FARADAY FUTURE INTELLIGENT ELECTRIC INC. (FFAI)

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

All references in this Report to “FFAI,” the “Company,” “FF,”“we,” “us,” or “our” mean Faraday Future Intelligent Electric Inc., together with its consolidated subsidiaries. Unless the context otherwise requires, references to “Faraday Future Intelligent Electric Inc.” mean the parent company without its consolidated subsidiaries.

The following discussion and analysis is intended to help readers understand our results of operations and financial condition. This discussion and analysis is provided as a supplement to, and should be read in conjunction with our Unaudited Condensed Consolidated Financial Statements and Notes thereto included elsewhere in this Quarterly Report on Form 10-Q (this “Report” or this “Form 10-Q”). Some of the information contained in this discussion and analysis or set forth elsewhere in this Report, including information regarding to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from management’s expectations as a result of various factors, including but not limited to those discussed in the sections entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed on March 31, 2026 and “Cautionary Note Regarding Forward-Looking Statements” below. The objective of this section is to provide investors with an understanding of the financial drivers and levers of our business and to describe the financial performance of the business.

Cautionary Note Regarding Forward-Looking Statements

This Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements include, but are not limited to, any statements relating to our financial and business performance, market acceptance and success of our business model, our ability to expand the scope of our offerings, and our ability to comply with the extensive, complex, and evolving regulatory requirements. These statements are based on management's current expectations, but actual results may differ materially due to various factors.

The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control), and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the section titled “Risk Factors” in the Form 10-K for the year ended December 31, 2025 filed on March 31, 2026. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation (and expressly disclaim any obligation) to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. These risks and others described under the section titled “Risk Factors” Item 1A in the Form 10-K, filed on March 31, 2026, may not be exhaustive.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and developments in the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements contained in this Report. In addition, even if our results or operations, financial condition and liquidity, and developments in the industry in which we operate are consistent with the forward-looking statements contained in this Report, those results or developments may not be indicative of results or developments in subsequent periods.

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Overview

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 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.

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. 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.

Strategies

•Dual-Home Market Strategy: We have implemented a dual-home market strategy, integrating U.S.-based technological innovation and vehicle development with China’s supply chain and production capabilities.

•Third Pole Strategy: We have begun implementing a "third pole" strategy with an operational facility in the U.A.E., complementing our U.S. and China market approach.

•Dual-flywheel Strategy:

1.Product and Ecosystem Bridge – Focused on connecting our intelligent mobility operations with our broader EAI ecosystem, including intelligent electric vehicles, robotics, AI-enabled technology, and related platform initiatives. This strategy builds on the original FF Bridge Strategy launched in May 2024, which leverages our “Light 4, Swift 4, Focused 5, Empowering 5” model to combine global supply chain strengths with innovation in the United States. Management believes this approach supports FX, our mass-market brand, and may expand potential opportunities in the U.S. AIEV market.

2.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.

3.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

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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: We have implemented an initiative intended to reinforce management’s commitment to transparency, accountability, and long-term value creation, including share purchases by our leadership.

Technology & Innovation

•Our Proprietary VPA: We have designed and developed our proprietary Variable Platform Architecture (“VPA”), a mobility platform designed to enable scalable vehicle development across multiple segments.

•Propulsion System: Our propulsion system is designed to support vehicle acceleration, range, and efficiency through our inverter design and integration with our AI-powered user experience.

•I.A.I Technology: 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.

•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 approximately 656 patents globally.

AIEV Product & Pipeline

•FF 91: We believe the FF 91 Futurist (the “FF 91,” “FF 91 Futurist,” or “FF 91 2.0 Futurist Alliance”) is one of the first ultra-luxury electric vehicles designed to offer a highly personalized, fully connected user experience for drivers and passengers. We began production of the FF 91 2.0 Futurist Alliance and commenced deliveries in 2023. As part of our delivery plan, we are continuing limited FF 91 deliveries to select users while reallocating resources, manufacturing capacity, and engineering efforts toward the planned FF 92 upgrade and the FX Super One. Our strategy emphasizes continued FF 91 deliveries together with development of the FF 92, while the

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Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

All references in this report to “FFAI,” the “Company,” “FF,”“we,” “us,” or “our” mean Faraday Future Intelligent Electric Inc., together with its consolidated subsidiaries. Unless the context suggests otherwise, references to “Faraday Future Intelligent Electric Inc.” mean the parent company without its subsidiaries.

The following discussion and analysis is intended to help the reader understand our results of operations and financial condition. This discussion and analysis is provided as a supplement to, and should be read in conjunction with our Consolidated Financial Statements and Notes thereto included elsewhere in this Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-K, including information with respect to our plans and strategy for our business, include forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from management’s expectations as a result of various factors, including but not limited to those discussed in the section titled “Risk Factors” in Item 1A above and “Cautionary Note Regarding Forward Looking Statements” below. The objective of this section is to provide investors an understanding of the financial drivers and levers in our business and describe the financial performance of the business.

Cautionary Note Regarding Forward-Looking Statements

This Form 10-K includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,”

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“expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements include, but are not limited to, any statements relating to our financial and business performance, market acceptance and success of our business model, our ability to expand the scope of our offerings, and our ability to comply with the extensive, complex, and evolving regulatory requirements. These statements are based on management's current expectations, but actual results may differ materially due to various factors.

The forward-looking statements contained in this Form 10-K are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting the Company may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control), and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the section titled “Risk Factors” in Item 1A above. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation (and expressly disclaim any obligation) to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. These risks and others described under the section titled “Risk Factors” in Item 1A above may not be exhaustive.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and developments in the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements contained in this Report. In addition, even if our results or operations, financial condition and liquidity, and developments in the industry in which we operate are consistent with the forward-looking statements contained in this Form 10-K, those results or developments may not be indicative of results or developments in subsequent periods.

Overview

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 Gardena, California area, we design and engineer next-generation intelligent, connected electric vehicles. We manufacture vehicles at the FF aiFactory California production facility in Hanford, California. We also have additional engineering, sales, and operational capabilities in China and are exploring potential manufacturing opportunities there through a joint venture or other arrangements. 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.

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. The shift in strategy from relying primarily on the FF 91 platform, the elimination of federal tax credits for electric vehicles effective September 30, 2025, and escalating U.S.-China trade tensions and potential restrictions on critical materials resulted in the Company recording an asset impairment of $128.9 million during the year ended December 31, 2025. 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.

The Company has also begun implementing an embodied AI robotics strategy intended to complement its intelligent mobility ecosystem. This initiative is focused on the development and potential commercialization of robotics products that may leverage the Company’s AI, sensor, and software capabilities developed for its vehicles. Initial robotics concepts have been introduced, and early-stage commercialization activities are underway. Management views embodied AI robotics as a

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potential extension of the Company’s EAI ecosystem, connecting intelligent vehicles, an EAI brain and open-source, open-platform framework, and a decentralized AI data factory to support long-term technology commercialization efforts.

During the year ended December 31, 2025, we consolidated AIXC, a newly acquired entity with operations in the life sciences sector. AIXC’s common stock is listed on Nasdaq under the ticker symbol “AIXC.” While AIXC is currently immaterial to our operating results, we intend to use it as a platform for evaluating emerging technology initiatives, including blockchain infrastructure and digital asset platform development that may complement the Company’s broader ecosystem strategy.

Company Strategies

•Dual-Home Market Strategy: We have implemented a dual-home market strategy, integrating U.S.-based technological innovation and vehicle development with China’s supply chain and production capabilities.

•Third Pole Strategy: We have begun implementing a "third pole" strategy with an operational facility in the U.A.E., complementing our U.S. and China market approach.

•Dual-flywheel Strategy:

1.Product and Ecosystem Bridge – Focused on connecting the Company’s intelligent mobility operations with emerging digital asset and Web3 initiatives. This strategy builds on the original FF Bridge Strategy launched in May 2024, which leverages the Company’s “Light 4, Swift 4, Focused 5, Empowering 5” model to combine global supply chain strengths with innovation in the United States. Management believes this approach supports FX, the Company’s mass-market brand, and may expand potential opportunities in the U.S. AIEV market.

2.Digital Asset and Web3 Bridge – Focused on integrating real-world business operations with on-chain assets and related blockchain-based initiatives. In August 2025, the Company launched its Dual-Bridge Ecosystem Strategy to support AI mobility and Web3 integration. The Company is evaluating initiatives such as the EAI Vehicle Chain, which is intended to support tokenized vehicle sales, crypto-based deposits, and Web3-native user engagement, while using blockchain technology to promote a more decentralized and transparent mobility ecosystem.

•Stockholder Initiative: We have implemented an initiative intended to reinforce management’s commitment to transparency, accountability, and long-term value creation, including share purchases by the Company’s leadership.

Technology & Innovation

•Our Proprietary VPA: We have designed and developed a breakthrough mobility platform—our proprietary VPA, which enables scalable vehicle development across multiple segments.

•Propulsion System: Our propulsion system provides a competitive edge in acceleration and range, enabled by an industry-leading inverter design and a propulsion system integrated with our AI-powered user experience.

•I.A.I Technology: 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 the Company’s evolving ecosystem strategy, which includes embodied AI robotics initiatives and the exploration of blockchain infrastructure and digital asset platform technologies through AIXC.

•Intellectual Property: Since inception, we have developed a portfolio of intellectual property, established a global team of automotive and technology experts. As of December 31, 2025, FF has been granted approximately 656 patents globally.

AIEV Product & Pipeline

•FF 91: We believe the FF 91 Futurist (the “FF 91,” “FF 91 Futurist,” or “FF 91 2.0 Futurist Alliance”) is one of the first ultra-luxury electric vehicles designed to offer a highly personalized, fully connected user experience for drivers and passengers. We began production of the FF 91 2.0 Futurist Alliance and commenced deliveries in 2023. As part of our delivery plan, we are continuing limited FF 91 deliveries to select users while reallocating resources, manufacturing capacity, and engineering efforts toward the planned FF 92 upgrade and the FX Super One. Our strategy emphasizes continued FF 91 deliveries together with development of the FF 92, while the FX brand leverages the Super One to enter the U.S. multi-purpose vehicle market.

•FF 92: We are developing the FF 92 as the next-generation ultra-luxury electric vehicle built on the FF 91 platform, designed to maintain our leading edge in product and technology in the ultra-spire segment as part of a planned FF 92 upgrade program. The FF 92 remains in the research and development stage and has not yet entered commercial

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production.

•FX Super One: We are developing the FX Super One as the first “First Class AI‑MPV” under the FX brand, blending luxury and versatility in an AI‑powered multi‑purpose vehicle. The FX Super One is designed to serve visionaries and families, combining a spacious cabin with flexible four‑, six‑ or seven‑seat configurations and advanced AI features. It incorporates the world’s first Super EAI F.A.C.E. system—a customizable front LED display that can serve as an expressive “face” and extend the user’s presence—and is built on FF’s EAI 6×4 technology platform. The vehicle offers both pure battery‑electric and AI hybrid extended‑range powertrain options, intelligent all‑wheel drive, and an expansive interior with zero‑gravity seats, a multi‑source sensor suite for proactive safety, and an EAI operating system that supports voice, gesture and immersive multimedia interaction. With a target of delivering “twice the performance at half the price” and creating a new “First Class AI‑MPV” market in the U.S. and Middle East, the FX Super One is currently in development; pilot production and regulatory preparations are under way.

•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. 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.

The Company is evaluating digital asset and blockchain-related initiatives as part of its broader Eco 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.

Digital Asset Platform Initiatives

•The Company is evaluating digital asset and blockchain-based platform capabilities through its controlling interest in AIXC, which was obtained in September 2025, and related ecosystem initiatives. These efforts are intended to support potential Web3 applications, decentralized infrastructure, and digital asset–related services that may complement the Company’s broader intelligent mobility ecosystem.

•The Company is exploring blockchain infrastructure and digital asset platform technologies that could enable secure data management, digital identity, and decentralized applications associated with connected vehicles and user engagement platforms. These initiatives remain in the early development stage and have not yet generated material revenues.

Embodied AI Robotics Initiatives

•The Company has also begun 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 the Company’s AI perception, control systems, and autonomous computing architecture into robotics applications.

Manufacturing & Distribution

•FF Series Manufacturing: The FF 91 Series is currently being manufactured in FF aiFactory California.

•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.

•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 the Company’s 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.

Recent Developments

The following summarizes certain developments occurring from January 1, 2025 through the filing date of this report that relate to the Company’s operations, financing activities, and corporate initiatives.

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AIEV - Strategic Operations and Product Development

•In March 2025, we hosted FF Open AI Day and unveiled our Personalized AI and Bespoke AI systems. These innovations are part of our All-AI Mobility Ecosystem. Personalized AI is designed to learn and adapt to user preferences across vehicle controls, comfort, and interaction styles. Bespoke AI delivers co-created, premium user interfaces and intelligent services tailored for luxury users, acting as a digital concierge. Both systems are built on large-model AI architecture and are planned for integration into the FF 91 and FX series.

•In March 2025, Future AIHER AI Hybrid Extended-Range Electric Powertrain System Inc. was incorporated in the State of Delaware as a subsidiary of the Company.

•In April 2025, the Company entered into a B2B vehicle reservation agreement with JC Auto, a New York City–based dealership operating as 129 Auto Sales Corp., for up to 1,000 FX Super One vehicles, including a $100,000 non-refundable deposit and priority delivery of up to 300 vehicles subject to future production, pricing and delivery schedules.

•In May 2025, the Company entered into a second B2B pre-order agreement with Sky Horse Auto LLC—a California-based premium mobility provider—for up to 300 FX Super One vehicles, supported by a $30,000 non-refundable deposit and priority delivery; subject to future production, pricing and delivery schedules.

•In May 2025, the Company disclosed it had secured non-binding fleet reservation deposits totaling 1,300 FX Super One vehicles, including prior agreements with JC Auto and Sky Horse Auto, reflecting growing demand from U.S. mobility operators.

•In May 2025, the Company secured 600 additional B2B deposits from U.S.-based multi-channel network ("MCN") agencies CreatoRev and Good Deal, bringing total FX Super One B2B deposits to over 2,500 units.

•In May 2025, the Company began deploying FF 91 AI and software technologies, including a voice interaction system based on large language models, into the FX product line.

•In May 2025, the Company expanded its U.S. and Middle East operations, with its Ras Al Khaimah (RAKEZ) facility in the U.A.E. ready for occupancy and targeted FX Super One production in the region contingent on funding. The strategy supports regulatory streamlining, market training, and regional investor interest.

•In July 2025, the Company publicly unveiled the FX Super One at a launch event in Los Angeles, introducing its F.A.C.E. LED display technology and Super EAI ecosystem. The Company reported receiving more than 10,000 reservation deposits and expressions of customer interest for the vehicle as it advances toward future production readiness.

•In August 2025, the Company stated its focus on expanding its FX and FF 91 model lines, emphasizing broader market reach by introducing luxury technology from the FF 91 into future mass-production FX vehicles.

•In September 2025, the Company advanced its global expansion by preparing its Ras Al Khaimah (U.A.E.) operations to support the FX Super One program under its Global Automotive Bridge Strategy, while continuing to evaluate digital platform initiatives associated with its broader Eco Artificial Intelligence (“EAI”) ecosystem strategy.

•In November 2025, the Company disclosed that its future FF and FX battery electric vehicles, beginning with new models from 2026, will adopt the North American Charging System (“NACS”) port, providing future users with direct access to more than 28,000 Tesla Superchargers across the United States, Canada, Japan, and South Korea, while maintaining access to existing CCS fast-charging networks through operators such as ChargePoint and EVgo.

•In November 2025, the Company reported that the FX Super One program has received reservation deposits and non-binding indications of interest for more than 11,000 vehicles in the United States and more than 200 vehicles in the United Arab Emirates, including from B2B fleet customers, as the Company continues development of the FX Super One program.

•In November 2025, the Company noted that it had successfully completed the first round of safety testing for upper interior occupant impact protection for the FX Super One as part of the broader safety assessment and homologation process for the vehicle.

•In December 2025, the Company reported operational progress related to the FX Super One program, including the arrival of initial vehicle components at its Hanford, California manufacturing facility and preparations for the first pre-production vehicle roll-off event scheduled for December 21, 2025. The Company also disclosed that its Board of Directors conditionally approved a five-year production plan targeting cumulative production and sales of approximately 400,000 to 500,000 vehicles, subject to securing additional financing and strategic partner agreements.

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•In February 2026, GlobeX AI Hong Kong Holding Limited, a special purpose entity controlled by the Company, entered into a Strategic Cooperation Agreement and an engineering services agreement with Hebei Huanzhou Automobile Sales Co., Ltd. in connection with the development, component procurement and engineering support for a battery electric version of the FX Super One for the U.S. market.

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. and the launch of its first three robotics product lines: FF Futurist, FF Master, and FX Aegis. 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.

AIXC - Strategic Operations and Product Development

▪In August 2025, the Company disclosed the development of the C10 Index and related Crypto + EAI application framework, with real-time index tracking expected to be available on FF.com and the FF App.

▪In September 2025, the Company reported progress on developing the C10 Crypto Treasury Index, an internal initiative under evaluation that may involve digital asset index tracking and related platform capabilities within the Company’s broader ecosystem strategy.

▪In September 2025, the Company disclosed plans to establish a separate entity to pursue digital asset–related initiatives as part of its broader ecosystem strategy. This initiative is intended to evaluate potential applications of blockchain infrastructure and digital asset technologies that could complement the Company’s intelligent mobility ecosystem.

▪In September 2025, the Company completed a strategic $30 million investment in AIXC as the lead investor in a $41 million PIPE transaction related to digital asset platform initiatives, through which the Company obtained controlling interest of AIXC. Following stockholder approval, AIXC may pursue initiatives related to digital asset infrastructure and platform development aligned with the Company’s broader ecosystem strategy.

The following summarizes certain significant financing activities during the period. Additional details regarding the Company’s debt and financing arrangements are included in Notes 8 and 9 to the consolidated financial statements.

AIEV - Capital Raising & Financing Agreements

•In December 2025, the Company entered into warrant termination agreements with certain holders of outstanding warrants previously issued in connection with several securities purchase agreements, including financings completed in May 2023, September 2024, December 2024, March 2025, and July 2025. Pursuant to these agreements, the Company and the applicable warrant holders agreed to terminate specified warrants to purchase shares of the Company’s Class A common stock. Upon execution of the agreements, the terminated warrants and all related rights were cancelled and ceased to have any further force or effect. The agreements were entered into as part of the Company’s ongoing efforts to simplify its capital structure and manage potential future dilution.

•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.

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

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to settle certain previously assigned debt obligations for an aggregate settlement amount of RMB 25.4 million (approximately $3.5 million), payable in installments through December 31, 2028.

AIXC - Capital Raising & Financing Agreements

•In August 2025, the Company disclosed plans to pursue financing dedicated to digital asset initiatives, including potential purchases of crypto assets, subject to the Company obtaining sufficient financing.

•In August 2025, the Company entered into a strategic partnership with HabitTrade, a digital-asset infrastructure firm, to support development of blockchain components as part of the Company’s broader ecosystem initiatives.

•In August 2025, the Company disclosed it is exploring a C10 ETF concept tied to the newly disclosed index.

•In September 2025, the Company outlined a proposed structure intended to establish an independent capital platform to support blockchain and digital asset initiatives while maintaining Faraday Future’s controlling interest in the platform.

•In September 2025, Faraday Future invested approximately $30 million in AIXC at an effective price of $2.246 per share, resulting in beneficial ownership of approximately 55% of AIXC’s common stock. Global Co-CEO YT Jia also invested approximately $4 million under a voluntary two-year lock-up agreement.

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

AIEV - Stock Exchange Compliance & Stockholder and Corporate Actions

•In March 2025, we changed our Nasdaq ticker symbol to “FFAI”.

•In May 2025, the Company disclosed that Global Co-CEO YT Jia and President Jerry Wang each adopted SEC Rule 10b5-1 stock purchase plans, with trades expected to begin in August 2025. Mr. Jia completed purchases totaling $560,000 during the quarter ended September 30, 2025, and Mr. Wang purchased 10,600 shares before his plan was cancelled by the broker.

•In June 2025, Mr. Koti Meka, Chief Financial Officer, adopted a Rule 10b5-1 trading plan on June 12, 2025, providing for the purchase of up to $20,000 of the Company’s Class A Common Stock. Before the plan was cancelled by the broker, Mr. Meka purchased no shares of the Company’s Class A Common Stock under this trading plan.

•In July 2025, the Company and certain executives, including Global Co-CEO Yueting Jia and President Jerry Wang, received Wells Notices from the SEC indicating that SEC staff is considering recommending enforcement action relating to alleged statements made in connection with the Company’s 2021 PIPE and SPAC transactions.

•In August 2025, the Company issued one share of Series A Preferred Stock to its Chief Executive Officer, Matthias Aydt. The Series A Preferred Stock carries special voting rights and provides voting power of 3,000,000,000 votes per share as set forth in the Series A Certificate of Designation.

•In August 2025, the Company disclosed that Founder and Global Co-CEO Yueting Jia and Global President Jerry Wang executed purchases of Company common stock under pre-established Rule 10b5-1 trading plans.

•In August 2025, additional share purchases by Company leadership, including CFO Koti Meka and FX CEO Xiao (Max) Ma, were scheduled pursuant to their existing Rule 10b5-1 trading plans adopted in June 2025.

•In September 2025, the Company disclosed that it successfully completed Nasdaq’s one-year compliance monitoring period and regained full compliance.

•In September 2025, all core proposals, other than a pending name change, were approved at the Company’s special meeting of stockholders.

•In November 2025, the Company issued a correction to a previously furnished earnings release to clarify that certain preliminary financial information included in the release differed from the final financial results presented in the Company’s Form 10-Q for the quarter ended September 30, 2025. The Company indicated that additional adjustments were identified during the completion of its quarter-end close and review process and that the financial information presented in the Form 10-Q represents the Company’s final results for the period.

•In December 2025, the Company filed a Certificate of Designation creating one share of Series A Preferred Stock and issued that share to Matthias Aydt for $100 pursuant to a purchase agreement. The share carried 7,000,000,000 votes, but only with respect to the Share Authorization Proposal; those votes were required to be cast in the same proportion as votes cast by holders of common stock on that proposal, and the share had no other voting rights except as required by Delaware law.

•In February 2026, the Company held a special meeting of stockholders at which stockholders approved an increase in the Company’s authorized shares to support capital planning, FX Super One vehicle milestones, and expansion of

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embodied artificial intelligence (“EAI”) robotics initiatives. On February 18, 2026, the Company filed a Certificate of Amendment to increase its authorized Class A common stock from 232,470,985 shares to 312,285,439 shares and its authorized preferred stock from 17,931,000 shares to 24,087,265 shares. The additional authorized share capacity is intended to support near-term capital planning needs, existing obligations to issue shares of Class A common stock, and potential future financings, strategic transactions, stock issuances pursuant to employee benefit plans, and other proper corporate purposes aligned with the Company’s 2026 business strategy. The approval relates solely to the authorization of additional shares and does not, by itself, result in the issuance of any shares.

•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.

•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 Global Co-Chief Executive Officer Yueting Jia and Global President Jiawei (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.

•In March 2026, the Company received a notice from Nasdaq indicating that it was not in compliance with the minimum bid price requirement under Nasdaq Listing Rule 5550(a)(2), because the closing bid price of its Class A common stock remained below $1.00 per share for 30 consecutive trading days. 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.

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

Corporate Governance

•In March 2025, Jerry Wang was promoted to Global President of the Company.

•In April 2025, Yueting Jia, our founder, was promoted to Global Co-Chief Executive Officer (“Global Co-CEO”) and will co-lead the Company alongside Matthias Aydt.

•In May 2025, the Company formalized YT Jia’s appointment as Global Co-CEO under a “Stockholders First” equity incentive plan.

•In August 2025, the Board approved temporary governance adjustments during the SEC investigation, assigning primary oversight of finance, legal, accounting, and public reporting functions to Global Co-CEO Matthias Aydt during the pendency of the investigation.

•In August 2025, the Company reported formation of a wholly owned subsidiary, FFAI Crypto Treasury and Bridging Holdings Inc., related to its digital asset initiatives.

•In September 2025, Global Co-CEO Yueting Jia completed the second tranche of stock purchases under his Rule 10b5-1 plan, investing approximately $180,000 of his signing bonus to demonstrate confidence in FF’s long-term strategy and stockholder alignment.

•In September 2025, Global Co-CEO Yueting Jia completed purchases of the Company’s common stock under his Rule 10b5-1 trading plan totaling approximately $740,000.

•In September 2025, the Board approved the foundational steps for the spin-off entity and delegated management authority to oversee its implementation and compliance planning in alignment with U.S. regulatory standards for digital assets.

•In November 2025, AIXC held a special meeting of stockholders approving the Subscription Agreement and related share issuances, enabling the Company to obtain a majority ownership position in AIXC and designate a majority of the reconstituted board of directors.

•In November 2025, following stockholder approval, AIXC filed a Certificate of Amendment to change its corporate name to AIxCrypto Holdings, Inc.

•In December 2025, the Audit Committee of the Board of Directors approved the dismissal of Macias Gini & O’Connell LLP (“MGO”) as the Company’s independent registered public accounting firm and the appointment of HTL International, LLC as the Company’s new independent registered public accounting firm. MGO’s audit report on the Company’s consolidated financial statements for the year ended December 31, 2024 did not contain an

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adverse opinion or disclaimer of opinion and was not qualified or modified as to accounting principles or auditing scope, but included an explanatory paragraph regarding substantial doubt about the Company’s ability to continue as a going concern. The Company reported that there were no disagreements with MGO on accounting principles or practices, financial statement disclosure, or auditing scope or procedures during the relevant reporting periods. MGO provided a letter to the Securities and Exchange Commission stating that it agreed with the statements made by the Company regarding the change in auditors.

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

Supply Chain Exposure and Tariff Risk

As of December 31, 2025, 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 year ended December 31, 2025, the Company increased it lower-of-cost-and-net-realizable-value inventory reserve by $17.8 million, bringing the total reserve to $21.1 million as of December 31, 2025, compared to $3.3 million as of December 31, 2024. Of the increase recorded during 2025, approximately $13.3 million related to market conditions, including anticipated tariffs and higher transportation costs, and approximately $4.6 million related to excess and obsolete inventory identified during the period.

While supply-chain conditions, including tariffs and logistics costs, were considered in the valuation of inventory, the increase in the reserve was also influenced by the Company’s evolving product strategy, including a greater focus on development of the FX Super One platform and reduced emphasis on the FF 91 program. Because U.S. tariff policies continue to evolve, 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.

Segment Information

We haves two operating segments—AI Electric Vehicle (“AIEV”), and digital assets — both segment meet the criteria for separate reporting under ASC 280. Through August 12, 2025, our two Global Co-Chief Executive Officers (“Global Co-CEOs”), acting jointly serving as Co-Chief Operating Decision Makers (“CODMs”), and regularly evaluated the Company’s financial performance using consolidated financial information at the total-company level including consolidated loss from operations, cash flows, liquidity, and strategic initiatives. Effective August 13, 2025, in connection with temporary governance adjustments approved by the Board, Mr. Matthias Aydt serves as our sole CODM for purposes of ASC 280.

Management has identified Loss from operations, as presented in our 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. This measure is critical for a going concern that must carefully manage its cash outflows, particularly given that the timing of its cash inflows is influenced by external investor decisions. 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 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. The CODM, works in close collaboration with our business leaders to establish critical operational targets, sets project timelines, and adjusts 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. This rigorous oversight supports the our strategic objectives to focus business activities on production, sales, and leasing of its FF 91 vehicles, the planned FF 92 upgrade program, and the commercialization of the FX Series vehicles.

During 2025, the Company acquired a controlling interest in AIXC, and the acquisition closed on September 29, 2025. Accordingly, AIXC’s results were included in the Company’s consolidated financial statements only from the acquisition date through December 31, 2025. The Company intends to use AIXC as the platform for future crypto-related initiatives; however, no active crypto operations were conducted during 2025, and the Company liquidated its crypto holdings to help fund the AIXC

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transaction. (For further information see Note 3 - Business Acquisition - Consolidation of AIXC, and Note 1 - Nature of Business and Organization).

Components of Our Results of Operations

Key Factors Affecting Operating Results

Our performance and future success depend on several factors that present significant opportunities but also pose risks and challenges including those discussed below and, in the section, titled “Risk Factors” in Item 1A included elsewhere in this annual report.

Production and Operations

We expect to continue to incur significant operating costs that will impact our future profitability, including R&D expenses as we introduce new models and improve existing models; capital expenditures for the expansion of our manufacturing capacities; additional operating costs and expenses for production ramp-up; raw material procurement costs; general and administrative expenses as we scale our operations; interest expense from debt financing activities; and selling and distribution expenses as we builds our brand and markets our vehicles. We may incur significant costs in connection with our services as we deliver at scale the FF 91 Futurist, including servicing and warranty costs. Our ability to become profitable in the future will depend on our ability to successfully market our vehicles and control our costs.

Through December 31, 2025, we have sold eleven and leased twelve vehicles. As a result, we will require substantial additional capital to develop products and fund operations for the foreseeable future. Until we can generate sufficient revenue from product sales, we will fund our ongoing operations through a combination of various funding and financing alternatives, including equipment financing of the FF aiFactory California, secured syndicated debt financing, convertible notes, working capital loans, and equity offerings, among other options. The particular funding mechanisms, terms, timing, and amounts are dependent on our assessment of opportunities available in the marketplace and the circumstances of the business at the relevant time. Any delays in the successful completion of its FF aiFactory California will impact our ability to generate revenue. For additional discussion of the substantial doubt about our ability to continue as a going concern, see Note 2, Liquidity and Capital Resources and Going Concern in the notes to the Consolidated Financial Statements and for further details on liquidity, please see the “Liquidity and Capital Resources” section below.

Revenue and Cost of Revenue

Automotive Sales Revenue

We began the production of our FF 91 Futurist in March 2023 and started making deliveries to customers in August 2023 and have delivered four vehicle during the year ended December 31, 2025.

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.

We recognize revenue on automotive sales upon delivery to the customer, which is when control of vehicle transfers. Payments are typically received at the point control transfers or in accordance with payment terms customary to the business and as indicated in the sales contract. OTA software updates are provisioned upon transfer of control of a vehicle and recognized over time on a straight-line basis as we have a stand-ready obligation to deliver such services to the customer. For obligations related to automotive sales, we estimate the standalone selling price by considering costs used to develop and deliver the good or service, third-party pricing of similar options and other information that may be available. The transaction price is allocated among the performance obligations in proportion to the standalone selling price of our performance obligations. Vehicle contracts do not contain a significant financing component.

Revenue from immaterial promises is combined with the vehicle performance obligation and recognized when the product has been transferred. We accrue costs to transfer these immaterial goods and services regardless of whether they have been transferred.

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 was immaterial to our Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2025.

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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. 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. The resulting net amount is recorded as marketing expense. In situations where the net amount is less than the vehicle’s sale price or the contractual lease payment, the difference between the net amount and the sale price or lease payment is recognized as revenue.

Automotive Leasing Revenue

Revenue from Operating Leasing Program

We have outstanding leases under our vehicle operating leasing program in the U.S. Qualifying customers are permitted to lease a vehicle for up to 36 months. At the end of the lease term, customers are generally required to return the vehicles to us. We account for these leasing transactions as operating leases. We evaluate whether a lease contract should be combined with other agreements — such as co-creation arrangements when leasing contracts are negotiated together and are economically interdependent. 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 December 31, 2025, 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.

Revenue from Sales-Type Leasing Program

We have outstanding leases accounted for as sales-type leases under accounting standards codification (“ASC”) 842, Leases (“ASC 842”). Customers have the right to purchase the vehicle at the end of the lease term, which is usually 36 months. A customer qualifies under this program if the purchase option is reasonably certain to be exercised, and we therefore expect the customer to take title to the vehicle at the end of the lease term after making all contractual payments. We recognize all revenue and costs associated with the sales-type lease as automotive leasing revenue and automotive leasing cost of revenue, respectively, upon delivery of the vehicle to the customer when collectability of lease payments is probable at lease commencement. If collectability of lease payments is not probable at commencement, we recognize the lease payments as deposit liability and do not derecognize the leased vehicle until such point that collectability of lease payments becomes probable. We evaluate whether a lease contract should be combined with other agreements — such as co-creation arrangements when leasing contracts are negotiated together and are economically interdependent.

Customer Deposits

Our customers may reserve a vehicle and 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 $3.0 million as of December 31, 2025 and December 31, 2024, 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. Such advance payments are considered non-refundable, and we defer revenue related to any products or services that are not yet transferred.

As of December 31, 2025, the Company had received approximately 13,600 non-binding, non-refundable B2B reservation deposits and 536 B2C non-binding refundable reservations, totaling 14,136 reserved vehicles. By comparison, as of December 31, 2024, the Company had received 299 B2C reservations. The increase in total reservations was primarily driven by the launch of the FX Super One vehicle and the expansion of co-creator and reservation programs designed to drive early engagement and demand. The co-creator program leverages early supporters, channel partners, and social media influencers to generate awareness, promote product visibility, and build community participation around the brand and its new product offerings with a particular focus on driving B2C orders.

The Company enters into co-creation collaborations of varying value and service scope with B2B pre-order customers. Fees paid to non-influencer participants are recorded as co-creation expenses, while fees paid to influencer marketing agencies are classified either as contra-revenue or as marketing-related general and administrative expenses, depending on the nature of the arrangement. Co-creator costs are recorded as marketing expenses when the fair value of services provided under the co-creation agreement substantiates the payment; however, any portion of the payment that exceeds the fair value of those services is treated as a reduction of revenue in accordance with ASC 606.

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Deferred Revenue

Deferred revenue is equivalent to the total transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, as of the balance sheet date. Deferred revenue related to products and services was insignificant as of December 31, 2025 and December 31, 2024.

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.

Cost of Automotive Leasing Program

Cost of automotive leasing revenue includes the depreciation of operating lease vehicles, cost of goods sold associated with direct sales-type leases and warranty expense related to leased vehicles.

Warranties

We provide a manufacturer’s warranty on all vehicles sold. The warranty covers the rectification of reported defects via repair, replacement, or adjustment of faulty parts or components. The warranty does not cover any item that fails due to normal wear and tear. This assurance-type warranty does not create a performance obligation separate from the vehicle. Management tracks warranty claims by vehicle ID, owner, and date. As we continue to manufacture and sell more vehicles we will reassess and evaluate our warranty claims for purposes of our warranty accrual.

Operating Expenses

Research and Development

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. 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. While we have substantially completed R&D activities related to the FF 91, we expect R&D expenses to increase in the near future due to increased R&D activities related to the FF 92 and FX series vehicles.

Sales and Marketing

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.

General and Administrative

General and administrative expenses consist primarily of personnel-related costs (including salaries, bonuses, benefits, and stock-based compensation) for employees associated with administrative services such as legal, human resources, information technology, accounting and finance, other related costs, and legal loss contingency expenses, which are our estimates of future legal settlements. These expenses also include certain third-party consulting services, certain facilities costs, and any corporate overhead costs not allocated to other expense categories. We expect our general and administrative expenses to increase as we continue to grow our business.

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Loss from Disposal of Property, Plant and Equipment

Loss on disposal of property, plant, and equipment relates to the abandonment of certain FF 91 Futurist program construction in progress assets, primarily vendor tooling, machinery, and equipment, due to the redesign of the related FF 91 components and implementation of our cost reduction program. Charges associated with disposals are recognized within operating expenses in the Consolidated Statements of Operations and Comprehensive Loss.

Asset Impairment

We record impairments in operating expenses related to deposits for future goods and services, property, plant, and equipment based on tangible-asset valuations, and lease right-of-use assets associated with facility exits and changes in our long-term operating plans. Charges associated with impairment of assets are recognized within operating expenses in the Consolidated Statements of Operations and Comprehensive Loss.

When we identify impairment indicators under ASC 360—such as changes in regulatory incentives, evolving macroeconomic and geopolitical conditions, market-based indicators of our enterprise value, or updates to our product and manufacturing roadmap—we evaluate the recoverability of our long-lived assets and, when necessary, record impairment charges to reduce their carrying values to estimated fair value. In the third quarter of 2025, this process resulted in impairment charges on certain long-lived assets, including tooling, machinery, equipment and related assets at vendor sites and at the FF aiFactory California facility in Hanford, California.

Impairment of Goodwill and Intangible Assets

We record impairments within operating expenses related to goodwill and intangible assets when the carrying value of a reporting unit or asset exceeds its estimated fair value. Goodwill associated with the AIXC reporting unit arose from the Company’s acquisition of AIXC and is tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable. Intangible assets primarily consist of acquired in-process research and development and other identifiable intangible assets, which are evaluated for impairment in accordance with applicable accounting guidance. Impairment charges related to goodwill and intangible assets are recognized within operating expenses in the Consolidated Statements of Operations and Comprehensive Loss.

Credit Loss Expense

We record credit loss expense related to financial assets measured at amortized cost, including short-term notes receivable, in accordance with ASC 326 (Current Expected Credit Losses). Credit losses are estimated using forward-looking information that considers historical experience, current conditions, and reasonable and supportable forecasts regarding the collectability of the underlying receivables. The Company, through its acquisition of AIXC, holds short-term notes receivable from Marizyme, Inc. Credit loss expense recognized in the Consolidated Statements of Operations reflects changes in the allowance for expected credit losses based on the Company’s ongoing assessment of the borrower’s financial condition, estimated recoverable amounts, and other relevant factors affecting collectability.

Non-operating Expenses

Change in Fair Value of (Related Party and Third Party) Notes Payable, Warrant Liabilities, and Derivatives Call Options

Change in fair value measurements consists of the losses and gains as a result of fair value measurements of certain notes payable, warrant liabilities, and other instruments which we record at fair value.

Loss on Settlement of (Related Party and Third Party) Notes Payable

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.

Interest Expense (Related Party and Third Party)

Interest expense primarily consists of interest on outstanding notes payable not marked to fair value, capital leases, certain supplier payables, and vendor payables in trust.

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Net Loss on Digital Assets

We recognize gains and losses related to digital assets within operating results based on changes in their fair value and transactions during the period. Digital assets are measured at fair value with changes in value recognized in earnings in accordance with applicable accounting guidance. Fair value is determined using quoted prices in the principal markets accessible to the Company through its custodial and trading counterparties. Net losses on digital assets recognized in the 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 / (Expense), net

Other income (loss), 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 expense to fluctuate as we continue to transact internationally.

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Consolidated Results of Operations

Consolidated Statements of Operations

Consolidated - Revenue

Revenue decreased by $3 thousand for the year ended December 31, 2025, compared to the same period in 2024. Revenue was consistent year over year for the year ended December 31, 2025. Revenue was essentially flat year over year. Although vehicle deliveries increased, with four vehicles delivered in 2025 compared to three in 2024, automotive sales revenue did not increase correspondingly. This decrease was largely offset by higher leasing revenue as the Company expanded its operating lease program. Higher leasing revenue from the Company’s expanded operating lease program largely offset the decline in automotive sales revenue. Overall revenue remains limited as the Company continues in a pre-commercial production phase.

Looking ahead, the Company intends to advance the commercialization of the FX Super One as it transitions from pre-production and validation activities toward scaled manufacturing and staged deliveries. Management expects that revenue will remain limited until production and deliveries increase; however, as the FX Super One moves through its planned ramp-up phases, vehicle sales and related leasing activities are expected to become more meaningful drivers of consolidated revenue.

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The timing and extent of revenue growth will depend on execution of manufacturing, supplier, regulatory, and delivery milestones.

Consolidated - Cost of Revenue

Cost of revenue increased by $14.3 million for the year ended December 31, 2025, compared to the same period in 2024. The increase was primarily driven by higher inventory reserves partially offset by lower depreciation expense following the impairment of certain long-lived assets.

During 2025, the Company recorded a net increase of approximately $17.8 million in inventory reserves based on updated production plans and inventory utilization. In addition, depreciation expense allocated to cost of revenue declined by approximately $5.0 million as a result of impairment charges recorded during 2025 under ASC 360.

Consolidated - Research and Development

R&D expense decreased by $8.6 million for the year ended December 31, 2025, compared to the same period in 2024. The decrease was primarily driven by a $7.0 million reduction in wages and related benefit, including lower bonus expense, and a $6.6 million reduction in IT-related R&D expenses These decreases were partially offset by a $3.3 million increase in operating consumables and equipment rental—costs for prototype parts, vehicle purchases for testing, and services supporting development of the FX vehicle platform—as well as $2.4 million of lower cost allocations to cost of sales in the current period.

Throughout 2025, R&D activities primarily supported 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 United Arab Emirates (U.A.E.) to align manufacturing standards and production planning under its global bridge strategy.

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, and software refinement, in collaboration with key technology and supply-chain partners to support scalable FX Series production readiness. During the year, 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. This initiative is intended to complement the Company’s broader intelligent vehicle strategy and support long-term technology diversification.

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Consolidated - Settlement on Accrued Research and Development

A $14.9 million gain from the settlement of previously accrued research and development expenses was recognized during the year ended December 31, 2024, with no comparable gain or loss recognized during the year ended December 31, 2025. This gain resulted from a settlement that resolved ongoing disputes over unpaid invoices due to Palantir.

Consolidated - Sales and Marketing

Sales and marketing expense increased by $3.0 million for the year ended December 31, 2025, compared to the same period in 2024. The increase was primarily driven by a $5.9 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 were partially offset by a $2.3 million decrease in rent and related expense and a $0.9 million reduction in wages and related benefits, including lower bonus expense.

Throughout 2025, the Company executed 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. This approach supported expanded global visibility through high-profile activations, including the FX Super One global launch in Los Angeles, participation in the Pebble Beach automotive showcase, and the 919 Futurist Day & Stockholders’ Community Day. These initiatives were designed to strengthen brand awareness and customer engagement while maintaining disciplined marketing spend and focused resource allocation.

The Company also advanced its international marketing presence, particularly in the Middle East, through localized brand activations, regional events, and targeted customer outreach aligned with future market entry plans. These efforts contributed to increased brand recognition and FX Super One reservation activity. The combination of experiential events, digital marketing initiatives, and strategic influencer partnerships supported sustained brand momentum while managing overall marketing costs.

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. 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.

Consolidated - General and Administrative

General and administrative expense increased by $12.6 million for the year ended December 31, 2025, compared to the same period in 2024. The increase was primarily driven by a $19.4 million increase in professional fees, reflecting higher legal expenses, audit and advisory fees, SOX compliance support, and services provided under the FFGP agreement. Wages and related benefit costs increased by $3.7 million due to higher salaries and nondiscretionary bonuses, and a $2.3 million

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decrease in costs allocated to cost of sales. These increases were partially offset by a $4.0 million reduction in insurance costs, primarily due to lower directors and officers (“D&O”) insurance premiums and other corporate insurance savings, $6.6 million lower depreciation and amortization expense, as well as $2.1 million of lower rent expense in the current period.

Throughout 2025, the Company continued to experience elevated general and administrative costs as it managed increased legal, compliance, and governance requirements. These included expenses associated with the SEC investigation, the implementation of temporary governance adjustments, enhanced Sarbanes-Oxley compliance activities, and recurring Form S-1 registration filings to facilitate the resale of shares issued upon conversion of certain convertible debt instruments. Professional service costs also increased in connection with the opening of operations in the United Arab Emirates, the negotiation and execution of a major mass-production engineering services agreement, research and structuring of new preferred equity issuances, the acquisition and integration of AIXC, robotics-related strategic initiatives, and advisory support related to evolving tariff and trade matters. Staffing levels remained higher year-over-year in both the U.S. and China to support these expanded activities, resulting in increased wages and related benefits despite lower discretionary bonus expense. Although management implemented efficiency initiatives, including vendor consolidation, office space optimization, and administrative streamlining, overall G&A expenses remained elevated due to the Company’s expanded regulatory, transactional, and strategic initiatives.

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

Loss on disposal of property, plant, and equipment increased by approximately $0.8 million for the year ended December 31, 2025, compared to the same period in 2024. We dispose of equipment when the assets become obsolete, costly to maintain, or are replaced by more efficient technologies.

Consolidated - Asset Impairment

NM = not meaningful

During the year ended December 31, 2025, the Company recorded total impairment charges of approximately $137.4 million related to long-lived assets. Based on the results of an independent third-party tangible asset valuation study performed in connection with identified triggering events under ASC 360, the Company recorded impairment charges of $128.9 million related to Property, Plant, and Equipment, Net, and $8.5 million related to Deposits and Other Current Assets.

The 2025 impairment was primarily attributable to certain tooling, machinery, and manufacturing equipment located at vendor sites and at the Company’s FF aiFactory California production facility in Hanford, California. These assets were determined to be impaired following a reassessment of operational plans and near-term production forecasts, including the Company’s strategic shift from FF 91 program activities toward the planned FF 92 upgrade program and reorganization and retooling efforts in preparation for the commercial production of the FX Super One. Triggering events included the elimination of federal EV tax credits, escalating U.S.–China trade tensions, and the Company’s market capitalization relative to the carrying value of its long-lived assets.

During the year ended December 31, 2024, the Company recorded an impairment loss related to lease right-of-use (“ROU”) assets. This charge resulted from facility exits, including a leased retail store, a research facility, and an administrative location in China, as the Company negotiated lease terminations with landlords. No property, plant, and equipment impairment charges were recorded during 2024.

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Consolidated - Impairment of Goodwill

NM = not meaningful

During the year ended December 31, 2025, we recorded a $4.5 million goodwill impairment related to the AIXC business acquired in September 2025. In connection with the annual impairment assessment under ASC 350, management compared the estimated fair value of the AIXC reporting unit to its carrying value. The fair value was supported primarily using a market-based valuation approach that considered AIXC’s diluted market capitalization and other relevant market indicators.

Following the acquisition, AIXC experienced continued operating losses and volatility in its market valuation, which resulted in the reporting unit’s estimated fair value falling below its carrying amount as of the testing date. Accordingly, the Company recognized an impairment charge limited to the recorded goodwill balance. There was no comparable goodwill impairment in 2024, as no goodwill was recorded prior to the AIXC acquisition.

Consolidated - Credit Loss Expense

NM = not meaningful

During the year ended December 31, 2025, we recorded a $4.3 million of credit loss expense primarily related to the Marizyme promissory note acquired in connection with the AIXC business combination. In accordance with ASC 326, the Company evaluated the collectability of the note and recorded an allowance for expected credit losses based on an assessment of the borrower’s financial condition, liquidity constraints, and uncertainty regarding repayment.

The increase in credit loss expense in 2025 reflects updated information obtained following the acquisition, including continued operating losses at the borrower and heightened uncertainty surrounding its ability to satisfy the note in accordance with contractual terms. There was no comparable credit loss expense in 2024, as the note was not held by the Company prior to the AIXC acquisition.

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

The $61.6 million year-over-year improvement reflects the combined effects of losses recognized upon initial issuance of instruments and subsequent fair value remeasurement.

Losses recognized at issuance remained elevated in 2025, totaling approximately $61.9 million, compared to approximately $49.6 million in 2024. The increase was driven primarily by higher common stock warrant issuance activity following the execution of new SPAs beginning in the second half of 2024, which provided for increased warrant coverage relative to legacy arrangements. In addition, derivative call options (Incremental Warrants) were first recognized in December 2024 after a spike in the Company’s stock price caused these instruments to become in-the-money, contributing to higher issuance-related losses in late 2024 and continuing through much of 2025. Issuance activity declined significantly in the fourth quarter of 2025, which moderated incremental issuance-related losses toward year end.

More than offsetting these losses, we recognized substantially higher gains from fair value remeasurement in 2025, totaling approximately $116.6 million, compared to approximately $39.9 million in 2024. This increase was driven by a materially larger population of equity-linked instruments outstanding during the period, particularly warrants and Incremental Warrants, together with a sustained decline in the Company’s stock price during 2025. Immediately prior to certain warrant

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cancellations on December 28, 2025, there were 56,584,917 SPA Portfolio third-party warrants outstanding, compared to 5,931,638 outstanding as of December 31, 2024. As our stock price declined over the course of 2025, the fair value of notes, warrants, and derivative call options decreased, resulting in a larger net remeasurement gain for the year.

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

The Change in fair value of related party notes payable, warrant liabilities, and derivative call options decreased by $1.9 million for the year ended December 31, 2025, when compared with the same period in 2024. Significant driving factors include (1) an increase in related party activity, such as issuance and conversion of the related party 2025 March Unsecured SPA Notes, warrants, and Incremental Warrants and (2) the recognition of day-one losses upon issuance of related party 2025 March Unsecured SPA Notes and associated instruments. We issued related party SPA Portfolio Notes with a principal value of $5.0 million during the year ended December 31, 2025. Upon issuance the Company recognized a day-one loss of $3.6 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 offset by net $2.2 million gain from the remeasurement of related party notes payable, related party warrant liabilities, and related party Incremental Warrants as of December 31, 2025. The fair value of our related party instruments decreased during the period ended December 31, 2025, primarily due to a decrease in our Class A Common Stock price over the period since the first issuance of 2025 March Unsecured SPA Notes to related parties in March 2025.

There was no significant related party debt activity during the year ended December 31, 2024.

Consolidated - Loss on Settlement of Notes Payable

The $61.2 million decrease in Loss on settlement of notes payable, compared to the prior year, primarily reflects a lower loss recognized per dollar of principal converted during 2025, and to a lesser extent, a lower overall volume of debt conversions. During the year ended December 31, 2025, we converted $125.0 million of principal into 117,784,999 shares of Class A common stock, compared to $141.6 million of principal converted into 62,141,799 shares during the year ended December 31, 2024. Despite a relatively similar level of principal converted, the year-over-year decrease in loss on settlement of notes payable primarily reflects a lower loss recognized per dollar of principal. The annual average loss per dollar of principal declined to approximately $0.80 in 2025 compared to approximately $1.12 in 2024. This period-over-period improvement was primarily driven by differences in conversion pricing mechanics and the relative timing of stock price movements between the periods. During the first six months of 2024, conversions occurred at fixed conversion prices in an environment where our stock price increased prior to settlement, resulting in higher extinguishment losses as the fair value of equity delivered exceeded the carrying amount of the debt extinguished. In contrast, the 2025 conversions incorporated variable pricing features for the whole period that generally reduced the differential between the fair value of equity issued and the carrying amount of the Notes settled, particularly during periods of lower and less volatile stock prices. Additionally, the lower loss per dollar in 2025 reflects the reduced contractual interest rate on the notes (10% in 2025 versus 15% in 2024) and the absence of make-whole provisions that were applicable to certain conversions during the first half of 2024.

Consolidated - Loss on Settlement of Related Party Notes Payable

During the year ended December 31, 2025 a related party converted various notes with an aggregate principal of $6.5 million in exchange for 6,326,566.00 shares of our Class A Common Stock. We recognized a $5.1 million Loss on settlement

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of related party notes payable for the difference between the fair value of the shares issued and the fair value of the debt. instrument. During the year ended December 31, 2024, a related party converted only $0.7 million of principal and we recognized a modest Loss on settlement of related party notes payable of $0.2 million.

During the year ended December 31, 2024 we recognized a $14.1 million loss on related party notes related to interest, penalties, and principal increases resulting from our breach of the agreement with Chongqing Leshi Small Loan Co., Ltd. (“Chongqing”), as discussed in Note 9, Related Party Transactions in the notes to the Consolidated Financial Statements. There was no breach of our agreement with Chongqing during the years ended December 31, 2025 and 2024.

Consolidated - Interest Expense

Interest expense increased by approximately $0.8 million for the year ended December 31, 2025, compared to the same period in 2024. This decrease was primarily due to interest expense allocated to construction in progress, partially offset by 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 - Related Party Interest Expense

Related party interest expense decreased by $8.7 million for the year ended December 31, 2025, compared to the same period in 2024. The decrease was primarily driven by our default in the first quarter of 2024 on the loan with our related party lender, Chongqing, which triggered retroactive interest charges and penalties under the prior agreement. Under the revised loan agreement, no interest is incurred unless the Company defaults.

Consolidated - Loss on Digital Assets, net

* NM = not meaningful

Net loss on digital assets increased by $4.1 million for the year ended December 31, 2025, compared to the same period in 2024. The increase was attributable to digital asset transactions occurring during 2025 following the AIXC acquisition. During the year, the Company and AIXC purchased and subsequently sold various cryptocurrencies, resulting in realized losses based on the difference between the sales proceeds and the historical cost basis of the assets sold.

In addition, the Company recognized unrealized losses on digital assets held at year end due to declines in quoted market prices relative to their carrying values. Digital assets are measured at fair value, with changes in fair value recognized in earnings. The net loss for 2025 reflects both realized losses from sales activity and fair value adjustments resulting from market volatility in cryptocurrency prices during the year. There were no digital asset transactions or related gains or losses during the year ended December 31, 2024.

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Consolidated - Other Income (Expense), net

Other income, net increased by $6.4 million for the year ended December 31, 2025, compared to the same period in 2024. 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 2024, 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 UAE Dirham is pegged to the U.S. dollar.

AIEV Results of Operations

AIEV - Statements of Operations

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AIEV - Revenue

Revenue decreased by $3 thousand for the year ended December 31, 2025, compared to the same period in 2024. Revenue was consistent year over year for the year ended December 31, 2025. Revenue was essentially flat year over year. Although vehicle deliveries increased, with four vehicles delivered in 2025 compared to three in 2024, automotive sales revenue did not increase correspondingly. This decrease was largely offset by higher leasing revenue as the Company expanded its operating lease program. Higher leasing revenue from the Company’s expanded operating lease program largely offset the decline in automotive sales revenue. Overall revenue remains limited as the Company continues in a pre-commercial production phase.

Looking ahead, the Company intends to advance the commercialization of the FX Super One as it transits from pre-production and validation activities toward scaled manufacturing and staged deliveries. Management expects that revenue will remain limited until production and deliveries increase; however, as the FX Super One moves through its planned ramp-up phases, vehicle 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 execution of manufacturing, supplier, regulatory, and delivery milestones.

AIEV - Cost of Revenue

Cost of revenue increased by $14.3 million for the year ended December 31, 2025, compared to the same period in 2024. he increase was primarily driven by higher inventory reserves partially offset by lower depreciation expense following the impairment of certain long-lived assets.

During 2025, the Company recorded a net decrease of approximately $17.8 million in inventory reserves as prior-period reserve balances were written off or otherwise adjusted based on updated production plans and inventory utilization. In addition, depreciation expense allocated to cost of revenue declined by approximately $5.0 million as a result of impairment charges recorded during 2025 under ASC 360. During 2025, the Company identified impairment triggering events, including the elimination of federal EV tax credits, escalating U.S.–China trade tensions, and the Company’s market capitalization relative to its carrying value.

AIEV - Research and Development

R&D expense decreased by $8.5 million for the year ended December 31, 2025, compared to the same period in 2024. The decrease was primarily driven by a $7.0 million reduction in wages and related benefit, including lower bonus expense, and a $6.6 million reduction in IT-related R&D expenses These decreases were partially offset by a $3.3 million increase in operating consumables and equipment rental—costs for prototype parts, vehicle purchases for testing, and services supporting development of the FX vehicle platform—as well as $2.4 million of lower cost allocations to cost of sales in the current period.

Throughout 2025, R&D activities primarily supported 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 United Arab Emirates (U.A.E.) to align manufacturing standards and production planning under its global bridge strategy.

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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, and software refinement, in collaboration with key technology and supply-chain partners to support scalable FX Series production readiness. During the year, 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. This initiative is intended to complement the Company’s broader intelligent vehicle strategy and support long-term technology diversification.

AIEV - Settlement of Accrued Research and Development expenses

*NM = not meaningful

A $14.9 million gain from the settlement of previously accrued research and development expenses was recognized during the year ended December 31, 2024, with no comparable gain or loss recognized during the year ended December 31, 2025. This gain resulted from a settlement that resolved ongoing disputes over unpaid invoices due to Palantir.

AIEV - Sales and Marketing

Sales and marketing expense increased by $3.0 million for the year ended December 31, 2025, compared to the same period in 2024. The increase was primarily driven by a $5.9 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 were partially offset by a $2.3 million decrease in rent and related expense and a $0.9 million reduction in wages and related benefits, including lower bonus expense.

Throughout 2025, the Company executed 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. This approach supported expanded global visibility through high-profile activations, including the FX Super One global launch in Los Angeles, participation in the Pebble Beach automotive showcase, and the 919 Futurist Day & Stockholders’ Community Day. These initiatives were designed to strengthen brand awareness and customer engagement while maintaining disciplined marketing spend and focused resource allocation.

The Company also advanced its international marketing presence, particularly in the Middle East, through localized brand activations, regional events, and targeted customer outreach aligned with future market entry plans. These efforts contributed to increased brand recognition and FX Super One reservation activity. The combination of experiential events, digital marketing initiatives, and strategic influencer partnerships supported sustained brand momentum while managing overall marketing costs.

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.

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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. 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 Administrative

General and administrative expense increased by $9,451 for the year ended December 31, 2025, compared to the same period in 2024. The increase was primarily driven by a $17.3 million increase in professional fees, reflecting higher legal expenses, audit and advisory fees, SOX compliance support, and services provided under the FFGP agreement. Wages and related benefit costs increased by $3.7 million due to higher salaries and nondiscretionary bonuses.and a $2.3 million decrease in costs allocated to cost of sales. These increases were partially offset by a $4.0 million reduction in insurance costs, primarily due to lower directors and officers (“D&O”) insurance premiums and other corporate insurance savings, $6.6 million lower depreciation and amortization expense, as well as $2.1 million of lower rent expense in the current period.

Throughout 2025, the Company continued, to experience elevated general and administrative costs as it managed increased legal, compliance, and governance requirements. These included expenses associated with the SEC investigation, the implementation of temporary governance adjustments, enhanced Sarbanes-Oxley compliance activities, and recurring Form S-1 registration filings to facilitate the resale of shares issued upon conversion of certain convertible debt instruments. Professional service costs also increased in connection with the opening of operations in the United Arab Emirates, the negotiation and execution of a major mass-production engineering services agreement, research and structuring of new preferred equity issuances, the acquisition and integration of AIXC, robotics-related strategic initiatives, and advisory support related to evolving tariff and trade matters. Staffing levels remained higher year-over-year in both the U.S. and China to support these expanded activities, resulting in increased wages and related benefits despite lower discretionary bonus expense. Although management implemented efficiency initiatives, including vendor consolidation, office space optimization, and administrative streamlining, overall G&A expenses remained elevated due to the Company’s expanded regulatory, transactional, and strategic initiatives.

AIEV - Loss from disposal of property, plant and equipment

Loss on disposal of property, plant, and equipment increased by approximately $0.8 million for the year ended December 31, 2025, compared to the same period in 2024. We dispose of equipment when the assets become obsolete, costly to maintain, or are replaced by more efficient technologies.

AIEV - Asset Impairment

* NM = not meaningful

During the year ended December 31, 2025, the Company recorded total impairment charges of approximately $137.4 million related to long-lived assets. Based on the results of an independent third-party tangible asset valuation study performed in connection with identified triggering events under ASC 360, the Company recorded impairment charges of $128.9 million related to Property, Plant, and Equipment, Net, and $8.5 million related to Deposits and Other Current Assets.

The 2025 impairment was primarily attributable to certain tooling, machinery, and manufacturing equipment located at vendor sites and at the Company’s FF aiFactory California production facility in Hanford, California. These assets were

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determined to be impaired following a reassessment of operational plans and near-term production forecasts, including the Company’s strategic shift from FF 91 program activities toward the planned FF 92 upgrade program and reorganization and retooling efforts in preparation for the commercial production of the FX Super One. Triggering events included the elimination of federal EV tax credits, escalating U.S.–China trade tensions, and the Company’s market capitalization relative to the carrying value of its long-lived assets.

During the year ended December 31, 2024, the Company recorded an impairment loss related to lease right-of-use (“ROU”) assets. This charge resulted from facility exits, including a leased retail store, a research facility, and an administrative location in China, as the Company negotiated lease terminations with landlords. No property, plant, and equipment impairment charges were recorded during 2024.

AIEV - Goodwill Impairment

NM = not meaningful

During the year ended December 31, 2025, $4.5 million of the $4.5 million consolidated goodwill impairment charge related to the AIXC business acquired in September 2025 was allocated to AIEV for segment reporting purposes.

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

The $61.2 million year-over-year improvement reflects the combined effects of losses recognized upon initial issuance of instruments and subsequent fair value remeasurement.

Losses recognized at issuance remained elevated in 2025, totaling approximately $61.9 million, compared to approximately $49.6 million in 2024. The increase was driven primarily by higher common stock warrant issuance activity following the execution of new SPAs beginning in the second half of 2024, which provided for increased warrant coverage relative to legacy arrangements. In addition, derivative call options (Incremental Warrants) were first recognized in December 2024 after a spike in the Company’s stock price caused these instruments to become in-the-money, contributing to higher issuance-related losses in late 2024 and continuing through much of 2025. Issuance activity declined significantly in the fourth quarter of 2025, which moderated incremental issuance-related losses toward year end.

More than offsetting these losses, we recognized substantially higher gains from fair value remeasurement in 2025, totaling approximately $124.2 million, compared to approximately $39.9 million in 2024. This increase was driven by a materially larger population of equity-linked instruments outstanding during the period, particularly warrants and Incremental Warrants, together with a sustained decline in the Company’s stock price during 2025. Immediately prior to certain warrant cancellations on December 28, 2025, there were 56,584,917 SPA Portfolio third-party warrants outstanding, compared to 5,931,638 outstanding as of December 31, 2024. As our stock price declined over the course of 2025, the fair value of notes, warrants, and derivative call options decreased, resulting in a larger net remeasurement gain for the year.

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

The Change in fair value of related party notes payable, warrant liabilities, and derivative call options increased by $1.9

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million for the year ended December 31, 2025, when compared with the same period in 2024. Significant driving factors include (1) an increase in related party activity, such as issuance and conversion of the related party 2025 March Unsecured SPA Notes, warrants, and Incremental Warrants and (2) the recognition of day-one losses upon issuance of related party 2025 March Unsecured SPA Notes and associated instruments. We issued related party SPA Portfolio Notes with a principal value of $5.0 million during the year ended December 31, 2025. Upon issuance the Company recognized a day-one loss of $3.6 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 offset by net $2.2 million gain from the remeasurement of related party notes payable, related party warrant liabilities, and related party Incremental Warrants as of December 31, 2025. The fair value of our related party instruments decreased during the period ended December 31, 2025, primarily due to a decrease in our Class A Common Stock price over the period since the first issuance of 2025 March Unsecured SPA Notes to related parties in March 2025.

There was no significant related party debt activity during the year ended December 31, 2024.

AIEV - Loss on Settlement of Notes Payable

The $61.2 million decrease in Loss on settlement of notes payable, compared to the prior year, primarily reflects a lower loss recognized per dollar of principal converted during 2025, and to a lesser extent, a lower overall volume of debt conversions. During the year ended December 31, 2025, we converted $125.0 million of principal into 117,784,999 shares of Class A common stock, compared to $141.6 million of principal converted into 62,141,799 shares during the year ended December 31, 2024. Despite a relatively similar level of principal converted, the year-over-year decrease in loss on settlement of notes payable primarily reflects a lower loss recognized per dollar of principal. The annual average loss per dollar of principal declined to approximately $0.80 in 2025 compared to approximately $1.12 in 2024. This period-over-period improvement was primarily driven by differences in conversion pricing mechanics and the relative timing of stock price movements between the periods. During the first six months of 2024, conversions occurred at fixed conversion prices in an environment where our stock price increased prior to settlement, resulting in higher extinguishment losses as the fair value of equity delivered exceeded the carrying amount of the debt extinguished. In contrast, the 2025 conversions incorporated variable pricing features for the whole period that generally reduced the differential between the fair value of equity issued and the carrying amount of the Notes settled, particularly during periods of lower and less volatile stock prices. Additionally, the lower loss per dollar in 2025 reflects the reduced contractual interest rate on the notes (10% in 2025 versus 15% in 2024) and the absence of make-whole provisions that were applicable to certain conversions during the first half of 2024.

AIEV - Loss on Settlement of Related Party Notes Payable

During the year ended December 31, 2025 a related party converted various notes with an aggregate principal of $6.5 million in exchange for 6,326,566.00 shares of our Class A Common Stock. We recognized a $5.1 million Loss on settlement of related party notes payable for the difference between the fair value of the shares issued and the fair value of the debt. instrument. During the year ended December 31, 2024, a related party converted only $0.7 million of principal and we recognized a modest Loss on settlement of related party notes payable of $0.2 million.

During the year ended December 31, 2024 we recognized a $14.1 million loss on related party notes related to interest, penalties, and principal increases resulting from our breach of the agreement with Chongqing Leshi Small Loan Co., Ltd. (“Chongqing”), as discussed in Note 9, Related Party Transactions in the notes to the Consolidated Financial Statements. There was no breach of our agreement with Chongqing during the years ended December 31, 2025 and 2024.

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AIEV - Interest Expense

Interest expense decreased by approximately $0.4 million for the year ended December 31, 2025, compared to the same period in 2024. This decrease was primarily due to interest expense allocated to construction in progress, partially offset by 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.

AIEV - Related Party Interest Expense

Related party interest expense decreased by $8.7 million for the year ended December 31, 2025, compared to the same period in 2024. The decrease was primarily driven by our default in the first quarter of 2024 on the loan with our related party lender, Chongqing, which triggered retroactive interest charges and penalties under the prior agreement. Under the revised loan agreement, no interest is incurred unless the Company defaults.

AIEV - Loss on Digital Assets, net

* NM = not meaningful

Net loss on digital assets increased by $0.5 million for the year ended December 31, 2025, compared to the same period in 2024. The change was attributable to digital asset transactions within the AIEV segment during 2025. During the year, the Company purchased and subsequently sold certain cryptocurrencies, resulting in realized losses based on the difference between sales proceeds and the historical cost of the assets sold.

In addition, the Company recognized unrealized losses on digital assets held at year end due to declines in quoted market prices relative to their carrying values. Digital assets are measured at fair value, with changes in fair value recognized in earnings. The net loss for 2025 reflects both realized losses from sales activity and fair value adjustments driven by cryptocurrency market volatility. There were no digital asset transactions or related gains or losses during the year ended December 31, 2024.

AIEV - Other Income (Expense), net

Other income, net increased by $6.1 million for the year ended December 31, 2025, compared to the same period in 2024. 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 2024, 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 UAE Dirham is pegged to the U.S. dollar.

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AIXC Results of Operations

AIXC - Statements of Operations

AIXC - Research and Development

NM = not meaningful

R&D expense increased by $154 thousand for the year ended December 31, 2025, compared to the same period in 2024. The increase reflects AIXC’s research and development activity during the fourth quarter of 2025 following its acquisition. As AIXC was not part of the Company in the prior year period, the amounts are not comparable. The overall impact on consolidated results was immaterial.

AIXC - General and Administrative

NM = not meaningful

General and administrative expense increased by $3.1 million for the year ended December 31, 2025, compared to the same period in 2024. The increase reflects AIXC’s fourth-quarter operating activity following its acquisition, primarily driven by professional services, consulting and accounting fees, master service fees, marketing expenses, and personnel-related costs. As AIXC was not part of the Company in the prior-year period, amounts are not comparable.

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AIXC - Credit Loss

NM = not meaningful

During the year ended December 31, 2025, we recorded a $4.3 million of credit loss expense primarily related to the Marizyme promissory note acquired in connection with the AIXC business combination. In accordance with ASC 326, the Company evaluated the collectability of the note and recorded an allowance for expected credit losses based on an assessment of the borrower’s financial condition, liquidity constraints, and uncertainty regarding repayment.

The increase in credit loss expense in 2025 reflects updated information obtained following the acquisition, including continued operating losses at the borrower and heightened uncertainty surrounding its ability to satisfy the note in accordance with contractual terms. There was no comparable credit loss expense in 2024, as the note was not held by the Company prior to the AIXC acquisition.

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

* NM = not meaningful

The change in fair value of financial instruments was $0.4 million for the year ended December 31, 2025, 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.

AIXC - Interest Expense

NM = not meaningful

Interest expense increased by approximately $353 thousand for the year ended December 31, 2025, compared to the same period in 2024. The increase reflects interest incurred on AIXC’s outstanding debt obligations during the fourth quarter of 2025 following its acquisition. As AIXC was not part of the Company in the prior-year period, amounts are not comparable.

AIXC - Net Loss on Digital Assets, net

NM = not meaningful

Net loss on digital assets increased by $3.6 million for the year ended December 31, 2025, compared to the same period in 2024. The increase reflects digital asset activity during the fourth quarter of 2025 following the acquisition of AIXC. Prior to the acquisition, AIXC operated as a biologics-focused company and did not engage in digital asset transactions. The 2025

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loss includes realized losses on sales and unrealized losses from period-end fair value remeasurement, as digital assets are measured at fair value with changes recognized in earnings.

AIXC - Other Income (loss), net

NM = not meaningful

Other income, net increased by $0.3 million for the year ended December 31, 2025, compared to the same period in 2024. The increase reflects miscellaneous non-operating items recognized during the fourth quarter of 2025 following the acquisition of AIXC, including interest income and other routine adjustments. As AIXC was not part of the Company in the prior-year period, there are no comparable amounts.

Liquidity and Capital Resources

Going Concern

Conditions Raising Substantial Doubt

We have evaluated whether conditions and events, considered in the aggregate, raise substantial doubt about our ability to continue as a going concern within one year after the date that the Consolidated Financial Statements are issued. In accordance with ASC 205-40, Presentation of Financial Statements — Going Concern, management considered our recurring losses from operations since inception and continued cash outflows from operating activities. Based on this evaluation, we concluded that substantial doubt exists regarding our ability to continue as a going concern for the one-year period following issuance of these Consolidated Financial Statements.

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 December 31, 2025, we had an accumulated deficit of $4,705.0 million, unrestricted cash of $34.9 million, and negative working capital of $79.7 million. These conditions contribute to the substantial doubt determination under ASC 205-40.

We project that we will require substantial additional funding to continue operations, advance development and future production planning related to its FF Series program,, initiate production of our FX Series vehicles, and commence our planned robotics production initiative in the first quarter of 2026. 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. Although we expect that the launch of the FX Series and the planned robotics initiative may support future revenue generation and operational performance, these initiatives are subject to execution, market acceptance, and funding risks, and there can be no assurance that sufficient liquidity will be generated within the next twelve months.

The consolidation of AIXC did not materially improve our near-term liquidity position or alter our current working capital constraints. Although AIXC may support longer-term business initiatives, it does not alleviate the substantial doubt that exists regarding our ability to continue as a going concern within the next twelve months.

Management’s Plans

In accordance with ASC 205-40, management has developed plans intended to mitigate the conditions that give rise to substantial doubt. We have historically funded operations primarily through the issuance of notes payable, related party convertible notes (see Note 8 and Note 9), and the sale of common stock. 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 December 31, 2025, the SPA Portfolio Notes were in good standing.

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As of December 31, 2025, SPA Commitments totaled $739.0 million, of which $503.3 million was funded, $186.2 million expired unfunded, $49.5 million remained to be funded, and $51.1 million in principal was outstanding. Optional Commitments totaled $467.0 million, of which $111.0 million was funded, $315.5 million expired unfunded, $40.5 million remained to be funded, and $23.3 million was outstanding. Remaining 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.

Operational Context

During 2023, we commenced deliveries of the FF 91. We currently manufacturing the FF 91 and plans to manufacture FF 92 models within the FF Series. The FX Series was launched in 2025, beginning with the Super One model, and the Company is currently accepting reservation deposits. Series production is expected following completion of production readiness activities.

In 2025, the Company also advanced initiatives in robotics and intelligent automation and continued developing digital asset initiatives. These initiatives may require additional capital and are not expected to generate near-term cash flows.

Equity Issuance Constraints and ATM Program

On September 26, 2023, we entered into a sales agreement under its 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.

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.

Strategic Investment

On September 29, 2025, we completed our investment in AIXC. 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 year ended December 31, 2025.

Risks Affecting Liquidity

We continue to explore financing alternatives; however, delays in securing funding commitments have constrained production activities. Capital raising efforts may be unsuccessful or delayed, and projections may underestimate professional fees and financing-related costs.

Our capital raising efforts remain subject to Nasdaq listing standards, authorized share limitations, and anti-dilution features in existing instruments.

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.

Elevated U.S. import tariffs on EV components sourced from China may increase manufacturing costs as production scales. While tariffs did not materially impact 2025 cost of goods sold due to limited production volume, continued reliance on China-based suppliers may increase input costs and funding needs.

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 Consolidated Financial Statements are issued, as contemplated by ASC 205-40.

Basis of Presentation

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The Consolidated Financial Statements do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, the Consolidated Financial Statements have been prepared assuming we will continue as a going concern.

Sources of Liquidity

As of December 31, 2025, our principal source of liquidity was cash on hand totaling $34.9 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 Consolidated Financial Statements included in this Form 10-K.

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 Chief Product and User Ecosystem Officer (who, in April 2025, became Global Co-CEO). Effective August 13, 2025, during the pendency of the SEC investigation, Mr. Jia was temporarily excluded from oversight of the finance, legal, accounting, and public reporting functions. 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 Consolidated Financial Statements included in this Form 10-K.

Notes payable with third parties and related parties are summarized in the following tables as of June 30, 2025, including contractual maturities, stated interest rates, unpaid principal balances, fair value adjustments, original issue discounts (including amounts allocated to warrants), and net carrying values.

Most of our notes payable are measured under the fair value option, with changes in fair value recorded in the Consolidated Statements of Operations and Comprehensive Loss. Because these instruments are carried at fair value, no effective interest rate is presented. While the SPA Portfolio Notes bear stated interest rates of 10% or 15%, our effective cost of capital is substantially higher. Each SPA Portfolio Note permits settlement in shares at a value exceeding the stated principal and accrued interest. In addition, each holder receives an SPA Portfolio Warrant, and certain holders receive an Incremental Warrant. These features significantly increase the effective cost of capital beyond the stated rates. The financial impact of the SPA Portfolio Notes is reflected in changes in fair value and losses on extinguishment, as presented in our Consolidated Statements of Operations and Comprehensive Loss.

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Third-Party Notes Payable (December 31, 2025)

Related Party Notes Payable (December 31, 2025)

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Cash Flow Analysis

Operating Activities

We continue to experience negative operating cash flows as we advance the design and development of our vehicles and expand our infrastructure in both the United States and China. 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 year ended December 31, 2025, net cash used in operating activities was $107.6 million, compared to $70.2 million for the same period in 2024, reflecting a $37.4 million increase in cash outflows.

Net Loss: The $41.2 million increase in Net loss in 2025 compared to the same period in 2024, reflecting an unfavorable change in result year over year. This change includes various non-cash items that are excluded in calculating cash flow from operating activities.

Non-cash adjustments: Non-cash adjustments increased by $39.0 million for the year ended December 31, 2025 compared to the same period in 2024. This increase was comprised of a $135.6 million increase in Asset impairment, a $17.4 million increase in Reserve on inventory, and a $14.9 million decrease in Settlement on accrued research and development expenses. These adjustments were partially offset by a $64.2 million Change in fair value of notes payable, warrant liabilities, and derivative liabilities, a $61.2 million reduction in Loss on settlement of notes payable, and a $9.2 million reduction Loss on settlement of related party notes payable. As these adjustments do not represent actual cash changes, they are disclosed for reconciliation purposes consistent with the cash flow statement.

Changes in working capital: Changes in working capital decreased by $35.2 million for the year ended December 31, 2025 compared to the same period in 2024. For the year ended December 31, 2025, changes in working capital included unfavorable shifts in our operating assets and liabilities. Notable contributors to the change were a $12.8 million change in Accrued expenses and other current liabilities, and a $8.7 million change in Related party accrued interest expense, and a $5.6 million change in Inventory. While these figures are detailed in the cash flow statement, they underscore the critical role that effective working capital management has played in reducing our operating cash outflows. The reductions in cash outlays for working capital purposes result from our cost-saving and cash management measures.

Investing Activities

Net cash used in investing activities was $23.5 million for the year ended December 31, 2025, compared to $7.4 million for the same period in 2024, reflecting an increase of $16.1 million. The higher use of cash was primarily attributable to a $27.0 million due to Purchase of digital assets and $1.1 million of net investment related to our acquisition of AIXC. This outflow was partially offset by a $12.6 million of proceeds received from the Sale of digital assets. The Company continues to manage through liquidity constraints; however, these strategic outlays contributed to the elevated level of investing activity during the period.

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-convertible funding. For the year ended December 31, 2025, financing activities provided a net cash inflow of $161.4 million, compared to a net cash inflow of $80.7 million for the same period in 2024—an increase of $80.7 million. The improvement reflects the Company’s continued ability to secure financing despite a challenging capital markets environment. In 2025, proceeds from notes payable were $151.7 million, up by $83.6 million from $68.1 million in 2024. Our proceeds from related party notes payable increased to $4.7 million in 2025 from $3.1 million in 2024, an increase of $1.7 million. Financing activities also included $9.9 million of net proceeds from a follow-on capital contribution related to AIXC, after issuance costs. These net aggregate inflows were offset by increases in payments of notes

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payable and other financing obligations, which totaled $4.0 million and $4.5 million, respectively, and a decline in Proceeds from related party notes payable, net of original issuance discount of $6.7 million during 2025.

Effect of Exchange Rate Changes on Cash and Restricted Cash

The exchange rates effect on cash and restricted cash was $2.6 million and zero for the years ended December 31, 2025 and 2024, respectively. The effects of exchange rate changes on cash and restricted cash result from fluctuations on the translation of assets and liabilities denominated in foreign currencies, primarily Chinese Yuan. Fluctuations in exchange rates against the U.S. Dollar may positively or negatively affect our operating results.

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 December 31, 2025 and 2024.

Critical Accounting Estimates

Our Consolidated Financial Statements are prepared in accordance with U.S. GAAP generally accepted accounting principles. The preparation of our Consolidated Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent liabilities, and the reported amounts of expenses during the reporting period. Management has based its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions. Changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ significantly from the estimates made by our management. To the extent that there are material differences between these estimates and actual results, future financial statement presentation, financial condition, results of operations, and cash flows will be affected. Given the global economic climate and unpredictable nature, estimates are subject to additional variability and volatility.

For a description of our significant accounting policies, see Note 1, Nature of Business and Organization, Basis of Presentation, and Summary of Significant Accounting Policies of the notes to Consolidated Financial Statements included elsewhere in this Form 10-K. An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the Consolidated Financial Statements Management believes the following critical accounting policies reflect the more significant estimates and assumptions used in the preparation of the Consolidated Financial Statements.

Impairment of Long-Lived Assets

Description

We assess our long-lived assets, consisting primarily of property and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. We perform impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

The Company measures impairment based on the excess of carrying value over estimated fair value. Fair value is determined using valuation techniques appropriate for the nature of the underlying assets, which may include a cost approach, market approach, or income approach. For the year ended December 31, 2025, the Company primarily utilized a cost approach to estimate the fair value of certain long-lived assets, reflecting replacement cost adjusted for physical deterioration and economic obsolescence.

Judgments and Uncertainties

The Company estimated fair value with the assistance of an independent valuation specialist, primarily using a cost approach. Key assumptions include estimates of replacement cost, economic obsolescence, physical depreciation, and the timing required for assets to be placed into their intended use. These assumptions are based on management’s assessment of

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current and expected operating conditions, production readiness, and future utilization of the assets, together with valuation methodologies applied by the independent valuation specialist. The Company also considers market-based and other external information, as applicable, in evaluating the reasonableness of these assumptions.

Changes in these assumptions, including estimates of economic obsolescence or expected asset utilization, could result in materially different fair value measurements and corresponding impairment charges.

Effect if Actual Results Differ from Assumptions

If actual conditions differ from management’s assumptions, including assumptions regarding replacement cost, economic obsolescence, physical depreciation, or the expected timing of placing assets into their intended use, the resulting fair value estimates could change and additional impairment charges could be required4

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Recent Accounting Pronouncements

See the sections titled “Recent Accounting Pronouncements” in Note 1, Nature of Business and Organization, Basis of Presentation, and Summary of Significant Accounting Policies in our Consolidated Financial Statements included elsewhere in this Form 10-K for a discussion about our recently adopted accounting pronouncements and the recently issued accounting pronouncements not yet adopted which are determined to be applicable to us.