Serve Robotics (NASDAQ:SERV) reported second-quarter revenue growth but sharply reduced its full-year outlook after delivery volume through Uber declined for the first time in 17 quarters, prompting the company to reassess the future of the partnership and redirect resources toward other channels.
Chief Executive Officer and Co-Founder Ali Kashani said delivery volume through Uber had increased for 17 consecutive quarters from the first quarter of 2022 through the first quarter of 2026. That trend reversed in the second quarter because of lower-than-expected robot utilization.
“Based on the volume decline and some of these recent broader discussions with Uber, we don’t currently expect that it would make sense to renew our agreement when it expires in early 2027,” Kashani said, unless the operating model improves meaningfully. He added that Serve remains engaged with Uber and is open to finding a path to continue working together.
Revenue Guidance Cut as Expected Uber Ramp Is Removed
Serve reported second-quarter revenue of $3.2 million, up 9% from the first quarter and more than 400% year-over-year. However, Kashani said the result was below the level needed to support the company’s previous full-year outlook.
The company cut its full-year 2026 revenue guidance to $9 million to $10 million from a prior forecast of $26 million. CFO Brian Read said the revised range would still represent nearly 3.5 times year-over-year revenue growth.
According to management, the guidance reduction reflects both the delivery decline that occurred during the second quarter and the removal of a previously expected substantial increase in Uber delivery volume during the second half of the year.
Kashani emphasized that Uber represented a limited portion of second-quarter revenue. He said the size of the guidance cut reflected the removal of an anticipated future ramp rather than the loss of a large existing revenue stream.
Read said total revenue increased sequentially because other business lines more than offset a meaningful quarter-over-quarter decline in delivery revenue. Daily active robots were steady, while software revenue was nearly $1 million.
- Second-quarter revenue: $3.2 million, compared with $3 million in the first quarter.
- Second-quarter gross loss: approximately $8.8 million.
- Second-quarter gross margin: negative 271%.
- GAAP operating expenses: $57.3 million.
- Non-GAAP operating expenses: approximately $40.4 million.
- GAAP net loss: $64 million, or $0.80 per share.
- Non-GAAP net loss: $47.1 million, or $0.59 per share.
Read said fleet gross margin improved sequentially despite the Uber delivery decline, which he attributed to operational efficiency and cost discipline. He said the company’s path toward positive gross margin depends on higher revenue per robot operating hour, improved operational productivity, and a larger contribution from recurring software and platform revenue.
Diversification Efforts Include DoorDash, Advertising and Healthcare
Management pointed to growth in other delivery and non-delivery channels as evidence of the company’s diversification strategy. Kashani said deliveries with DoorDash grew nearly 50% sequentially in the second quarter, and grew another 50% between June and July.
Serve also said it plans to announce another major delivery marketplace partnership in coming weeks. Kashani said the company is advancing commercial programs intended to support denser order allocation, simpler merchant integration and higher robot utilization.
Advertising accounted for nearly half of Serve’s robotic food-delivery revenue during the quarter, management said. Kashani said advertising spending had shown softness following the start of a war, but the company worked to offset that pressure. The business is seeing both local and national advertising campaigns, according to management, primarily involving robot wraps, along with growth in experiential uses of robots.
Recurring revenue exceeded 50% of total revenue in the quarter. The company’s healthcare robotics business, which includes Diligent Robotics, continued to provide contracted multiyear revenue, management said. Serve said it has signed seven multiyear contract extensions with hospital customers so far this year and added two new hospitals.
Read said software revenue could be “a little softer” in the second half, though he said Diligent would continue to support the company’s revenue mix and margin profile. Kashani said Diligent is investing in new hardware designed to position the business for more rapid scaling in future years.
New Products and Market Expansion Planned
Serve plans to provide a summer business update on Aug. 17 covering a new delivery marketplace partnership, two market launches, a merchant integration product and technology developments.
One planned product, called Beacon, is a standalone countertop device intended to connect restaurants and customers directly with Serve robots. Kashani said nearly two-thirds of delivery orders in Serve’s operating areas cannot currently use robotic last-mile delivery because of back-of-house integration barriers.
Beacon has cellular connectivity and requires only a consistent power source from restaurants, Kashani said. The company expects the product to allow it to work with restaurants regardless of their existing internet or point-of-sale infrastructure, including merchants not connected to third-party delivery platforms.
Later in the fall, Serve expects to introduce another product intended to expand direct customer demand and support additional types of goods and delivery use cases beyond restaurant food. Kashani cited the company’s recently announced work with laundry business NoScrubs as an example of non-food delivery activity.
The company also expects to discuss developments in its autonomy stack later this year. Kashani said Serve has reached milestones in developing AI models intended to make robots safer, faster, smarter, more reliable and more capable.
Cost Reductions Preserve Investment in Autonomy
With the lower revenue outlook, Serve is reducing planned capital expenditures and operating expenses. The company lowered its 2026 capital expenditure outlook to approximately $15 million to $17 million from about $25 million. It also reduced non-GAAP operating expense guidance to approximately $140 million to $150 million from $160 million to $170 million.
Read said the company expects the cost discipline to come from headcount controls, optimized deployment infrastructure spending and tighter discretionary spending. Serve is also evaluating opportunities to consolidate overlapping general and administrative functions and shared services through the Diligent integration.
The company said it will continue investing in autonomy and software, including its next-generation autonomy platform, which management expects to improve unit economics and expand the geography its fleet can serve.
Serve ended the quarter with more than $240 million in cash and marketable securities. Kashani said the company has 2,000 robots distributed across more than 40 cities nationwide and intends to focus fleet capacity, capital and operating attention on channels with stronger demand signals, higher expected utilization and more attractive economics.
About Serve Robotics (NASDAQ:SERV)
Serve Robotics develops and operates autonomous sidewalk delivery robots designed to transform last-mile logistics for restaurants, retailers and grocery brands. By combining proprietary hardware, sensor suites and dispatch software, the company enables on-demand deliveries of food, beverages and consumer goods while minimizing reliance on traditional vehicle fleets.
The core Serve robot integrates four-wheeled mobility, LiDAR and vision cameras with AI-driven navigation algorithms to detect obstacles, traverse urban sidewalks and interact safely with pedestrians.
