Xos, Inc.
For the period ended Dec 31, 2024. Filed Mar 31, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 31, 2025
XOS$2.43+2.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-29.
0001819493-24-000050
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001819493-25-000043
Item 7. 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 160 previous paragraphs and 163 current paragraphs.
65 unchanged; 59 reworded; 33 added; 33 removed; 3 previous and 6 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 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 (33)
Current report
Xos is an early-stage growth company, and as such incurred net losses and cash outflows since its inception. As an early-stage growth company, the Company's ability to access capital is critical. However, there can be no assurance such capital will be available to the Company when needed, on favorable terms or at all. If we are unable to collect on our outstanding accounts receivable, obtain a sufficient level of new capital in the near-term and/or obtain replacement financing for or extend the maturity of existing debt, we could be required to dissolve and liquidate our assets under bankruptcy laws or otherwise.
Current report
As an early-stage growth company, we have incurred net losses and cash outflows since our inception. We will continue to incur net losses and cash outflows in accordance with our operating plan as we continue to scale our operations to meet anticipated demand and seek to establish our product and service offerings. As a result, our ability to access capital is critical and until we can generate sufficient revenue to cover our operating expenses, working capital and capital expenditures, we will need to raise additional capital in order to fund and scale our operations. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our commercialization, research and development programs and/or other efforts and our ability to continue our operations would be negatively impacted. If we seek additional financing to fund our business activities in the future and there remains substantial doubt about our ability to continue as a going concern, investors or other financing sources may be unwilling to provide funding to us on commercially reasonable terms, if at all. In addition, we may have to liquidate our assets and may receive less than the value at which those assets are carried on our audited financial statements and/or seek protection under Chapters 7 or 11 of the United States Bankruptcy Code. This could potentially cause us to cease operations and result in a complete or partial loss of your investment in our Common Stock.
Current report
Management’s plans to improve Xos’s liquidity and working capital requirements over the next twelve months include reducing operating costs in order to conserve financial resources. Accordingly, in the fourth quarter of 2024, Xos took the following measures:
Current report
•We completed a reduction in force (the “RIF”) pursuant to which we terminated approximately 26% of our total workforce. We do not expect to incur material costs in connection with the RIF. The RIF may have unintended adverse effects on our operations and results. See “Our recent cost-cutting measures may not adequately reduce our operating costs or improve our operating margins, may lead to additional workforce attrition and may cause operational disruptions” in Part I Item 1A Risk Factors of this Report.
Current report
•Certain of our senior executives have accepted temporary reductions in their annual base salaries, including our Chief Executive Officer and Chief Operating Officer who have volunteered to temporarily reduce their cash salaries by between approximately 20% and approximately 50%, effective October 28, 2024.
Current report
Supply Chain Disruptions
Current report
While our ability to source certain critical inventory items has been steadily improving since prior years, we are still experiencing long-standing negative effects from global economic conditions, and management expects such effects to continue to varying degrees for the foreseeable future. We have also observed, and expect to be impacted by, sporadic and unpredictable shortages for specific components, primarily in power electronics and harnesses, and disruptions to the supply of components. Fluctuating fuel prices and geopolitical conflicts have compounded ongoing supply and demand pressures for shipping, resulting in port congestion, higher freight fees and longer transit times.
Current report
Despite these disruptions, our supply chain team continues to employ mitigating strategies to effectively source inventory for all of our products. We continue working with vendors to find alternative solutions to overcome these constraints and, where appropriate, working to find alternate sources of supply for critical components, including placing orders in advance of projected need, while ensuring such components have extended usage projected. Changes to trade policies and tariffs (or the perception that such changes may occur) could materially adversely affect our ability to source components at reasonable prices or at all. We have been closely monitoring potential changes to trade policies and tariffs in order to proactively adjust and refine our strategy. These steps are designed to promote availability of materials in time to meet production plans, without inflating inventory beyond projected lead times.
Current report
We are increasingly subject to varying and sometimes conflicting rules, tariffs, and import restrictions that can change with little notice. These regulatory changes may impact our ability to continue sourcing components from certain regions or accessing key suppliers. See “Changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences, could adversely affect our business, prospects, financial condition and operating results,” in Part I, Item 1A “Risk Factors” of this Report.
Current report
Revenue
Current report
Revenue also consists of sales-type leases which are accounted for under ASC 842, Leases. Revenue is the lower of the fair value of the asset leased or the present value of the lease receivable and prepayments.
Current report
We also earn tradable credits in the operation of our automotive business under various regulations related to emission reduction, clean fuel, and others. We sell these credits to other regulated entities who can use the credits to comply with emission standards and other regulatory requirements. We recognize revenue on the sale of these credits, which have negligible incremental costs associated with them, at the time control of the regulatory credit is transferred to the purchasing party.
Current report
General and Administrative Expense
Current report
Research and Development Expense
Current report
•expenses related to licenses and subscriptions of software utilized in R&D activities;
Current report
We expect our R&D costs to decrease for the foreseeable future primarily due to lower headcount driven by our RIF.
Current report
Sales and Marketing Expense
Current report
We expect our S&M expense to decrease for the foreseeable future primarily due to lower headcount driven by our RIF.
Current report
Global general economic and political conditions, such as inflation, tariffs (or the threat of tariffs), uncertain credit and global financial markets, supply chain disruption, international currency fluctuations, and geopolitical events have had and could continue to have an adverse impact in our ability to raise additional funds. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our commercialization, research and development programs and/or other efforts and our ability to continue our operations would be negatively impacted. If we seek additional financing to fund our business activities in the future and there remains substantial doubt about our ability to continue as a going concern, investors or other financing sources may be unwilling to provide funding to us on commercially reasonable terms, if at all. In addition, we may have to liquidate our assets and may receive less than the value at which those assets are carried on our audited financial statements and/or seek protection under Chapters 7 or 11 of the United States Bankruptcy Code. This could potentially cause us to cease operations and result in a complete or partial loss of your investment in our Common Stock.
Current report
Cash Flow Data
Current report
Cash Flow from Operating Activities
Current report
Cash Flow from Investing Activities
Current report
Cash Flow from Financing Activities
Current report
Cash Conservation Measures
Current report
Management’s plans to improve our liquidity and working capital availability over the next twelve months include reducing operating costs in order to conserve financial resources. Accordingly, in the fourth quarter of 2024, we took the following measures:
Current report
•We completed a reduction in force (the “RIF”) pursuant to which we terminated approximately 26% of our total workforce. We do not expect to incur material costs in connection with the RIF.
Current report
•Certain of our senior executives have accepted temporary reductions in their annual base salaries, including our Chief Executive Officer and Chief Operating Officer who have volunteered to temporarily reduce their cash salaries by between approximately 20% and approximately 50%, effective October 28, 2024.
Current report
Management plans to continue to seek opportunities to reduce costs and, in particular, cash expenditures, in a manner intended to minimize their adverse impact on our core operations. However, there can be no assurance that the measures described above, or any other cost-cutting measures we may implement in the future, will be sufficient to address our immediate or longer-term liquidity and working capital needs. Moreover, it is possible that such measures will have an adverse effect on our operations (see Part I, Item 1A Risk Factors of this Report, under the caption “Our recent cost-cutting measures may not adequately reduce our operating costs or improve our operating margins, may lead to additional workforce attrition and may cause operational disruptions”).
Current report
For other features and services such as over-the-air software updates that are included as part of the vehicle consideration received, an observable price is used to determine the stand-alone selling price or, when one is not available, a blended market approach and cost-plus margin approach is utilized. Revenue is provisioned upon control transfer of a vehicle and recognized over time on a straight-line basis as the Company has a stand-ready obligation to deliver such services to the customer.
Current report
The Company has outstanding sales-type leases for stepvans and Hubs under ASC 842, Leases (“ASC 842”). Arrangements under this program can have terms for up to 60 months for stepvans and 24 months for Hub units. The Company recognizes all revenue and costs associated with the sales-type leases upon delivery of the vehicle to the customer. Interest income based on the implicit rate in the lease is recorded over time as customers are invoiced on a monthly basis.
Current report
Derivative Liabilities
Current report
Duty Drawback Receivables
Current report
Duty drawback is the recovery of tariffs paid for vehicles that we acquired as a result of the consummation of the Arrangement. The Company expects to recover some of the vehicle inventory value through crushing the vehicles to recover tariffs already paid. As of December 31, 2024, the Company estimates aggregate tariff recovery of approximately $2.7 million with respect to destruction of SOLO vehicles and submission of the related claim documents. As of June 30, 2024, the Company completed the crushing of the vehicles but, as of December 31, 2024, has not yet received any tariff recovery related to the destruction of SOLO vehicles.
Removed paragraphs (33)
Previous report
We currently manufacture a Class 5-6 MD X-Platform with multiple body options to address different customer use cases, including parcel delivery, linen, food & beverage, and armored cash transport. In May 2022 we launched our Class 7-8 HD X-Platform.
Previous report
from vehicle and powertrain sales, $0.6 million (or 2% of revenue) from Fleet-as-a-Service, and $1.7 million (or 4% of revenue) from ancillary revenue.
Previous report
Business Combination and Public Company Costs
Previous report
On August 20, 2021, the transactions contemplated by the Agreement and Plan of Merger, as amended on May 14, 2021, by and among NextGen, Sky Merger Sub I, Inc., a Delaware corporation and a direct wholly owned subsidiary of NextGen (“Merger Sub”), and Xos, Inc., a Delaware corporation (now known as Xos Fleet, Inc., “Legacy Xos”), were consummated (the “Closing”), whereby Merger Sub merged with and into Legacy Xos, the separate corporate existence of Merger Sub ceased and Legacy Xos became the surviving corporation and a wholly owned subsidiary of NextGen (such transaction the “Merger” and, collectively with the transfer by way of continuation and deregistration of NextGen from the Cayman Islands and the continuation and domestication of NextGen as a corporation incorporated in the State of Delaware (the “Domestication”), the “Business Combination”). As a result of the Merger, NextGen completed the Domestication, Merger Sub merged with and into Xos Fleet, Inc. (which was formerly known as Xos, Inc.), the separate corporate existence of Merger Sub ceased and Xos Fleet, Inc. was to be the surviving corporation and a wholly owned subsidiary of NextGen, and NextGen changed its name to “Xos, Inc.” Xos Fleet, Inc. is the accounting predecessor and the combined entity will be the successor SEC registrant, and Xos’ financial statements for previous periods will be disclosed in the registrant’s future periodic reports filed with the SEC.
Previous report
As a consequence of the completion of the Business Combination, we became the successor to an SEC-registered and Nasdaq-listed company with ticker “XOS”, which has required us and will continue to require us to hire additional personnel and implement procedures and processes to address public company regulatory requirements and customary practices. We have incurred and expect to incur additional annual expenses as a public company for, among other things, directors’ and officers’ liability insurance, director fees and additional internal and external accounting and legal and administrative resources, including increased audit and legal fees.
Previous report
Supply Chain Management
Previous report
As described more fully below, certain areas of our supply chain have been disrupted due to global economic conditions. Our ability to find alternative solutions to meet customer demands will affect our financial performance.
Previous report
Global economic conditions, while generally seeing some minor and gradual improvements, continue to impact our ability to procure and our suppliers’ ability to produce certain critical inventory items. The speed and nature of the recovery in response to the pandemic has been slow, placing a burden on our supply chain management, including but not limited to the following areas:
Previous report
•Semiconductor chip shortage: The global silicon semiconductor industry has experienced a shortage in supply and difficulties in ability to meet customer demand. This shortage has led to an increase in lead-times of production of semiconductor chips and other highly engineered components since the beginning of 2020.
Previous report
•Battery cells: The battery cell industry is facing a shortage in supply which is causing suppliers to both limit customer allocations and provide no cost relief.
Previous report
•Supply limitation on vehicle bodies and aluminum: Vehicle body suppliers are currently experiencing elevated pricing or a shortage of key materials such as aluminum.
Previous report
In addition, efforts to achieve direct material cost reductions, such as re-sourcing raw materials, reengineering our product offerings, and finding new sources of supply, have also impacted our ability to source critical components in the short term. In the face of such challenges, we have taken measures to secure inventory necessary for the manufacture of our vehicles, including working with vendors to find alternate sources of supply for critical components and placing orders in advance of projected need. In spite of the various measures taken to minimize the impact of these supply limitations, we continue to experience uncertainty that all inventory will be able to be delivered in time for production plans.
Previous report
The unpredictability of supply availability could lead to previously unforeseen cost and delivery pressures on certain material and logistical costs. As the Company accelerates execution of its strategic plans, we will endeavor to be strategic in our cost action plans, including working with various vendors and service providers to provide us cost-effective arrangements.
Previous report
General and Administrative Expenses
Previous report
Research and Development Expenses
Previous report
We expect our research and development costs to decrease for the foreseeable future primarily due to lower headcount driven by our reduction in workforce.
Previous report
Sales and Marketing Expenses
Previous report
•travel expenses of our sales force who are primarily responsible for introducing our platform and offerings to potential customers;
Previous report
•depreciation expense on property and equipment related to S&M activities, calculated over the estimated useful life of the property and equipment on a straight-line basis. Upon property and equipment retirement or disposal, the cost of the asset disposed, and the related accumulated depreciation from the accounts and any gain or loss is reflected in the consolidated statements of operations and comprehensive loss, allocated to S&M.
Previous report
We expect these expenses to decrease for the foreseeable future primarily due to lower headcount driven by our reduction in workforce.
Previous report
Revenues
Previous report
Additionally, Xos consummated the Arrangement with ElectraMeccanica on March 26, 2024. As a result, our liquidity will be supplemented by accessing ElectraMeccanica's cash balance, which was estimated to be approximately $48.0 million as of the date the Arrangement was consummated.
Previous report
Based on our ability to raise funds through the strategies described above, the consummation of the Arrangement with ElectraMeccanica and our cash and cash equivalents as of December 31, 2023, we have concluded that it is probable that such proceeds would provide sufficient liquidity to complete the integration of ElectraMeccanica and fund operations for the next twelve months following the date of this Report. As a result, it is probable that our plans alleviate the substantial doubt about our ability to continue as a going concern for at least one year from the issuance of the consolidated financial statements.
Previous report
ElectraMeccanica Acquisition
Previous report
Purchase Agreement in the accompanying consolidated financial statements for more information regarding the SEPA, the Side Letter and the Securities Purchase Agreement.
Previous report
Cash Flows Summary
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Cash Flows from Operating Activities
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Cash Flows from Investing Activities
Previous report
Net cash used in investing activities was $82.7 million for the year ended December 31, 2022, primarily consisting of property and equipment additions of $14.1 million and net purchase of investments in marketable debt securities, available-for-sale of $96.8 million.
Previous report
Cash Flows from Financing Activities
Previous report
We maintain a portfolio of investments in a variety of fixed and variable rate debt securities, including U.S. treasuries, corporate debt, asset-backed securities and other, non-U.S. government and supranational bonds and certificate of deposit. We consider our investments in marketable debt securities to be available-for-sale, and accordingly, are recorded at their fair values. We determine the appropriate classification of investments in marketable debt securities at the time of purchase. Interest along with amortization of purchase premiums and accretion of discounts from the purchase date through the estimated maturity date, including consideration of variable maturities and contractual call provisions, are included in other expense, netin the consolidated statements of operations and comprehensive income loss. We typically invest in highly-rated debt securities, and its investment policy generally limits the amount of credit exposure to any one issuer. The policy requires substantially all investments to be investment grade, with the primary objective of minimizing the potential risk of principal loss.
Previous report
We review quarterly its investment portfolio of all securities in an unrealized loss position to determine if an impairment charge exists. See Note 9 – Investments in Marketable Debt Securities, Available-for-Sale for additional information.
Previous report
Derivative Liability
Reworded paragraphs (59)
Previous wording
The following discussion and analysis provides information which Xos’ management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition. The discussion should be read together with the consolidated financial statements and related notes that are included elsewhere in this Report. You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes to those statements. You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes to those statements. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under the section entitled “Risk Factors”. Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and “the Company” are intended to mean the business and operations of Xos and its consolidated subsidiaries.
Current wording
The following discussion and analysis provides information which Xos’s management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition. You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes to those statements. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part I Item 1A “Risk Factors” of this Report. Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “we”, “us”, “our”, and “the Company” are intended to mean the business and operations of Xos and its consolidated subsidiaries.
Previous wording
Xos is a leading fleet electrification solutions provider committed to the decarbonization of commercial transportation. Xos designs and manufactures Class 5-8 battery-electric commercial vehicles that travel on last-mile, back-to-base routes of up to 200 miles per day. Xos also offers charging infrastructure products and services through Xos Energy Solutions™ to support electric vehicle fleets. The Company’s proprietary fleet management software, Xosphere™, integrates vehicle operation and vehicle charging to provide commercial fleet operators a more seamless and cost-efficient vehicle ownership experience than traditional internal combustion engine counterparts. Xos developed the X-Platform (its proprietary, purpose-built vehicle chassis platform) and the X-Pack (its proprietary battery system) specifically for the medium- and heavy-duty commercial vehicle segment with a focus on last-mile commercial fleet operations.
Current wording
We are a leading fleet electrification solutions provider committed to the decarbonization of commercial transportation. We design and manufacture Classes 5 through 8 battery-electric commercial vehicles that travel on last-mile, back-to-base routes of up to 200 miles per day. We also offer, through Xos Energy Solutions™, mobile and fixed charging infrastructure products, such as the Xos Hub, and have from time to time offered services to support electric vehicle fleets. Our proprietary fleet management software, Xosphere™, integrates vehicle operation and vehicle charging to provide commercial fleet operators a more seamless and cost-efficient vehicle ownership experience than traditional internal combustion engine counterparts. We developed the X-Platform (our proprietary, purpose-built vehicle chassis platform) and high-voltage architecture with a focus on the medium-duty commercial vehicle segment and, in particular, last-mile commercial fleet operations.
Previous wording
Our X-Platform (our proprietary, purpose-built vehicle chassis platform) and X-Pack (our proprietary battery system) provide modular features that allow us to accommodate a wide range of last-mile applications and enable us to offer clients at a lower total cost of ownership compared to traditional diesel fleets. The X-Platform and X-Pack were both engineered to be modular in nature to allow fleet operators to customize their vehicles to fit their commercial applications (e.g., upfitting with a specific vehicle body and/or tailoring battery range).
Current wording
Our X-Platform provides modular features that allow us to accommodate a wide range of last-mile applications and enable us to offer clients vehicles at a lower total cost of ownership compared to traditional diesel fleets. The X-Platform was engineered to be modular in nature to allow fleet operators to customize their vehicles to fit their commercial applications (e.g., upfitting with a specific vehicle body and/or tailoring battery range).
Previous wording
Xos Energy Solutions™ is our comprehensive charging infrastructure through which Xos offers mobile and permanent multi-application charging equipment, mobile energy storage, and turnkey energy infrastructure services to accelerate transitions to electric fleets by maximizing incentive capture and reducing implementation lead times and costs. Xos Energy Solutions™ offers customers full service project management, electric vehicle chargers and charging equipment, and solutions for charging infrastructure installation. This service is available to customers whether they use Xos trucks, competitor trucks, or a mixed fleet.
Current wording
Xos Energy Solutions™ is our charging infrastructure business through which we offer mobile and stationary multi-application chargers, including the Xos Hub, and mobile energy storage to accelerate transitions to electric fleets by maximizing incentive capture and reducing implementation lead times and costs.
Previous wording
We have also developed a fleet management platform called Xosphere™ that interconnects vehicle, maintenance, charging, and service data. The Xosphere™ is aimed at minimizing electric fleet TCO through fleet management integration. This comprehensive suite of tools allows fleet operators to monitor vehicle and charging performance in real-time with in-depth telematics; reduce charging cost; optimize energy usage; and manage maintenance and support with a single software tool.
Current wording
We have also developed a fleet management platform called Xosphere™ that interconnects vehicle, maintenance, charging, and service data. The Xosphere™ is aimed at minimizing electric fleet total cost of ownership through fleet management integration. This comprehensive suite of tools allows fleet operators to monitor vehicle and charging performance in real-time with in-depth telematics; reduce charging cost; optimize energy usage; and manage maintenance and support with a single software tool.
Previous wording
During the year ended December 31, 2023, we delivered 277 vehicles (including leases), 5 powertrains and 1 hub. During the year ended December 31, 2022, we delivered 257 vehicles (including leases) and 18 powertrains. Actual sales performance during the current year was in line with our revised anticipated deliveries despite continuing charging infrastructure challenges and supply chain delays.
Current wording
During the year ended December 31, 2024, we delivered 244 vehicles (including leases), 19 powertrains and 34 Hubs. During the year ended December 31, 2023, we delivered 277 vehicles (including leases), 5 powertrains and 1 hub.
Previous wording
For the year-ended December 31, 2023, we have generated $42.2 million in revenue (or 95% of revenue) from vehicle and powertrain sales, $1.2 million (or 3% of revenue) from Fleet-as-a-Service revenue, and $1.1 million (or 2% of revenue) from ancillary revenue. For the year ended December 31, 2022, we have generated $34.1 million in revenue (or 94% of revenue)
Current wording
For the year-ended December 31, 2024, we generated $42.8 million in revenue (or 76% of revenue) from vehicle sales, $8.7 million (or 16% of revenue) in powertrain and hub sales, $0.7 million (or 1% of revenue) in sales-type lease revenue, $1.8 million (or 3% of revenue) in other product revenue, and $1.9 million (or 3% of revenue) from ancillary revenue. For the year ended December 31, 2023, we have generated $39.9 million in revenue (or 90% of revenue) from vehicle sales, $1.2 million (or 3% of revenue) in powertrain and hub sales, $1.5 million (or 3% of revenue) in sales-type lease revenue, $0.8 million (or 2% of revenue) from other product revenue, and $1.1 million (or 2% of revenue) from ancillary revenue.
Previous wording
We believe our growth in the coming years is supported by the strong secular tailwinds of an increased focus on the impact of climate change and the growth of e-commerce and last-mile delivery. Commercial trucks are the largest emitters of greenhouse gases per capita in the transportation industry. The U.S. federal, state and foreign governments, along with corporations such as FedEx, UPS and Amazon, have set ambitious goals to reduce greenhouse gas emissions. Simultaneously, e-commerce continues to grow rapidly and has been accelerated by changes in consumer purchasing behavior during the COVID-19 pandemic. We believe the increased regulation relating to commercial vehicles, the launch of sustainability initiatives from leading financial and corporate institutions and the rapid growth of last-mile logistics will fuel accelerated adoption of our products worldwide.
Current wording
We believe our growth in the coming years will be supported by the growth of e-commerce and last-mile delivery, and will depend in part on regulatory and consumer interest in reducing the impacts of climate change. E-commerce continues to grow rapidly and has been accelerated by changes in consumer purchasing behavior as a result of the COVID-19 pandemic. Commercial trucks are the largest emitters of greenhouse gasses per capita in the transportation industry. Although there can be no assurance such goals will be maintained, the U.S. federal, state and foreign governments, along with corporations such as FedEx, UPS and Amazon, have set ambitious goals to reduce greenhouse gas emissions. We believe regulation relating to commercial vehicles, sustainability initiatives from leading financial and corporate institutions and growth of last-mile logistics will be important factors in establishing the level of demand for, and adoption of, our products worldwide.
Previous wording
On March 26, 2024, Xos completed the previously announced business combination involving ElectraMeccanica, whereby Xos acquired all of the issued and outstanding common shares of ElectraMeccanica pursuant the Plan of Arrangement under the Business Corporations Act (British Columbia) in accordance with the terms of the Arrangement Agreement. Subject to the terms and conditions set forth in the Arrangement Agreement and the Plan of Arrangement, on March 26, 2024, each ElectraMeccanica Share outstanding immediately prior to the effective time of the Arrangement was converted automatically into the right to receive 0.0143739 of a share of Common Stock, for total consideration of 1,766,388 shares of Common Stock. As a result, our liquidity will be supplemented by accessing ElectraMeccanica's cash balance, which was estimated to be $48.0 million as of the date the Arrangement was consummated. See Note 19 — Subsequent Events in the accompanying consolidated financial statements for more information.
Current wording
The Arrangement was consummated on March 26, 2024. Subject to the terms and conditions set forth in the Arrangement Agreement and the Plan of Arrangement, on March 26, 2024, each ElectraMeccanica Share outstanding immediately prior to the effective time of the Arrangement was converted automatically into the right to receive 0.0143739 of a share of our Common Stock, for total consideration of 1,766,388 shares of Common Stock. Our liquidity was supplemented by net cash acquired in connection with the acquisition of ElectraMeccanica, which was approximately $50.2 million (excluding severance related costs paid at closing).
Previous wording
We expect to derive future revenue from sales of our vehicles, battery systems and other product and service offerings. As many of these products are in development, we will require substantial additional capital to continue developing our products and services and bring them to full commercialization as well as fund our operations for the foreseeable future. Until we can generate sufficient revenue from product sales, we expect to finance a substantial portion of our operations through commercialization and production with proceeds from the Business Combination, the SEPA, the Convertible Note (as defined below) and any future capital raising efforts. The amount and timing of our future funding requirements, if any, will depend on many factors, including the pace and results of our commercialization efforts.
Current wording
We expect to derive future revenue from sales of our vehicles, battery systems and other product and service offerings. As many of these products are in development, we will require substantial additional capital to continue developing our products and services and bring them to full commercialization as well as fund our operations for the foreseeable future. Until we can generate sufficient revenue from product sales, we expect to finance a substantial portion of our operations through commercialization and production with proceeds from the Business Combination, the SEPA, the Convertible Note, the ElectraMeccanica acquisition and any future capital raising efforts. The amount and timing of our future funding requirements, if any, will depend on many factors, including the pace and results of our commercialization efforts.
Previous wording
The accompanying consolidated financial statements include the accounts of Xos and its wholly owned subsidiaries, Xos Fleet, Inc., and Xos Services, Inc. (f/k/a Rivordak, Inc.). All significant intercompany accounts and transactions have been eliminated in consolidation. All long-lived assets are maintained in, and all losses are attributable to, the United States.
Current wording
The accompanying consolidated financial statements include the accounts of Xos and its wholly owned subsidiaries, Xos Fleet, Inc. and Xos Services, Inc. (f/k/a Rivordak, Inc.), as well as the entities acquired pursuant to the Arrangement. All significant intercompany accounts and transactions have been eliminated in consolidation. All long-lived assets are maintained in, and all losses are attributable to, the United States.
Previous wording
Currently, we conduct business through one operating segment. We are an early-stage growth company with minimal commercial operations and our activities to date have been conducted primarily within North America. For more information about our basis of operations, refer to Note 1 — Description of Business in the accompanying consolidated financial statements for more information.
Current wording
Currently, we conduct business through one operating segment. We are an early-stage growth company with minimal commercial operations and our activities to date have been conducted primarily within North America. For more information about our basis of operations, refer to Note 1 - Description of Business in the accompanying notes to the consolidated financial statements for more information.
Previous wording
To date, we have primarily generated revenue from the sale of electric step vans, stripped chassis vehicles and battery systems. Our stripped chassis is our vehicle offering that consists of our X-Platform electric vehicle base and X-Pack battery systems, which customers can upfit with their preferred vehicle body. As we continue to expand our commercialization, we expect our revenue to come from these products and other vehicle offerings including chassis cabs, which will feature our chassis and powertrain with the inclusion of a proprietary designed cab, and tractors, a shortened version of the chassis cab designed to haul trailers (also known as “day cabs”), that travel in last-mile use cases. In addition, we also offer service offerings, such as Fleet- as-a-Service, which is a full suite of service offerings that includes Xos Energy Solutions™, our energy solutions offering and Xosphere™, our fleet management platform.
Current wording
To date, we have primarily generated revenue from the sale of electric step vans, stripped chassis vehicles and battery systems. Our stripped chassis is our vehicle offering that consists of our X-Platform electric vehicle base and battery systems, which customers can upfit with their preferred vehicle body. As we continue to expand our commercialization, we expect our revenue to come from these products and other vehicle offerings including chassis cabs, which will feature our chassis and powertrain with the inclusion of a proprietary designed cab, and tractors, a shortened version of the chassis cab designed to haul trailers (also known as “day cabs”), that travel in last-mile use cases. Through Xos Energy Solutions™, we have provided charging infrastructure, including our Xos Hub, as well as certain energy services. In addition, we offer Xosphere™, our fleet management platform.
Previous wording
Revenue consists of product sales, inclusive of shipping and handling charges, net of estimates for customer allowances, Fleet-as-a-Service product offerings, and leasing. Revenue is measured as the amount of consideration we expect to receive in exchange for delivering products. All revenue is recognized when we satisfy the performance obligations under the contract. We recognize revenue by delivering the promised products to the customer, with the revenue recognized at the point in time the customer takes control of the products. For shipping and handling charges, revenue is recognized at the time the products are delivered to or picked up by the customer. For leasing, revenue is recognized on a straight line basis over the term of the lease agreement. The majority of our current contracts have a single performance obligation, which is met at the point in time that the product is delivered, and title passes, to the customer, and are short term in nature.
Current wording
Revenue consists of product sales, inclusive of shipping and handling charges, net of estimates for customer allowances, service offerings, and leasing. Revenue is measured as the amount of consideration we expect to receive in exchange for delivering products. All revenue is recognized when we satisfy the performance obligations under the contract. We recognize revenue by delivering the promised products to the customer, with the revenue recognized at the point in time the customer takes control of the products. For shipping and handling charges, revenue is recognized at the time the products are delivered to or picked up by the customer. For operating leases which are accounted for under ASC 842, Leases, revenue is recognized on a straight line basis over the term of the lease agreement. The majority of our current contracts have a single performance obligation, which is met at the point in time that the product is delivered, and title passes to the customer, and are short term in nature.
Previous wording
Cost of goods sold includes materials and other direct costs related to production of our vehicles, including components and parts, batteries, direct labor costs and manufacturing overhead, among others. Cost of goods sold also includes material and other direct costs related to the production and assembly of powertrains and battery packs as well as materials and other costs incurred related to charging infrastructure installation. Materials include inventory purchased from suppliers, as well as assembly components that are assembled by company personnel, including allocation of stock-based compensation expense. Direct labor costs relate to the wages of those individuals responsible for the assembly of vehicles, powertrain units and batteries delivered to customers. Cost of goods sold also includes depreciation expense on property and equipment related to cost of goods sold activities, calculated over the estimated useful life of the property and equipment on a straight-line basis. Upon property and equipment retirement or disposal, the cost of the asset disposed, and the related accumulated depreciation from the accounts and any gain or loss is reflected in the consolidated statements of operations and comprehensive loss, allocated to cost of goods sold.
Current wording
Cost of goods sold includes materials and other direct costs related to production of our vehicles, including components and parts, batteries, direct labor costs and manufacturing overhead, among others. Cost of goods sold also includes material and other direct costs related to the production and assembly of powertrains and battery packs as well as materials and other costs incurred related to charging infrastructure installation. Materials include inventory purchased from suppliers, as well as assembly components that are assembled by company personnel, including allocation of stock-based compensation expense. Direct labor costs relate to the wages of those individuals responsible for the assembly of vehicles, powertrain units, Hubs and batteries delivered to customers. Cost of goods sold also includes depreciation expense on property and equipment related to cost of goods sold activities, calculated over the estimated useful life of the property and equipment on a straight-line basis. Upon property and equipment retirement or disposal, the cost of the asset disposed, and the related accumulated depreciation from the accounts and any gain or loss is reflected in the consolidated statements of operations and comprehensive loss, allocated to cost of goods sold.
Previous wording
We are continuing to undertake efforts to find more cost-effective vendors and sources of parts and raw materials to lower our overall cost of production. Direct labor and overhead costs relate primarily to expenses incurred through our third-party manufacturing partners. We expect these expenses to increase in future periods as production volume increases to meet expected growth in customer demand.
Current wording
We are continuing to undertake efforts to find more cost-effective vendors and sources of parts and raw materials to lower our overall cost of production.
Previous wording
General and administrative (“G&A”) expenses consist of personnel-related expenses, outside professional services, including legal, audit and accounting services, as well as expenses for facilities, non-sales related travel, and general office supplies and expenses. Personnel-related expenses consist of salaries, benefits, allocations of stock-based compensation, and associated payroll taxes. Overhead items including rent, insurance, utilities, and other items are included as G&A expenses. G&A expenses also include depreciation expense on property and equipment related to G&A activities, calculated over the estimated useful life of the property and equipment on a straight-line basis. Upon property and equipment retirement or disposal, the cost of the asset disposed, and the related accumulated depreciation from the accounts and any gain or loss is reflected in theconsolidated statements of operations and comprehensive loss, allocated to G&A.
Current wording
General and administrative (“G&A”) expense consists of personnel-related expenses, outside professional services, including legal, audit and accounting services, as well as expenses for facilities, non-sales related travel, and general office supplies and expenses. Personnel-related expenses consist of salaries, benefits, allocations of stock-based compensation, and associated payroll taxes. Overhead items including rent, insurance, utilities, and other items are included in G&A expense. G&A expense also includes depreciation expense on property and equipment related to G&A activities, calculated over the estimated useful life of the property and equipment on a straight-line basis. Upon property and equipment retirement or disposal, the cost of the asset disposed, and the related accumulated depreciation from the accounts and any gain or loss is reflected in theconsolidated statements of operations and comprehensive loss, allocated to G&A.
Previous wording
We expect that our G&A will start to decrease for the foreseeable future primarily due to lower headcount driven by our reduction in workforce.
Current wording
We expect that our G&A expense will decrease for the foreseeable future primarily due to lower headcount driven by our RIF.
Previous wording
Research and development (“R&D”) expenses consist primarily of costs incurred for the design and development of our vehicles and battery systems, which include:
Current wording
Research and development (“R&D”) expense consists primarily of costs incurred for the design and development of our vehicles and battery systems, which include:
Previous wording
Sales and marketing (“S&M”) expenses consist primarily of expenses related to our marketing of vehicles and brand initiatives, which includes:
Current wording
Sales and marketing (“S&M”) expense consists primarily of expenses related to our marketing of vehicles and brand initiatives, which includes:
Previous wording
•web design, marketing and promotional items, and consultants who assist in the marketing of the Company;
Current wording
•web design, marketing and promotional items, and consultants who assist in the marketing of the Company and its products and services.
Previous wording
Other expense, net primarily includes interest income from our investments in marketable debt securities, available-for-sale, interest paid on our equipment leases and interest expense related to our financing obligations, including the amortization for debt discount and issuance costs.
Current wording
Other expense, net is primarily comprised of income associated with the duty drawback receivable, which are estimated recoveries of tariffs paid for vehicles that were acquired through the ElectraMeccanica acquisition, and interest income from our investments in marketable debt securities, available-for-sale (applicable to 2023), income from the sublease of our Los Angeles, California office space, and other income, partially offset by interest paid on our equipment leases and interest expense related to our financing obligations, including the amortization for debt discount and issuance costs.
Previous wording
Change in fair value of derivative instruments relates to Common Stock warrant liability assumed as part of the Business Combination and the conversion feature on the convertible notes issued in prior years and derivative features of the Convertible Debentures issued on August 11, 2022 and September 21, 2022. Changes in the fair value relate to remeasurement of our public and private placement warrants to fair value as of any respective exercise date and as of each subsequent balance sheet date and mark-to-market adjustments for derivative liabilities each measurement period.
Current wording
Change in fair value of derivative instruments relates to Common Stock warrant liability assumed as part of the Business Combination and the conversion feature on the convertible notes issued in prior years and derivative features of the Convertible Debentures (as defined below) issued on August 11, 2022 and September 21, 2022. Changes in the fair value relate to remeasurement of our Public and Private Placement Warrants to fair value as of any respective exercise date and as of each subsequent balance sheet date and mark-to-market adjustments for derivative liabilities each measurement period.
Previous wording
Our total revenue increased by $8.1 million, or 22%, from $36.4 million in the year ended December 31, 2022 to $44.5 million in the year ended December 31, 2023. The increase in revenues for the year ended December 31, 2023, was driven by increased deliveries of our stepvans coupled with an increase in average selling price associated with sales of our updated stepvan platform produced and delivered in the current year. During the year ended December 31, 2023, we delivered 283 units, (277 stepvans including leases, 5 powertrains and 1 hub), compared to 275 units (257 stepvans and 18 powertrains) in the year ended December 31, 2022.
Current wording
Our total revenue increased by $11.4 million, or 26%, from $44.5 million in the year ended December 31, 2023 to $56.0 million in the year ended December 31, 2024. The increase in revenues for the year ended December 31, 2024, was driven by increased deliveries of our hub and powertrain units coupled with an increase in average selling price associated with sales of our updated stepvan platform produced and delivered in the current year. During the year ended December 31, 2024, we delivered 297 units, (244 stepvans, including leases, 19 powertrains and 34 hubs, including leases), compared to 283 units (277 stepvans, 5 powertrains, and 1 hub) in the year ended December 31, 2023.
Previous wording
Cost of goods sold decreased by $20.6 million, or 31%, from $66.4 million in year ended December 31, 2022 to $45.8 million in the year ended December 31, 2023. The decrease in cost of goods sold is directly attributable to decreases of (i) $3.1 million in direct materials, (ii) $1.8 million in direct labor, (iii) $7.7 million in inventory reserves and associated write-downs of inventory to its net realizable value, (iv) $6.8 million in unfavorable physical inventory count and other adjustments, (v) $0.2 million due to recognition of return reserves for the year ended December 31, 2023 and (vi), $1.8 million in freight incurred for customer deliveries. These decreases were offset by an increase of $0.3 million related to warranty reserves and $0.5 million related to overhead.
Current wording
Cost of goods sold increased by $6.2 million, or 13%, from $45.8 million in year ended December 31, 2023 to $52.0 million in the year ended December 31, 2024. The increase in cost of goods sold is attributable to increases of (i) $2.3 million in inventory reserves and associated write-downs of inventory to its net realizable value, (ii) $2.3 million in unfavorable physical inventory count and other adjustments, (iii) $2.0 million in direct materials, (iv) $0.6 million related to overhead, and (v) $0.3 million due to recognition of return reserves for the year ended December 31, 2024. These increases were offset by a decrease of (i) $0.8 million in direct labor and (ii) $0.5 million related to warranty reserves.
Previous wording
The decrease in direct material costs is driven by improvements in the design and sourcing of materials in the new stepvan platform. The decrease in direct labor encompasses both employee and subcontractor labor costs and also reflects the realization of improvements in the production process and design of the new stepvan platform. The decrease in inventory reserves is driven by a reduction in the recognition of reserves for excess and obsolete inventory as well as write-downs of inventories to their net realizable value as a result of the significant reserves recorded in the prior year. The decrease in unfavorable physical inventory count adjustments is the result of our continued focus on inventory accuracy and management. The increase in overhead costs is primarily attributable to the absorption of inbound freight for units produced and sold in the current year.
Current wording
The increase in inventory reserves was driven by an increase in reserves for excess and obsolete inventory as well as write-downs of older generation stepvans to their net realizable value based on expected selling prices. The increase in unfavorable physical inventory count adjustments is the result of write-offs of inventory primarily related to an annual physical inventory count. The increase in direct material costs was driven by the increase in the number of unit deliveries in 2024. The increase in overhead costs is primarily attributable to the absorption of inbound freight for units produced and sold in 2024. The decrease in direct labor encompasses both employee and subcontractor labor costs and also reflects the realization of improvements in the production process and design of the new stepvan platform. The decrease in warranty reserves is mainly due to changes in anticipated costs based on actual claims.
Previous wording
General and administrative expense decreased by $3.4 million, or 8%, from $41.1 million in the year ended December 31, 2022 to $37.7 million in the year ended December 31, 2023, attributable to decreases of (i) $2.3 million in headcount and personnel cost for legal, finance, accounting, information technology and general and administrative functions, (ii) $2.3 million in insurance costs driven by cost efficiencies associated with a new broker for 2023 plan renewal, (iii) $0.5 million in professional fees, including ElectraMeccanica transaction related expenses, and (iv) $1.1 million in other operating expenses, including travel, recruiting, and facility costs. These decreases were offset by increases of (i) $1.6 million in depreciation expense due to the allocation of overhead costs and (ii) $1.2 million in stock-based compensation expense.
Current wording
General and administrative expense decreased by $2.6 million, or 7%, from $37.7 million in the year ended December 31, 2023 to $35.1 million in the year ended December 31, 2024, attributable to decreases of (i) $1.9 million in professional fees (ii) $1.1 million in headcount and personnel cost for legal, finance, accounting, IT and general and administrative functions, (iii) $1.0 million in insurance costs driven by cost efficiencies associated with a new broker and (iv) $1.0 million in other operating expenses, including travel, recruiting, and computer equipment. These decreases were offset by increases of (i) $1.9 million in facility costs and (ii) $0.5 million in stock-based compensation expense.
Previous wording
Research and development expenses decreased by $11.1 million, or 36%, from $30.7 million in the year ended December 31, 2022 to $19.6 million in the year ended December 31, 2023. The change was primarily due to decreases of (i) $7.2 million in allocation of personnel costs driven by lower headcount in engineering, (ii) $1.2 million in equipment and material purchases due to fewer research and development projects in development year over year and (iii) $3.7 million in net other costs, driven by reductions of consulting and design fees, in addition to equipment and vehicle purchases used solely for research and development purposes. These decreases were offset by an increase of $1.0 million in stock-based compensation expense.
Current wording
Research and development expenses decreased by $9.0 million, or 46%, from $19.6 million in the year ended December 31, 2023 to $10.6 million in the year ended December 31, 2024. The change was primarily due to decreases of (i) $4.3 million in allocation of personnel costs driven by lower headcount in engineering, (ii) $3.0 million in equipment and material purchases due to fewer research and development projects in development year over year, (iii) $1.3 million in net other costs, driven by reductions of consulting and design fees, in addition to equipment and vehicle purchases used solely for research and development purposes and (iv) $0.4 million in stock-based compensation expense.
Previous wording
Sales and marketing expense decreased by $3.2 million, or 33%, from $9.5 million in the year ended December 31, 2022 to $6.4 million in the year ended December 31, 2023. The change was primarily due to decreases of (i) $2.7 million in allocation of personnel costs driven by lower headcount and (ii) $1.0 million related to reduction in consulting fees, public relations costs, tradeshows costs and general marketing expenses. These decreases were offset by an increase of $0.5 million in stock-based compensation expense.
Current wording
Sales and marketing expense decreased by $2.3 million, or 35%, from $6.4 million in the year ended December 31, 2023 to $4.1 million in the year ended December 31, 2024. The change was primarily due to decreases of (i) $1.7 million in allocation of personnel costs driven by lower headcount, (ii) $0.4 million related to reduction in public relations costs and tradeshows costs and (iii) $0.2 million in stock-based compensation expense.
Previous wording
Other expense, net increased by $7.2 million, or 149%, from $4.8 million in the year ended December 31, 2022 to $12.0 million in the year ended December 31, 2023. The change was attributable to increases of (i) $5.8 million in net interest expense related to the Convertible Note and Convertible Debentures, including amortization of related discounts and issuance costs, (ii) $1.6 million of redemption premiums related to prepayments on Convertible Debentures and (iii) $0.8 million for impairment on assets held for sale. These increases were offset by decreases of $0.9 million in amortization expense related to marketable debt securities, available-for-sale and (ii) $0.1 million in other miscellaneous expenses.
Current wording
Other expense, net decreased by $7.5 million, or 62%, from $12.0 million in the year ended December 31, 2023 to $4.6 million in the year ended December 31, 2024. The change was attributable to decreases of (i) $6.2 million in net interest expense related to the Convertible Debentures being paid off during the year ended December 31, 2023, (ii) $1.6 million of redemption premiums related to prepayments on Convertible Debentures during the year ended December 31, 2023, with no such comparable expense during 2024, (iii) $0.2 million in amortization expense related to marketable debt securities, available-for-sale, with no such comparable expenses during 2024, (iv) $2.7 million increase in other income from the duty drawback receivable, and (v) $0.1 million in other miscellaneous expenses. These decreases were offset by an increase of $3.3 million for impairment on property and equipment and assets held for sale.
Previous wording
The gain on the change in fair value of derivative instruments decreased by $13.5 million, or 95% from $14.2 million in the year ended December 31, 2022 to $0.7 million in the year ended December 31, 2023. The change in fair value in both periods is primarily attributable to the change in our stock price and the resulting valuation at the respective reporting period.
Current wording
The gain on the change in fair value of derivative instruments decreased by $0.4 million, or 59% from $0.7 million in the year ended December 31, 2023 to $0.3 million in the year ended December 31, 2024. The decrease in change in fair value in both periods is primarily attributable to differences in our stock price and the resulting valuation for the applicable reporting period.
Previous wording
The gain on the change in fair value of contingent earn-out shares liability decreased by $28.2 million, or 98% from $28.7 million in the year ended December 31, 2022 to $0.5 million in the year ended December 31, 2023. The change in fair value in both periods is primarily attributable to the change in our stock price and the resulting valuation at the respective reporting period.
Current wording
The gain on the change in fair value of contingent earn-out shares liability decreased by $0.5 million, or 93% from $0.5 million in the year ended December 31, 2023 to $39,000 in the year ended December 31, 2024. The decrease in change in fair value in both periods is primarily attributable to differences in our stock price and the resulting valuation for the applicable reporting period.
Previous wording
The Company recorded income tax provisions of $21,000 and $8,000 during the years ended December 31, 2023 and 2022, respectively.
Current wording
The Company recorded income tax provisions of $37,000 and $21,000 during the years ended December 31, 2024 and 2023, respectively.
Previous wording
As of December 31, 2023, our principal sources of liquidity were our cash and cash equivalents of$11.6 million and our access to capital under the SEPA. However, our access to capital under the SEPA is not available as of the date of this Report and will not be available until we file with the SEC (i) ElectraMeccanica's financial statements for the fiscal years ended December 31, 2023 and December 31, 2022 and (ii) a post-effective amendment to the Registration Statement on Form S-1 filed on July 27, 2023. Our short-term uses of cash are for working capital and our long-term uses of cash are for working capital and to pay the principal of our indebtedness.
Current wording
As of December 31, 2024, our principal sources of liquidity were our cash and cash equivalents of$11.0 million. Our short-term uses of cash are for working capital and our long-term uses of cash are for working capital and to pay the principal of our indebtedness. During the twelve months ended December 31, 2024, we incurred a net loss of approximately$50.2 million and had net cash used in operating activities of $48.8 million.
Previous wording
As an early stage growth company, we have incurred net losses and cash outflows since our inception. We will continue to incur net losses and cash outflows in accordance with our operating plan as we continue research and development activities with respect to our vehicles and battery systems and scale our operations to meet anticipated demand. As a result, our ability to access capital is critical and until we can generate sufficient revenue to cover our operating expenses, working capital and capital expenditures, we will need to raise additional capital in order to fund and scale our operations. These conditions and events raise substantial doubt about our ability to continue as a going concern.
Current wording
As an early stage growth company, we have incurred net losses and cash outflows since our inception. We will continue to incur net losses and cash outflows in accordance with our operating plan as we continue to scale our operations to meet anticipated demand and seek to establish our product and service offerings. As a result, our ability to access capital is critical and until we can generate sufficient revenue to cover our operating expenses, working capital and capital expenditures, we will need to raise additional capital in order to fund and scale our operations. These conditions and events raise substantial doubt about our ability to continue as a going concern. Our financial information does not include any adjustment that may result from the outcome of this uncertainty.
Previous wording
In response to these conditions, we are currently evaluating different strategies to obtain the required funding for future operations. We have plans to secure and intend to employ various strategies to raise additional capital, such as through the SEPA and other capital raising strategies such as a combination of debt financing, other non-dilutive financing and/or equity financing, including through asset-based lending and/or receivable financing. However, the ability to access the SEPA is dependent on trading volumes and market price of our Common Stock.
Current wording
In response to these conditions, we are currently evaluating different strategies to obtain the required funding for future operations. We have plans to secure and intend to employ various strategies to raise additional capital, which may include the SEPA as well as other capital raising strategies such as debt financing (which may include asset-based lending and/or receivable financing), other non-dilutive financing and/or equity financing. However, our access to the SEPA is not available as of the date of this Report and will not be available unless and until a post-effective amendment to the Registration Statement on Form S-1 filed on July 27, 2023, is filed and declared effective and other applicable conditions are met. Moreover, unless extended by mutual agreement of the parties, the SEPA is scheduled to expire on February 11, 2026. Our ability to access other capital when needed is not assured and, if capital is not available to us when, and in the amounts needed, we could be required to delay, scale back or abandon some or all of our development programs and other operations, which could materially harm our business, prospects, financial condition and operating results.
Previous wording
On March 23, 2022, we entered into a Standby Equity Purchase Agreement (the "SEPA") with Yorkville, which was subsequently amended on June 22, 2023 (as amended, the "SEPA"), whereby we have the right, but not the obligation, to sell to Yorkville up to $125.0 million of its shares of Common Stock at our request any time until February 11, 2026, subject to certain conditions. As of December 31, 2023, the remaining commitment available under the SEPA was $119.5 million. We used the net proceeds received from sales of Common Stock pursuant to the SEPA for working capital and general corporate purposes and expect similar use of proceeds going forward. See Note 8 — Convertible Notes and Note 10 — Equity — Standby Equity
Current wording
On March 23, 2022, we entered into a Standby Equity Purchase Agreement with YA II PN, Ltd (“Yorkville”), which was subsequently amended on June 22, 2023 (as amended, the "SEPA"), whereby we have the right, but not the obligation, to sell to Yorkville up to $125.0 million of our shares of Common Stock at our request any time until February 11, 2026, subject to certain conditions. As of December 31, 2024, the remaining commitment available under the SEPA was $119.4 million. However, our ability to fully utilize the remaining commitment amount may be limited by various factors, including, but not limited to, the availability of an effective registration statement permitting the resale of such shares of Common Stock. In particular, the Company’s access to capital under the SEPA is not available as of the date of this Report and will not be available until the Company files with the SEC a post-effective amendment to the applicable Registration Statement. Moreover, such registration statement only registers the resale of 3,333,333 shares of Common Stock, which is insufficient for us to fully utilize the remaining commitment under the SEPA, given the current market price of our Common Stock. Furthermore, unless extended by mutual agreement of the parties, the SEPA is scheduled to expire on February 11, 2026. We used the net proceeds received from sales of Common Stock pursuant to the SEPA for working capital and general corporate purposes and expect similar uses of any remaining proceeds going forward. See Note 10 — Convertible Notes and Note 11 — Equity — Standby Equity Purchase Agreement in the accompanying consolidated financial statements for more information regarding the SEPA.
Previous wording
On August 11, 2022 and September 21, 2022, we issued convertible debentures (as subsequently amended, the “Convertible Debentures”) to Yorkville in the aggregate principal amount of $35.0 million, with a maturity date of November 11, 2023, which may be extended to February 11, 2024. Also on August 11, 2022, we issued a convertible promissory note (as subsequently amended and restated, the “Convertible Note”) to Aljomaih Automotive Co. (“Aljomaih”) with a principal amount of $20.0 million and a maturity date of August 11, 2025. As of December 31, 2023, aggregate principal amounts of $0.0 million and $20.0 million were outstanding on the Convertible Debentures and the Convertible Note, respectively. We have used the net proceeds from the Convertible Debentures and the Convertible Note for operational liquidity, working capital and general and administrative expenses and expect similar use of proceeds going forward.
Current wording
On August 11, 2022 and September 21, 2022, we issued convertible debentures (as subsequently amended, the “Convertible Debentures”) to Yorkville in the aggregate principal amount of $35.0 million, with a maturity date of November 11, 2023, which was extended to February 11, 2024 pursuant to the terms of that certain Securities Purchase Agreement. Also on August 11, 2022, we issued a convertible promissory note (as subsequently amended and restated, the “Convertible Note”) to Aljomaih Automotive Co. (“Aljomaih”) with a principal amount of $20.0 million and a maturity date of August 11, 2025. See Note 10 - Convertible Notes in the accompanying consolidated financial statements for more information.
Previous wording
Pursuant to the Convertible Debentures, being less than a certain floor price (the “Floor Price”) for five consecutive trading days, we were required to make, and made, Prepayments during the year ended December 31, 2023 consisting of$32.8 million of principal payments, $1.6 million of redemption premium payments and $1.5 million of accrued interest payments. See Note 8 — Convertible Notes in the accompanying consolidated financial statements for more information regarding the Convertible Debentures and Convertible Note.
Current wording
Pursuant to the Convertible Debentures, as a result of the daily volume-weighted average price of our Common Stcok being less than a certain floor price (the “Floor Price”) for five consecutive trading days, we were required to make, and made, prepayments on the Convertible Debentures during the year ended December 31, 2023 consisting of $32.8 million of principal payments, $1.6 million of redemption premium payments and $1.5 million of accrued interest payments. See Note 10 — Convertible Notes in the accompanying consolidated financial statements for more information regarding the Convertible Debentures and Convertible Note.
Previous wording
Our cash flows from operating activities are significantly affected by the growth of our business. Our operating cash flows are also affected by our working capital needs to support growth in inventory and fluctuations in accounts payable and other current assets and liabilities.
Current wording
Our cash flow from operating activities is significantly affected by the growth of our business. Our operating cash flow is also affected by our working capital needs to support growth in inventory and fluctuations in accounts receivable, accounts payable and other current assets and liabilities.
Showing the first 40 of 59 pairs. Open the source sections for the rest.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
On January 11, 2024, Xos and ElectraMeccanica entered into an arrangement agreement, as amended on January 31, 2024 (the “Arrangement Agreement”), pursuant to which Xos acquired all of the issued and outstanding common shares of ElectraMeccanica (“ElectraMeccanica Shares”) pursuant to a plan of arrangement (the “Plan of Arrangement”) under the Business Corporations Act (British Columbia) (the “Arrangement”).
Current report — wording carried from elsewhere
Change in Fair Value of Derivative Instruments
Current report — wording carried from elsewhere
As of December 31, 2024, the aggregate principal amounts of $20.0 million was outstanding on the Convertible Note. The Convertible Debentures were fully repaid on December 4, 2023. We have used the net proceeds from the Convertible Debentures and the Convertible Note for operational liquidity, working capital and general and administrative expenses and expect similar uses of any remaining proceeds going forward.
Current report — wording carried from elsewhere
Net cash provided by investing activities was $51.2 million for the year ended December 31, 2024, due to $51.4 million net cash acquired in connection with the acquisition of ElectraMeccanica and proceeds from the disposal of assets held for sale of $0.1 million, partially offset by property and equipment additions of $0.3 million.
Current report — wording carried from elsewhere
See Note 17 – Income Taxes for additional information.
Current report — wording carried from elsewhere
See Note 2 – Basis of Presentation, Summary of Significant Accounting Policies and Recent Accounting Pronouncements for additional information.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Change in Fair Value of Derivatives
Previous report — wording carried elsewhere
On March 26, 2024, we completed the previously announced business combination involving ElectraMeccanica, whereby we acquired all of the issued and outstanding common shares of ElectraMeccanica pursuant the Plan of Arrangement under the Business Corporations Act (British Columbia) in accordance with the terms of the Arrangement Agreement. See Note 19 — Subsequent Events in the accompanying consolidated financial statements for more information regarding the Arrangement.
Previous report — wording carried elsewhere
Investments in Marketable Debt Securities, Available-for-Sale