What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-13 compared with 2026-05-14 · 860 added, 417 removed, 558 unchanged (70% of the section changed)

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Company Overview

We are a California-based, global, shared, intelligent mobility ecosystem company founded in 2014 with a vision to disrupt the automotive industry.

Our Class A Common Stock and Public Warrants trade on The Nasdaq Capital Market (“Nasdaq”) under the ticker symbols “FFAI” and “FFAIW,” respectively.

With headquarters in the greater Los Angeles, California area, we design and engineer next-generation intelligent, connected electric vehicles and are developing embodied AI robotics products and related commercialization initiatives.

We are a California-based, Physical AI ecosystem company founded in 2014 with a vision to disrupt the automotive industry.

Our Class A Common Stock trade on The Nasdaq Capital Market (“Nasdaq”) under the ticker symbols “FFAI”.

Our Public Warrants, which previously traded on Nasdaq under the ticker symbol “FFAIW,” expired on July 21, 2026.

With headquarters in the greater Los Angeles, California area, we design and engineer next-generation intelligent, connected electric vehicles and develop and commercialize multi-form Embodied Artificial Intelligence (“EAI”) robotics products and related platform and ecosystem initiatives.

We manufacture vehicles at the FF aiFactory California production facility in Hanford, California.

We also have additional engineering, sales, and operational capabilities in China.

Additionally, we have established operations in the United Arab Emirates, including an entity to manage assembly and sales support for FF 91 series vehicles and a facility in Ras Al Khaimah intended to support future FX Super One production, further expanding our presence in the Middle East as part of our “third pole” strategy.

Additionally, we have established operations in the United Arab Emirates, including an entity to support regional sales and operations and a facility in Ras Al Khaimah.

During the three months ended June 30, 2026, FX Super One sales activity and related assembly and delivery preparation in the U.A.E.

were paused in response to regional geopolitical conditions and management’s reprioritization of certain internal resources toward the robotics business, while EV engineering and production-readiness activities continued through the Company’s supplier arrangements.

Since our founding, we have developed technologies and products focused on intelligent electric vehicles and connected mobility systems.

We believe these capabilities support our strategy to develop intelligent electric vehicles and related mobility technologies.

Our long-term strategy is centered on building an integrated Embodied Artificial Intelligence (“EAI”) ecosystem that includes intelligent electric vehicles and robotics.

Our product roadmap builds on the FF 91 platform through the planned FF 92 upgrade program and the FX Super One and reflects an increased focus on reallocating resources, manufacturing capacity, and engineering efforts toward these programs and our robotics commercialization initiatives.

Our product strategy is centered on two principal product categories—intelligent electric vehicles and embodied AI robotics.

Separately, through AIXC, we pursue platform, digital-asset and related emerging-technology initiatives.

Our product roadmap builds on the FF 91 platform through the planned FF 92 upgrade program and includes the FX Super One and it reflects an increased focus on reallocating resources, manufacturing capacity, and engineering efforts toward our robotics commercialization initiatives.

We expect our broader product portfolio to better align product strategy with anticipated demand, improve capital efficiency, and support the next phase of our commercialization efforts.

We have begun implementing an embodied AI robotics strategy intended to complement our intelligent mobility ecosystem.

This initiative is focused on the development and commercialization of robotics products that may leverage our AI, sensor, software, and platform capabilities developed for intelligent electric vehicles.

During the three months ended March 31, 2026, our robotics business entered the early commercialization stage, including initial product deliveries and non-binding pre-order activity supported by non-refundable deposits.

Management views embodied AI robotics as an extension of our EAI ecosystem, connecting intelligent vehicles, robotics devices, an EAI brain, an open-source and open-platform framework, and data-driven AI capabilities to support long-term technology commercialization efforts.

AIXC’s common stock is listed on Nasdaq under the ticker symbol “AIXC.” Through AIXC, we are evaluating emerging technology initiatives, including AI, blockchain-based platform development, and related crypto service initiatives that may complement our broader ecosystem strategy.

We have advanced our EAI robotics strategy from initial commercialization into a broader multi-form Physical AI platform.

Our robotics strategy also focuses on four areas:

the EAI Brain;

Industry Productivity Solutions and the Developer Platform;

and the EAI Data Factory, During the six months ended June 30, 2026, we expanded robotics product sales and shipments, launched the FF EAI Brain and Open Developer Platform, introduced a six-series full-form robotics lineup, and advanced education and industrial application ecosystems.

Our robotics strategy is intended to integrate devices, data, and the EAI Brain and Open Developer Platform while leveraging AI, sensor, software, and platform capabilities developed across our vehicle and robotics businesses.

AIXC’s common stock is listed on Nasdaq under the ticker symbol “AIXC.” Through AIXC which we consolidate as a variable interest entity under ASC 810, we are pursuing real-world asset (“RWA”) tokenization, digital asset, and EAI infrastructure initiatives, including blockchain-enabled infrastructure for traditional assets and AI-enabled physical systems.

• Dual-Home Market Strategy:

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and China market approach.

During the three months ended June 30, 2026, FX Super One sales activity and related assembly and delivery preparation in the U.A.E.

were paused in response to regional conditions and adjustments to the FX Super One program.

• Dual-flywheel Strategy:

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Management believes this approach supports FX, our mass-market brand, and may expand potential opportunities in the U.S.

AIXC Platform Strategy – Focused on evaluating emerging technology initiatives through AIXC, including AI, blockchain-based platform development, and related crypto service initiatives that may complement our broader EAI ecosystem.

These initiatives remain in the early stages and are intended to support potential future platform capabilities associated with intelligent mobility, robotics, user engagement, and ecosystem development.

AIXC Platform Strategy – Focused on developing programmable systems at the intersection of RWA tokenization and EAI, including infrastructure for the on-chain administration of traditional and real-world assets and the economic coordination of AI-enabled physical systems.

AIXC is evaluating the partial

tokenization of the FFAI securities portfolio held through its entrusted investment arrangement and is developing AIxC Hub, a platform intended to support the registration, validation, and economic coordination of AI-enabled physical hardware and robotic systems.

During the three months ended June 30, 2026, AIXC launched RoboShare, a robot rental matching marketplace, and AIXC01, an autonomous asset infrastructure network.

As of June 30, 2026, the proposed tokenization had not been completed, and AIXC had not entered into any definitive, binding commercial agreements with FFAI Robotics.

These initiatives remain in the early stages of development.

EAI EV and EAI Robotics Strategy – We are advancing a dual-engine strategy centered on intelligent electric vehicles and embodied AI robotics.

This strategy is intended to leverage our AI, sensor, software, and

platform capabilities across both vehicle and robotics applications, while supporting commercialization opportunities through product sales, non-binding pre-order activity, co-creation arrangements, and scenario-based deployments.

This strategy is intended to leverage our AI, sensor, software, and platform capabilities across both vehicle and robotics applications, while supporting commercialization opportunities through product sales, non-binding pre-order activity, co-creation arrangements, and scenario-based deployments.

• Stockholder Initiative:

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Our advanced I.A.I technology offers high-performance computing, high-speed internet connectivity, OTA updating, an open ecosystem for third-party application integration, and an advanced autonomous driving-ready system.

These capabilities also support our evolving ecosystem strategy, which includes embodied AI robotics initiatives and related crypto service and blockchain-based platform technologies through AIXC.

Our broader technology and ecosystem strategy also includes embodied AI robotics initiatives and, through AIXC, the development of RWA tokenization and EAI infrastructure.

• Intellectual Property:

Since inception, we have developed a portfolio of intellectual property, and established a global team of automotive and technology experts.

As of March 31, 2026, we had been granted approxima tely 656 patents global ly.

As of June 30, 2026, we had been granted approxima tely 656 patents global ly.

AIEV Product & Pipeline

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pilot production and regulatory preparations are under way.

During the three months ended March 31, 2026, we continued development, supplier coordination, and commercialization preparation activities for the FX Super One, including pre-order and go-to-market activities in the U.S.

and Middle East.

During the three months ended June 30, 2026, we continued development, supplier coordination, and commercialization preparation activities for the FX Super One, including pre-order and go-to-market activities in the U.S.

FX Super One sales activity and related assembly and delivery preparation in the U.A.E.

were paused during the quarter in response to regional conditions and adjustments to the program..

• Vehicle Pipeline:

In addition to the FF 91, FF 92, and FX Super One, our planned B2C passenger vehicle lineup includes the FX 4 and FX 6.

The FX 4 is designed as a mainstream, large-space sporty AIEV intended to broaden our reach beyond the ultra-luxury segment, while the FX 6 is planned as a larger, family-oriented AIEV positioned above the FX 4 within the FX lineup.

the FX 4 within the FX lineup.

Both models are expected to offer a mix of battery-electric and range-extended powertrain configurations and are intended to complement the FX Super One by expanding our presence in higher-volume segments of the global EV market.

Both the FX 4 and FX 6 are currently in the early stages of research and development.

We are evaluating AI, blockchain-based platform, and related crypto service initiatives as part of our broader Embodied Artificial Intelligence (“EAI”) ecosystem strategy.

These initiatives remain in the early development stage and are intended to support potential platform capabilities associated with the Company’s ecosystem development.

Through AIXC, we are pursuing RWA tokenization, digital asset, and EAI infrastructure initiatives as part of our broader Physical AI ecosystem strategy.

These initiatives remain in the early development stage.

AIXC Platform Initiatives

• Through AIXC, we are evaluating emerging technology initiatives, including AI, blockchain-based platform

development, and related crypto service initiatives.

These efforts are intended to support potential Web3 applications, decentralized infrastructure, and crypto service-related services that may complement the Company’s broader intelligent mobility ecosystem.

• We are exploring blockchain-based platform technologies that could enable secure data management, digital identity, and decentralized applications associated with connected vehicles and user engagement platforms.

• Through AIXC, we are developing programmable systems at the intersection of RWA tokenization and EAI.

These efforts include software infrastructure for the digitization and on-chain administration of traditional and real-world assets and infrastructure intended to support AI-enabled physical hardware and robotic systems.

• We are evaluating blockchain-enabled infrastructure for asset administration, ownership records, transaction settlement, and the coordination of AI-enabled physical systems.

These initiatives remain in the early development stage and have not yet generated material revenues.

Embodied AI Robotics Initiatives

• We have begun implementing exploring embodied AI robotics applications that leverage its artificial intelligence, sensor, and software platform capabilities developed for its intelligent electric vehicles.

These efforts are focused on extending our AI perception, control systems, and autonomous computing architecture into robotics applications.

• We have expanded the development and commercialization of multi-form EAI robotics products and related education, industrial and developer-platform initiatives.

During the three months ended June 30, 2026, we launched the six-series full-form FF EAI Robot World, the FF EAI Brain and Open Developer Platform, an EAI robotics education ecosystem and the FF Faber industrial mobile manipulator series.

These initiatives remain in the early stages and are subject to product readiness, certification, supply availability, funding and customer adoption risks.

Manufacturing & Distribution

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• FX Series Manufacturing:

Certain FX Series models are expected to be manufactured at FF aiFactory California, and, contingent on adequate funding and local regulatory and operational preparations, FX Super One production is targeted at our Ras Al Khaimah facility in the United Arab Emirates.

Certain FX Series models are expected to be manufactured at the FF aiFactory California, and, contingent on adequate funding and local regulatory and operational preparations, FX Super One production is targeted at our Ras Al Khaimah facility in the United Arab Emirates.

We had also been evaluating future FX Super One production at our Ras Al Khaimah facility in the U.A.E.;

however, related assembly and delivery preparation activities were paused during the three months ended June 30, 2026.

The location and timing of future production remain subject to funding, operational readiness, regulatory approvals and regional market conditions.

• Robotics Manufacturing :

Our robotics products are currently being assembled at our El Segundo, California facility.

We are evaluating plans to scale production, including potential transition of robotics assembly to our Hanford, California facility and/or other manufacturing locations, subject to funding, operational readiness, and market demand.

Certain final integration, software configuration, testing, inspection and delivery-preparation activities for our robotics products are currently performed at our El Segundo, California facility.

The products and their principal components are currently sourced primarily from third-party suppliers, including suppliers located in China.

We are evaluating plans to scale production, including potentially expanding robotics manufacturing and integration activities to our Hanford, California facility and/or other manufacturing locations, subject to funding, operational readiness and market demand.

• Global Availability:

All of our vehicles are expected to be available for sale in the U.S.

and the Middle East.

Our Ras Al Khaimah facility in the United Arab Emirates integrates offices, production workshops, and operational hubs and is positioned to support sales and service across the Gulf Cooperation Council countries;

this facility has been highlighted as a springboard for our future expansion into European and North African markets.

In parallel, the FF China team is focused on strengthening global supply‑chain management and pursuing strategic partnerships with intelligent‑driving companies, which could eventually support manufacturing and distribution activities in China.

We intend to pursue sales of our vehicles and robotics products in the U.S.

and selected international markets, including the Middle East, subject to funding, product readiness, regulatory approvals and regional market conditions.

During the three months ended June 30, 2026, FX Super One sales activity and related assembly and delivery preparation in the U.A.E.

The FF China team continues to support global supply-chain management and strategic partnerships that may support future manufacturing and distribution activities..

Recent Developments

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The agreements also addressed certain intellectual property, product liability and after-sales matters, and the parties may negotiate additional vehicle development projects, including the FX 4, and potential geographic expansion to Canada and the Middle East.

• In March 2026, the Company provided an update on its EAI EV strategy, stating that the FX Super One had advanced into engineering validation, homologation and production system refinement following the roll-off of the first pre-production vehicle at its Hanford, California facility in December 2025.

The Company also stated that it continued to advance U.S.

production readiness, including localized certification work related to Federal Motor Vehicle Safety Standards (“FMVSS”) requirements, and remained focused on phased delivery of the FX Super One.

• In March 2026, the Company announced that it continued to expand its Co-Creation Ecosystem B2B2C model and Four-Pillar Sales Architecture, including community sales, partner sales, B2B sales and third-party e-commerce.

The Company also stated that, following its presence at the NADA Dealer Summit, it signed memorandums of understanding for sales cooperation covering both the FX Super One and EAI robots with several U.S.

mainstream dealerships.

first pre-production vehicle at its Hanford, California facility in December 2025.

The Company also stated that it continued to advance U.S.

production readiness, including localized certification work related to Federal Motor Vehicle Safety Standards (“FMVSS”) requirements, and remained focused on phased delivery of the FX Super One.

• In April 2026, GlobeX AI Hong Kong Holding Limited, a special purpose entity controlled by the Company, entered into a supplemental agreement to a previously executed engineering services agreement with its previously

announced bridge strategy partner.

Under the supplemental agreement, the Company plans to upgrade the FX Super One to an 800V architecture or accelerate the AIHER project, while pausing the original Super One 400V cooperation project.

The advance research and development fee remains due and payable, while subsequent remaining balances and development, testing and engineering services are paused.

Robotics - Strategic Operations and Product Development

• In February 2026, the Company established FF AI-Robotics Inc.

and launched three robotics product lines, FF Futurist, FF Master and FX Aegis, and disclosed that sales and pre-orders had opened, more than 1,200 non-binding and non-refundable B2B deposits had been received, and initial deliveries were planned for late February 2026.

The Company also stated that the Mobile Manipulator Robot Series was planned to be launched in the second quarter, that robotics production preparation was underway, and that FF AI-Robotics entered into a non-binding letter of intent with AIXC to evaluate Web3 collaboration opportunities.

• In February 2026, the Company furnished a corrected press release announcing the establishment of FF AI-Robotics Inc.

• In April 2026, GlobeX AI Hong Kong Holding Limited, a special purpose entity controlled by the Company, entered into a supplemental agreement with its previously announced bridge strategy partner to suspend the development, testing and engineering services under the previously executed Super One engineering services agreement.

Separately, GlobeX AI entered into a non-binding letter of intent with the bridge strategy partner to explore the development of a Super One 800V EV product based on the partner's M82 model for the U.S.

The scope, responsibilities, costs and other terms of the proposed 800V project remain subject to negotiation and execution of definitive agreements.

Robotics - Strategic Operations, Product Development, and Regulatory Matters

• In February 2026, the Company announced the establishment of FF AI-Robotics Inc.

and the launch of its first three robotics product lines:

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The release stated that sales and pre-order collection had begun, the first deliveries were planned for the end of February, the Mobile Manipulator Robot Series was planned for the second quarter, and the Company had received more than 1,200 non-binding and non-refundable B2B deposits.

The release also stated that the robotics business had entered production preparation and that FF AI-Robotics entered into a non-binding letter of intent with AIXC to evaluate Web3 collaboration opportunities.

• In February 2026, the Company delivered its first batch of robots to Golden Hills, a premium Airbnb property operator in Florida and Nevada, pursuant to a sales agreement.

This milestone marked the official launch of FF’s first AI-robot delivery cycle in 2026.

The following summarizes certain significant financing activities during the period.

• In June 2026, the Company launched the first half of its full-form EAI Robot World across six product series and its Three-in-One EAI robotics education ecosystem strategy.

The Company also introduced the All-New Futurist humanoid robot and the FX Navi quadruped robot, priced at $1,990, opened sales and delivery for FX Navi, and launched the initial tools for its open-source developer platform.

• Later in June 2026, the Company launched the second half of its full-form EAI Robot World at Automate in Chicago, including the All-New Futurist and the FF Faber industrial-grade mobile manipulator series, and previewed its industrial ecosystem.

The Company announced a list price of $89,900 for a specified All-New Futurist configuration that included a premium Skills package.

The Company also reported more than 100 robot sales and shipments during June, achievement of its first-half robotics shipment target and an increase in its 2026 robotics sales and shipment target.

• In July, 2026, the Federal Communications Commission (“FCC”) added foreign-produced advanced robotic devices to its Covered List.

As a result, new foreign-produced advanced robotic devices generally are prohibited from obtaining the FCC equipment authorization required for importation, marketing and sale in the United States unless the applicable device or class of devices receives a Conditional Approval from the U.S.

Department of War.

The FCC action does not revoke existing equipment authorizations, and models authorized before July 28, 2026 may continue to be imported, marketed and sold.

The Company had been monitoring this potential regulatory development and is assessing its applicability to the Company’s existing and planned robotics products, including the authorization status of individual models and configurations and potential compliance alternatives for future products.

As part of this assessment, the Company is also exploring potential U.S.-based manufacturing and assembly alternatives for its robotics business.

Because the FCC action does not revoke existing authorizations, the Company does not currently expect a material near-term impact on models confirmed to be covered by authorizations issued before July 28, 2026.

However, the action could delay or increase the cost of introducing new or modified robotics products in the United States and could require additional regulatory approvals or changes to the Company’s sourcing, manufacturing or product plans.

The Company is continuing to evaluate the potential operational and financial effects and cannot currently estimate the ultimate impact.

The following summarizes certain significant financing activities from January 1, 2026 through the filing date.

Additional details regarding the Company’s debt and financing arrangements are included in Notes 8 and 9 to the Unaudited Condensed Consolidated Financial Statements.

AIEV - Capital Raising & Financing Agreements

• In February 2026, the Company entered into a Securities Purchase Agreement with an accredited investor to sell $10.0 million of Class A common stock at a per-share price equal to 100% of the closing price immediately prior to closing.

The subscription amount was to be provided to the investor by AIxCrypto Holdings Inc.

(“AIXC”), and the agreement included a true-up share issuance feature if the Company issued common stock or equivalent securities before the earlier of six months after closing or effectiveness of the related registration statement at a lower price, subject to specified exceptions.

Capital Raising & Financing Strategy

• In March 2026, the Company entered into two supplemental agreements with Chongqing LeTV Microloan Co., Ltd.

to settle certain previously assigned debt obligations for an aggregate settlement amount of RMB 25.4 million (approximately $3.7 million), payable in installments through December 31, 2028.

• In April 2026, the Company entered into a $2.0 million unsecured loan agreement with Gold King Arthur Holding Limited.

• In April 2026, the Company entered into a $2.0 million unsecured loan agreement with Gold King Arthur Holding

The loan bore interest at 10% per annum, matured one year from the advancement date, and was designated for expenses associated with the Company’s robotics business, other business operations, including payroll, and related unforeseen expenses.

The loan and accrued interest were subsequently satisfied through cancellation and extinguishment as part of the amended and restated securities purchase agreement with Gold King Arthur Holding Limited.

The amended and restated securities purchase agreement increased the total investment amount to approximately $12.0 million and contemplated the issuance of Class A common stock, newly designated Series C Convertible Preferred Stock, and a fixed warrant arrangement tied to the Company’s future FX Super One delivery milestone.

• In April 2026, the Company entered into a notes purchase agreement with Streeterville Capital, LLC, pursuant to which the Company issued and sold a Promissory Note A-1 with an original principal amount of approximately $15.8 million and a Secured Promissory Note B with an original principal amount of $30.0 million, for an aggregate purchase price of $45.0 million.

The amended and restated securities purchase agreement superseded the February 2026 securities purchase agreement, increased the total investment amount to approximately $12.0 million and resulted in the issuance of Class A Common Stock and newly designated Series C Convertible Preferred Stock and included a fixed warrant arrangement tied to the Company’s future FX Super One delivery milestone.

• In April 2026, the Company entered into a notes purchase agreement with Streeterville Capital, LLC, pursuant to which the Company issued and sold a Promissory Note A-1 with an original principal amount of approximately $15.8 million and a Secured Promissory Note B with an original principal amount of $30.0 million (collectively, the “Secured Streeterville Notes”), for an aggregate purchase price of $45.0 million.

The A-1 Note bears interest at 9.0% per annum, matures 24 months after the purchase price date, includes an original issue discount and transaction expense amount, and provides the lender with certain monthly redemption rights beginning in October 2026, subject to the terms of the note.

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The Company’s obligations under the notes are guaranteed by certain subsidiaries, and the B Note is further supported by a pledge of the Company’s membership interests in FFAI Holdings, LLC.

• In May 2026, the Company entered into a Securities Purchase Agreement with institutional investors (the “2026 May Convertible SPA”) and issued senior convertible notes with an aggregate original principal amount of $27.0 million (the “2026 May Convertible SPA Notes”) for a $25.0 million aggregate purchase price.

The notes bear interest at 8% per annum, mature one year after issuance, are convertible into Class A Common Stock under the terms of the notes, and are secured by deposit account control agreements;

the Company also entered into a placement agency agreement with Univest Securities, LLC.

• In July 2026, the Company amended and restated its July 14, 2025 securities purchase agreement to divide the remaining second closing into eight subsequent closings, eliminate the obligation to issue common warrants at those closings for all but one investor, and remove the obligation to register for resale the shares issuable upon conversion of the related notes and exercise of the related warrants.

On July 8 and July 9, 2026, the Company entered into agreements terminating warrants to purchase an aggregate of 5,359,525 shares of Class A Common Stock, prior to giving effect to the 1-for-150 reverse stock split effected on July 24, 2026, that had been issued under its December 2024 and March 2025 securities purchase agreements.

• In August 2026, he Company announced several capital structure initiatives, including its intent, subject to applicable contractual obligations and law, to establish a minimum conversion floor price of $5.00 per share for its existing convertible notes, provide weekly disclosures regarding convertible note conversion activity, and explore equity financing alternatives and standalone financing for its robotics business.

The Company also stated that it intends to continue its liability reduction efforts.

These initiatives are subject to applicable contractual requirements, negotiations with counterparties and other conditions, and there can be no assurance that they will be implemented as proposed.

The following summarizes certain stock exchange compliance matters, corporate actions, and governance developments during the period.

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• In February 2026, the Company filed a certificate of elimination with respect to the Company’s Series A Preferred Stock, par value $0.0001 per share, following the automatic redemption of all outstanding shares of FFAI Series A Preferred Stock after the conclusion of the Company’s stockholders’ special meeting.

The certificate of elimination (i) eliminated the previous designation of one share of FFAI Series A Preferred Stock from the charter, and (ii) caused such share of FFAI Series A Preferred Stock to resume its status as an authorized but unissued and non-designated share of preferred stock.

The certificate of elimination

(i) eliminated the previous designation of one share of FFAI Series A Preferred Stock from the charter, and (ii) caused such share of FFAI Series A Preferred Stock to resume its status as an authorized but unissued and non-designated share of preferred stock.

• In March 2026, the Company received a letter from the Division of Enforcement of the U.S.

Securities and Exchange Commission stating that, based on the information available as of March 18, 2026, the staff did not intend to recommend an enforcement action against the Company.

Similar letters were also received by Company Founder and Yueting Jia and Jerry Wang in their individual capacities.

Similar letters were also received by Company Founder Yueting Jia and Jerry Wang in their individual capacities.

The letters further stated that they “must in no way be construed as indicating that the party has been exonerated or that no action may ultimately result from the staff’s investigation.

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The Company has until September 16, 2026 to regain compliance, and its Class A common stock will continue to trade on the Nasdaq Capital Market during the compliance period.

• In March 2026, the Company announced an executive and employee share purchase initiative under which certain executives and employees would defer a portion of their base compensation for the period from March 1, 2026 through May 31, 2026.

Subject to Board approval, applicable securities laws and the Company’s trading policies, the Company stated that it intended to repurchase shares of its common stock in an amount approximately equal to the estimated after-tax deferred compensation for the period, or approximately $0.5 million, and subsequently transfer the repurchased shares to participating executives and employees in settlement of the deferred compensation obligations.

On July 24, 2026, the Company effected a 1-for-150 reverse stock split to increase the per-share trading price of its Class A common stock and support its efforts to regain compliance with Nasdaq’s minimum bid price requirement.

The reverse stock split reduced the number of issued and outstanding shares without changing the number of authorized shares.

The reverse stock split does not ensure that the Company will regain or maintain compliance with Nasdaq’s continued listing standards.

• In April 2026, the Company entered into a purchase agreement with Matthias Aydt, pursuant to which the Company issued and sold one share of newly designated Series A Preferred Stock for a purchase price of $100.

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The Series A Preferred Stock is not convertible into common stock, is not entitled to dividends, has a $100 liquidation preference, and is subject to transfer restrictions.

• In May 2026, at the Company’s annual meeting, stockholders approved, among other matters, the issuance of Class A Common Stock in connection with certain notes, preferred stock and warrants, an increase in authorized shares of common and preferred stock, and a reverse stock split at a ratio of up to 1-for-150.

On May 27, 2026, the Company filed a Certificate of Amendment increasing authorized common stock from 312,285,439 to 452,813,887 shares and authorized preferred stock from 24,087,265 to 34,926,534 shares, and filed a Certificate of Elimination for the Series A Preferred Stock following its automatic redemption after the annual meeting.

The following summarizes certain leadership, governance, and organizational developments during the period .

Corporate Governance

• In February 2026, Chui Tin Mok, an executive member of the Company’s Board of Directors, notified the Board of his intention to resign as a director upon the Board’s confirmation of a successor nominee, in order to focus on the Company’s business execution in the United Arab Emirates (“U.A.E.”) and the broader Middle East.

Mok will continue to serve as an executive officer and Head of FF Middle East.

• In March 2026, the Company announced that it had relocated its headquarters to Silicon Beach in El Segundo, California, which the Company stated was intended to enhance its ability to attract senior talent and support its next phase of growth.

• In April 2026, Matthias Aydt resigned from the Board of Directors for personal reasons, effective immediately, and

informed the Board of his intention to resign as Global Co-Chief Executive Officer at such time as the Board deems fit.

• In April 2026, Matthias Aydt resigned from the Board of Directors for personal reasons, effective immediately.

Jie (Jay) Sheng also resigned from the Board, effective immediately, and Chui Tin Mok resigned from the Board following his previously disclosed notice of intent to resign, while continuing in his role as an executive officer and Head of FF Middle East.

The Company also announced that FF Top nominated Xiao (Lucky) Jiang and Kevin Chen to the Board, and the Board appointed Jiawei (Jerry) Wang, Xiao (Lucky) Jiang and Kevin Chen as directors.

Kevin Chen is expected to be appointed to the Audit, Compensation, and Nominating and Corporate Governance Committees, and Jerry Wang was appointed to the Finance and Investment Committee.

• In May 2026, the Board of Directors accepted the resignation of Matthias Aydt from his position as Global co-CEO.

Jerry Wang was appointed to the Finance and Investment Committee.

• In May 2026, the Board of Directors accepted the resignation of Matthias Aydt from his position as Global Co-Chief Executive Officer.

With the resignation of Mr.

Aydt, the Board of Directors acknowledged Mr.

Yueting Jia as the sole Global CEO of the Company.

Yueting Jia as the sole Global Chief Executive Officer of the Company.

The Company also appointed Jiawei (Jerry) Wang as Global Executive Chairman and Todd Harrington as General Counsel and Board Secretary.

• In May 2026, the Company’s stockholders elected Jiawei (Jerry) Wang, Xiao (Lucky) Jiang, Kevin Chen, Chad Chen and Lev Peker to serve as directors until the 2027 annual meeting and until their successors are duly elected and qualified, or until their earlier death, resignation or removal.

• In July 2026, the Company implemented staff reductions and temporary salary reductions as cash-conservation measures and offered affected employees an opportunity to receive equity-based compensation intended to offset a portion of the reduction in cash compensation.

Supply Chain Exposure and Tariff Risk

As of March 31, 2026, a significant portion of our direct materials was sourced from China, which may expose certain components to U.S.

import tariffs and other supply-chain cost pressures.

During the three months ended March 31, 2026, the Company decreased its lower-of-cost-and-net-realizable-value inventory reserve by $15.4 million, bringing the total reserve to $5.7 million as of March 31, 2026, compared to $21.1 million as of December 31, 2025.

tariff policies continue to evolve and the Company maintains a flexible approach in responding to those developments.

As production planning evolves, the Company may continue to evaluate sourcing strategies, pricing, and inventory reserves in response to changes in global supply-chain conditions and trade policies.

As of June 30, 2026, a significant portion of our direct materials was sourced from China, which may expose us to U.S.

import tariffs, customs and trade restrictions, vendor concentration, supply disruptions, longer lead times and increased cross-border logistics costs.

tariff and trade policies continue to evolve and could increase our landed costs, delay product deliveries, limit access to certain suppliers or technologies, or require changes to our sourcing, product design or assembly plans.

Our robotics business currently relies on third-party suppliers and technology partners for significant portions of the robotic hardware, components, embedded software and manufacturing support used in our products.

This reliance may limit our control over product changes, component availability, regulatory compliance, quality, intellectual-property matters, cybersecurity, after-sales support and production timing.

We are evaluating alternative suppliers, U.S.-based integration and assembly capabilities, and increased localization of critical components.

These initiatives remain under development and may require additional capital, time and operational resources.

As production planning evolves, we may adjust our sourcing, pricing, inventory levels and procurement commitments in response to changes in global supply-chain conditions and trade policies..

Segment Information

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and AIXC —each of which meets the criteria for separate reporting under ASC 280.

Our CEOs acting as our Co-Chief Operating Decision Makers (“CODMs”), regularly evaluated the financial performance using consolidated financial information at the total-company level including consolidated loss from operations, cash flows, liquidity, and strategic initiatives.

Our Global Chief Executive Officer (“CEO”) serves as our Chief Operating Decision Maker (“CODM”) and regularly evaluates our financial performance using consolidated and segment-level financial information, including consolidated loss from operations, cash flows, liquidity, and strategic initiatives.

The AIXC segment is focused on developing programmable systems at the intersection of real-world asset (“RWA”) tokenization and Embodied Artificial Intelligence (“EAI”), including blockchain-enabled infrastructure for traditional assets and AI-enabled physical systems.

Management has identified Loss from operations, as presented in our Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss, as the primary measure used by the CODM to evaluate the performance of the business and allocate resources.

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We define “significant segment expense” as controllable operating costs that are regularly provided to and reviewed by management, which include the expenses presented in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss as Cost of revenue, Research and development, Sales and marketing, and General and administrative.

Management closely tracks its expenditure on these key expense categories through regular reviews of cash balances, near‑term cash flow projections, monthly management reports, and project management reports.

Refer to Note 17, Segment Information, for further detail on the components of loss from operations and the additional Robotics gross profit measure reviewed by the CODM.

Management closely tracks expenditures on these key expense categories through regular reviews of cash balances, near‑term cash flow projections, monthly management reports, and project management reports.

The CODM, works in close collaboration with our business leaders to establish critical operational targets, set project timelines, and adjust spending plans.

These leaders are responsible for implementing its strategic plans and revising targets and deadlines based on continuous internal communications and review meetings, thereby ensuring that any deviations from target spending or project timelines are promptly addressed.

While loss from operations is the primary measure used to evaluate overall performance and allocate resources across segments, we also evaluate the Robotics segment using gross profit as an additional performance measure, as this segment is in the early stages of commercialization and focuses on product-level profitability.

During the three months ended June 30, 2026, the CODM began reviewing enhanced segment-level management reports.

We are developing and implementing an enhanced segment reporting framework, including methodologies for allocating certain shared costs and resources among our segments.

Because these allocation methodologies were not fully implemented during the periods presented, the enhanced reports supplement our existing management reporting process and do not change the segment measures or allocation practices disclosed herein.

While loss from operations is the primary measure used to evaluate our overall performance and allocate resources across segments, we also evaluate the Robotics segment using gross profit as an additional performance measure, as this segment is in the early stages of commercialization and focuses on product-level profitability.

Gross profit is defined as revenue less cost of revenues.

At this time, General and administrative, Research and development, and Sales and marketing expenses are not allocated to the Robotics segment.

These costs continue to be managed on a consolidated basis and are primarily reflected within the AIEV segment.

Gross profit is not used as the primary measure of segment profit or loss for AIEV or AIXC.

This oversight supports our strategic objectives to prioritize the commercialization of the FX Series vehicles and Robotics products, while continuing to support production, sales, and leasing activities for our FF 91 vehicles, the planned FF 92 upgrade program, and the development of our AI, blockchain-based platform, and related crypto service initiatives through AIXC.

This oversight supports our strategic objectives to prioritize the commercialization of the FX Series vehicles and Robotics products, while continuing to support production, sales, and leasing activities for our FF 91 vehicles, the planned FF 92 upgrade program, and AIXC’s development of RWA tokenization and EAI infrastructure initiatives.

Components of Our Results of Operations

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Automotive Sales Revenue

During the three months ended March 31, 2026 the Company began the rollout of its new FX Super One model in the U.A.E.

During the six months ended June 30, 2026 the Company began the rollout of its new FX Super One model in the U.A.E.

Automotive sales revenue includes revenues related to deliveries of new vehicles, and specific other features and services including home charger, charger installation, twenty-four-seven roadside assistance, OTA software updates, internet connectivity and destination fees.

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In certain circumstances, we provide customers with a residual value guarantee which may or may not be exercised in the future.

The impact of such residual value guarantees wa s immaterial to our Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2026 .

The impact of such residual value guarantees wa s immaterial to our Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2026, and 2025 .

We have entered into, and may continue to enter into, co-creator consulting agreements with our customers under which customers share feedback, driving data, ideas, experiences with our engineers, social media posts, and other promotional activities in exchange for specified fees.

We evaluate the economic substance of these co-creation agreements to determine whether they should be combined with customer sales contracts under the contract combination guidance in ASC 606.

the contracts are economically linked, we account for them as a single arrangement.

When the contracts are economically linked, we account for them as a single arrangement.

Under this approach, the cash inflows from the customer and the cash outflows from us are netted and treated as a single transaction.

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We record leasing revenues as automotive leasing revenue on a straight-line basis over the contractual term, and we record the depreciation of these vehicles as cost of automotive leasing revenue.

As of March 31, 2026, deferred lease-related upfront payments which will be recognized on a straight-line basis over the contractual terms of the individual leases were immaterial.

As of June 30, 2026, deferred lease-related upfront payments which will be recognized on a straight-line basis over the contractual terms of the individual leases were immaterial.

Our policy is to exclude taxes collected from a customer from the transaction price of automotive contracts.

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Revenue allocated to each robot is recognized at a point in time when control of the respective robot transfers to the customer, which generally occurs upon delivery in accordance with the terms of the applicable sales contract.

During the three months ended March 31, 2026, the Company recognized its initial Robotics revenue, representing the first quarter in which the Company recognized revenue from sales of Robotics products.

Customer Deposits

Our customers may reserve a vehicle and Robotics product preorder certain services by making a customer deposit, which is fully refundable at any time.

Refundable deposits, for vehicle reservations and services, received from customers prior to an executed vehicle purchase agreement are recorded as customer deposits (Accrued expenses and other current liabilities).

Customer deposits were $4.4 million and $4.4 million as of March 31, 2026 and December 31, 2025, respectively.

When vehicle purchase agreements are executed, the consideration for the vehicle and any accompanying products and services must be paid in advance prior to our transfer of the products or services.

Certain consumer customers may reserve a vehicle or Robotics product preorder certain services by making a customer deposit, which is fully refundable at any time.

Deposit terms for business-to-business customers are governed by the applicable contracts and may differ.

Refundable deposits, for reservations and services, received from customers prior to an executed vehicle purchase agreement are recorded as customer deposits within Accrued expenses and other current liabilities).

Customer deposits were $4.1 million and $4.4 million as of June 30, 2026 and December 31, 2025, respectively.

When purchase agreements are executed, the consideration for the vehicle and any accompanying products and services must be paid in advance prior to our transfer of the products or services.

Such advance payments are considered non-refundable, and we defer revenue related to any products or services that are not yet transferred.

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When the contracts are economically interdependent, the Company accounts for them as a single arrangement.

Under this approach, the cash inflows from the customer and the cash outflows from the Company are netted and treated as a single transaction.

Under this approach, the cash inflows

from the customer and the cash outflows from the Company are netted and treated as a single transaction.

The resulting net amount is recorded as marketing expense if the net amount is more than the sale price of the vehicle or robot.

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Cost of Automotive Sales Revenue

Cost of automotive sales revenue includes direct and indirect materials, labor costs, manufacturing overhead, including depreciation costs of tooling and machinery, shipping and logistic costs, vehicle connectivity costs, and reserves for estimated warranty expenses.

Cost of automotive sales revenues also includes adjustments to warranty expense.

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Cost of Robotics revenue includes product costs, freight, import fees, and warranty costs.

Warranty costs related to Robotics revenue were insignificant for the three months ended March 31, 2026.

Warranty costs related to Robotics revenue were insignificant for the three and six months ended June 30, 2026.

There were no Robotics sales or related warranty costs during the corresponding periods in 2025.

We provide a manufacturer’s warranty on all vehicles sold.

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Research and development activities remain a significant part of our business.

Our R&D efforts focus on the design and development of our electric vehicles and continue to prepare our prototype electric vehicles to exceed industry standards for compliance, innovation, and performance.

Our R&D efforts focus on the design and development of our electric vehicles and Robotics products and continue to prepare our prototype electric vehicles and Robotics products to exceed industry standards for compliance, innovation, and performance.

R&D expenses consist of personnel-related costs (including salaries, bonuses, benefits, and stock-based compensation) for our employees focused on R&D activities, other related costs, depreciation, R&D services provided by co-creators, and an allocation of overhead.

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Sales and marketing expenses consist primarily of personnel-related costs (including salaries, bonuses, benefits, and stock-based compensation) for our employees focused on sales and marketing, costs associated with sales and marketing activities, marketing services provided by co-creators, and an allocation of overhead.

Marketing activities are those related to introducing our brand, our electric vehicles, and our electric vehicle prototypes to the market.

We expect Sales and marketing expenses to continue to increase as we bring our electric vehicles (in particular, FX Super One and FF 92) to market and seek to generate additional sales.

Marketing activities are those related to introducing our brand, our electric vehicles, our electric vehicle prototypes, and our Robotics products to the market.

We expect Sales and marketing expenses to continue to increase as we bring our electric vehicles (in particular, FX Super One and FF 92) and Robotics products to market and seek to generate additional sales.

General and Administrative

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Loss from Disposal of Property, Plant and Equipment

Loss on disposal of property, plant, and equipment relates to the write-off or abandonment of assets no longer expected to provide future economic benefit, including construction in progress, vendor tooling, machinery and equipment.

Loss (Gain) on disposal of property, plant, and equipment relates to the write-off or abandonment of assets no longer expected to provide future economic benefit, including construction in progress, vendor tooling, machinery and equipment.

These disposals may result from changes in business plans, product design, production requirements, or cost reduction initiatives.

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Loss on settlement of notes payable consists of losses resulting from the settlement of notes payable as part of our ongoing financing activities and losses incurred on modifications of our notes payable that qualify as an extinguishment pursuant to ASC 470-50, Debt–Modifications and Extinguishments .

Loss on Settlement of notes receivable

Loss on settlement of notes receivable recognized when notes receivable are settled for consideration that is less than their net carrying value, after giving effect to the related allowance for expected credit losses.

Interest Expense (Related Party and Third Party)

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Net losses on digital assets recognized in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss reflect realized gains or losses from sales of digital assets as well as unrealized gains or losses resulting from changes in market prices at each reporting date.

Other Income, net

Other income, net consists of foreign currency transaction gains and losses and other expenses such as bank fees and late charges.

Foreign currency transaction gains and losses are generated by revaluation of debt and the settlements of invoices denominated in currencies other than the functional currency.

We expect other income (expense) to fluctuate as we continue to transact internationally.

Other Income (Expense), net

Other income (expense), net consists of primarily of gains recognized from negotiated settlements and the resolution of aged accounts payable balances through the Company’s liability management initiatives, including its net equity improvement initiative.

Other income (expense), net also includes foreign currency transaction gains and losses and other expenses, such as bank fees and late charges.

Foreign currency transaction gains and losses result from the remeasurement of debt and the settlement of invoices denominated in currencies other than the functional currency.

We expect other income (expense), net to fluctuate as we contin ue to transact internationally and pursue liability management initiatives.

Consolidated Results of Operations

Consolidated Statements of Operations

Three Months Ended March 31,

Three Months Ended June 30,

(in thousands) 2026 2025

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General and administrative 14,305 14,097

Impairment of long-lived assets and deposits — —

Impairment of intangible assets, including goodwill 3,629 —

Loss (Gain) on disposal of property, plant, and equipment (12) 276

Total operating expenses 24,125 21,250

Loss from operations (34,827) (48,108)

Change in fair value of notes payable, warrant liabilities, and derivative call options 1,261 (46,078)

Change in fair value of related party notes payable, warrant liabilities, and derivative call options 85 (5,150)

Loss on settlement of notes payable (7,845) (22,458)

Loss on settlement of related party notes payable — (1,860)

Loss on settlement of notes receivable (376) —

Interest expense (2,348) (812)

Net loss on digital assets (984) —

Other income (expense), net 5,165 (210)

Loss before income taxes (39,869) (124,676)

Income tax (expense) benefit 906 —

Net loss $ (38,963) $ (124,676)

Consolidated Statements of Operations

Six Months Ended June 30,

(in thousands) 2026 2025

Revenue $ 1,348 $ 370

Cost of revenue 23,428 48,293

Gross profit (22,080) (47,923)

Operating expenses

Research and development 11,133 11,423

Sales and marketing 7,676 4,502

General and administrative 23,500 27,771

Loss on disposal of property, plant, and equipment 316 320

Impairment of long-lived assets and deposits 183 —

Impairment of intangible assets, including goodwill 5,701 —

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Loss on settlement of related party notes payable — (3,040)

Loss on settlement of notes receivable (376) —

Interest expense (4,826) (3,114)

Net loss on digital assets (2,930) —

Other income, net 2,252 1,784

Other income (expense), net 7,417 1,574

Loss before income taxes (82,167) (134,944)

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Net loss $ (81,280) $ (134,954)

Consolidated - Revenue

Three Months Ended March 31, Change

Consolidated - Revenue (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Revenue $ 836 $ 54 $ 782 1448.1 %

Revenue increase d by $196 thousand for the three months ended March 31, 2026 , compared to the same period in 2025.

The increase was primarily due to the recognition of $208 thousand of automotive sales revenue from sales of FX Super One vehicles in the U.A.E.

and $288 thousand of Robotics revenue from sales of Robotics products during the three months ended March 31, 2026 .

The three months ended March 31, 2026 represented the first quarter in which the Company recognized revenue from sales of FX Super One vehicles and Robotics products.

Revenue from FF vehicles was $16 thousand for the three months ended March 31, 2026 , consisting of operating lease revenue, compared to $316 thousand for the same period in 2025, consisting of $265 thousand of operating lease revenue and $51 thousand of sales-type lease revenue.

The Company did not recognize FF automotive sales revenue during either period.

The co-creation fees recorded as a reduction of revenue under ASC 606 were $198 thousand for the three months ended March 31, 2026, compared to $263 thousand for the same period in 2025.

Revenue increase d by $782 thousand for the three months ended June 30, 2026 , compared to the same period in 2025.

The increase was attributable to $853 thousand of Robotics segment revenue from product sales, partially offset by a $71 thousand decrease in AIEV revenue.

The Robotics business remained in the early stage of commercialization during the quarter.

Revenue reflected initial customer and channel deliveries following the launch and expansion of the Company's six-series robot lineup and related education and ecosystem initiatives.

The amount and timing of future revenue will depend on product availability, completion of procurement and integration activities, customer acceptance and delivery schedules, sales-channel development and available working capital.

Consolidated - Revenue (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Revenue $ 1,348 $ 370 $ 978 264.3 %

Revenue increase d by $978 thousand for the six months ended June 30, 2026 , compared to the same period in 2025.

Robotics contributed $1.1 million of revenue with no comparable amount in the prior-year period, partially offset by a $0.2 million decrease in AIEV revenue.The six months ended June 30, 2026 represented the first six-month period in which the Company recognized revenue from sales of FX Super One vehicles and Robotics products.

AIEV revenue was $207 thousand for the six months ended June 30, 2026, consisting of $179 thousand of automotive sales and $28 thousand sales-type lease revenue, compared to $370 thousand for the same period in 2025, consisting of $265 thousand of sales-type lease revenue and $105 thousand of operating lease revenue.

The co-creation fees recorded as a reduction of revenue under ASC 606 were $220 thousand for the six months ended June 30, 2026 , compared to $263 thousand for the same period in 2025.

Looking ahead, the Company intends to continue advancing commercialization of the FX Super One and Robotics products while continuing limited-volume FF 91 deliveries and related leasing activities.

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Management expects that revenue will remain limited until production volumes, customer deliveries, customer acceptance, and funding availability support increased sales activity.

As the FX Super One and Robotics products move through their planned ramp-up phases, vehicle sales, Robotics product sales, and related

leasing activities are expected to become more meaningful drivers of consolidated revenue.

As the FX Super One and Robotics products move through their planned ramp-up phases, vehicle sales, Robotics product sales, and related leasing activities are expected to become more meaningful drivers of consolidated revenue.

The timing and extent of revenue growth will depend on the Company’s ability to execute on product development, manufacturing, supply chain, regulatory, funding, and delivery milestones.

Consolidated - Cost of Revenue

Three Months Ended March 31,

Consolidated - Cost of Revenue (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Cost of revenue $ 11,538 $ 26,912 $ (15,374) (57.1) %

Cost of revenue decreased by $9.5 million for the three months ended March 31, 2026, compared to the same period in 2025.

Consolidated - Research and Development

Three Months Ended March 31,

Cost of revenue decreased by $15.4 million for the three months ended June 30, 2026, compared to the same period in 2025.The decrease was primarily lower depreciation expense following the $128.9 million impairment of certain property and equipment recognized during the third quarter of 2025, which reduced quarterly depreciation expense by approximately $11.8 million, and a $3.8 million decrease in inventory reserve expense compared with the second quarter of 2025, when the Company recognized a provision for inventory reserve of $3.8 million.

Consolidated - Cost of Revenue (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Cost of revenue $ 23,428 $ 48,293 $ (24,865) (51.5) %

Cost of revenue decreased by $24.9 million for the six months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily lower depreciation expense following the $128.9 million impairment of certain property and equipment recognized during the third quarter of 2025, which reduced depreciation expense by approximately $20.8 million, and a $3.8 million decrease in inventory reserve expense compared with the six months ended June 30, 2025, when the Company recognized a provision for inventory reserve of $3.8 million.

Consolidated - Research and Development (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Research and development $ 4,143 $ 5,004 $ (861) (17.2) %

R&D expense increased by $0.6 million for the three months ended March 31, 2026, compared to the same period in 2025.

The increase was primarily driven by $1.6 million increase in operating consumables and equipment rental—costs for prototype parts, vehicle purchases for testing, and services supporting development of the FX vehicle and Robotics platforms.

These increases were partially offset by a $1.2 million reduction in wages and related benefit, including lower bonus expense.

During the three months ended March 31, 2026, the Company continued R&D activities primarily supporting the FX Super One program, including final validation, U.S.

homologation testing, and production readiness initiatives.

Development efforts included vehicle performance and durability testing, integration of Advanced Driver Assistance Systems (“ADAS”), supplier coordination, and prototype tooling.

The Company also provided engineering support for technical preparations in the U.A.E.

to align manufacturing standards and production planning under its global bridge strategy.

In addition, the Company continued development activities related to its Robotics platform, including product testing, software integration, and technical support for early-stage commercialization.

As the Company transitions from an R&D-intensive phase toward commercial production, resources are being strategically reallocated to manufacturing engineering, quality validation, and process optimization.

Current R&D initiatives remain focused on vehicle performance, safety system enhancements, software refinement, and Robotics platform development, in collaboration with key technology and supply-chain partners to support scalable FX Series and Robotics production readiness.

During the period, the Company entered into a strategic mass-production engineering services agreement with a major global automotive manufacturer to support manufacturing engineering, validation, and production ramp-up activities for the FX Super One.

Activities under this agreement are expected to facilitate commercial production readiness, with associated costs incurred primarily as development and engineering expenditures.

In the first quarter of 2026, the Company expanded its technology development initiatives to include robotics applications, leveraging its intelligent mobility platform and software capabilities to explore opportunities in advanced automation and AI-enabled systems.

R&D expense decreased by $0.9 million for the three months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $1.0 million decrease in wages and related benefits including lower bonus expense.

During the second quarter of 2026, the Company continued to advance its technology development initiatives across intelligent vehicles and robotics applications.

Based on its belief that an 800V architecture would offer greater product

competitiveness and user value than the originally contemplated 400V model, the Company announced plans to upgrade the FX Super One to an 800V architecture or, alternatively, accelerate the AIHER hybrid project.

The Company also continued to expand its technology development initiatives into robotics applications by leveraging its intelligent mobility platform, artificial intelligence capabilities and software infrastructure to explore opportunities in advanced automation and AI-enabled systems.

Robotics-related activities included product testing and integration, development of the EAI Brain, Data Factory and Open Developer Platform, device firmware and software development, and applications for education and industrial use.

This initiative is intended to complement the Company’s broader intelligent vehicle strategy and support long-term technology diversification.

Consolidated - Sales and Marketing

Three Months Ended March 31,

Consolidated - Research and Development (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Research and development $ 11,133 $ 11,423 $ (290) (2.5) %

R&D expense decreased by $0.3 million for the six months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $2.2 million reduction in wages and related benefits, including lower bonus expense, partially offset by a $1.8 million increase in operating consumables and equipment rental costs associated with prototype parts, vehicle purchases for testing, and services supporting the development of the FX vehicle and Robotics platforms.

During the six months ended June 30, 2026, the Company continued to advance its technology development initiatives across intelligent vehicles and Robotics applications.

As part of its intelligent vehicle strategy, the Company announced plans either to upgrade the FX Super One from the originally contemplated 400-volt architecture to an 800-volt architecture, which it believes would improve product competitiveness and user value, or, alternatively, to accelerate the development of the AIHER hybrid project.

The Company also expanded its technology development initiatives to include Robotics applications, leveraging its intelligent mobility platform and software capabilities to explore opportunities in advanced automation and AI-enabled systems.

These initiatives are intended to complement the Company’s broader intelligent vehicle strategy and support long-term technology diversification.

As the Company transitions from an R&D-intensive phase toward commercial production, resources are being reallocated to manufacturing engineering, quality validation, and process optimization.

Current R&D initiatives remain focused on vehicle performance, safety system enhancements, software refinement, and Robotics platform development and are being conducted in collaboration with key technology and supply-chain partners to support production readiness for the FX Series and Robotics products.

During the period, the Company through GlobeX AI Hong Kong Holding Limited, eentered into a mass-production engineering services agreement with its bridge strategy partner to support development, testing and engineering activities for the FX Super One.

In April 2026, the parties entered into a supplemental agreement to suspend further performance of the development, testing and engineering services under that agreement.

Separately, GlobeX AI entered into a non-binding letter of intent with the bridge strategy partner to explore the development of a Super One 800V EV product, with the scope, responsibilities, costs and other terms of the proposed project subject to negotiation and execution of definitive agreements.

Costs incurred under the engineering services agreement primarily relate to development and engineering activities.

Consolidated - Sales and Marketing (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Sales and marketing $ 2,060 $ 1,873 $ 187 10.0 %

Sales and marketing expense increased by $3.0 million for the three months ended March 31, 2026, compared to the same period in 2025.

Sales and marketing expense increased by $0.2 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by a $1.6 million rise in compensation costs, reflecting higher headcount in 2026 and a bonus accrual adjustment in 2025.

These increases were partially offset by a $0.4 million decrease in rent and related expense, $0.5 million decrease in marketing expenses due to reduced Middle East vehicle-commercialization activity.

and $0.4 million decrease in general expenses related sales and marketing activities including operation consumables.

Consolidated - Sales and Marketing (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Sales and marketing $ 7,676 $ 4,502 $ 3,174 70.5 %

Sales and marketing expense increased by $3.2 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by a $1.4 million increase in marketing expenses related to the launch and promotion of the FX Super One, including digital campaigns, content development, influencer engagement, and event activations.

The increase was also driven by a $0.7 million increase in rent expense, and a $0.3 million increase in wages and related benefits.

The increase also included $0.6 million of AIXC sales and marketing costs, which had no comparable consolidated amount in the prior-year period because AIXC was acquired in the third quarter of 2025.

The increase was also driven by a $1.9 million increase in wages and related benefits, reflecting higher headcount in 2026 and a bonus accrual adjustment in 2025.

The Company’s marketing activities during the period supported the FX Super One, FF 91, and Robotics initiatives through regional brand activations, product showcases, co-creation delivery events, digital content, and partner outreach designed to increase product visibility and customer engagement in priority markets.

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Marketing activities are also expected to include targeted outreach and ecosystem-building initiatives related to AIXC’s digital asset and AI-enabled technology platform, although such activities are expected to remain a smaller component of consolidated Sales and marketing expense in the near term.

Consolidated - General and Administrative

Three Months Ended March 31, Change

Consolidated - General and Administrative (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

General and administrative $ 14,305 $ 14,097 $ 208 1.5 %

General and administrative expense decreased by $4.5 million for the three months ended March 31, 2026, compared to the same period in 2025.

General and administrative expense increased by $0.2 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by a $0.9 million increase of a bonus paid pursuant to a contractual agreement.

This increase was partially offset by a $0.8 million reduction in professional service fees.

The Company continued to incur legal, accounting, consulting, compliance, governance, public-company reporting and financing costs while integrating AIXC and establishing the Robotics business.

AIXC's current-quarter expense included personnel costs, management-service fees, legal and accounting fees, consulting costs, director-related costs and insurance.

The partial AIEV offset reflected continued cost optimization and lower travel and entertainment costs, although liquidity constraints and the complexity of financing, legal and regulatory matters continued to affect the Company's administrative cost base.

Consolidated - General and Administrative (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

General and administrative $ 23,500 $ 27,771 $ (4,271) (15.4) %

General and administrative expense decreased by $4.3 million for the six months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $7.8 million, decrease in professional fees, reflecting reimbursements of legal expenses.

These decreases were partially offset by $4.2 million increase due to higher payroll costs.

Notwithstanding the decrease in general and administrative expense, the Company continued to incur costs during the three months ended March 31, 2026 to support legal, compliance, governance, public company reporting, financing, capital markets, AIXC integration, U.A.E.

Notwithstanding the decrease in general and administrative expense, the Company continued to incur costs during the six months ended June 30, 2026 to support legal, compliance, governance, public company reporting, financing, capital markets, AIXC integration, U.A.E.

expansion, and Robotics-related strategic initiatives.

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The Company expects general and administrative expense to continue to reflect the level of legal, compliance, reporting, and strategic activity required to support its evolving business operations.

Consolidated - Net Loss from disposal of property, plant and equipment

Three Months Ended March 31, Change

Consolidated - Loss (gain) from disposal of property, plant and equipment (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on disposal of property, plant, and equipment $ 328 $ 44 $ 284 645.5 %

Loss on disposal of property, plant, and equipment increased by approximately $0.3 million for the three months ended March 31, 2026, compared to the same period in 2025.

Loss (Gain) on disposal of property, plant, and equipment $ (12) $ 276 $ (288) (104.3) %

The Company recognized a $12 thousand gain on disposal of property, plant, and equipment for the three months ended June 30, 2026, compared with a $276 thousand loss for the three months ended June 30, 2025.

We dispose of equipment when the assets become obsolete, costly to maintain, or are replaced by more efficient technologies.

Consolidated - Impairment of Intangible assets, including Goodwill

Three Months Ended March 31, Change

Consolidated - Net Loss from disposal of property, plant and equipment (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss (Gain) on disposal of property, plant, and equipment $ 316 $ 320 $ (4) (1.3) %

Loss (Gain) on disposal of property, plant, and equipment decreased by approximately $4 thousand for the six months ended June 30, 2026, compared to the same period in 2025.

We dispose of equipment when the assets become obsolete, costly to maintain, or are replaced by more efficient technologies.

Consolidated - Impairment of intangible assets, including goodwill (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Impairment of intangible assets, including goodwill $ 3,629 $ — $ 3,629 NM*

NM = not meaningful

During the three months ended March 31, 2026, the Company recorded a goodwill impairment charge of $2.1 million related to the AIXC reporting unit.

During the three months ended June 30, 2026, the Company recorded a $3.6 million impairment of intangible assets, which was primarily due to a $3.6 million impairment charge related to acquired in-process research and development (“IPR&D”) associated with AIXC’s legacy biotechnology business.

The increase was due to the full impairment of the acquired IPR&D following the AIXC Board of Directors’ decision in May 2026 to permanently discontinue and wind down the legacy biotechnology operations, which caused management to conclude that the related IPR&D was no longer expected to provide future economic benefit.

There was no comparable impairment in the prior-year periods because the Company did not consolidate AIXC during the three months ended June 30, 2025.

Consolidated - Impairment of Intangible assets, including Goodwill (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Impairment of intangible assets, including goodwill $ 5,701 $ — $ 5,701 NM*

NM = not meaningful

During the six months ended June 30, 2026, the Company recorded a impairment charge of intangible assets, including goodwill of $5.7 million, which was primarily consist of $2.1 million impairment charge of goodwill and $3.6 million

impairment charge of intangible assets.

Impairment of goodwill was related to the AIXC reporting unit.

In connection with the impairment assessment under ASC 350, management compared the estimated fair value of the AIXC reporting unit to its carrying value.

2 unchanged sentences

Accordingly, the Company recognized an impairment charge limited to the recorded goodwill balance.

The Company also recorded a $0.2 million impairment charge related to AIXC capitalized software costs.

The impairment was recorded in connection with AIXC’s strategic realignment and discontinuation of certain software development initiatives, including platforms that no longer aligned with AIXC’s focus on real-world asset tokenization and EAI infrastructure.

As a result, management concluded that the related capitalized software costs no longer had future economic benefit.

Consolidated - Credit Loss Expense

Three Months Ended March 31, Change

During the six months ended June 30, 2026, the Company recorded a $3.6 million impairment charge of intangible assets related to acquired in-process research and development (“IPR&D”) associated with AIXC’s legacy biotechnology business, compared to no impairment charge during the same period in 2025.

There was no comparable impairment in the prior-year periods because the Company did not consolidate AIXC during the six months ended June 30, 2025.

Consolidated - Credit Loss Expense (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

1 unchanged sentence

NM = not meaningful

During the three months ended March 31, 2026, the Company recorded $0.1 million of credit loss expense primarily related to interest accrued on the Marizyme promissory note acquired in connection with the AIXC business combination.

During the six months ended June 30, 2026 , the Company recorded $0.1 million of credit loss expense primarily related to interest accrued on the Marizyme promissory note acquired in connection with the AIXC business combination.

In the fourth quarter of 2025, AIXC wrote off substantially all of the outstanding principal balance of the note due to Marizyme’s bankruptcy status.

1 unchanged sentence

There was no comparable consolidated credit loss expense related to the Marizyme note in the prior-year period, as AIXC was acquired by the Company in the third quarter of 2025.

Consolidated - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options

Three Months Ended March 31, Change

Consolidated - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of notes payable, warrant liabilities, and derivative call options $ 1,261 $ (46,078) $ 47,339 (102.7) %

Gain from change in fair value of notes payable, warrant liabilities, decreased by $48.7 million period over period .

The decrease was primarily due to significantly larger fair value remeasurement gains recognized in the prior-year period, compared to more limited fair value gains in the current period due to reduced sensitivity of the instruments to equity price movements.

During the three months ended March 31, 2025, we recognized significant gains from decreases in the fair value of notes payable, warrant liabilities, and derivative call options, including $13.6 million related to Incremental Warrants, $31.9 million related to the SPA Portfolio Notes, and $6.4 million related to warrants.

These decreases were primarily driven by a decline in the Company’s stock price from elevated levels as of December 31, 2024, while the instruments remained deeply in-the-money and highly sensitive to equity price movements.

During the three months ended March 31, 2026 , although the Company’s stock price also declined significantly, the impact on fair value was substantially less pronounced.

The Company recognized a $1.3 million gain from changes in fair value of third-party notes payable, warrant liabilities and derivative call options for the three months ended June 30, 2026, compared with a $46.1 million loss for the three months ended June 30, 2025.

During the three months ended June 30, 2025 we recognized an aggregate day-one loss of $12.5 million related to the initial measurement of SPA Portfolio Notes, Warrants and Incremental Warrants.

The 2025 loss was further impacted by a $31.8 million loss from subsequent fair value remeasurement.

The re-measurement was primarily driven by an approximately 49% increase in the Company’s stock price during the period compared to preceding three month compared with the preceding three-month period.

During the three months ended June 30, 2026, although the Company’s stock price declined approximately 16%, the impact on fair value was substantially less pronounced.

The decline in stock price moved certain instruments to at- or out-of-the-money positions, reducing their sensitivity to further changes in the underlying equity price.

As a result, decreases in the fair value of warrant liabilities and derivative call options were more limited, and the fair value of notes payable increased modestly during the period.

This reflects the non-linear valuation characteristics of the Company's hybrid instruments, where the magnitude of fair value changes diminishes as instruments move away from in-the-money positions, and where structural features — including conversion price reset mechanisms and increased implied volatility — partially offset the effects of a declining stock price.

Consolidated - Change in Fair Value of Related Party Notes Payable and Related Party Warrant Liabilities

Three Months Ended March 31, Change

In addition, the new convertible or share-redeemable notes issued during the period did not include warrants or other bundled derivative instruments and were calibrated to transaction proceeds at inception, resulting in no significant day-one losses.

These factors contributed to substantially lower fair value volatility compared with the prior-year period.

Consolidated - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of notes payable, warrant liabilities, and derivative call options $ 4,032 $ 5,380 $ (1,348) (25.1) %

The gain from change in fair value of notes payable, warrant liabilities, and derivative call options decreased by $1.3 million period over period .

The decrease was primarily due to larger fair value remeasurement gains recognized in the prior-year period, compared to more limited fair value gains in the current period due to reduced sensitivity of the instruments to equity price movements.

During the six months ended June 30, 2025 we recognized an aggregate day-one loss of $36.1 million related to the initial measurement of SPA Portfolio Notes, Warrants and Incremental Warrants.

This loss was offset by a $43.7 million net gain from subsequent remeasurement.

Our outstanding notes and warrants were remeasured at predominantly lower fair values due to pricing inputs that use the market price of our Common Stock, which experienced a decline during the period.

The fair value of the SPA Portfolio Notes and associated warrants is influenced by the relationship between the Company’s stock price and the applicable conversion or exercise prices.

During the six months ended June 30, 2026, although the Company’s stock price also declined, the impact on fair value was substantially less pronounced.

The decline in stock price moved certain instruments to at- or out-of-the-money positions, reducing their sensitivity to further changes in the underlying equity price.

As a result, decreases in the fair value of warrant liabilities and derivative call options were more limited, and the fair value of notes payable increased modestly during the period.

In addition, the new convertible or share-redeemable notes issued during the current-year period did not include warrants or other bundled derivative instruments and were calibrated to transaction proceeds at inception, resulting in no significant day-one fair value losses.

These factors resulted in substantially lower fair value volatility during the current-year period compared with the prior-year period.

Consolidated - Change in Fair Value of Related Party Notes Payable and Related Party Warrant Liabilities (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options $ 85 $ (5,150) $ 5,235 (101.7) %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options increased by $1.7 million period over period, shifting from a loss of $0.3 million for the three months ended March 31, 2025, compared to a gain of $1.4 million for the same period in 2026.

During the three months ended March 31, 2025, we issued new related party instruments, including notes payable, warrants, and incremental warrants.

The initial recognition of these instruments at fair value resulted in day-one losses that largely offset remeasurement gains recognized during the period, which were driven by a decline in the Company’s stock price.

As a result, the period reflected a modest loss.

During the three months ended March 31, 2026, the only related party instruments measured at fair value that remained outstanding were incremental warrants, as the related party notes payable accounted for under the fair value option and the related party warrants had been settled or extinguished in prior periods.

The gain recognized during the period was driven by a decrease in the fair value of the incremental warrants, primarily due to a decline in the Company’s stock price during the quarter.

The Company recognized a $0.1 million gain from Change in fair value of related party notes payable, warrant liabilities, and derivative call options for the three months ended June 30, 2026, compared with a $5.2 million loss for the three months ended June 30, 2025.

During the three months ended June 30, 2025 the Company issued $3.0 million of related party SPA Portfolio Notes.

Upon issuance the Company recognized a day-one loss of $2.3 million, as the combined fair value of the SPA Portfolio Note, SPA Portfolio Note Warrant, and Incremental Warrant exceeded the cash proceeds received.

These issuance-date losses were further increased by a $2.7 million loss from the remeasurement of related party notes payable, related party warrant liabilities, and related party Incremental Warrants as of June 30, 2025.

The remeasurement loss was primarily driven by an approximately 49% increase in the Company’s stock price and the greater sensitivity of the related party instruments to stock price movements during the period.

During the three months ended June 30, 2026, the only related party instruments measured at fair value that remained outstanding were derivative call options,, as the related party notes payable accounted for under the fair value option and the related party warrants had been settled or extinguished in prior periods.

These instruments did not experience significant fair value fluctuations, primarily due to reduced sensitivity to changes in the Company’s stock price.

In contrast, during the prior-year period, the Company had outstanding related party convertible debt, liability-classified warrants, and derivative call options that were more sensitive to changes in the Company’s stock price.

Consolidated - Change in Fair Value of Related Party Notes Payable and Related Party Warrant Liabilities (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options $ 1,524 $ (5,427) $ 6,951 (128.1) %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options increased by $7.0 million period over period, shifting from a loss of $5.4 million for the six months ended June 30, 2025, to a gain of $1.5 million for the same period in 2026.

During the six months ended June 30, 2025, the Company issued $4.6 million of rel ated party SPA Portfolio Notes.

Upon issuance the Company recognized a day-one loss of $3.4 million, as the combined fair valu e of the SPA Portfolio Note, SPA Portfolio Note Warrant, and Incremental Warrant exceeded the cash proceeds received.

These issuance-date losses were further increased by $1.8 million loss from the remeasurement of related party notes payable, related party warrant liabilities, and related party Incremental Warrants as of June 30, 2025 .

During the six months ended June 30, 2026, the only related party instruments measured at fair value that remained outstanding were derivative call options, as the related party notes payable accounted for under the fair value option and the related party warrants had been settled or extinguished in prior periods.

The gain recognized during the period was driven by a decrease in the fair value of the derivative call options, primarily during the first quarter of 2026, as the decline in the Company’s stock price reduced the probability of economically favorable exercise.

Fair value fluctuations were substantially more limited during the second quarter as the instruments became less sensitive to further stock price movements.

In the absence of new issuances during the period, the full effect of favorable remeasurement was reflected in earnings.

Consolidated - Loss on Settlement of Notes Payable

Three Months Ended March 31, Change

Consolidated - Loss on Settlement of Notes Payable (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes payable $ (7,845) $ (22,458) $ 14,613 (65.1) %

Loss on settlement of notes payable decreased by $7.5 million , for the three months ended March 31, 2026 compared to the same period in 2025.

The favorable variance was primarily driven by a reduction in the average loss rate on conversions,

partially offset by an increase in the volume of principal converted.

During the three months ended March 31, 2025 , we experienced higher per-dollar losses on extinguishment as our stock price traded materially above the conversion price floors across all convertible instruments.

Loss on settlement of notes payable decreased by $14.6 million, for the three months ended June 30, 2026 compared to the same period in 2025.

The favorable variance was primarily driven by a reduction in the average loss rate on conversions, partially and the decrease in the volume of principal converted.

During the three months ended June 30, 2025, we experienced higher per-dollar losses on extinguishment as the conversion features of our convertible instruments were more significantly in the money.

As a result, shares issued at fair values significantly in excess of the carrying value of the debt extinguished.

This resulted in average loss rate of 67% of principal converted.

In contrast, during the three months ended June 30, 2026, the Company’s convertible instruments were less sensitive to stock price movements as the conversion features were no longer significantly in the money.

As a result, the average loss rate decreased to approximately 45% of principal converted.

Total principal converted decreased to $17.6 million in 2026 from $34.4 million in 2025, the lower loss rate and lower conversion volume, resulting in an overall decrease in loss on extinguishment for the period.

The lower loss rate and lower conversion volume resulted in an overall decrease in loss on extinguishment for the period.

Consolidated - Loss on Settlement of Notes Payable (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes payable $ (16,276) $ (38,378) $ 22,102 (57.6) %

Loss on settlement of notes payable decreased by $22.1 million, for the six months ended June 30, 2026 compared to the same period in 2025.

The favorable variance was primarily driven by a reduction in the average loss rate on conversions and the

decrease in the volume of principal converted.

During the six months ended June 30, 2025 , we experienced higher per-dollar losses on extinguishment as our stock price traded materially above the conversion price floors across all convertible instruments.

As a result, the notes were deeply in-the-money at the time of conversion, with shares issued at fair values significantly in excess of the carrying value of the debt extinguished.

This resulted in elevated loss rates ranging from approximately 47% to 103% of principal converted.

In contrast, during the three months ended March 31, 2026, our stock price declined to levels at or near the contractual conversion price floors across the portfolio, which substantially reduced the in-the-money spread on conversions.

This resulted an average loss rate of 70% of principal converted..

In contrast, during the six months ended June 30, 2026, our stock price declined to levels at or near the contractual conversion price floors across the portfolio, which substantially reduced the in-the-money spread on conversions.

As a result, the average loss rate decreased to approximately 35% of principal converted.

Although total principal converted increased to $28.5 million in 2026 from $20.4 million 2025, the lower loss rate more than offset the impact of the higher conversion volume, resulting in an overall decrease in loss on extinguishment for the period.

Consolidated - Loss on Settlement of Related Party Notes Payable

Three Months Ended March 31, Change

Total principal converted decreased to $46.1 million in 2026 from $54.8 million 2025, the lower loss rate and lower conversion volume, resulting in an overall decrease in loss on extinguishment for the period.

The lower loss rate and lower conversion volume resulted in an overall decrease in loss on extinguishment for the period.

Consolidated - Loss on Settlement of Related Party Notes Payable (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of related party notes payable $ — $ (1,860) $ 1,860 (100.0) %

Loss on settlement of related party notes payable decreased by $1.2 million for the three months ended March 31, 2026, compared to the same period in 2025 driven by the absence of related-party note conversions in the current period.

Loss on settlement of related party notes payable decreased by $1.9 million for the three months ended June 30, 2026, compared to the same period in 2025 driven by the absence of related-party note conversions in the current period.

In the prior-year period we recognized a $1.9 million loss on extinguishment related to the conversion of related-party unsecured convertible notes held by Metaverse Horizon Limited (“MHL”), a related party.

During the three months ended March 31, 2025 MHL, a related party, converted outstanding debt with a principal balance of $1.5 million into 1,352,767 shares of Class A Common Stock, resulting in an extinguishment loss.

No similar transactions occurred during the three months ended March 31, 2026.

Consolidated - Interest Expense

Three Months Ended March 31, Change

During the three months ended June 30, 2025 MHL, a related party, converted outstanding debt with a principal balance of $2.1 million into 13,452 shares of Class A Common Stock, resulting in an extinguishment loss.

No similar transactions occurred during the three months ended June 30, 2026.

Consolidated - Loss on Settlement of Related Party Notes Payable (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of related party notes payable $ — $ (3,040) $ 3,040 (100.0) %

Loss on settlement of related party notes payable decreased by $3.0 million for the six months ended June 30, 2026, compared to the same period in 2025 driven by the absence of related-party note conversions in the current period.

In the prior-year period we recognized a $3.0 million loss on extinguishment related to the conversion of related-party unsecured convertible notes held MHL.

During the six months ended June 30, 2025 MHL, a related party, converted outstanding debt with a principal balance of $3.6 million into 30,395 shares of Class A Common Stock, resulting in an extinguishment loss.

No similar transactions occurred during the six months ended June 30, 2026.

Consolidated - Loss on Settlement of Notes Receivable (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes receivable $ (376) $ — $ (376) NM *

NM = not meaningful

During the three months ended June 30, 2026, the Company recorded a loss on settlement of notes receivable of $0.4 million.

The increase was attributable to the settlement of the Marizyme Notes during the second quarter of 2026, for which the Company received $0.1 million in cash and recognized a loss of $0.4 million on the remaining net carrying value.

Consolidated - Loss on Settlement of Notes Receivable (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes receivable $ (376) $ — $ (376) NM *

NM = not meaningful

During the six months ended June 30, 2026, the Company recorded a loss on settlement of notes receivable of $0.4 million.

Consolidated - Interest Expense (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Interest expense $ (2,348) $ (812) $ (1,536) 189.2 %

Interest expense increased by approximately $0.2 million for the three months ended March 31, 2026, compared to the same period in 2025.

This increase was primarily due to higher interest costs associated with our financial obligations related to the FF aiFactory California manufacturing facility in Hanford, California.

Interest expense increased by approximately $1.5 million for the three months ended June 30, 2026, compared to the same period in 2025.

This increase was primarily due to the prior-year period including approximately $1.4 million of credits to interest expense within our China entities that did not recur at a comparable level in the current-year period, as well as higher interest costs associated with our financial obligations related to the FF aiFactory California manufacturing facility in Hanford, California..

The interest expense on this financing obligation increases over time under the effective interest method, as the principal balance remains outstanding until maturity, with capitalized tenant improvement costs funded by a third party also increasing the carrying amount of the liability.

Consolidated - Loss on Digital Assets, net

Three Months Ended March 31, Change

Consolidated - Interest Expense (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Interest expense $ (4,826) $ (3,114) $ (1,712) 55.0 %

Interest expense increased by approximately $1.7 million for the six months ended June 30, 2026, compared to the same period in 2025.

This increase was primarily due the prior-year period including interest costs allocated to construction in progress, which reduced interest expense recognized during that period, together with higher interest costs associated with our financial obligations related to the FF aiFactory California manufacturing facility in Hanford, California.

Consolidated - Loss on Digital Assets, net (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Net loss on digital assets $ (984) $ — $ (984) NM *

During the three months ended June 30, 2026, the Company recorded a net loss on digital assets of $1.0 million related to digital assets held by AIXC.

The loss reflected realized losses from digital asset transactions and unrealized gains and losses from changes in the fair value of digital assets held as of June 30, 2026.

There was no comparable consolidated net loss on digital assets in the prior-year period, as AIXC was acquired by the Company in the third quarter of 2025 and did not hold digital assets within the Company’s consolidated results during the three months ended June 30, 2025.

Consolidated - Loss on Digital Assets, net (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Net loss on digital assets $ (2,930) $ — $ (2,930) NM *

* NM = not meaningful

During the three months ended March 31, 2026, the Company recorded a net loss on digital assets of $1.9 million related to digital assets held by AIXC.

The loss reflected realized losses from digital asset transactions and unrealized gains and losses from changes in the fair value of digital assets held as of March 31, 2026.

Consolidated - Other Income, net

Three Months Ended March 31, Change

During the six months ended June 30, 2026, the Company recorded a net loss on digital assets of $2.9 million related to digital assets held by AIXC.

The loss reflected realized losses from digital asset transactions and unrealized gains and losses from changes in the fair value of digital assets held as of June 30, 2026.

Consolidated - Other Income, net (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Other income (expense), net $ 5,165 $ (210) $ 5,375 (2559.5 %)

Other income, net increased by $5.4 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily due to approximately $5.2 million of gains recognized from negotiated settlements and the resolution of aged accounts payable and other accrued liability balances through the Company’s liability management initiatives, including its net equity improvement initiative.

The remaining increase primarily reflected a favorable year-over-year change in foreign currency transaction gains and losses.

Consolidated - Other Income, net (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Other income, net $ 7,417 $ 1,574 $ 5,843 371.2 %

Other income, net increased by $0.5 million for the three months ended March 31, 2026, compared to the same period in 2025.

The increase was primarily driven by approximately $0.3 million of interest and investment income from AIXC, primarily related to interest income on the Marizyme note receivable and income earned on money market investments.

The increase also included higher net foreign currency transaction gains during the current period, recognized by the Company’s China subsidiary on U.S.

dollar-denominated debt balances due to Chinese yuan appreciated against the U.S.

Foreign currency effects related to the Company’s operations in the United Arab Emirates were not significant, as the U.A.E.

Dirham is pegged to the U.S.

Other income, net increased by $5.8 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase also included approximately $0.3 million of interest and investment income from AIXC, primarily related to interest income on the Marizyme note receivable and income earned on money market investments.

The remaining increase primarily reflected a favorable year-over-year change in foreign currency transaction gains and losses.

AIEV Results of Operations

During the three and six months ended June 30, 2026, the Company continued to advance its EAI EV strategy, including the FF 91 series, the planned FF 92 upgrade program, and FX Super One development activities.

In February 2026, GlobeX AI Hong Kong Holding Limited, a special purpose entity controlled by the Company, entered into agreements with its bridge strategy partner to support component procurement and engineering services for a battery-electric version of the Super One under development for the U.S.

In April 2026, GlobeX entered into a supplemental agreement to the previously executed engineering services agreement, pursuant to which the Company plans to upgrade the FX Super One to an 800V architecture or accelerate the AIHER project, while pausing the original Super One 400V cooperation project.

Separately, a letter of intent was executed in connection with the proposed development of an 800V EV project.

The Company continues to evaluate and develop its U.S.

FX product and engineering plans with its bridge strategy partner, while managing the timing and level of development activity based on available financing, expected product competitiveness, and capital efficiency.

AIEV - Statements of Operations

Three Months Ended March 31,

Three Months Ended June 30,

(in thousands) 2026 2025

Consolidated Statements of Operations

Revenue $ (17) $ 54

14 unchanged sentences

Interest expense (2,348) (812)

Other income, net 1,949 1,784

Other income (expense), net 5,038 (210)

Loss before income taxes (35,890) (124,676)

AIEV - Revenue

Three Months Ended March 31, Change

AIEV - Statements of Operations

Six Months Ended June 30,

(in thousands) 2026 2025

Revenue $ 207 $ 370

Cost of revenue 22,640 48,293

Gross profit (22,433) (47,923)

Operating expenses

Research and development 11,123 11,423

Sales and marketing 6,952 4,502

General and administrative 17,084 27,771

Loss on disposal of property, plant, and equipment 316 320

Impairment of intangible assets, including goodwill 5,701 —

Total operating expenses 41,176 44,016

Loss from operations (63,609) (91,939)

Change in fair value of notes payable, warrant liabilities, and derivative call options 3,947 5,380

Change in fair value of related party notes payable, warrant liabilities, and derivative call options 1,524 (5,427)

Loss on settlement of notes payable (16,276) (38,378)

Loss on settlement of related party notes payable — (3,040)

Interest expense (4,826) (3,114)

Other income (expense), net 6,987 1,574

Loss before income taxes $ (72,253) $ (134,944)

AIEV - Revenue (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Revenue $ (17) $ 54 $ (71) (131.5) %

Revenue decreased by $92 thousand for the three months ended March 31, 2026, compared to the same period in 2025 .

Revenue decreased by $71 thousand for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to $17 thousand of revenue reversals related to vehicle sales returns in 2026, compared with $54 thousand of operating lease revenue recognized in 2025.

AIEV - Revenue (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Revenue $ 207 $ 370 $ (163) (44.1) %

Revenue decreased by $163 thousand for the six months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily due to lower FF vehicle revenue, partially offset by the recognition of $179 thousand of automotive sales revenue from sales of FX Super One vehicles in the U.A.E.

The three months ended March 31, 2026 represented the first quarter in which the Company recognized revenue from sales of FX Super One vehicles.

Revenue from FF vehicles was $16 thousand for the three months ended March 31, 2026, consisting of operating lease revenue, compared to $316 thousand for the same period in 2025 , consisting of $265 thousand of operating lease revenue and $51 thousand of sales-type lease revenue.

The six months ended June 30, 2026 represented the first six-month period in which the Company recognized revenue from sales of FX Super One vehicles.

Revenue from FF vehicles was $28 thousand for the six months ended June 30, 2026, consisting of sales-type lease revenue, compared to $370 thousand for the same period in 2025, consisting of $265 thousand of sales-type lease revenue and $105 thousand of operating lease revenue.

The Company did not recognize FF automotive sales revenue during either period.

The co-creation fees recorded as a reduction of revenue under ASC 606 were$186 thousand for the three months ended March 31, 2026, compared to $263 thousand for the same period in 2025 .

The co-creation fees recorded as a reduction of revenue under ASC 606 were $186 thousand for the six months ended June 30, 2026, compared to $263 thousand for the same period in 2025.

Looking ahead, the Company intends to continue advancing commercialization of the FX Super One while continuing limited-volume FF 91 deliveries and related leasing activities.

3 unchanged sentences

The timing and extent of revenue growth will depend on the Company’s ability to execute on product development, manufacturing, supply chain, regulatory, funding, and delivery milestones.

AIEV - Cost of Revenue

Three Months Ended March 31, Change

AIEV - Cost of Revenue (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Cost of revenue $ 10,894 $ 26,912 $ (16,018) (59.5) %

Cost of revenue decreased by $9.6 million for the three months ended March 31, 2026, compared to the same period in 2025.

AIEV - Research and Development

Three Months Ended March 31, Change

Cost of revenue decreased by $16.0 million for the three months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily lower depreciation expense following the $128.9 million impairment of certain property and equipment recognized during the third quarter of 2025, which reduced quarterly depreciation expense by approximately $12.2 million, and a $3.8 million decrease in inventory reserve expense compared with the second quarter of 2025, when the Company recognized a provision for inventory reserve of $3.8 million.

AIEV - Cost of Revenue (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Cost of revenue $ 22,640 $ 48,293 $ (25,653) (53.1) %

Cost of revenue decreased by $25.7 million for the six months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily lower depreciation expense following the $128.9 million impairment of certain property and equipment recognized during the third quarter of 2025, which reduced quarterly depreciation expense by approximately $21.6 million, and a $3.8 million decrease in inventory reserve expense compared with the six months ended June 30, 2025, when the Company recognized a provision for inventory reserve of $3.8 million.

AIEV - Research and Development (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Research and development $ 4,137 $ 5,004 $ (867) (17.3) %

R&D expense increased by $0.6 million for the three months ended March 31, 2026, compared to the same period in 2025.

These increases were partially offset by a $1.2 million reduction in wages and related benefit, including lower bonus expense.

During the three months ended March 31, 2026, the Company continued R&D activities primarily supporting the FX Super One program, including final validation, U.S.

homologation testing, and production readiness initiatives.

Development efforts included vehicle performance and durability testing, integration of ADAS, supplier coordination, and prototype tooling.

The Company also provided engineering support for technical preparations in the U.A.E.

to align manufacturing standards and production planning under its global bridge strategy.

Current R&D initiatives remain focused on vehicle performance, safety system enhancements, software refinement platform development, in collaboration with key technology and supply-chain partners to support scalable FX Series production readiness.

Activities under this agreement are expected to facilitate commercial production readiness, with associated costs incurred primarily as development and engineering expenditures.

AIEV - Sales and Marketing

Three Months Ended March 31, Change

R&D expense decreased by $0.9 million for the three months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $1.0 million decrease in wages and related benefits including lower bonus expense.

During the second quarter of 2026, the Company continued to advance its technology development initiatives across intelligent vehicles and robotics applications.

Based on its belief that an 800V architecture would offer greater product competitiveness and user value than the originally contemplated 400V model, the Company announced plans to upgrade the FX Super One to an 800V architecture or, alternatively, accelerate the AIHER hybrid project.

This initiative is intended to complement the Company’s broader intelligent vehicle strategy and support long-term technology diversification.

AIEV - Research and Development (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Research and development $ 11,123 $ 11,423 $ (300) (2.6) %

R&D expense decreased by $0.3 million for the six months ended June 30, 2026, compared to the same period in 2025.

During the six months ended June 30, 2026, the Company continued to advance its technology development initiatives across intelligent vehicles and Robotics applications.

These initiatives are intended to complement the Company’s broader intelligent vehicle strategy and support long-term technology diversification.

As the Company transitions from an R&D-intensive phase toward commercial production, resources are being reallocated to manufacturing engineering, quality validation, and process optimization.

Robotics products.

During the period, the Company, through GlobeX AI Hong Kong Holding Limited, entered into a mass-production engineering services agreement with its bridge strategy partner to support development, testing and engineering activities for the FX Super One.

In April 2026, the parties entered into a supplemental agreement to suspend further performance of the development, testing and engineering services under that agreement.

Costs incurred under the engineering services agreement primarily relate to development and engineering activities.

AIEV - Sales and Marketing (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Sales and marketing $ 1,974 $ 1,873 $ 101 5.4 %

Sales and marketing expense increased by $2.3 million for the three months ended March 31, 2026, compared to the same period in 2025.

The increase was primarily driven by a $1.2 million rise in marketing expenses related to the launch and promotion of the FX Super One, including digital campaigns, content development, influencer engagement, and event activations.

Additional costs were incurred from expanded marketing activities in the Middle East to support brand visibility in international markets.

These increases also include $0.7 million increase in rent and related expense and a $0.3 million increase in wages and related benefits costs.

Sales and marketing expense increased by $0.1 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by a $1.6 million rise in compensation costs, reflecting selective additions to sales and marketing personnel and other related payroll costs.

These increases were partially offset by a $0.4 million decrease in rent and related expense and $0.6 million decrease in marketing expenses due to reduced Middle East vehicle-commercialization activity, and decrease in general expenses related sales and marketing activities including operation consumables.

AIEV - Sales and Marketing (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Sales and marketing $ 6,952 $ 4,502 $ 2,450 54.4 %

Sales and marketing expense increased by $2.5 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by a $0.6 million increase in marketing expenses related to the launch and promotion of the FX Super One, including digital campaigns, content development, influencer engagement, and event activations.

The increase was also driven by a $1.9 million increase in wages and related benefits.

Throughout 2025 to present, the Company continues to execute an event-driven marketing strategy centered on its Co-Creation model, engaging industry leaders, influencers, and early adopters to promote the brand and its vehicles.

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Looking ahead, the Company expects marketing activities to remain aligned with its transition toward commercial production of the FX Series, with continued emphasis on targeted launch events, digital engagement, and market-specific activation strategies designed to support reservation conversion and brand positioning in priority regions.

In the first quarter of 2026, the Company expanded its brand and technology outreach to include robotics-related initiatives, leveraging its intelligent mobility platform and AI capabilities.

During six months ended June 30, 2026 , the Company expanded its brand and technology outreach to include robotics-related initiatives, leveraging its intelligent mobility platform and AI capabilities.

Marketing efforts associated with this initiative are intended to introduce the Company’s broader technology ecosystem and support long-term brand diversification beyond electric vehicles.

AIEV - General and

Three Months Ended March 31, Change

AIEV - General and Administrative (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

General and administrative $ 11,437 $ 14,097 $ (2,660) (18.9) %

General and administrative expense decreased by $8.0 million for the three months ended March 31, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $8.7 million decrease in professional fees, reflecting reimbursements of legal expenses.

These decreases were partially offset by $1.6 million increase due to higher payroll costs.

During the three months ended March 31, 2026, the Company continued to incur general and administrative costs associated with legal, compliance, governance, public company reporting, and strategic initiatives.

General and administrative expense decreased by $2.7 million for the three months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $2.1 million decrease in professional service fees.

AIEV - General and Administrative (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

General and administrative $ 17,084 $ 27,771 $ (10,687) (38.5) %

General and administrative expense decreased by $10.7 million for the six months ended June 30, 2026, compared to the same period in 2025.

The decrease was primarily driven by a $10.8 million decrease in professional fees.

During the six months ended June 30, 2026, the Company continued to incur general and administrative costs associated with legal, compliance, governance, public company reporting, and strategic initiatives.

These activities included matters related to the conclusion of an SEC investigation, ongoing legal and advisory support, corporate governance and compliance activities, and support for financing, capital markets, AIXC integration, expansion into the U.A.E., and Robotics-related strategic initiatives.

Payroll costs also increased year-over-year as the Company maintained personnel and management resources to support these expanded activities.

Although general and administrative expense decreased compared to the prior-year period, the Company expects G&A costs to continue to reflect the level of legal, compliance, reporting, and strategic activity required to support its evolving business operations.

AIEV - Loss from disposal of property, plant and equipment

Three Months Ended March 31, Change

The decrease in general and administrative expense compared to the prior-year period primarily reflected lower legal and compliance-related professional services following the conclusion of the SEC investigation, including related insurance reimbursements, as well as lower depreciation and amortization expense.

These decreases were partially offset by lower allocations of costs to cost of sales and higher wages, benefits and related expenses and rent and related expenses.

The Company expects G&A costs to continue to reflect the level of legal, compliance, reporting, and strategic activity required to support its evolving business operations.

AIEV - Loss (gain) from disposal of property, plant and equipment (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on disposal of property, plant, and equipment $ 328 $ 44 $ 284 645.5 %

Loss on disposal of property, plant, and equipment increased by approximately $0.3 million for the three months ended March 31, 2026, compared to the same period in 2025.

Loss (Gain) on disposal of property, plant, and equipment $ (12) $ 276 $ (288) (104.3) %

Loss (Gain) on disposal of property, plant, and equipment decreased by approximately $288 thousand for the three months ended June 30, 2026, compared to the same period in 2025.

We dispose of equipment when the assets become obsolete, costly to maintain, or are replaced by more efficient technologies.

AIEV - Goodwill Impairment

Three Months Ended March 31, Change

AIEV - Loss from disposal of property, plant and equipment (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss (Gain) on disposal of property, plant, and equipment $ 316 $ 320 $ (4) (1.3) %

Loss (Gain) on disposal of property, plant, and equipment increased by approximately $4 thousand for the six months ended June 30, 2026, compared to the same period in 2025.

We dispose of equipment when the assets become obsolete, costly to maintain, or are replaced by more efficient technologies.

AIEV - Impairment of intangible assets, including goodwill (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Impairment of intangible assets, including goodwill $ 3,629 $ — $ 3,629 NM

NM = not meaningful

During the three months ended March 31, 2026, the Company recorded a goodwill impairment charge of $2.1 million related to goodwill recognized in connection with the AIXC acquisition and assigned to the Company’s AIEV reporting unit.

In connection with the impairment assessment under ASC 350, management compared the estimated fair value of the AIEV reporting unit to its carrying value.

During the three months ended June 30, 2026, the Company recorded a $3.6 million impairment of intangible assets related to acquired in-process research and development (“IPR&D”) associated with AIXC’s legacy biotechnology business.

There was no comparable impairment in the prior-year periods because the Company did not consolidate AIXC during the three months ended June 30, 2025.

AIEV - Impairment of intangible assets, including goodwill (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Impairment of intangible assets, including goodwill $ 5,701 $ — $ 5,701 NM

NM = not meaningful

During the six months ended June 30, 2026, the Company recorded a impairment charge of intangible assets, including goodwill of $5.7 million, which consisted of $2.1 million impairment charge of goodwill and $3.6 million impairment charge of intangible assets.

The Impairment of goodwill was related to goodwill recognized in connection with the AIXC acquisition and assigned to the Company’s AIXC reporting unit.

In connection with the impairment assessment under ASC 350, management compared the estimated fair value of the AIXC reporting unit to its carrying value.

The estimated fair value was supported primarily by a market-based valuation approach that considered relevant market indicators, including the Company’s market capitalization, trading volume, market liquidity, and other observable market data.

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Accordingly, the Company recognized an impairment charge limited to the recorded goodwill balance.

AIEV - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options

Three Months Ended March 31, Change

There was no comparable impairment in the prior-year periods because the Company did not consolidate AIXC during the six months ended June 30, 2025.

AIEV - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of notes payable, warrant liabilities, and derivative call options $ 1,256 $ (46,078) $ 47,334 (102.7) %

Change in fair value of notes payable, warrant liabilities, and derivative call options was a gain of $2.7 million for the three months ended March 31, 2026 , compared to a gain of $51.5 million for the same period in 2025, representing a $48.8 million decrease in gain.

The decrease was primarily due to significantly larger fair value remeasurement gains recognized in the prior-year period, partially offset by current-period fair value gains related to outstanding notes payable, warrant liabilities, and derivative call options.

During the three months ended March 31, 2025, the Company recognized significant gains from decreases in the fair value of notes payable, warrant liabilities, and derivative call options, including gains related to SPA Portfolio Notes, warrants, and Incremental Warrants.

These gains were primarily driven by a decline in the Company’s stock price from temporarily elevated levels as of December 31, 2024, when a larger portion of the Company’s equity-linked instruments was deeply in-the-money and highly sensitive to changes in the Company’s stock price.

During the three months ended March 31, 2026 , the Company also experienced stock price volatility;

however, the fair value impact was less pronounced because certain instruments had moved closer to at-the-money or out-of-the-money levels, reducing their sensitivity to further stock price decreases.

Changes in fair value during the period were also affected by the terms of the Company’s hybrid instruments, including conversion price resets, full-ratchet anti-dilution provisions warrant features, derivative call options, volatility assumptions, and changes in the outstanding instrument population.

Certain conversions during the period were effected at prices below the stated conversion prices and triggered full-ratchet anti-dilution adjustments on other outstanding instruments, which affected the fair value remeasurement results.

As a result, the Company recognized more limited net fair value remeasurement gains in the current period compared to the prior-year period.

Current-period activity also reflected new note issuances, debt conversions, and fair value adjustments during the three months ended March 31, 2026 .

Third-party notes payable decreased from $60.7 million as of December 31, 2025 to $46.4 million as of March 31, 2026, primarily reflecting $25.3 million of debt converted into equity, partially offset by $5.9 million of new issuances and $5.2 million of fair value adjustments.

AIEV - Change in Fair Value of Related Party Notes Payable and Related Party Warrant Liabilities

Three Months Ended March 31, Change

During the three months ended June 30, 2025 we recognized an aggregate day-one loss of $12.5 million related to the initial measurement of SPA Portfolio Notes, Warrants and Incremental Warrants.

The 2025 loss was further impacted by a

$31.8 million loss from subsequent fair value remeasurement.

The re-measurement was primarily driven by n approximately 49% increase in the Company’s stock price during the period compared to preceding three-month period.

During the three months ended June 30, 2026, although the Company’s stock price declined, the impact on fair value was substantially less pronounced.

The decline in stock price moved certain instruments to at- or out-of-the-money positions, reducing their sensitivity to further changes in the underlying equity price.

As a result, decreases in the fair value of warrant liabilities and derivative call options were more limited, and the fair value of notes payable increased modestly during the period.

These factors contributed to substantially lower fair value volatility compared with the prior-year period.

AIEV - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of notes payable, warrant liabilities, and derivative call options $ 3,947 $ 5,380 $ (1,433) (26.6) %

The gain from change in fair value of notes payable, warrant liabilities, decreased by $1.4 million period over period .

During the six months ended June 30, 2025 we recognized an aggregate day-one loss of $36.1 million related to the initial measurement of SPA Portfolio Notes, Warrants and Incremental Warrants.

This loss was offset by a $43.7 million net gain from subsequent remeasurement.

The fair value of the SPA Portfolio Notes and associated warrants is influenced by the relationship between the Company’s stock price and the applicable conversion or exercise prices.

During the six months ended June 30, 2026, although the Company’s stock price also declined, the impact on fair value was substantially less pronounced.

The decline in stock price moved certain instruments to at- or out-of-the-money positions, reducing their sensitivity to further changes in the underlying equity price.

As a result, decreases in the fair value of warrant liabilities and derivative call options were more limited, and the fair value of notes payable increased modestly during the period.

These factors resulted in substantially lower fair value volatility during the current-year period compared with the prior-year period.

AIEV - Change in Fair Value of Related Party Notes Payable and Related Party Warrant Liabilities (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options $ 85 $ (5,150) $ 5,235 (101.7) %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options decreased by $1.7 million for the three months ended March 31, 2026 , compared to the same period in 2025.

The increase was primarily due to current-period fair value changes associated with related-party warrant liabilities and derivative call options, compared to smaller fair value gains in the prior-year period related to related-party unsecured convertible notes.

During the three months ended March 31, 2025, the Company recognized fair value gains related to related-party convertible instruments, including unsecured convertible notes issued to MHL, a related party.

The prior-year gains were primarily driven by decreases in the fair value of related-party unsecured convertible notes as the Company’s stock price declined during the period.

During the three months ended March 31, 2026, the change in fair value was larger than in the prior-year period due to changes in the valuation of related-party instruments subject to fair value measurement, including the impact of stock price movements, volatility assumptions, conversion or settlement features, and other instrument-specific terms.

As with the Company’s third-party instruments, the fair value of related-party instruments does not move linearly with changes in the Company’s stock price because the instruments include features such as conversion rights, full-ratchet anti-dilution provisions, and other settlement mechanics.

AIEV - Loss on Settlement of Notes Payable

Three Months Ended March 31, Change

During the three months ended June 30, 2025 the Company issued $3.0 million of related party SPA Portfolio Notes.

During the three months ended June 30, 2026, the only related party instruments measured at fair value that remained outstanding were derivative call options, as the related party notes payable accounted for under the fair value option and the related party warrants had been settled or extinguished in prior periods.

hese instruments did not experience significant fair value fluctuations, primarily due to reduced sensitivity to changes in the Company’s stock price.

AIEV - Change in Fair Value of Related Party Notes Payable and Related Party Warrant Liabilities (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of related party notes payable, warrant liabilities, and derivative call options $ 1,524 $ (5,427) $ 6,951 (128.1) %

During the six months ended June 30, 2025, the Company issued $4.6 million of rel ated party SPA Portfolio Notes.

Fair value fluctuations were substantially more limited during the second quarter as the derivative call options became less sensitive to further stock price movements.

In the absence of new issuances during the period, the full effect of favorable remeasurement was reflected in earnings.

AIEV - Loss on Settlement of Notes Payable (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes payable $ (7,845) $ (22,458) $ 14,613 (65.1) %

Loss on settlement of notes payable decreased by $7.5 million, for the three months ended March 31, 2026 compared to the same period in 2025.

The favorable variance was primarily driven by a lower loss recognized per dollar of principal converted, which more than offset a higher level of conversion activity in the current period.

During the three months ended March 31, 2026, the Company converted approximately $28.4 million of principal into Class A Common Stock, compared to approximately $28.5 million of principal converted during the same period in 2025.

Despite the higher principal amount converted in the current period, the loss on settlement decreased because the average loss recognized per dollar of principal converted declined significantly.

During the three months ended March 31, 2025, the Company’s stock price was materially above the applicable conversion floor prices for certain converting instruments.

As a result, the fair value of shares issued upon conversion exceeded the carrying amount of the debt extinguished by a greater amount, resulting in higher settlement losses, particularly for conversions of Junior Secured SPA Notes and 2023 Unsecured SPA Notes.

During the three months ended March 31, 2026, the Company’s stock price had declined to levels closer to the applicable contractual conversion price floors for certain instruments, narrowing the in-the-money spread and reducing the loss recognized on settlement despite the higher volume of principal converted.

The current-period loss primarily related to conversions of 2023 Unsecured SPA Notes, Junior Secured SPA Notes, 2024 Unsecured SPA Notes, 2025 March Unsecured SPA Notes, and 2025 July Unsecured SPA Notes.

These conversions resulted in settlement losses of approximately $8.4 million in the aggregate for the three months ended March 31, 2026, compared to approximately $15.9 million in the prior-year period.

AIEV - Loss on Settlement of Related Party Notes Payable

Three Months Ended March 31, Change

Loss on settlement of notes payable decreased by $14.6 million, for the three months ended June 30, 2026 compared to the same period in 2025.

The favorable variance was primarily driven by a reduction in the average loss rate on conversions and the decrease in the volume of principal converted.

During the three months ended June 30, 2025, we experienced higher per-dollar losses on extinguishment as our the conversion features of our convertible instruments were more significantly in the money.

As a result, the notes were deeply in-the-money at the time of conversion, with shares issued at fair values significantly in excess of the carrying value of the debt extinguished.

This resulted in an average loss rate of 67% of principal converted.

As a result, the average loss rate decreased to approximately 45% of principal converted.

Total principal converted decreased to $17.6 million in 2026 from $34.4 million 2025, the lower loss rate and lower conversion volume, resulting in an overall decrease in loss on extinguishment for the period.

AIEV - Loss on Settlement of Notes Payable (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes payable $ (16,276) $ (38,378) $ 22,102 (57.6) %

Loss on settlement of notes payable decreased by $22.1 million, for the six months ended June 30, 2026 compared to the same period in 2025.

The favorable variance was primarily driven by a reduction in the average loss rate on conversions and the decrease in the volume of principal converted.

As a result, the notes were deeply in-the-money at the time of conversion, with shares issued at fair values significantly in excess of the carrying value of the debt extinguished.

This resulted in an average loss rate of 70% of principal converted.

As a result, the average loss rate decreased to approximately 35% of principal converted.

The lower loss rate and lower conversion volume resulted in an overall decrease in loss on extinguishment for the period.

AIEV - Loss on Settlement of Related Party Notes Payable (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of related party notes payable $ — $ (1,860) $ 1,860 (100.0) %

Loss on settlement of related party notes payable decreased by $1.2 million for the three months ended March 31, 2026, compared to the same period in 2025.

The decrease was due to the absence of related-party note conversions during the current period, compared to a loss recognized in the prior-year period from the conversion of related-party unsecured convertible notes.

No comparable related-party note conversion occurred during the three months ended March 31, 2026.

AIEV - Interest Expense

Three Months Ended March 31, Change

During the three months ended June 30, 2025 MHL converted outstanding debt with a principal balance of $2.1 million into 13,452 shares of Class A Common Stock, resulting in an extinguishment loss.

No similar transactions occurred during the three months ended June 30, 2026.

AIEV - Loss on Settlement of Related Party Notes Payable (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of related party notes payable $ — $ (3,040) $ 3,040 (100.0) %

In the prior-year period we recognized a $3.0 million loss on extinguishment related to the conversion of related-party unsecured convertible notes held by MHL.

No similar transactions occurred during the six months ended June 30, 2026.

AIEV - Interest Expense (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Interest expense $ (2,348) $ (812) $ (1,536) 189.2 %

Interest expense increased by approximately $0.2 million for the three months ended March 31, 2026, compared to the same period in 2025.

Interest expense increased by approximately $1.5 million for the three months ended June 30, 2026, compared to the same period in 2025.

This increase was primarily due to higher interest costs associated with our financial obligations related to the FF aiFactory California manufacturing facility in Hanford, California.

AIEV - Other Income, net

Three Months Ended March 31, Change

AIEV - Interest Expense (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Interest expense $ (4,826) $ (3,114) $ (1,712) 55.0 %

Interest expense increased by approximately $1.7 million for the six months ended June 30, 2026, compared to the same period in 2025.

This increase was primarily due to higher interest costs associated with our financial obligations related to the FF aiFactory California manufacturing facility in Hanford, California.

AIEV - Other Income, net (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Other income, net $ 5,038 $ (210) $ 5,248 (2499.0 %)

Other income, net increased by $0.2 million for the three months ended March 31, 2026, compared to the same period in 2025.

The increase was primarily driven by lower foreign currency transaction losses in 2025.

Although the Chinese yuan appreciated against the U.S.

dollar during the current period, overall exchange rate movements were less volatile than the U.S.

dollar appreciation experienced in 2025, resulting in a reduced foreign currency impact on the Company’s RMB-denominated monetary balances.

Foreign currency effects related to the Company’s operations in the United Arab Emirates were not significant, as the U.A.E.

Other income, net increased by $5.2 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by gains recognized from negotiated settlements and the resolution of aged accounts payable and other accrued liability balances through the Company’s liability management initiatives, including its net equity improvement initiative.

The increase was partially offset by an unfavorable change in foreign currency transaction gains and losses, primarily related to the remeasurement of Chinese yuan-denominated balances.

AIEV - Other Income, net (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Other income (loss), net $ 6,987 $ 1,574 $ 5,413 343.9 %

Other income, net increased by $5.4 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase also reflected a favorable year-over-year change in foreign currency transaction gains and losses, primarily related to the remeasurement of RMB-denominated monetary balances.

Foreign currency effects associated with the Company’s operations in the United Arab Emirates were not significant because the U.A.E.

dirham is pegged to the U.S.

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Robotics - Statements of Operations

Three Months Ended March 31,

During the three and six months ended June 30, 2026, the Company continued to advance the early commercialization of its embodied AI robotics business, including product delivery activity, customer and partner engagement, and product and ecosystem launch activities.

To support these initiatives, the Company continued to establish operating infrastructure for supplier contracting, aftersales service, Hong Kong and China business activities, and robotics manufacturing.

The Company also began preparing certain manufacturing capabilities and processes at its Hanford, California facility to support robotics activities, including pilot build readiness, manufacturing layout and process verification, materials planning, team training, and development of related manufacturing and quality management processes.

The robotics business remains in the early stages of commercialization, and operating results may vary significantly from period to period based on the timing of product deliveries, partner activities, and the continued development of the Company’s manufacturing, supply chain, sales, and service capabilities.

Three Months Ended June 30,

(in thousands) 2026 2025

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Gross profit $ 209 $ —

Robotics - Revenue

Three Months Ended March 31, Change

Six Months Ended June 30,

(in thousands) 2026 2025

Revenue $ 1,141 $ —

Cost of revenue 788 —

Gross profit $ 353 $ —

Robotics - Revenue (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Revenue $ 853 $ — $ 853 — %

Revenue increase d by $288 thousand for the three months ended March 31, 2026 , compared to the same period in 2025.

The increase was primarily due to the recognition $288 thousand of Robotics revenue from sales of Robotics products during the three months ended March 31, 2026 .

The three months ended March 31, 2026 represented the first quarter in which the Company recognized revenue from sales of Robotics products.

The co-creation fees recorded as a reduction of revenue under ASC 606 were $12 thousand for the three months ended March 31, 2026, compared to none for the same period in 2025.

Looking ahead, the Company intends to continue advancing commercialization of Robotics products.

Management expects that revenue will remain limited until production volumes, customer deliveries, customer acceptance, and funding availability support increased sales activity.

As Robotics products move through their planned ramp-up phases, Robotics product sales are expected to become more meaningful drivers of consolidated revenue.

The timing and extent of revenue growth, if any, will depend on the Company’s ability to execute on product development, manufacturing, supply chain, regulatory, funding, and delivery milestones.

Robotics - Cost of Revenue

Three Months Ended March 31, Change

Revenue increased by $853 thousand for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily due to the recognition $853 thousand of Robotics revenue from sales of Robotics products during the three months ended June 30, 2026.

The co-creation fees recorded as a reduction of revenue under ASC 606 were $22 thousand for the three months ended June 30, 2026, compared to none for the same period in 2025.

Robotics - Revenue (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Revenue $ 1,141 $ — $ 1,141 — %

Revenue increased by $1,141 thousand for the six months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily due to the recognition $1,141 thousand of Robotics revenue from sales of Robotics products during the six months ended June 30, 2026.

The co-creation fees recorded as a reduction of revenue under ASC 606 were $34 thousand for six months ended June 30, 2026, compared to none for the same period in 2025.

Looking ahead, the Company intends to continue advancing the commercialization of its robotics products and related ecosystem initiatives.

Management expects robotics revenue to remain limited and uneven in the near term until production volumes, customer deliveries, customer acceptance, and funding availability support increased sales activity.

As robotics products progress through planned ramp-up phases, robotics product sales may become a more meaningful contributor to consolidated revenue.

The timing and extent of future revenue growth, if any, will depend on the Company’s ability to execute on product development, manufacturing readiness, supply chain, sales, service, and delivery milestones.

Robotics - Cost of Revenue (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Cost of revenue $ 644 $ — $ 644 — %

Cost of revenue increased by $144 thousand for the three months ended March 31, 2026, compared to the same period in 2025.

Cost of Robotics revenue includes product costs, freight, and import fees.

Cost of revenue increased by $644 thousand for the three months ended June 30, 2026, compared to the same period in 2025.

Cost of Robotics revenue includes product costs, freight, import fees and warranty costs.

Robotics - Cost of Revenue (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Cost of revenue $ 788 $ — $ 788 — %

Cost of revenue increased by $788 thousand for the six months ended June 30, 2026, compared to the same period in 2025.

Cost of Robotics revenue includes product costs, freight, import fees and warranty costs.

AIXC Results of Operations

AIXC - Statements of Operations

Three Months Ended March 31,

Three Months Ended June 30,

(in thousands) 2026 2025

3 unchanged sentences

General and administrative 2,868 —

Impairment of intangible assets, including goodwill 183 —

Total operating expenses 2,960 —

Loss from operations (2,960) —

Change in fair value of notes payable, warrant liabilities, and derivative call options 5 —

Loss on settlement of notes receivable (376) —

Net loss on digital assets (984) —

Other income (expense), net 127 —

Loss before income taxes (4,188) $ —

AIXC - Statements of Operations

Six Months Ended June 30,

(in thousands) 2026 2025

Operating expenses

Research and development $ 10 $ —

Sales and marketing 724 —

General and administrative 6,416 —

Impairment of long-lived assets and deposits 183 —

Credit loss expense - short-term note receivable 143 —

2 unchanged sentences

Change in fair value of notes payable, warrant liabilities, and derivative call options 85 —

Loss on settlement of notes receivable (376) —

Net loss on digital assets (2,930) —

Other income, net 303 —

Other income (expense), net 430 —

Loss before income taxes $ (10,267) $ —

AIXC - Research and Development

Three Months Ended March 31, Change

AIXC - Sales and Marketing (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Research and development $ 4 $ — $ 4 NM *

Sales and marketing $ 86 $ — $ 85.937 NM *

NM = not meaningful

R&D expense increased by $4 thousand for the three months ended March 31, 2026, compared to the same period in 2025.

The increase was due to minimal research and development activity at AIXC, which had no comparable consolidated

amount in the prior-year period because AIXC was acquired in the third quarter of 2025.

Sales and marketing expense increased by $0.1 million for the three months ended June 30, 2026, compared to the same period in 2025 The increase was due to the marketing expenses in sales and marketing activity at AIXC, which had no comparable consolidated amount in the prior-year period because AIXC was acquired in the third quarter of 2025.

The impact on consolidated results was immaterial.

AIXC - General and Administrative

Three Months Ended March 31, Change

AIXC - Sales and Marketing (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Sales and marketing $ 724 $ — $ 723.937 NM *

NM = not meaningful

Sales and marketing expense increased by $0.7 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase was due to the marketing expenses in sales and marketing activity at AIXC, which had no comparable consolidated amount in the prior-year period because AIXC was acquired in the third quarter of 2025.

The impact on consolidated results was immaterial.

AIXC - General and Administrative (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

General and administrative $ 2,868 $ — $ 2,868.39 NM *

NM = not meaningful

General and administrative expense increased by $3.5 million for the three months ended March 31, 2026, compared to the same period in 2025.

General and administrative expense increased by $2.9 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase reflects AIXC’s current-period operating activity following its acquisition, primarily driven by approximately $1.2 million of professional-service costs, including legal, accounting, consulting, investor relations, and director-related costs;

3 unchanged sentences

Because AIXC was acquired in the third quarter of 2025, there was no comparable consolidated amount in the prior-year period.

AIXC - Impairment of Intangible Assets

Three Months Ended March 31, Change

AIXC - General and Administrative (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Impairment of intangible assets, including goodwill $ 183 $ — $ 183 NM*

General and administrative $ 6,416 $ — $ 6,416.39 NM *

NM = not meaningful

During the three months ended March 31, 2026, we recorded a $0.2 million impairment charge related to AIXC capitalized software costs, compared to no impairment charge during the three months ended March 31, 2025.

The increase was due to the impairment of certain AIXC capitalized software development costs in the current period following management’s reassessment of the related projects.

There was no comparable impairment in the prior-year period because the Company did not consolidate AIXC during the three months ended March 31, 2025.

AIXC - Credit Loss

Three Months Ended March 31,

General and administrative expense increased by $6.4 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase reflects AIXC’s current-period operating activity following its acquisition, primarily driven by approximately $3.1 million of professional-service costs, including legal, accounting, consulting, investor relations, and director-related costs;

approximately $0.6 million of master service fees charged by the Company’s AIEV reporting segment;

approximately $1.9 million of personnel-related costs;

and approximately $0.5 million of insurance expense.

Because AIXC was acquired in the third quarter of 2025, there was no comparable consolidated amount in the prior-year period.

AIXC - Credit Loss (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

1 unchanged sentence

NM = not meaningful

During the three months ended March 31, 2026, we recorded a $0.1 million o f credit loss expense primarily related to interest accrued on the Marizyme promissory note acquired in connection with the AIXC business combination.

During the six months ended June 30, 2026, we recorded a $0.1 million o f credit loss expense primarily related to interest accrued on the Marizyme promissory note acquired in connection with the AIXC business combination.

In the fourth quarter of 2025, AIXC wrote off substantially all of the outstanding principal balance of the note due to Marizyme’s bankruptcy status.

1 unchanged sentence

There was no comparable consolidated credit loss expense related to the Marizyme note in the prior-year period, as AIXC was acquired by the Company in the third quarter of 2025.

AIXC - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options

Three Months Ended March 31, Change

AIXC - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

1 unchanged sentence

* NM = not meaningful

The change in fair value of financial instruments was $0.1 million for the three months ended March 31, 2026, reflecting the period-end remeasurement of AIXC’s single fair value–measured instrument following its acquisition.

The change in fair value of financial instruments was $5 thousand for the three months ended June 30, 2026, reflecting the period-end remeasurement of AIXC’s single fair value–measured instrument following its acquisition.

There were no comparable amounts in the prior year as AIXC was acquired by the Company in the third quarter of 2025.

AIXC - Net Loss on Digital Assets, net

Three Months Ended March 31,

AIXC - Change in Fair Value of Notes Payable, Warrant Liabilities, and Derivative Call Options (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Change in fair value of notes payable, warrant liabilities, and derivative call options $ 85 $ — $ 85 NM *

* NM = not meaningful

The change in fair value of financial instruments was $85 thousand for the six months ended June 30, 2026, reflecting the period-end remeasurement of AIXC’s single fair value–measured instrument following its acquisition.

There were no comparable amounts in the prior year as AIXC was acquired by the Company in the third quarter of 2025.

AIXC - Loss on Settlement of Notes Receivable (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes receivable $ (376) $ — $ (376) NM *

NM = not meaningful

During the three months ended June 30, 2026, the Company recorded a loss on settlement of notes receivable of $0.4 million.

AIXC - Loss on Settlement of Notes Receivable (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Loss on settlement of notes receivable $ (376) $ — $ (376) NM *

NM = not meaningful

During the six months ended June 30, 2026, the Company recorded a loss on settlement of notes receivable of $0.4 million.

AIXC - Net Loss on Digital Assets, net (3-Month Overview)

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Net loss on digital assets $ (984) $ — $ (984) NM *

NM = not meaningful

Net loss on digital assets increased by $1.9 million for the three months ended March 31, 2026, compared to the same period in 2025.

The loss reflected realized losses from digital asset transactions and unrealized gains and losses from changes in the fair value of digital assets held as of March 31, 2026.

Net loss on digital assets increased by $1.0 million for the three months ended June 30, 2026, compared to the same period in 2025.

The loss reflected realized losses from digital asset transactions and unrealized gains and losses from changes in the fair value of digital assets held as of June 30, 2026.

AIXC - Net Loss on Digital Assets, net (6-Month Overview)

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Net loss on digital assets $ (2,930) $ — $ (2,930) NM *

NM = not meaningful

Net loss on digital assets increased by $2.9 million for the six months ended June 30, 2026, compared to the same period in 2025.

The loss reflected realized losses from digital asset transactions and unrealized gains and losses from changes in the fair value of digital assets held as of June 30, 2026.

AIXC - Other Income (loss), net

Three Months Ended March 31, Change

Three Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Other income, net $ 303 $ — $ 303 NM *

Other income (expense), net $ 127 $ — $ 127 NM *

NM = not meaningful

Other income, net increased by $0.3 million for the three months ended March 31, 2026, compared to the same period in 2025.

Other income, net increased by $0.1 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by interest and investment income from AIXC, including interest income on the Marizyme Notes and income earned on money market investments.

Because AIXC was acquired in the third quarter of 2025, there was no comparable consolidated amount in the prior-year period.

AIXC - Other Income (loss), net

Six Months Ended June 30, Change

(in thousands) 2026 2025 Amount %

Other income (expense), net $ 430 $ — $ 430 NM *

NM = not meaningful

Other income, net increased by $0.4 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase was primarily driven by interest and investment income from AIXC, including interest income on the Marizyme Notes and income earned on money market investments.

Because AIXC was acquired in the third quarter of 2025, there was no comparable consolidated amount in the prior-year period.

Liquidity and Capital Resources

5 unchanged sentences

We have devoted, and expect to continue to devote, substantial effort and capital resources to strategic planning, engineering, design, and development of our electric vehicle platform, development of vehicle models, completion of the FF aiFactory California manufacturing facility, and capital raising activities.

As of March 31, 2026, we had an accumulated deficit of $4,743.9 million, unrestricted cash of $12.2 million, and negative working capital of $76.0 million.

We incurred a net loss of $42.3 million for the three months ended March 31, 2026.

This condition, together with our accumulated deficit and liquidity

constraints, contributes to management’s determination that there is substantial doubt about our ability to continue as a going concern under ASC 205-40.

As of June 30, 2026, we had an accumulated deficit of $4,779.9 million, unrestricted cash of $11.2 million, current restricted cash of $12.5 million, and a working capital deficit of $83.8 million.

The restricted cash was generally unavailable to fund our ordinary operating activities.

Excluding restricted cash

from current assets, we had a working capital deficit of $96.3 million.

This condition, together with the Company’s accumulated deficit and liquidity constraints, contributes to management’s determination that there is substantial doubt about the Company’s ability to continue as a going concern under ASC 205-40.

We project that we will require substantial additional funding to continue operations, advance development and future production planning related to our FF Series program, initiate production of our FX Series vehicles, and continue and expand our robotics production and commercialization activities.

Management also considered our cash flow forecast through the one-year assessment period, including expected operating cash outflows, production readiness and commercialization activities for the FX Series and Robotics products, and corporate overhead.

The forecast indicates continued liquidity pressure during the assessment period and dependence on timely execution of financing activities.

Management also considered our current five-year business plan, together with our June 30, 2026 liquidity position, expected operating cash requirements, known and reasonably knowable obligations, and financing assumptions relevant to the one-year assessment period.

This information indicates continued liquidity pressure during the assessment period and dependence on timely execution of financing activities.

If additional capital is not secured, we may not have sufficient resources to meet our obligations or continue operations, which could result in bankruptcy protection and asset liquidation, with equity holders receiving little to no recovery.

6 unchanged sentences

We intend to continue pursuing these funding sources.

We have issued various financing arrangements collectively known as the SPA Portfolio Notes.

These are categorized as follows:

(i) Secured SPA Notes;

(ii) 2023 Unsecured SPA Notes;

(iii) Junior Secured SPA Notes;

(iv) 2024 Unsecured SPA Notes (v), 2025 March Unsecured SPA Notes, and (vi) 2025 July Unsecured SPA Notes, and 2025 July Unsecured SPA Notes.

As of March 31, 2026, the SPA Portfolio Notes were in good standing.

As of March 31, 2026, SPA Commitments totaled $739.0 million, of which $517.5 million was funded, $177.2 million expired unfunded, $44.3 million remained to be funded, and $48.0 million in principal was outstanding.

Optional Commitments totaled $467.0 million, of which $106.0 million was funded, $327.5 million expired unfunded, $33.5 million remained to be funded, and $7.1 million was outstanding.

Remaining amounts are subject to closing conditions, including minimum share price and trading volume requirements.

During the three months ended June 30, 2026, we completed two additional financing transactions.

On April 17, 2026, we issued the Secured Streeterville Notes for an aggregate purchase price of $45.0 million and an aggregate original principal amount of approximately $45.8 million.

On May 15, 2026, we issued the 2026 May Convertible SPA Notes for aggregate funded proceeds of $25.0 million and an initial aggregate outstanding principal value of $27.0 million.

Of the aggregate proceeds from these financings, $42.5 million was deposited into accounts subject to deposit account control agreements and was classified as restricted cash as of June 30, 2026.

Although these financings provided additional capital, a substantial portion of the proceeds remained restricted, and the financings did not eliminate our need to obtain additional funding.

See Note 8, Notes Payable, for additional information.

In June 2026, we filed a replacement registration statement on Form S-3, which, became effective on July 24, 2026 and is intended to replace our prior shelf registration statement and support future capital raising activities, including potential sales under the our ATM Program.

Subsequent to June 30, 2026, we commenced sales under our ATM Program and sold 163,174 shares of Class A Common Stock for gross proceeds of approximately $1.0 million.

Our ability to raise additional capital under our ATM Program remains subject to the continued effectiveness and availability for use of the applicable registration statement, continued compliance with applicable securities laws, Form S-3 eligibility requirements, Nasdaq listing requirements, authorized share availability, market conditions, trading volume, share price, and other applicable limitations.

There can be no assurance regarding the amount of additional proceeds that may be raised under our ATM Program.

Subsequent to June 30, 2026, we implemented staff reductions and temporary salary reductions as additional cash-conservation measures.

We announced and explained these measures to affected employees and offered employees subject to the temporary salary reductions an opportunity to receive equity-based compensation intended to offset a portion of the reduction in cash compensation.

The amount, timing and issuance of any such equity awards are subject to the applicable terms of the program, required approvals, applicable securities laws and our trading policies.

These measures are intended to reduce near-term operating cash requirements but may not generate sufficient savings to alleviate the substantial doubt regarding our ability to continue as a going concern.

We have issued various financing arrangements collectively referred to as the SPA Portfolio Notes, including, 2023 Unsecured SPA Notes , Junior Secured SPA Notes , 2024 Unsecured SPA Notes , 2025 March Unsecured SPA Notes, 2025 July Unsecured SPA Notes, 2026 May Convertible SPA Notes, and Secured Streeterville Notes.

As of June 30, 2026 , the SPA Portfolio Notes were in good standing.

As of June 30, 2026, SPA Commitments totaled $635.1 million, of which $591.8 million was funded, $43.3 million was unfunded, and $107.1 million in principal was outstanding.

Optional Commitments totaled $139.5 million, of which

$106.0 million was funded, $33.5 million was unfunded, and $4.8 million in principal was outstanding.

Remaining unfunded amounts are subject to closing conditions, including minimum share price and trading volume requirements.

We may be unable to satisfy the closing conditions under the SPA Commitments or obtain additional financing on acceptable terms or at all.

We have implemented capital raising initiatives, including our At-The-Market (“ATM”) offering program, subject to authorized share availability and compliance with securities laws and Nasdaq listing requirements.

The replacement registration statement became effective on July 24, 2026, and subsequent to June 30, 2026, we commenced sales under our ATM Program.

Our ability to make additional sales under our ATM Program remains subject to applicable securities laws, Nasdaq listing requirements, authorized share availability, market conditions, trading volume, share price, and other applicable limitations.

Operational Context

8 unchanged sentences

On September 26, 2023, we entered into a sales agreement under our ATM Program permitting aggregate gross sales proceeds of up to $90.0 million, subject to share availability and regulatory compliance.

Due to the late filing of the September 30, 2025 Form 10-Q, we are ineligible to access the ATM Program until no earlier than December 1, 2026, assuming continued compliance with SEC reporting requirements thereafter.

In June 2026, we filed a replacement registration statement on Form S-3 that includes a prospectus covering the potential offer and sale of up to $90.0 million of Class A Common Stock under the ATM Program.

The replacement registration statement became effective on July 24, 2026.

Subsequent to June 30, 2026, we commenced sales under our ATM Program and sold 163,174 shares of Class A Common Stock for gross proceeds of approximately $1.0 million.

Our ability to make additional sales under our ATM Program remains subject to continued compliance with applicable securities laws, Form S-3 and Rule 415 requirements, Nasdaq listing requirements, authorized share availability, market conditions, trading volume, share price, and other applicable limitations.

Under Nasdaq’s continued listing requirements, if the closing bid price of our Class A Common Stock is $0.10 or less for ten consecutive trading days, we may become subject to immediate delisting proceedings and trading in our securities could be suspended.

During July 2026, the closing bid price of our Class A Common Stock traded at or below $0.10, creating a risk that our securities could become subject to suspension and delisting proceedings.

On July 24, 2026, we effected a 1-for-150 reverse stock split, primarily to increase the per-share trading price of our Class A Common Stock, address the immediate risk associated with the low-price threshold and support our efforts to regain compliance with Nasdaq’s minimum bid price requirement.

The reverse stock split reduced the number of issued and outstanding shares without reducing the number of authorized shares.

The reverse stock split did not generate any cash proceeds and does not ensure that we will regain or maintain compliance with Nasdaq’s minimum bid price requirement or other continued listing standards.

Our ability to issue additional shares is constrained by authorized share limits and anti-dilution provisions in certain debt and equity instruments, which could increase share issuance requirements.

Although the reverse stock split did not increase the total number of authorized shares, it reduced the number of issued and outstanding shares and thereby increased the number of authorized but unissued shares available for potential future issuance.

Future equity issuances remain subject to contractual obligations, Nasdaq requirements, applicable securities laws, market conditions and the potential for substantial dilution.

Strategic Investment

1 unchanged sentence

This transaction was executed as part of a broader strategy to pursue non-automotive initiatives.

AIXC’s historical operations were immaterial to consolidated results for the three months ended March 31, 2026.

AIXC’s historical operations were immaterial to consolidated results for the three and six months ended June 30, 2026.

Risks Affecting Liquidity

3 unchanged sentences

Our capital raising efforts remain subject to Nasdaq listing standards, authorized share limitations, and anti-dilution features in existing instruments.

The July 24, 2026 reverse stock split does not eliminate the risks associated with our ability to regain and maintain compliance with Nasdaq’s continued listing standards or successfully access the capital markets.

Our liquidity is also influenced by supplier payment terms, advance deposit requirements, reliance on third-party partners, and capital market conditions affecting the electric vehicle industry.

3 unchanged sentences

Going Concern Determination

Despite management’s plans, our recurring operating losses and negative cash flows from operations raise substantial doubt about our ability to continue as a going concern within one year after the date these Unaudited Condensed Consolidated Financial Statements are issued, as contemplated by ASC 205-40.

Despite management’s plans, the completion of the Secured Streeterville Notes and the 2026 May Convertible SPA Notes financings, the filing of the replacement registration statement on Form S-3, our commencement of sales under of the ATM Program, the July 24, 2026 reverse stock split, the implementation of staff and temporary salary reductions, and our continued pursuit of other financing alternatives, our recurring operating losses and negative cash flows from operations raise substantial doubt about our ability to continue as a going concern within one year after the date these Unaudited Condensed Consolidated Financial Statements are issued, as contemplated by ASC 205-40.

Basis of Presentation

2 unchanged sentences

Sources of Liquidity

As of March 31, 2026, our principal source of liquidity was cash on hand totaling $12.2 million, which was held for working capital and general corporate purposes.

We also have access to various sources of additional capital, including the SEPA and the SPA Commitments.

Our ability to access these sources of capital and further information on amounts available is discussed in Note 2, Liquidity and Capital Resources and Going Concern, of the notes to the Unaudited Condensed Consolidated Financial Statements included in this Form 10-Q.

As of June 30, 2026, our principal source of unrestricted liquidity was cash and cash equivalents of $11.2 million, which was held for working capital and general corporate purposes.

We also had restricted cash of $42.7 million, substantially all of which was held in accounts subject to deposit account control agreements and was not generally available to fund our ordinary operating activities except in accordance with the applicable financing agreements.

We also may obtain additional capital including from potential sources, including, the SEPA and the SPA Commitments.

Our ability to access these sources of capital and further information regarding the amounts potentially available is discussed in Note 2, Liquidity and Capital Resources and Going Concern, of the notes to the Unaudited Condensed Consolidated Financial Statements included in this Form 10-Q.

Significant Related Party Notes Payable and Notes Payable Facilities

We have been significantly funded by notes payable from related parties and third parties.

The related parties include employees as well as affiliates of employees and affiliates and other companies controlled or previously controlled by our founder and sole Global Chief Executive Officer and Principal Executive Officer, Mr.

For more information on the outstanding related party notes payable and notes payable as well as the related schedules of maturities, see Note 8, Notes Payable , and Note 9, Related Party Transactions , of the notes to the Unaudited Condensed Consolidated Financial Statements included in this Form 10-Q.

The Company has entered into notes payable agreements with third parties.

The tables below summarize these agreements as of March 31, 2026 and December 31, 2025, providing details on contractual maturity dates, contractual interest rates, unpaid principal balances, fair value adjustments, original issue discounts, including proceeds allocated to warrants, and net carrying values.

On September 29, 2025,the Compan y obtained control of AIXC .

Accordingly, AIXC’s assets and liabilities, including its outstanding debt instruments, have been consolidated as of September 29, 2025.

The inclusion of AIXC’s debt in the consolidated balances below reflects the fair value of such obligations recognized upon initial consolidation.

Most of the Company’s notes payable are accounted for under the fair value option in accordance with ASC 825, with changes in fair value recorded in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

For instruments measured at fair value, no effective interest rate is presented, as changes in fair value capture all economic returns associated with these debt instruments.

Although the stated interest rates on the SPA Portfolio Notes are 10% or 15%, the Company’s effective cost of capital is substantially higher.

Each SPA Portfolio Note permits the holder to settle in shares at a value exceeding the stated principal and accrued interest.

In addition, each noteholder receives an SPA Portfolio Warrant, and certain holders receive an Incremental Warrant.

These settlement features and additional instruments have significant value and materially increase the effective cost of capital above the stated rates.

Further, these instruments carry high interest rate structures and embedded economics that can result in a loss on issuance.

The financial impact of the SPA Portfolio Notes is reflected in the change in fair value and loss on extinguishment line items in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

March 31, 2026

We have funded our operations through related-party and third-party notes payable, including the SPA Portfolio Notes, the Secured Streeterville Notes and the 2026 May Convertible SPA Notes.

See Note 8, Notes Payable, and Note 9, Related Party Transactions, for additional information, including outstanding balances and contractual maturities.

Notes Payable

The table below summarizes the Company’s third-party notes payable as of June 30, 2026.

The June 30, 2026 amounts include AIXC’s debt, which has been consolidated since September 29, 2025.

June 30, 2026

(in thousands) Contractual

3 unchanged sentences

Adjustments Original Issue Discount and Proceeds Allocated to Warrants Net

2023 Unsecured SPA Notes Various through March 2032 10 % - 15% $ 4,753 $ 78 $ (475) $ 4,356

2023 Unsecured SPA Notes Various through April 2032 10 % - 15% $ 4,500 $ 193 $ (450) $ 4,243

Junior Secured SPA Notes Various through December 2030 10% 4,727 (124) — 4,603

2024 Unsecured SPA Notes July 2030 10% 33 5 — 38

2025 March Unsecured SPA Notes Various through March 2031 10% 8,538 (2,393) (2,703) 3,442

2025 March Unsecured SPA Notes Various through June 2031 10% 8,538 (2,462) (2,703) 3,373

2025 July Unsecured SPA Notes August 2030 10% 14,738 (57) (3,026) 11,655

2 unchanged sentences

Due on Demand —% 4,421 — — 4,421

Secured Streeterville Notes April 2028 3.5%- 9% 45,780 (1,934) (750) 43,096

May 2026 Convertible Notes May 2027 8% 27,000 (1,444) (2,000) 23,556

$ 116,237 $ (7,380) $ (8,929) $ 99,928

1 unchanged sentence

Notes payable, long-term portion $ 71,951

The Company has entered into notes payable agreements with related parties.

The Company receives funding through notes payable from various parties, including related parties.

These related parties include employees, affiliates of employees, affiliates, and other companies controlled or previously controlled by the Company’s CEO, Mr.

The tables below summarize the related party note payable agreements as of March 31, 2026 and December 31, 2025, providing details on contractual maturity dates, contractual interest rates, and net carrying values.

March 31, 2026

Related Party Notes Payable

The table below summarizes the Company’s related party notes payable as of June 30, 2026 .

June 30, 2026

(in thousands) Contractual

7 unchanged sentences

Cash Flow Analysis

The following discussion summarizes the principal drivers of cash flows and changes in cash and restricted cash for the six months ended June 30, 2026 and 2025.

Six Months Ended June 30,

(in thousands) 2026 2025

7 unchanged sentences

Our operating cash flows are significantly affected by fluctuations in working capital components, including changes in personnel expenses, accounts payable, accrued interest, other current liabilities, deposits, and current assets.

For the three months ended March 31, 2026, net cash used in operating activities was $31.5 million, compared to $20.3 million for the same period in 2025, reflecting an $11.2 million increase in cash outflows.

Net loss increased by $32.0 million for the three months ended March 31, 2026, compared to the same period in 2025, reflecting an unfavorable year-over-year change in operating results.

For the six months ended June 30, 2026, net cash used in operating activities was $56.5 million, compared to $43.6 million for the same period in 2025, reflecting an $12.9 million increase in cash outflows.

Net loss decreased by $53.7 million for the six months ended June 30, 2026, compared to the same period in 2025, reflecting a favorable year-over-year change in operating results.

Non-cash adjustments:

Non-cash adjus tments increased by $33.5 million for the three months ended March 31, 2026 compared to the same period in 2025.

This increase was comprised of a $48.7 million decrease in gain from the Change in fair value of notes payable, warrant liabilities, and derivative liabilities, and a $1.9 million net loss on digital assets .

These adjustments were partially offset by a $9.4 million reduction in Depreciation and amortization expense and a $7.5 million decrease in Loss on settlement of notes payable.

Non-cash adjustments decreased by $52.3 million for the six months ended June 30, 2026 compared to the same period in 2025.

This decrease was primarily reflected of a $21.2 million reduction in Depreciation and amortization expense, a $22.1 million decrease in Loss on settlement of notes payable and a $7.0 million decrease in Change in fair value of related party notes payable, warrant liabilities, and derivative liabilities.

These adjustments were partially offset by a $5.7 million increase in goodwill and intangible impairment and a $2.9 million increase in Loss on digital assets, net.

Changes in working capital:

Changes in working capital were unfavorable by $12.7 million for the three months ended March 31, 2026 compared to the same period in 2025.

For the three months ended March 31, 2026, changes in working capital included a $0.5 million reduction in Related party accrued expenses and other current and non-current liabilities, and an $8.6 million reduction in Accrued expenses and other current and non-current liabilities.

Changes in working capital were unfavorable by $14.3 million for the six months ended June 30, 2026 compared to the same period in 2025.

For the six months ended June 30, 2026, changes in working capital included a $2.4 million reduction in Accounts payable, and an $11.1 million reduction in Accrued expenses and other current and non-current liabilities.

Investing Activities

Net cash provided in investing activities was $1.3 million for the three months ended March 31, 2026, compared to $1.6 million used for the same period in 2025, reflecting an increase of $2.8 million in cash provided by investing activities.

Net cash provided in investing activities was $0.2 million for the six months ended June 30, 2026, compared to $5.0 million used for the same period in 2025, reflecting an increase of $5.2 million in cash provided by investing activities.

The increase in cash was primarily attributable to a $2.1 million due to Sale of digital assets and decline of $3.3 million of Payments for property and equipment.

Financing Activities

Amid a challenging financing environment, we are actively seeking strategic opportunities to boost our cash reserves and support growth using a mix of convertible loans and non-con vertible funding.

For the three months ended March 31, 2026 ,

financing activities provided a net cash inflow of $7.8 million, compared to a net cash inflow of $24.6 million for the same period in 2025—a decline of $16.8 million.

This decline reflects lower financing proceeds in the current period compared to the prior-year period, as the Company continued to pursue financing in a challenging capital markets environment.

In 2026, proceeds from notes payable were $8.8 million, down by $13.2 million from $22.0 million in 2025.

Amid a challenging financing environment, we are actively seeking strategic opportunities to boost our cash reserves and support growth using a mix of convertible loans and non-con ver tible funding.

For the six months ended June 30, 2026, financing activities provided a net cash inflow of $76.4 million, compared to a net cash inflow of $55.1 million for the same period in 2025—an increase of $21.3 million.

This increase reflects higher financing proceeds in the current period compared to the prior-year period, as the Company continued to pursue financing in a challenging capital markets environment.

In 2026, proceeds from notes payable were $80.3 million, increase by $31.7 million from $48.6 million in 2025.

Effect of Exchange Rate Changes on Cash and Restricted Cash

The effect of exchange rates changes on cash and restricted cash was insignificant for the three months ended March 31, 2026, and 2025.

The effects of exchange rate changes on cash and restricted cash result from fluctuations in the translation of assets and liabilities denominated in foreign currencies, primarily Chinese Yuan.

The effect of exchange rates changes on cash and restricted cash was $1.1 million and $0.4 million for the six months ended June 30, 2026 and 2025.

The effects of exchange rate changes on cash and restricted cash result from fluctuations in the translation of assets and liabilities denominated in foreign currencies, primarily the Chinese Yuan.

Fluctuations in exchange rates against the U.S.

Dollar may positively or negatively affect our operating results.

Subsequent Financing Transactions

Subsequent to March 31, 2026, the Company completed additional private financing transactions, including the amended and restated Gold King Arthur Holding Limited securities purchase arrangement and the Streeterville Capital, LLC notes financing.

These transactions provided additional liquidity after quarter-end;

however, the Company continues to require substantial additional capital to fund operations, satisfy obligations, support production readiness and commercialization activities, and execute its business plan.

Off-Balance Sheet Arrangements

We did not have any material relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Thus, we did not have any off-balance sheet arrangements as of March 31, 2026 and December 31, 2025.

off-balance sheet arrangements or other contractually narrow or limited purposes.

Thus, we did not have any off-balance sheet arrangements as of June 30, 2026 and December 31, 2025.

Critical Accounting Estimates

The preparation of our Unaudited Condensed Consolidated Financial Statements for the three months ended March 31, 2026, in accordance GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of expenses during the reporting period.

The preparation of our Unaudited Condensed Consolidated Financial Statements for the three months ended June 30, 2026, in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of expenses during the reporting period.

Management bases these estimates on historical experience and on various other assumptions believed to be reasonable under the circumstances, the results of which form the basis for making judgments that are not readily apparent from other sources.

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What changed 10-Q

Item 2. Management’s Discussion and Analysis