ended September 30, 2023. This was primarily due to a $0.2 million decline in headcount related expenses due to outsourcing of field services partially offset by a $0.4 million increase in third-party costs. Additionally, there was a $0.1 million decrease in cellular fees as the Company continues to innovate around data usage and associated costs. The service cost of revenue, net includes the average service cost per unit, depreciation of the ASRs, and third-party fees. Additional costs relate to the ongoing maintenance and support of our installed base of ECDs which consists primarily of service personnel, vehicle expense, and warranty repair costs.
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Product cost of revenue, net was approximately $0.9 million for the three months ended September 30, 2024 compared to approximately $0.8 million for the prior year period.
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Gross Profit (Loss)
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Research and development expenses decreased by approximately $0.1 million, or approximately 7% for the three months ended September 30, 2024, as compared to the same period in the prior year. The decrease is primarily due to $0.3 million lower compensation and material expenses partially offset by $0.2 million in higher consulting fees.
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General and administrative expenses increased by approximately $1.0 million or approximately 31% for the three months ended September 30, 2024, as compared to the same period in the prior year. The increase was primarily related to a $0.9 million increase in
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investor relations costs and $0.7 million increase in third-party professional fees, primarily legal and finance services. These increases were partially offset by a decline in payroll expenses of $0.5 million and decline of $0.1 in stock compensation expense driven by a headcount reduction in the first quarter of 2024.
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Total other income (expense) decreased by approximately $1.3 million, or 70% for the three months ended September 30, 2024 as compared to the same period in the prior year, resulting in other income (expense), net of approximately $3.2 million for the three months ended September 30, 2024 compared to total other income (expense), net of approximately $1.9 million for the same period in the prior year. Interest expense increased by $0.1 million due to a higher interest-bearing debt balance in the current year period as compared to the same period in the prior year. The increase in the fair value of warrant and derivative liabilities for the three months ended September 30, 2024 was approximately $1.2 million more than in the same period in the prior year. We recorded $22 thousand in lease termination costs in the third quarter of fiscal 2024, resulting from the early termination of two long-term lease arrangements.
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Comparison of the Nine Months Ended September 30, 2024 and 2023
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Revenue, net
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Total revenue, net for the nine months ended September 30, 2024 of approximately $8.0 million was a decrease of approximately $1.8 million or 18% as compared to the same period in the prior year. The decrease was due to lower production and installation of the ECD products as the Company has been restructuring the formerly CASE Emergency Management business it acquired in 2022.
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Service revenue, net, comprised of ASR MaaS agreements and ECD maintenance agreements remained relatively flat for the nine months ended September 30, 2024 compared to the same period in the prior year. ASR services were impacted by the Company’s decision to replace ASR K5 v3 machines with K5 v5 machines due to quality and reliability of the older version.
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Product revenue, primarily composed of the ECD line of products, decreased by approximately $1.8 million or approximately 42% in the nine months ended September 30, 2024 compared to the same period in the prior year, primarily due to a decline in product production and installations. In addition, the structural changes implemented during the first quarter of 2024 and the resulting disruption also led to a period-over-period decline in installations across the ECD products.
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Cost of revenue, net
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Service cost of revenue, net for the nine months ended September 30, 2024 increased by approximately $1.2 million to approximately $8.3 million, compared to the nine months ended September 30, 2023, primarily due to write-offs related to K5 v3 machines. A high percentage of K5 v3 ASRs did not meet expected quality standards resulting in high service, maintenance and repair costs and low customer satisfaction. During the first quarter of 2024, we decided to discontinue the K5 v3 machines and replace them with the
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improved, better performing K5 v5 machines. K5 v3 machines, totaling approximately $1.1 million, were written off and recorded in service cost of revenue, net in the current year period and we expect this trend to continue throughout the year as we replace existing client machines. In addition, the Company made the decision to outsource its ECD field services function to third-party service and maintenance organizations with technicians better able to efficiently support our clients. As a result of this change, we saw a $1.2 million increase in third-party fees year-over-year. We expect that this outsourcing will allow the Company to better focus on its technology and innovation while reducing costs related to non-core business functions. Higher costs were partially offset by a $0.4 million reduction in headcount costs, a $0.2 million decline in cellular fees and a $0.1 million decline in software related expenses. The service cost of revenue, net is primarily related to the average service cost per unit, depreciation of the ASRs, and third-party fees. Additional costs relate to the ongoing maintenance and support of our installed base of ECDs which consists primarily of service personnel, vehicle expense, and warranty repair costs.
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Reworded paragraphs (22)
Previous wording
The following discussion of our financial condition and results of operations should be read in conjunction with the (1) unaudited condensed financial statements and the related notes thereto included elsewhere in this report, and (2) the audited financial statements and the related notes thereto and management’s discussion and analysis of financial condition and results of operations for the year endedDecember 31, 2023 included in our Annual Report.
Current wording
The following discussion of our financial condition and results of operations should be read in conjunction with the (1) unaudited condensed financial statements and the related notes thereto included elsewhere in this report, and (2) the audited financial statements and the related notes thereto andmanagement’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2024 included in our Annual Report on Form 10-K.
Previous wording
The historical results presented below are not necessarily indicative of the results that may be expected for any future period. Forward-looking statements about our business, results of operations, cash flows, financial condition and prospects based on current expectations that involve risks, uncertainties, and assumptions, and other important factors. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in “Risk Factors” in Part I, Item 1A of our Annual Report, as updated by our other filings with the SEC, and the section titled “Cautionary Note on Forward-Looking Statements” included elsewhere herein.
Current wording
*The historical results presented below are notnecessarily indicative of the results that may be expected for any future period.*Forward-looking statements about our business, results of operations, cash flows, financial condition and prospects based on current expectations that involve risks, uncertainties, and assumptions, and other important factors. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K, as updated by our other filings with the SEC, and the section titled “Cautionary Note on Forward-Looking Statements” included elsewhere herein.
Previous wording
Knightscope builds robotics and artificial intelligence (“AI”) technologies focused on public safety. Our products are manufactured in the United States and are designed to protect people and assets across various environments, including workplaces, schools, and public areas.
Current wording
Knightscope is dedicated to transforming public safety through AI-driven robotics, emergency communication solutions, and real-time monitoring. Our comprehensive suite of solutions includes Autonomous Security Robots (“ASR”), advanced AI-powered detection, emergency communication devices (“ECD”), and the cloud-based Knightscope Security Operations Center (“KSOC”), providing organizations with scalable, 24/7 autonomous monitoring. Our products are manufactured in the United States and are designed to protect people and assets across various environments, including workplaces, schools, and public areas.
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The Company has prioritized restructuring Knightscope’s capital structure to better align with its public company peers. Below is a summary of actions taken, which we believe, set up the Company for long term success.
Current wording
The Company has prioritized restructuring its capital structure to better align with its public company peers. Below is a summary of actions taken, which we believe, set up the Company for long term success.
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The Company is focused on scaling its business and on implementing strategies to decrease gross margin loss over time. We have continued our focus on controlling costs with steps that include
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The Company is focused on scaling its business and on implementing strategies to decrease gross margin loss over time.
Previous wording
In the third quarter of 2024, Knightscope continued to streamline operations of the ECD product line which was acquired when the Company purchased the assets of CASE Emergency Management. Although the disruptions from restructuring changes we made in the first half of this year continue to impact operations, we are beginning to see benefits, primarily as we work closely with our third-party partners to streamline field services for our ECD clients.
Current wording
Although the disruptions from restructuring changes we made in the first half of the prior year continue to impact operations, we are beginning to see benefits, primarily as we work closely with our third-party partners to streamline field services for our ECD clients and renegotiate some long-term services contracts.
Previous wording
Additionally, we believe our efforts to improve the ASR K5 v5 are showing promise as we see increased customer retention and a resulting increase in install base. The Company plans to invest in what management believes will be revenue-generating activities such as expansion of the sales team, developing channel partnerships and updating its website to attract new leads.
Current wording
Additionally, we believe our efforts to improve the ASR K5 v5 are showing promise in higher install base and increased customer retention. The Company continues to invest in revenue-generating activities such channel partnerships, lead generation, marketing and programs aimed at increasing our engagement with the federal government.
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Our strategy is to try to keep fixed costs low while minimizing variable costs in conjunction with pursuing our overall growth objectives.
Current wording
Our strategy is to try to keep fixed costs low while minimizing variable costs in conjunction with pursuing our growth objectives; however given the global nature of our supply chain, our business is subject to the imposition of tariffs and other trade barriers, which may make it more costly for us to import raw materials and components for our products.
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As of October 31, 2024, the Company had a total backlog of approximately $2.9 million, comprised of $2.4 million related to orders for ECDs and $0.5 million related to ASR orders.
Current wording
As of May 7, 2025, the Company had a total backlog of approximately $2.5 million, comprised of $1.9 million related to orders for ECDs and $0.6 million related to ASR orders.
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The revenue and cost of revenue described above resulted in a gross loss for the three months ended September 30, 2024 of approximately $0.7 million, net, compared to a gross profit of $0.1 million for the three months ended September 30, 2023.
Current wording
The revenue and cost of revenue described above resulted in a gross loss for the three months ended March 31, 2025 of approximately $0.7 million, net, compared to $1.4 million for the three months ended March 31, 2024.
Previous wording
Research and development expenses increased by approximately $0.2 million, or 4% for the nine months ended September 30, 2024, as compared to the same period in the prior year. The increase is primarily due to higher headcount than in the same period in the prior year which were lower following a workforce reduction in January 2023.
Current wording
Research and development expenses increased by approximately $0.6 million, or approximately 35% for the three months ended March 31, 2025, as compared to the same period in the prior year. The increase is primarily due to third-party engineering services as the Company continues to invest in the development of new products.
Previous wording
Sales and marketing expenses decreased by approximately $0.4 million, or approximately 28%, for the three months ended September 30, 2024, as compared to the same period in the prior year. The decrease was primarily due to $0.3 million in lower advertising and promotional costs and $0.1 million lower expenses related to compensation and allocation of amortization expense compared to the same period in the prior year.
Current wording
Sales and marketing expenses decreased by approximately $0.2 million, or approximately 15%, for the three months ended March 31, 2025, as compared to the same period in the prior year. The decrease was primarily due to a decline in advertising and promotional costs compared to the same period in the prior year.
Previous wording
Restructuring charges were approximately $33 thousand for the three month period ended September 30, 2024 compared to none for the same period in the prior year.
Current wording
Restructuring charges were $0 for the three month period ended March 31, 2025 compared to $119 for the same period in the prior year.
Previous wording
As of September 30, 2024, and December 31, 2023, we had $5.2 million and $2.3 million, respectively, of cash and cash equivalents. As of September 30, 2024, the Company had paid-in capital of $195.5 million, partially offset by an accumulated deficit of approximately $186.2 million, working capital of approximately $0.0 million and total stockholders’ equity of approximately $9.3 million. These factors raise substantial doubt about our ability to continue as a going concern. There can be no assurance that the Company will be successful in acquiring additional funding at levels sufficient to fund its future operations. Management’s plans include seeking additional financing, such as issuances of equity and issuances of debt and/or convertible debt instruments. Sales of additional equity securities, convertible debt and/or warrants by the Company could result in the dilution of the interests of existing stockholders. The Company will require significant additional financing to meet its planned capital and operational needs and is pursuing opportunities to obtain additional financing through equity and/or debt alternatives. However, there can be no assurance that financing will be available when required in sufficient amounts, on acceptable terms or at all. If the Company is unable to raise additional capital in sufficient amounts or on terms acceptable to it, the Company may have to significantly reduce its operations, delay, scale back or discontinue the development of one or more of its platforms or discontinue operations completely.
Current wording
As of March 31, 2025 and December 31, 2024, we had $12.7 million and $11.1 million, respectively, of cash and cash equivalents. As of March 31, 2025, the Company had additional paid-in capital of $218.2 million, partially offset by an accumulated deficit of approximately $200.1 million, working capital of approximately $9.6 million and total stockholders’ equity of approximately $18.2 million. These factors raise substantial doubt about our ability to continue as a going concern. There can be no assurance that the Company will be successful in acquiring additional funding at levels sufficient to fund its future operations. Management’s plans include seeking additional financing, such as issuances of equity and issuances of debt and/or convertible debt instruments. Sales of additional equity securities, convertible debt and/or warrants by the Company could result in the dilution of the interests of existing stockholders. The Company will require significant additional financing to meet its planned capital and operational needs and is pursuing opportunities to obtain additional financing through equity and/or debt alternatives. However, there can be no assurance that financing will be available when required in sufficient amounts, on acceptable terms or at all. If the Company is unable to raise additional capital in sufficient amounts or on terms acceptable to it, the Company may have to significantly reduce its operations, delay, scale back or discontinue the development of one or more of its platforms or discontinue operations completely.
Previous wording
SEC rules. Pursuant to General Instruction I.B.6 of Form S-3, the February Prospectus Supplement provided that in no event would we sell any securities in a public primary offering with a value exceeding one-third of our non-affiliated public float in any 12 month period unless our non-affiliated public float subsequently rose to $75.0 million or more.
Current wording
In February 2023, we commenced an at-the-market offering program with H.C. Wainwright & Co., LLC (“Wainwright”), as sales agent, in connection with our filing of a prospectus supplement filed on February 9, 2023 (the “February Prospectus Supplement”), allowing us to offer and sell from time to time of up to $20.0 million in shares of Class A Common Stock, subject to, and in accordance with, SEC rules. Pursuant to General Instruction I.B.6 of Form S-3, our prospectus supplement provided that in no event would we sell any securities in a public primary offering with a value exceeding one-third of our non-affiliated public float in any 12-month period unless our non-affiliated public float subsequently rose to $75.0 million or more.
Previous wording
On August 18, 2023, after our non-affiliated public float subsequently rose to an amount greater than $75.0 million, we filed a new prospectus supplement (the “August Prospectus Supplement”) providing for the offer and sale from time to time of up to $25.0 million in shares of Class A Common Stock subject to, and in accordance with, SEC rules.
Current wording
On November 14, 2024, after our non-affiliated public float rose to an amount greater than $75.0 million, we filed a new prospectus supplement (the “November Prospectus Supplement”) providing for the offer and sale from time to time of up to $25.0 million in shares of Class A Common Stock, in addition to the shares of Class A Common Stock previously sold, subject to, and in accordance with, SEC rules.
Previous wording
During the nine months ended September 30, 2024, we issued 1,470,537 shares of Class A Common Stock under the at-the-market offering program for net proceeds of approximately $20.4 million, net of brokerage and placement fees of approximately $0.8 million. From October 1, 2024 to November 13, 2024, we sold 245,882 shares of Class A Common Stock, generating approximately $2.3 million of proceeds, net of commissions and other issuance costs.
Current wording
For the three months ended March 31, 2025, we issued 1,247,836 shares of Class A Common Stock under the at-the-market offering program for net proceeds of approximately $7.4 million, net of brokerage and placement fees of approximately $0.2 million.
Previous wording
Net cash used in operating activities was approximately $17.4 million for the nine months ended September 30, 2024. Net cash used in operating activities resulted from a net loss of approximately $24.8 million and changes in working capital and non-cash charges.
Current wording
Net cash used in operating activities was approximately $6.4 million for the three months ended March 31, 2025. Net cash used in operating activities resulted from a net loss of approximately $6.9 million and changes in working capital and non-cash charges.
Previous wording
Net cash used in operating activities for the nine months ended September 30, 2024 decreased by approximately $0.8 million as compared to the same period of the prior year. This was primarily a result of an increase in the net loss of approximately $9.2 million, changes in assets and liabilities of approximately $4.4 million, a decrease in accrued interest of approximately $0.2 million, a decrease in common stock issued in exchange for consulting services of $0.4 million, a decrease in stock based compensation of approximately
Current wording
Net cash used in operating activities for the three months ended March 31, 2025 decreased by approximately $2.2 million as compared to the same period of the prior year. This was primarily a result of a decrease in the net loss of approximately $0.7 million, changes in assets and liabilities of approximately $1.4 million, an increase in stock-based compensation of approximately $0.1 million partially offset by a decrease in the change in fair value of warrant and derivative liabilities of approximately $0.8 million, and a loss on disposal of ASRs and related inventory of approximately $0.8 million.
Previous wording
Net cash used in investing activities for the nine months ended September 30, 2024 and 2023 was approximately $2.5 and $3.6 million, respectively.
Current wording
Net cash used in investing activities for the three months ended March 31, 2025 and 2024 was approximately $0.4 million and $0.9 million, respectively.
Previous wording
Net cash provided by financing activities was approximately $22.8 million for the nine months ended September 30, 2024, an increase of approximately $1.1 million as compared to the same period of the prior year. Our financing activities for the nine months ended September 30, 2024, consisted primarily of net proceeds from the issuance of Class A Common Stock under our at-the-market offering program with Wainwright and issuance of Regulation A bonds. In the prior year period our financing activities consisted primarily of net proceeds resulting from our at-the-market agreement with Wainwright.
Current wording
Net cash provided by financing activities was approximately $8.3 million for the three months ended March 31, 2025, a decrease of approximately $1.5 million as compared to the same period of the prior year. Our financing activities for the three months ended March 31, 2025, consisted primarily of net proceeds from the issuance of Class A Common Stock under our at-the-market offering program with Wainwright and the registered direct offering of approximately $7.4 million,
Previous wording
There have been no material changes to our critical accounting estimates from what was reported in the Annual Report. Please see Note 1 to our condensed financial statements elsewhere in this Quarterly Report on Form 10-Q.
Current wording
There have been no material changes to our critical accounting estimates from what was reported in the Annual Report on Form 10-K. Please see Note 1 to our condensed financial statements elsewhere in this Quarterly Report on Form 10-Q.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
The following table sets forth selected Condensed Statements of Operations data (in thousands) and such data as a percentage of total revenue.
Previous report — wording carried elsewhere
In February 2023, we commenced an at-the-market offering program with H.C. Wainwright & Co., LLC (“Wainwright”), as sales agent, in connection with which we filed a prospectus supplement filed on February 9, 2023 (the “February Prospectus Supplement”), allowing us to offer and sell from time to time of up to $20.0 million in shares of Class A Common Stock, subject to, and in accordance with,
Previous report — wording carried elsewhere
$0.7 million partially offset by a decrease in the change in fair value of warrant and derivative liabilities of approximately $5.5 million, a decrease in depreciation and amortization of $0.1 million and a loss on disposal of ASRs and related inventory of approximately $1.1 million.