SAN FRANCISCO - Serve Robotics Inc. (Nasdaq: SERV), a company specializing in autonomous delivery robotics, announced today that it has expanded its delivery operations into Koreatown, Los Angeles. This move is part of the company's strategy to extend its services across the U.S. Concurrently, Serve disclosed an augmented lidar supply agreement with Ouster, Inc. to enhance its robotic fleet's sensors, a key component in its scaling efforts.
Koreatown's dense commercial environment and growing residential community, along with its supportive sidewalk infrastructure, have been identified as ideal for Serve's robotic delivery services. The expansion aligns with ongoing collaborations between Serve and the Los Angeles city government, as well as local stakeholders. As of today, residents ordering through Uber (NYSE:UBER) Eats in Koreatown may receive their deliveries from a Serve robot.
To bolster its fleet, Serve has updated its agreement with Ouster, Inc. to include the latest REV7 sensors, which are expected to improve robot performance in terms of safety, speed, and cost-effectiveness. These upgrades are crucial as Serve prepares to deploy up to 2,000 robots by 2025.
Euan Abraham, Serve Robotics' Chief Hardware and Manufacturing Officer, expressed confidence in the extended partnership with Ouster, citing the improved technology as vital for their next-generation robot.
Serve Robotics, backed by major players like Uber and NVIDIA (NASDAQ:NVDA), was established as an independent entity from Uber in 2021. It aims to provide sustainable and economical delivery solutions through its AI-powered, low-emission sidewalk delivery robots.
The company has completed tens of thousands of deliveries for partners such as Uber Eats and 7-Eleven and holds scalable multi-year contracts, including plans to roll out a significant number of delivery robots on the Uber Eats platform in various U.S. markets.
In other recent news, Serve Robotics has announced significant developments in its growth strategy. The company has promoted Euan Abraham to the role of Chief Hardware & Manufacturing Officer, a move reflecting his substantial contributions to the firm. Abraham, with over two decades of experience in hardware design, is expected to drive innovation as Serve Robotics enters its next phase of growth.
In addition, Serve Robotics has solidified its partnership with Magna International (NYSE:MGA), one of the largest global automotive suppliers. This collaboration includes an exclusive contract manufacturing agreement that will allow Serve to expand its robot fleet for Uber Eats and other U.S. markets. As part of the agreement, Serve plans to introduce up to 2,000 robots on the Uber Eats platform across various U.S. locations.
These recent developments are part of Serve Robotics' strategic moves to enhance its robotic fleet and broaden the application of its robotics technology. The company's growth plan, backed by investors such as Uber and NVIDIA, includes deploying its AI-powered, low-emission robots in U.S. markets, supported by scalable multi-year contracts and a licensing partnership with Magna.
InvestingPro Insights
As Serve Robotics Inc. (Nasdaq: SERV) continues to expand its footprint in the autonomous delivery sector, financial metrics and market performance provide critical insights into the company's current standing. With a modest market capitalization of $66.93 million, Serve Robotics is navigating the competitive tech landscape with significant challenges. An InvestingPro Tip highlights the company's rapid cash burn, which is a crucial consideration for investors evaluating the sustainability of Serve's growth initiatives. Moreover, the company's stock has been subject to high price volatility, suggesting that investors may face substantial short-term risk.
In terms of financial health, Serve Robotics' gross profit margin stands at an alarming -53.99% for the last twelve months as of Q1 2024, reflecting inefficiencies or high costs relative to its revenue. The company's aggressive revenue growth of 742.6% during the same period indicates a potential for scalability, but this must be weighed against the substantial losses incurred. Additionally, the stock's performance has been disappointing, with a 92.72% decline over the last six months, bringing it close to its 52-week low.
Investors seeking a more in-depth analysis of Serve Robotics can find additional InvestingPro Tips that delve into aspects such as the company's debt levels, valuation multiples, and profitability. For instance, Serve does not pay dividends, which may deter income-focused investors. Those interested in exploring these insights further can benefit from an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro using the coupon code PRONEWS24. With 16 additional tips available, investors can gain a comprehensive understanding of Serve Robotics' potential and risks.
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