Arrive AI Inc.
For the period ended Jun 30, 2025. Filed Aug 14, 2025.
View on SEC.govAbout this filing
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.
Jun 30, 2025 · Filed Aug 14, 2025
ARAI$0.10+8.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-06-05.
0001641172-25-013826
Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-14.
0001641172-25-023999
Item 2. Management’s Discussion and Analysis of Financial Conditions 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 47 previous paragraphs and 69 current paragraphs.
24 unchanged; 1 reworded; 43 added; 22 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 2 previous and 9 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 (43)
Current report
Hancock Health Deployment
Current report
On May 19, 2025, we announced a two-year agreement to deploy patented Arrive Points at Hancock Health, a regional hospital located in Greenfield, Indiana. Under this agreement, Arrive Points will serve as a reliable, chain-of-custody compliant hub for the drop-off and pickup of biospecimens from the cancer center. The first deployment installed two third generation Arrive Points (“AP3”) in conjunction with ground robots in a single route. Initial revenue was recorded in this quarter for the engineering, development and consulting on the project. Recurring subscription service for access to the Arrive network and rolling robots began in August 2025. Additional delivery routes, including drone operations, are being evaluated for expansion in future stages.
Current report
Go2Delivery Partnership
Current report
On May 20, 2025, we announced a partnership with Go2 Delivery, a Virginia-based courier, to autonomously deliver high-risk, high-value specialty pharmacy products using Arrive AI technology. Go2 Delivery is rolling out Arrive Points initially in Virginia Beach, Virginia. The companies have been testing the process for several months, with the initial units delivered in 2024. We recognized revenue this quarter from the installation of the units and began subscription revenue service in April 2025.
Current report
Patents Issued
Current report
On June 10, 2025, we announced the issuance of a new U.S. patent. The new patent (US12304671B2) is for the Arrive Points’ ability to heat and cool items on demand and brings our total issued U.S. patents to eight.
Current report
Skye Air Mobility Partnership
Current report
On June 24, 2025, we announced a new global customer, Skye Air Mobility. Skye Air is India’s dominant and rapidly expanding hyperlocal drone delivery platform, making about 6,000 deliveries per day. Under the terms of the agreement, the two companies will collaborate to deploy up to 500 Arrive Points in India, including the capital of New Delhi. The first Arrive Point units are expected to be delivered to Skye Air by the end of 2025.
Current report
Filing of S-8 Registration Statement
Current report
On June 13, 2025, we filed a registration statement on Form S-8 to register 1,500,000 shares of common stock, which includes (i) 886,799 shares which may be issued under the Company’s 2023 Equity Incentive Plan (the “2023 Plan”), and (ii) 613,201 shares that may be issued upon exercise of outstanding options granted under the 2023 Plan. The 2023 Plan was adopted by the Company’s board of directors on April 27, 2023, and approved by Daniel S. O’Toole, the Company’s majority shareholder, on April 27, 2023.
Current report
Issuance of Shares Under the Equity Incentive Plan
Current report
From June 19, 2025 through July 18, 2025, we issued 36,079 fully vested shares under the 2023 Plan to employees, directors, and consultants. A total of 25,932 shares were issued to independent Directors, 4,111 shares were issued to employees, and 6,036 shares were issued to advisors and consultants.
Current report
On July 28, 2025, our resale registration statement was declared effective by the SEC registering up to 8,125,779 shares of common stock for resale by selling shareholders. This includes 8,000,000 shares under the Streeterville Purchase Agreement, 114,421 shares issuable upon exercise of outstanding warrants (6,680 of which have since expired), and 11,358 shares issued after the effectiveness of our registration statement on Form S-1 in connection with our direct listing.
Current report
Revenues:
Current report
During the three months ended June 30, 2025, we recognized total revenues of $90,725. Of this, $89,000 was for design and consulting services, $1,500 for installation fees, and $725 for monthly subscriptions. Consulting services, and installation fees are typically project-based and non-recurring in nature. Subscription services are recurring and paid either up-front or monthly for an annual term. We anticipate these revenue streams to continue in future quarters while we develop new revenue models for the autonomous delivery marketplace and AI data insight monetization.
Current report
As a development stage company, during the three months ended June 30, 2024, we had no revenues. Percentage change from the prior year period is therefore not meaningful (“NM”).
Current report
Operating Expenses:
Current report
Our second quarter results reflect continued investment in product development and marketing activities. This quarter’s general and administrative expenses include one-time costs related to the direct listing and financing transaction.
Current report
General and administrative expenses increased by $3,483,247 for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024. Primary components of general and administrative expenses were:
Current report
Research and Development expenses were $293,468 for the three months ended June 30, 2025, a decrease of $159,070 as compared to the same period in the prior year. This is due to the timing of vendor engineering projects (lower by $345,845), offset by higher independent contractor spend ($68,525) and one-time success bonuses for independent contractors ($118,250).
Current report
Marketing expenses were $49,602 for the three months ended June 30, 2025, a decrease of $176,687 from the same period in the prior year. The decrease is due to one-time expenses in the prior year period for television advertising ($200,000), offset by higher travel and miscellaneous expenses in the current quarter.
Current report
Other Income/Expenses:
Current report
Other income for the three months ended June 30, 2025 was $43,151. Income was recognized from payroll tax refunds earned under the federal R&D tax credit program of $42,857, and interest income of $294.
Current report
Interest expense of $194,212 was comprised primarily of the amortization of the original issue discount on the Streeterville convertible note ($192,000), other miscellaneous interest ($1,617) and bank charges ($595).
Current report
During the three months ended June 30, 2024, we recognized income from the Indiana EDGE tax credit of $24,089 and no federal R&D tax refunds. Interest expense for the prior-year period was $1,053.
Current report
Revenues:
Current report
During the six months ended June 30, 2025, we recognized total revenues of $90,725. Of this, $89,000 was for design and consulting services, $1,500 for installation fees, and $725 for monthly subscriptions.
Current report
As a development stage company, during the six months ended June 30, 2024, we had no revenues.
Current report
Operating Expenses:
Current report
Our first half results reflect continued investment in product development and marketing activities. General and administrative expenses include one-time costs related to the direct listing and financing transaction.
Current report
General and administrative expenses increased by $4,577,295 for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024. Primary components of general and administrative expenses were:
Current report
Research and Development expenses were $384,731 for the six months ended June 30, 2025, a decrease of $156,208 as compared to the same period in the prior year. This is due to the timing of vendor engineering projects (lower by $387,864), offset by higher independent contractor spend ($113,406) and one-time success bonuses for independent contractors ($118,250).
Current report
Marketing expenses were $57,263 for the six months ended June 30, 2025, a decrease of $195,483 from the same period in the prior year. The decrease is due to one-time expenses in the prior year period for television advertising ($200,000), offset by higher travel and miscellaneous expenses in the current quarter.
Current report
Other Income/Expenses:
Current report
Other income for the six months ended June 30, 2025 was $60,066. Income was recognized from payroll tax refunds earned under the federal R&D tax credit program of $42,857, state tax refund from the EDGE credit of $16,915, and interest income of $294.
Current report
Interest expense of $195,389 was comprised primarily of the amortization of the original issue discount on the Streeterville convertible note ($192,000), other miscellaneous interest ($1,939) and bank charges ($1,450).
Current report
During the six months ended June 30, 2024, we recognized income from the Indiana EDGE tax credit of $24,089 and no federal R&D tax refunds. Interest expense for the prior-year period was $2,017.
Current report
Net cash used in operating activities was $3,799,494 for the six months ended June 30, 2025, compared to $1,353,985 for the same period in 2024. The increase in cash outflows of $2,445,509 was primarily due to our net loss of $6,668,129, offset by non-cash items of stock-based compensation expense of $2,845,223, depreciation and amortization expense of $17,118 and the amortization of a discount on the convertible debt of $192,000.
Current report
Other working capital movements in the period resulted in a net cash outflow of $185,706, primarily due to an increase in prepaid expenses of $141,431, accounts receivable of $89,075, and a reduction of accrued liabilities of $27,245. This outflow was partially offset by increases in accounts payable of $61,131 and the credit card payable of $9,943.
Current report
For the six months ended June 30, 2024, operating cash flow was comprised of our net loss of $2,375,855, offset by non-cash items of stock-based compensation expense of $605,615 and depreciation and amortization of $14,469. Working capital movements in the prior-year period resulted in net cash inflows of $401,786 due to an increase in accounts payable of $344,817, accrued liabilities of $85,136 offset by outflows due to prepaid expenses ($3,381) and the credit card payable ($24,786).
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Removed paragraphs (22)
Previous report
On May 13, 2025, the Company’s S-1 Registration Statement was declared effective, registering 29,978,212 shares of our common stock representing one hundred percent (100%) of the company’s currently issued and outstanding common stock.
Previous report
Initial Trading on Nasdaq Global Market
Previous report
On May 15, 2025, the Company’s common stock began trading on the Nasdaq Global Market under the ticker “ARAI”.
Previous report
Closing of Equity Line of Credit
Previous report
On May 15, 2025, the Company closed a financing agreement with an investor. Per the terms of the agreement, the investor transferred $4,000,000 as the initial pre-paid advance. Shares to be issued under the share purchase agreement are included on a resale registration statement filed with the SEC.
Previous report
New Independent Board Member
Previous report
On June 2, 2025, the Company named Laurie Tucker as a new independent member of the Board of Directors. Ms. Tucker will serve an initial three-year term and also be the Chairperson of the Compensation Committee.
Previous report
Key Components of Our Results of Operations
Previous report
Our first quarter results reflect continued investment in our products and services. Operating expenses were higher than the same period in 2024, due mainly to higher compensation expenses in the quarter.
Previous report
Salaries and wages were higher by $1,085,536 (218%) compared to the same period in 2024. Base wages were lower by $16,097 (6%) due to fluctuations in the full-time workforce. Stock-based compensation increased $1,101,633, as the Company used equity instead of cash as compensation for services.
Previous report
Legal and professional fees were higher by $25,285 (14%) due mainly to increased filing and maintenance fees associated with its patent portfolio.
Previous report
Office supplies and software expenses were lower by $4,587 as the Company continued to manage discretionary spending in the quarter to extend the cash runway.
Previous report
Rent expense was higher by $4,400 compared to the prior year period. In April 2024, the Company moved to a new, larger office space resulting in higher monthly rent expense.
Previous report
Taxes and license expense was lower by $13,542 in the period, due mainly to lower payroll taxes. The Company deferred certain salaries and wages in the period, including the associated payroll taxes, to extend liquidity prior to closing the direct listing. These payroll taxes were accrued in salaries and wages.
Previous report
All other general and administrative expenses, in total, were lower by $23,082 due to reduced discretionary spend in all areas.
Previous report
Net cash used in operating activities was $546,671 for the three months ended March 31, 2025, compared to $602,477 for the same period in 2024. The decrease in cash outflows was primarily due to higher use of stock-based compensation in lieu of cash payments to employees, contractors and advisors. Stock-based compensation in the period increased by $1,101,633 compared to the same period in 2024, while the net loss was $1,061,412 higher compared to the prior year period, resulting in a net operating cash flow improvement of $40,221.
Previous report
Changes in net operating assets and liabilities resulted in a net inflow of $75,858 in the period. This was primarily driven by increases in accrued liabilities ($133,468), prepaid expenses ($7,081), other current assets ($1,412), and credit card payable ($159), offset by a reduction of accounts payable of $66,262. The increase in accrued liabilities was due to an increase of deferred salaries and wages of $113,716 in the period and deferral of licensing fee payments of $20,000.
Previous report
In the prior-year period, changes in net operating assets and liabilities resulted in a net inflow of $60,409. This was primarily driven by an increase in accrued liabilities ($87,676) and prepaid expenses ($4,377), offset by reductions in accounts payable ($3,554), and credit card payable ($28,090).
Previous report
Non-cash adjustments to reconcile net loss to cash used in operating activities for the current period included depreciation and amortization of $7,391, compared to $7,255 for the prior year period.
Previous report
Net cash used for investing activities was $2,832 in the period. This was due to an increase in construction in progress for final installation costs related to an Arrive Point asset deployed to a customer location.
Previous report
Net cash provided by financing activities was $715,553 in the period. This was due to new equity issuances and conversion of outstanding warrants. Funds raised through a crowdfunding campaign included new gross equity investment ($288,002), a net release of funds from prior crowdfunding issuances ($40,219), offset by funding costs associated with the campaign ($59,468), resulting in new funds from crowdfunding of $268,753.
Previous report
The Company also issued new shares to accredited investors for net proceeds of $152,000, and to an existing investor in exchange for a warrant conversion, resulting in net proceeds of $296,875. Payments made on an outstanding note for the company cargo van totalled $2,075 in the period.
Reworded paragraphs (1)
Previous wording
Our primary source of liquidity is cash on hand. As of March 31, 2025, our cash totalled $295,368. This represents an increase of $166,050 from the $129,318 on hand at the end of the prior fiscal year. This increase was primarily attributable to net proceeds received from the sales of stock totalling $717,628. These proceeds were used to fund general operating expenses, including salaries, professional services and research and development expenses.
Current wording
Our primary sources of liquidity are cash on hand, and the Streeterville Purchase Agreement. As of June 30, 2025, our cash was $607,496. This represents an increase of $478,178 from $129,318 on hand at the end of the prior fiscal year. Proceeds from the sales of common stock and the convertible note were used to fund general operating expenses, including salaries, professional services and research and development expenses. Cash flow was also impacted by significant one-off expenditures related to the public listing, as described in the discussion of operating expenses.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Comparison of the Six Months Ended June 30, 2025, and June 30, 2024