Luminar Technologies, Inc 10-Q for FY2025 Q2
Luminar Technologies, Inc. (LAZRQ)
10-Q
2025-08-13
For: 2025-06-30
View Original
Added on
April 10, 2026
About this 10-Q
Luminar Technologies, Inc filed this 10-Q on August 13, 2025, covering the quarter ended June 30, 2025 (FY2025 Q2).
Headline figures
Quarter ended June 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $15.63M
- down 5.0% from $16.45M a year earlier
- Net loss
- $22.9M
- compared with a net loss of $130.61M a year earlier
- Diluted EPS
- -$0.62
- compared with -$4.32 a year earlier
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended June 30, 2025
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from to
Commission file number 001-38791
LUMINAR TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||
(800 ) 532-2417
Registrant's telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | ||||||||||||||
| ☒ | Smaller reporting company | ||||||||||||||||
| Emerging growth company | |||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of August 8, 2025, the registrant had 63,891,880 shares of Class A common stock and 4,872,578 shares of Class B common stock, par value $0.0001 per share, outstanding.
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
FORM 10-Q
TABLE OF CONTENTS
| Page | ||||||||
1
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (this “Form 10-Q”) includes forward-looking statements in addition to historical information. These forward-looking statements are included throughout this Form 10-Q, including in the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of operations,” “Risk Factors,” and in other sections in this Form 10-Q. These statements reflect the current views of management with respect to future events and our financial performance. These forward-looking statements include statements regarding the estimated costs and expected benefits of the restructuring plan initiated in May 2024, including the additional actions taken under the restructuring plan in September 2024, the Company’s 2025 restructuring plan, including, without limitation, statements related to the Company’s expected charges for employee severance and other costs associated with the 2025 restructuring plan, including estimates of related cash expenditures by the Company, statements regarding the number of employees subject to the workforce reduction and the timing thereof, and the impact of the 2025 restructuring plan, product plans, future growth, sales estimates, market opportunities, strategic initiatives, industry positioning, customer acquisition and retention, revenue growth, statements regarding the Company’s sources of liquidity including whether it will be sufficient to satisfy liquidity requirements and to enable the Company to execute its business strategy, anticipated impacts on our business of current worldwide economic uncertainty, inflation, monetary policy shifts, and other disruptions due to geopolitical conditions and global health emergencies. In some cases, you can identify these statements by forward-looking words such as “outlook,” “believes,” “expects,” “future,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words or phrases, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business.
These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including our history of losses and our expectation that we will continue to incur significant expenses, including substantial research and development (“R&D”) costs, and continuing losses for the foreseeable future as well as our limited operating history which makes it difficult to evaluate our future prospects and the risks and challenges we may encounter; our strategic initiatives which may prove more costly than we currently anticipate and potential failure to increase our revenue to offset these initiatives; whether our LiDAR products are or will continue to be selected for inclusion in autonomous driving or advanced driving assistance systems (“ADAS”) by automotive original equipment manufacturers (“OEMs”) or their suppliers, and whether we will be de-selected by any customers; the lengthy period of time from a major commercial win to implementation and the risks of cancellation or postponement of the contract or unsuccessful implementation; potential inaccuracies in our forward-looking estimates of certain metrics, our future cost of goods sold (“COGS”) and bill of materials (“BOM”) and total addressable market; the discontinuation, lack of success of our customers in developing and commercializing products using our solutions or loss of business with respect to a particular vehicle model or technology package and whether end automotive consumers will demand and be willing to pay for such features; our ability to successfully fund our growth if there are considerable delays in product introductions by us or our OEM customers may face with their products; our inability to reduce and control the cost of the inputs on which we rely, which could negatively impact the adoption of our products and our profitability; the effect of continued pricing pressures, competition from other LiDAR manufacturers, OEM cost reduction initiatives and the ability of automotive OEMs to re-source or cancel vehicle or technology programs which may result in lower than anticipated margins, or losses, which may adversely affect our business; the effect of general economic conditions, including inflation, recession risks and rising interest rates, generally and on our industry and us in particular, including the level of demand and financial performance of the autonomous vehicle industry and the decline in fair value of available-for-sale debt securities in a rising interest rate environment; market adoption of LiDAR as well as developments in alternative technology and the increasingly competitive environment in which we operate, which includes established competitors and market participants that have substantially greater resources; our ability to achieve technological feasibility and commercialize our software products and the requirement to continue to develop new products and product innovations due to rapidly changing markets and government regulations of such technologies; our ability to manage our growth and expand our business operations effectively, including into international markets, such as China, which exposes us to operational, financial, regulatory and geopolitical risks; changes in our government contracts business and our defense customers’ business due to political change and global conflicts; adverse impacts due to limited availability and quality of materials, supplies, and capital equipment, or dependency on third-party service providers and single-source suppliers; the project-based nature of our orders, which can cause our results of operations to fluctuate on a quarterly and annual basis; whether we will be able to successfully transition our engineering designs into high volume manufacturing, including our ability to transition to an outsourced manufacturing business model and whether we and our outsourcing partners and suppliers can successfully operate complex machinery; whether we can successfully select, execute or integrate our acquisitions; defects, reliability and other issues with our products which could reduce market adoption of our new products, limit our ability to manufacture, damage our reputation and expose us to product liability, warranty and
2
other claims; our ability to maintain and adequately manage our inventory; our ability to maintain an effective system of internal control over financial reporting; our ability to protect and enforce our intellectual property rights; availability of qualified personnel, loss of highly skilled personnel; the transition associated with the appointment of new chief executive officer, the impact of inflation and our stock price on our ability to hire and retain highly skilled personnel; the amount and timing of future sales of our products and whether the average selling prices of our products could decrease rapidly over the life of the product as well as our dependence on a few key customers, who are often large corporations with substantial negotiating power; our ability to establish and maintain confidence in our long-term business prospects among customers and analysts and within our industry; whether we are subject to negative publicity; the effects of infectious diseases, health epidemics, pandemics and natural disasters on Luminar’s business; interruption or failure of our information technology and communications systems; cybersecurity risks to our operational systems, security systems, infrastructure, integrated software in our LiDAR solutions; market instability exacerbated by geopolitical conflicts, including the Israel-Hamas war and the conflict between Russia and Ukraine; trade disputes with China and other countries, including the effect of sanctions and trade restrictions, such as tariffs imposed by the U.S. government and any countermeasures by other governments in response to such tariffs, that may affect supply chain or sales opportunities or overall demand; the large amount of our outstanding indebtedness and our ability to comply with covenants contained in the agreements governing our indebtedness; our ability to access sources of capital to repay our indebtedness, and finance operations and growth, which we may not be able to obtain on favorable terms, if at all, or without substantial dilution to our stockholders; our ability to maintain compliance with the Nasdaq continued listing standards for the listing of our Class A common stock; our ability to accurately estimate the charges associated with the reductions under the 2025 restructuring plan, and those other factors discussed in Part 1, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (our “2024 Form 10-K”) under the heading “Risk Factors”, risk factors contained in Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025 (the “Q1 2025 10-Q”) and this Form 10-Q and in subsequent reports we file with the SEC. You should specifically consider the numerous risks outlined in the Risk Factors section of our 2024 Form 10-K, our Q1 2025 10-Q and this Form 10-Q. Given these risks, uncertainties and other factors, you should not place undue reliance on these forward-looking statements. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. We undertake no obligation to update any forward-looking statements made in this Form 10-Q to reflect events or circumstances after the date of this Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.
WEBSITE AND SOCIAL MEDIA DISCLOSURE
We use our website (https://www.luminartech.com/) and various social media channels as a means of disclosing information about the Company and its products to its customers, investors and the public (e.g., @luminartech on X (formerly Twitter), Luminartech on YouTube, and Luminar Technologies on LinkedIn). The information on our website (or any webpages referenced in this Form 10-Q) or posted on social media channels is not part of this or any other report that the Company files with, or furnishes to, the Securities and Exchange Commission (the “SEC”). The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts.
3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands)
| June 30, 2025 | December 31, 2024 | ||||||||||
| (Unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Restricted cash | |||||||||||
| Marketable securities | |||||||||||
| Accounts receivable | |||||||||||
| Inventory | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Property and equipment, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Intangible assets, net | |||||||||||
| Goodwill | |||||||||||
| Other non-current assets | |||||||||||
| Total assets | $ | $ | |||||||||
LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued and other current liabilities | |||||||||||
| Operating lease liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Debt | |||||||||||
| Operating lease liabilities, non-current | |||||||||||
| Other non-current liabilities | |||||||||||
| Total liabilities | |||||||||||
Commitments and contingencies (Note 16) | |||||||||||
Series A preferred stock | |||||||||||
| Stockholders’ deficit: | |||||||||||
| Class A common stock | |||||||||||
| Class B common stock | |||||||||||
| Additional paid-in capital | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
| Treasury stock | ( | ( | |||||||||
| Accumulated deficit | ( | ( | |||||||||
Total stockholders’ deficit | ( | ( | |||||||||
Total liabilities, preferred stock and stockholders’ deficit | $ | $ | |||||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
4
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(In thousands, except share and per share data)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| Products | $ | $ | $ | $ | |||||||||||||||||||
| Services | |||||||||||||||||||||||
| Total revenue | |||||||||||||||||||||||
| Cost of sales: | |||||||||||||||||||||||
| Products | |||||||||||||||||||||||
| Services | |||||||||||||||||||||||
| Total cost of sales | |||||||||||||||||||||||
| Gross loss | ( | ( | ( | ( | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Sales and marketing | |||||||||||||||||||||||
| General and administrative | ( | ||||||||||||||||||||||
| Restructuring costs | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Loss from operations | ( | ( | ( | ( | |||||||||||||||||||
| Other income (expense), net: | |||||||||||||||||||||||
Change in fair value of private warrants | |||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||
| Interest income | |||||||||||||||||||||||
| Gain on extinguishment of debt | |||||||||||||||||||||||
Gain (loss) from acquisition of EM4, LLC (“EM4”) | ( | ||||||||||||||||||||||
Gain from sale of investments | |||||||||||||||||||||||
Change in fair value of derivative liability | |||||||||||||||||||||||
| Losses and impairments related to investments and certain other assets, and other income (expense) | ( | ( | ( | ||||||||||||||||||||
| Total other income (expense), net | ( | ( | |||||||||||||||||||||
Loss before provision for (benefit from) income taxes | ( | ( | ( | ( | |||||||||||||||||||
Provision for (benefit from) income taxes | ( | ||||||||||||||||||||||
| Net loss | ( | ( | ( | ( | |||||||||||||||||||
Less: Deemed dividend on Series A preferred stock | |||||||||||||||||||||||
Net loss attributable to common stockholders | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Net loss per share attributable to common stockholders: | |||||||||||||||||||||||
Basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Weighted average shares used in computing net loss per share attributable to common stockholders: | |||||||||||||||||||||||
Basic and diluted | |||||||||||||||||||||||
| Comprehensive Loss: | |||||||||||||||||||||||
| Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Net unrealized loss on available-for-sale debt securities | ( | ( | ( | ( | |||||||||||||||||||
| Comprehensive loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
5
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Preferred Stock and Stockholders’ Deficit
(Unaudited)
(In thousands, except share data)
Series A Preferred Stock | Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Treasury Stock | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2024 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock upon exercise of stock options and vesting of restricted stock units | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock under employee stock purchase plan ("ESPP") | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock under the Equity Financing Program | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Vendor payments under the stock-in-lieu of cash program | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Milestone awards related to acquisitions | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation, including restructuring costs | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Expense related to Volvo Warrants | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payments of employee taxes related to vested restricted stock units | — | — | — | — | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2024 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of March 31, 2025 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Series A preferred stock, net of issuance costs and discount of $ | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock as commitment fee | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock upon conversion of Series A preferred stock | ( | ( | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deemed dividend on Series A preferred stock | — | — | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock upon vesting of restricted stock units | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock under ESPP | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock upon conversion of 2026 Convertible Senior Notes | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock under the Equity Financing Program | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Expense related to Volvo warrants | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation, including restructuring costs | — | — | — | — | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payments of employee taxes related to vested restricted stock units | — | — | — | — | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
*All periods presented prior to December 31, 2024 have been retroactively adjusted to reflect the 1-for-15 reverse stock split effected on November 20, 2024. Refer to Note 1 for further information.
See accompanying notes to the unaudited condensed consolidated financial statements.
6
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Preferred Stock and Stockholders’ Deficit
(Unaudited)
(In thousands, except share data)
Series A Preferred Stock | Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2023 | $ | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock upon exercise of stock options and vesting of restricted stock units | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock under ESPP | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock under the Equity Financing Program | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock under 401(k) Plan | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock in settlement of certain claims | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Vendor payments under the stock-in-lieu of cash program | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Milestone awards related to acquisitions | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation, including restructuring costs | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Expense related to Volvo Warrants | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payments of employee taxes related to stock-based awards | — | — | — | — | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2024 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Series A preferred stock, net of issuance costs and discount of $ | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock as commitment fee | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock upon conversion of Series A preferred stock | ( | ( | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deemed dividend on Series A preferred stock | — | — | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock upon vesting of restricted stock units | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock under ESPP | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock upon conversion of 2026 Convertible Senior Notes | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock upon conversion of 2030 Convertible Notes | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of Class A common stock under the Equity Financing Program | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock to a wholly owned subsidiary of TPK Holding Co., Ltd. (“TPK”) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Expense related to Volvo warrants | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation, including restructuring costs | — | — | — | — | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payments of employee taxes related to vested restricted stock units | — | — | — | — | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
*All periods presented prior to December 31, 2024 have been retroactively adjusted to reflect the 1-for-15 reverse stock split effected on November 20, 2024. Refer to Note 1 for further information.
See accompanying notes to the unaudited condensed consolidated financial statements.
7
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net loss | $ | ( | $ | ( | |||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Amortization of operating lease right-of-use assets | |||||||||||
| Amortization of discount on marketable securities | ( | ( | |||||||||
| Loss on marketable securities | |||||||||||
| Change in fair value of private warrants | ( | ||||||||||
| Vendor stock in lieu of cash program | |||||||||||
| Amortization of debt discount and issuance costs | |||||||||||
| Inventory write-offs and write-downs | |||||||||||
| Change in the fair value of derivatives | ( | ||||||||||
| Gain or write-off on sale or disposal of property and equipment | |||||||||||
| Share-based compensation, including restructuring costs | ( | ||||||||||
| Gain on extinguishment of debt | ( | ||||||||||
| Impairment of investments | |||||||||||
| Gain (loss) from acquisition of EM4 | ( | ||||||||||
| Change in product warranty and other | ( | ||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | ( | ( | |||||||||
| Inventories | ( | ( | |||||||||
| Prepaid expenses and other current assets | ( | ||||||||||
| Other non-current assets | ( | ||||||||||
| Accounts payable | ( | ||||||||||
| Accrued and other current liabilities | ( | ||||||||||
| Other non-current liabilities | ( | ( | |||||||||
| Net cash used in operating activities | ( | ( | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of marketable securities | ( | ( | |||||||||
| Proceeds from maturities of marketable securities | |||||||||||
| Proceeds from sales/redemptions of marketable securities | |||||||||||
| Purchases of property and equipment | ( | ( | |||||||||
| Acquisition of EM4 (net of cash acquired) | ( | ||||||||||
| Proceeds from disposal of property and equipment | |||||||||||
| Net cash provided by investing activities | |||||||||||
| Cash flows from financing activities: | |||||||||||
| Net proceeds from issuance of Class A common stock under the Equity Financing Program | |||||||||||
| Proceeds from sale of Class A common stock under ESPP | |||||||||||
| Proceeds from exercise of stock options | |||||||||||
| Payments of employee taxes related to stock-based awards | ( | ( | |||||||||
Repurchase of 2026 Convertible Senior Notes | ( | ||||||||||
| Proceeds from issuance of Series A preferred stock, net of issuance costs, discount and commitment fees | |||||||||||
| Net cash provided by financing activities | |||||||||||
Net decrease in cash, cash equivalents and restricted cash | ( | ( | |||||||||
| Beginning cash, cash equivalents and restricted cash | |||||||||||
| Ending cash, cash equivalents and restricted cash | $ | $ | |||||||||
| Supplemental disclosures of cash flow information: | |||||||||||
| Cash paid for interest | $ | $ | |||||||||
| Supplemental disclosures of noncash investing and financing activities: | |||||||||||
Conversion of 2030 Convertible Notes to Class A common stock | $ | $ | |||||||||
Conversion of 2026 Convertible Senior Notes to Class A common stock | $ | $ | |||||||||
Conversion of Series A preferred stock to Class A common stock | $ | $ | |||||||||
Deemed dividend on Series A preferred stock | $ | ( | $ | ||||||||
Recognition/(derecognition) of operating lease right-of-use asset and liability | $ | ( | $ | ||||||||
| Purchases of property and equipment recorded in accounts payable and accrued liabilities | $ | $ | |||||||||
See accompanying notes to the unaudited condensed consolidated financial statements.
8
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Note 1. Organization and Description of Business
Luminar Technologies, Inc. (together with its wholly-owned subsidiaries, the “Company” or “Luminar”) is incorporated in Delaware. Luminar is a technology company specializing in advanced Light Detection and Ranging (LiDAR) hardware and software solutions to enable the world’s safest and smartest vehicles. Over the past decade, Luminar has been building proprietary LiDAR hardware, core semiconductor components, software in-house to meet the demanding performance, safety, reliability and cost requirements to enable next-generation safety and autonomous capabilities for passenger and commercial vehicles, as well as other adjacent markets. The Company’s Class A common stock is listed on the Nasdaq Global Select Market under the symbol “LAZR.”
The Company is headquartered in Orlando, Florida and has personnel that conducts the Company’s operations from various locations in the United States and internationally including Germany, Sweden, Mexico, China and India.
Reverse Stock Split
In November 2024, following approval by the Company’s stockholders at a special meeting of stockholders (the “Special Meeting”) held in October 2024 of a reverse stock split of all the outstanding Class A common stock and Class B common stock and any common stock held by the Company as treasury shares (the “Reverse Stock Split”), and a determination by the Board of Directors of a reverse stock split ratio of 1-for-15 (the “Reverse Stock Split Ratio”), the Company effected a Reverse Stock Split at the Reverse Stock Split Ratio. All share data and per share data amounts prior to December 31, 2024 included in this Form 10-Q have been retrospectively adjusted to reflect the effect of the Reverse Stock Split.
Note 2. Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation and Consolidation
The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”) filed with the SEC on March 28, 2024. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. All intercompany transactions and balances have been eliminated in consolidation.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, equity, revenues and expenses, and related disclosures. The significant estimates made by management include inventory reserves, useful life of long-lived assets, valuation allowance for deferred tax assets, impairment of goodwill and IPR&D, assets acquired in mergers and acquisitions, including intangible assets, forecasted costs associated with non-recurring engineering (“NRE”) services, restructuring costs, valuation of convertible and senior notes and derivatives associated with them, valuation of distinct goods and services in the purchase contract with customers, and stock-based compensation expense. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. Actual results could differ from those estimates.
Liquidity
Since inception, the Company has not generated positive cash flows from operating activities and has incurred significant losses from operations. As of June 30, 2025, the Company had an accumulated deficit of $2.2 billion. The Company expects to continue to incur operating losses for at least the foreseeable future due to continued investments in product and software development, efforts to build customer relations, expansion into additional markets, and investments in developing advanced manufacturing capabilities, including at contract manufacturing partners.
As of June 30, 2025, the Company had cash and cash equivalents totaling $48.2 million and marketable securities of $59.5 million, totaling $107.6 million of total liquidity. For the six months ended June 30, 2025, $98.0 million of cash was used in operations. The Company’s principal sources of liquidity have been proceeds received from issuances of debt and equity. To execute on its strategic initiatives, the Company will continue to require additional capital resources. The Company continues to assess its liquidity position and opportunities for additional capital through issuances of equity securities, including convertible preferred securities, or the incurrence of additional debt. However, the Company may not be able to obtain funding on
9
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
acceptable terms, or at all. If the Company is unable to raise additional capital when desired, its business, financial condition, and results of operations would be adversely affected.
The Company expects to fund its operations, product and business development initiatives and associated capital expenditures through cash, cash equivalents and marketable securities, issuance of shares of Class A common stock to vendors and third parties for services provided under its stock in lieu of cash program, issuance of Class A common stock under the Equity Financing Program (as defined in Note 12 below) or the issuance of convertible preferred stock under its Series A Preferred Stock Financing Program (see Note 11 below), or any combination of the foregoing. Based on current plans and projections as well as trading dynamics of its Class A common stock, the Company believes its existing sources of liquidity will be sufficient to satisfy its liquidity requirements and enable it to continue to execute its business strategy for at least 12 months from the date of issuance of these condensed consolidated financial statements, though it is reliant for continued access to its Equity Financing Program and Series A Preferred Stock Financing Program.
Segment Information
The Company has determined its operating segments using the same indicators that were used to evaluate its performance internally. The Company’s business activities are organized in two operating segments:
(i) “Autonomy Solutions”, which includes manufacturing and sale of LiDAR sensors that measure distance using pulsed laser light to generate a 3D environmental model (a.k.a. “point cloud”), non-recurring engineering services related to the Company’s LiDAR products, development of software products that enable autonomy capabilities for automotive applications, and licensing of certain data and information. In June 2022, the Company acquired certain assets from Solfice Research, Inc. (“Solfice” or “Civil Maps”). In January 2023, the Company acquired certain assets from Seagate Technology LLC and Seagate Singapore International Headquarters Pte. Ltd. (individually and collectively, “Seagate”). Assets purchased from both Civil Maps and Seagate have been included in the Autonomy Solutions segment.
(ii) “Advanced Technologies and Services (“ATS”)”, which includes the design, development, manufacturing, packaging, and development services of photonic components and sub-systems (including semiconductor lasers and photodetectors), application-specific integrated circuits, and pixel-based sensors. The Company acquired Optogration, Inc. (“Optogration”) in August 2021, Freedom Photonics LLC (“Freedom Photonics”) in April 2022, and EM4, LLC (“EM4”) in March 2024. Operations of Optogration, Freedom Photonics and EM4 have been included in the ATS segment since their respective acquisition dates.
Concentration of Credit Risk
The Company’s revenue is derived from customers located in the United States and international markets. Three customers, customer C, customer B and customer A, accounted for 34 %, 22 % and 10 % of the Company’s accounts receivable as of June 30, 2025, respectively. Two customers, customer B and customer A, accounted for 32 % and 22 % of the Company’s accounts receivable as of December 31, 2024, respectively.
Significant Accounting Policies
The Company’s significant accounting policies are disclosed in its Annual Report on Form 10-K for the year ended December 31, 2024. There has been no material change to the Company’s significant accounting policies except as noted below related to issuance of preferred stock during the six months ended June 30, 2025.
Preferred Stock
The preferred stock is recorded outside of permanent equity when its contingently redeemable at the option of the holders upon events that are not solely within the Company’s control, in accordance with ASC 480, Distinguishing Liabilities from Equity. The preferred stock is recorded at proceeds received, net of issuance costs, discount and commitment fee. The carrying amount is accreted to the redemption value over the period from issuance to the earliest redemption date. The resulting accretion is treated as a deemed dividend and recorded as a reduction to retained earnings (or an increase in accumulated deficit), impacting the calculation of net income/(loss) available to common stockholders. The deemed dividend from accretion reduces earnings available to holders of the Company’s common stock in calculating basic and diluted EPS.
10
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Recent Accounting Pronouncements Adopted
In November 2024, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2024-04, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments (“ASU 2024-04”), which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. ASU 2024-04 will be effective for the Company for the fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The Company prospectively early adopted ASU 2024-04 as of January 1, 2025. The Company recorded a gain on extinguishment of $21.5 million as a result of Troubled Debt Restructuring (“TDR”) related to the Exchange Transactions (as defined in Note 8) for the 2026 Convertible Senior Notes (as defined in Note 8), and the extinguishment gain was recorded in the other income (expense), net in the condensed consolidated statements of operations. See Note 8 for additional information.
Recent Accounting Pronouncements Not Yet Effective
In May 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2025-04, Compensation-Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer (“ASU 2025-04”) to reduce diversity in practice and improve the decision usefulness and operability of the guidance for share-based consideration payable to a customer in conjunction with selling goods or services. The ASU is effective for fiscal years beginning after December 15, 2026 with updates to be applied on a retrospective or modified retrospective basis. Early adoption is permitted. The Company is evaluating the impact that this new standard will have on the Company’s condensed consolidated financial statements.
In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires public business entities to disclose qualitative and quantitative information about certain costs and expenses in the notes to the financial statements on an interim and annual basis. ASU 2024-03 will be effective for the Company for the fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently in the process of evaluating the effects of this pronouncement on the Company’s financial statements and does not expect it to have a material impact on the condensed consolidated financial statements.
In December 2023, the FASB issued ASU No. ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires a public company to enhance the transparency and decision usefulness of income tax disclosures to provide information to better assess how an entity’s operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. ASU 2023-09 will be effective for the Company for the annual period beginning January 1, 2025 with early adoption permitted. The Company is currently evaluating this guidance and the impact it may have on its financial statement disclosures.
Note 3. Business Combinations and Acquisitions
Acquisition of EM4
On March 18, 2024 (the “Acquisition Date”), the Company completed its acquisition of EM4, a designer, manufacturer and seller of packaged photonic components and sub-systems for aerospace and industrial markets. The EM4 acquisition is expected to accelerate the Company’s strategy to package lasers, detectors and ASICs into modules and sub-systems.
The Company acquired 100 % of the membership interests of EM4 from G&H Investment Holding, Inc. (“G&H”), for an aggregate purchase price of approximately $4.2 million in cash, net of working capital adjustments, and up to $6.75 million in contingent future payments to G&H subject to the achievement of certain financial performance targets. The Company utilized a Monte Carlo simulation model to estimate the probability-weighted fair value of the contingent consideration. This transaction has been accounted for as a business combination. The acquisition related costs incurred as part of the transaction were not material.
11
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Recording of Assets Acquired and Liabilities Assumed
The following table summarizes the purchase price allocation to assets acquired (in thousands):
Recorded Value | ||||||||
| Cash and cash equivalents | $ | |||||||
| Accounts receivable | ||||||||
| Contract asset | ||||||||
| Inventories, net | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Property plant and equipment | ||||||||
| Operating lease right-of-use assets | ||||||||
| Total assets acquired | ||||||||
| Current liabilities | ( | |||||||
| Operating lease liabilities, non-current | ( | |||||||
| Total liabilities assumed | ( | |||||||
| Net assets acquired | $ | |||||||
Since the consideration paid by the Company to acquire EM4’s business was lower than the estimated fair value of net assets acquired, the Company recognized a $1.5 million gain from the acquisition of EM4. The following factors contributed towards the purchase price paid by the Company being lower than the estimated fair value of the net assets acquired: (a) EM4 had historically been incurring losses; (b) G&H viewed EM4 as non-core; (c) although G&H pursued a competitive auction process for the business, the ultimate timeline to completion was drawn-out due to the complexity of the transaction structure; and (d) during the later stages of the sale process, after the Company was selected as the winning bidder, EM4’s business was impacted by the cancellation of certain material government programs as well as delays in certain other purchase orders, which also served to significantly reduce the estimated probability of the contingent future payments to G&H. In the first quarter of 2024, the gain from the acquisition of EM4 was estimated to be $1.8 million, but in the fourth quarter of 2024 the Company and G&H agreed to certain adjustments to EM4’s closing balance sheet which resulted in a $0.3 million reduction in purchase price and a commensurate increase in the gain from the acquisition of EM4.
The results of operations related to EM4 are included in the Company’s condensed consolidated statements of operations beginning from the Acquisition Date.
12
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Note 4. Revenue
The Company’s revenue is comprised of sales of LiDAR sensors, semiconductor components, NRE services and licensing of certain data and information available with the Company.
Disaggregation of Revenues
The Company disaggregates its revenue from contracts with customers by (1) geographic region based on a customer’s billed to location, and (2) type of good or service and timing of transfer of goods or services to customers (point-in-time or over time), as it believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors. Total revenue based on the disaggregation criteria described above, as well as revenue by segment, are as follows (in thousands):
| Three Months Ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Revenue | % of Revenue | Revenue | % of Revenue | ||||||||||||||||||||
| Revenue by primary geographical market: | |||||||||||||||||||||||
| North America | $ | % | $ | % | |||||||||||||||||||
| Asia Pacific | % | % | |||||||||||||||||||||
| Europe and Middle East | % | % | |||||||||||||||||||||
| Total | $ | % | $ | % | |||||||||||||||||||
| Revenue by timing of recognition: | |||||||||||||||||||||||
| Recognized at a point in time | $ | % | $ | % | |||||||||||||||||||
| Recognized over time | % | % | |||||||||||||||||||||
| Total | $ | % | $ | % | |||||||||||||||||||
| Revenue by segment: | |||||||||||||||||||||||
| Autonomy Solutions | $ | % | $ | % | |||||||||||||||||||
| ATS | % | % | |||||||||||||||||||||
| Total | $ | % | $ | % | |||||||||||||||||||
| Six Months Ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Revenue | % of Revenue | Revenue | % of Revenue | ||||||||||||||||||||
| Revenue by primary geographical market: | |||||||||||||||||||||||
| North America | $ | % | $ | % | |||||||||||||||||||
| Asia Pacific | % | % | |||||||||||||||||||||
| Europe and Middle East | % | % | |||||||||||||||||||||
| Total | $ | % | $ | % | |||||||||||||||||||
| Revenue by timing of recognition: | |||||||||||||||||||||||
| Recognized at a point in time | $ | % | $ | % | |||||||||||||||||||
| Recognized over time | % | % | |||||||||||||||||||||
| Total | $ | % | $ | % | |||||||||||||||||||
| Revenue by segment: | |||||||||||||||||||||||
| Autonomy Solutions | $ | % | $ | % | |||||||||||||||||||
| ATS | % | % | |||||||||||||||||||||
| Total | $ | % | $ | % | |||||||||||||||||||
Contract assets and liabilities
Changes in the Company’s contract assets and contract liabilities primarily result from the timing difference between the Company’s performance and the customer’s payment based on contractual terms. Contract assets primarily represent revenues recognized for performance obligations that have been satisfied but for which amounts have not been billed. Contract liabilities consist of the Company’s obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. Customer advance payments represent required customer payments in advance of product
13
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
shipments. Customer advance payments are recognized in revenue as or when control of the performance obligation is transferred to the customer.
The opening and closing balances of contract assets were as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Contract assets, current | $ | $ | |||||||||
| Contract assets, non-current | |||||||||||
| Ending balance | $ | $ | |||||||||
The significant changes in contract assets balances consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Beginning balance | $ | $ | |||||||||
| Amounts billed that were included in the contract assets beginning balance | ( | ( | |||||||||
| Contract assets from acquisition of EM4 (See Note 3) | |||||||||||
| Revenue recognized for performance obligations that have been satisfied but for which amounts have not been billed | |||||||||||
| Ending balance | $ | $ | |||||||||
The opening and closing balances of contract liabilities were as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Contract liabilities, current | $ | $ | |||||||||
| Contract liabilities, non-current | |||||||||||
| Ending balance | $ | $ | |||||||||
The significant changes in contract liabilities balances consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Beginning balance | $ | $ | |||||||||
| Revenue recognized that was included in the contract liabilities beginning balance | ( | ( | |||||||||
| Increase due to cash received and not recognized as revenue and billings in excess of revenue recognized during the period | |||||||||||
| Ending balance | $ | $ | |||||||||
Remaining Performance Obligations
Revenue allocated to remaining performance obligations was $6.3 million as of June 30, 2025 and includes amounts within contract liabilities. The Company expects to recognize approximately 100 % of this revenue over the next 12 months.
Note 5. Restructuring
On May 3, 2024, the Company announced a restructuring plan (“2024 Restructuring Plan”), including a reduction in its workforce by approximately 20 %. On September 20, 2024, the Company announced additional actions under the 2024 Restructuring Plan that included a cumulative reduction in workforce of approximately 30 % of the Company’s full-time employees since the beginning of 2024. On May 15, 2025, the Company began executing additional restructuring efforts (“2025 Restructuring Plan”), including a reduction in its workforce. The actions associated with the 2025 Restructuring Plan commenced immediately and are expected to be substantially complete by the end of 2025. By June 30, 2025, the reduction in workforce actions resulted in the termination of 257 employees. Separation costs associated with the 2025 Restructuring Plan amounted to $1.2 million and $1.2 million during the three and six months ended June 30, 2025, respectively, have been included as restructuring costs in the condensed consolidated statement of operations.
14
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
The following table summarizes the restructuring charges for the 2024 Restructuring Plan and the 2025 Restructuring Plan as of June 30, 2025.
Severance Expense | ||||||||
Balance as of December 31, 2024 | $ | |||||||
Restructuring charges | ||||||||
Cash payments | ( | |||||||
Non-cash charges | ( | |||||||
Balance payable and accrued liabilities as of June 30, 2025 | $ | |||||||
The entire balance payable of $0.3 million relates to the Autonomy Solutions segment.
Note 6. Investments
Debt Securities
The Company’s investments in debt securities consisted of the following as of June 30, 2025 and December 31, 2024 (in thousands):
| June 30, 2025 | ||||||||||||||||||||||||||
| Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||||
| U.S. treasury securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Commercial paper | ||||||||||||||||||||||||||
| Corporate bonds | ( | |||||||||||||||||||||||||
| Total debt securities | $ | $ | $ | ( | $ | |||||||||||||||||||||
| Included in cash and cash equivalents | $ | $ | $ | $ | ||||||||||||||||||||||
| Included in marketable securities | $ | $ | $ | ( | $ | |||||||||||||||||||||
| December 31, 2024 | ||||||||||||||||||||||||||
| Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||||
| U.S. treasury securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Commercial paper | ||||||||||||||||||||||||||
| Corporate bonds | ( | |||||||||||||||||||||||||
| Certificate of deposits | ||||||||||||||||||||||||||
| Total debt securities | $ | $ | $ | ( | $ | |||||||||||||||||||||
| Included in cash and cash equivalents | $ | $ | $ | $ | ||||||||||||||||||||||
| Included in marketable securities | $ | $ | $ | ( | $ | |||||||||||||||||||||
The following table presents the gross unrealized losses and the fair value for those debt securities that were in an unrealized loss position for less than 12 months as of June 30, 2025 and December 31, 2024 (in thousands):
| June 30, 2025 | December 31, 2024 | |||||||||||||||||||||||||
| Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||||
U.S. treasury securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Corporate bonds | ( | ( | ||||||||||||||||||||||||
| Total | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
15
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Equity Investments
The Company’s equity investments consisted of the following as of June 30, 2025 and December 31, 2024 (in thousands):
| Condensed Consolidated Balance Sheets Location | June 30, 2025 | December 31, 2024 | |||||||||||||||
Money market funds(1) | Cash and cash equivalents | $ | $ | ||||||||||||||
Marketable equity investments(1) | Marketable securities | ||||||||||||||||
Investment in non-marketable securities(2) | Other non-current assets | ||||||||||||||||
| Total | $ | $ | |||||||||||||||
(1) Investments with readily determinable fair values.
(2) Investment in privately held company without readily determinable fair value.
In December 2021, the Company made an investment in 1,495 Class A Preferred Units of Robotic Research OpCo, LLC (“Forterra”) for consideration of $10.0 million, which was settled by issuing 41,261 shares of Class A common stock of the Company. The Company’s investment in Forterra represented less than 5 % of Forterra’s capitalization. The Company neither had a significant influence over Forterra nor did its investment amounted to a controlling financial interest in Forterra. In the fourth quarter of 2022, the Company recorded an impairment charge of $6.0 million related to the investment in Forterra. As a result of anticipated losses of preferred rights and decline in enterprise value of Forterra, the Company has recorded an additional impairment charge of $4.0 million related to the said investment in the second quarter of 2024.
In July 2024, the Company and Forterra entered into the Fourth Amended and Restated Limited Liability Company Agreement, pursuant to which the 1,495 Class A Preferred Units issued and outstanding were converted into 3,459 Class A Common Units.
In May 2025, the Company and Forterra entered into the Unit Repurchase Agreement pursuant to which Forterra repurchased 3,459 Class A Common Units for a price per unit of $840.63 for an aggregated purchase price of $2.9 million. The gain on sale of equity investment was recorded in other income (expense), net in the condensed consolidated statements of operations.
Note 7. Financial Statement Components
Cash and Cash Equivalents
Cash and cash equivalents consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Cash | $ | $ | |||||||||
| Money market funds | |||||||||||
| U.S. treasury securities | |||||||||||
| Commercial paper | |||||||||||
| Corporate bonds | |||||||||||
| Total cash and cash equivalents | $ | $ | |||||||||
Inventory
Inventory comprised of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work-in-process | |||||||||||
| Finished goods | |||||||||||
| Total inventories, net | $ | $ | |||||||||
The Company’s inventory write-downs were $1.2 million and $3.4 million for the three and six months ended June 30, 2025 and $0.9 million and $17.8 million for the three and six months ended June 30, 2024, respectively. The write-downs were primarily due to obsolescence charges as a result of changes in product design, lower of cost or market assessment, yield losses, and other adjustments.
16
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Prepaid expenses | $ | $ | |||||||||
| Contract assets | |||||||||||
| Advance payments to vendors | |||||||||||
| Other receivables | |||||||||||
| Total prepaid expenses and other current assets | $ | $ | |||||||||
Property and Equipment
Property and equipment consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Machinery and equipment | $ | $ | |||||||||
| Computer hardware and software | |||||||||||
| Land | |||||||||||
| Leasehold improvements | |||||||||||
| Vehicles, including demonstration fleet | |||||||||||
| Furniture and fixtures | |||||||||||
| Construction in progress | |||||||||||
| Total property and equipment | |||||||||||
Accumulated depreciation | ( | ( | |||||||||
| Total property and equipment, net | $ | $ | |||||||||
Property and equipment capitalized under finance lease were not material.
Depreciation expense associated with property and equipment was $3.3 million and $6.7 million for the three and six months ended June 30, 2025, and $5.4 million and $12.5 million for the three and six months ended June 30, 2024, respectively.
The Company continually evaluates opportunities for optimizing its manufacturing processes and product design, including evaluating its sourcing strategies to reduce per unit sensor manufacturing costs. In 2023, the Company finalized and committed to a change in sourcing of certain sub-assemblies and components from one supplier to another, which required the Company to abandon certain equipment located at the legacy supplier. As a result, the Company reduced the useful lives of the long-lived assets within the impacted asset group in line with when these assets are expected to be abandoned. The reduction in the estimated useful lives of the impacted assets resulted in the Company recording $0.1 million and $0.3 million of incremental accelerated depreciation charges in the three and six months ended June 30, 2025, respectively.
Intangible Assets
The following table summarizes the activity in the Company’s intangible assets (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||||||||
| Beginning of the period | $ | $ | |||||||||||||||
| Additions | |||||||||||||||||
Amortization | ( | ( | |||||||||||||||
Impairment | ( | ||||||||||||||||
| End of the period | $ | $ | |||||||||||||||
17
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Intangible assets were acquired in connection with the Company’s acquisition of Optogration in August 2021, Freedom Photonics in April 2022, and acquisition of certain assets from Solfice in June 2022 and Seagate in January 2023. The components of intangible assets were as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gross Carrying Amount | Accumulated Amortization | Impairment (1) | Net Carrying Amount | Weighted Average Remaining Period (Years) | Gross Carrying Amount | Accumulated Amortization | Impairment (1) | Net Carrying Amount | Weighted Average Remaining Period (Years) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Customer relationships | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||
| Customer backlog | ( | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tradename | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assembled workforce | ( | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Developed technology | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| IPR&D | — | ( | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total intangible assets | $ | $ | ( | $ | ( | $ | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||||||||||
(1) See below for discussions related to impairment charges.
Amortization expense related to intangible assets was $1.0 million and $2.1 million for the three and six months ended June 30, 2025 and $1.0 million and $2.0 million for the three and six months ended June 30, 2024, respectively.
As of June 30, 2025, the expected future amortization expense for intangible assets was as follows (in thousands):
| Period | Expected Future Amortization Expense | |||||||
2025 (remaining six months) | $ | |||||||
| 2026 | ||||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| Thereafter | ||||||||
| Total | $ | |||||||
Goodwill
The carrying amount of goodwill allocated to the Company’s reportable segments was as follows (in thousands):
| Autonomy Solutions | ATS | Total | |||||||||||||||
Balance as of December 31, 2024 | $ | $ | $ | ||||||||||||||
| Impairment of goodwill related to Freedom Photonics | |||||||||||||||||
Balance as of June 30, 2025 | $ | $ | $ | ||||||||||||||
Total life-to-date goodwill impairment charge recorded by the ATS reportable segment was $15.9 million. No impairment charge has been recorded by the Autonomy Solutions reportable segment.
18
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Other Non-Current Assets
Other non-current assets consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Security deposits | $ | $ | |||||||||
| Non-marketable equity investment (see Note 6 for additional information) | |||||||||||
Prepaid expenses non-current | |||||||||||
| Other non-current assets | |||||||||||
| Total other non-current assets | $ | $ | |||||||||
Accrued and Other Current Liabilities
Accrued and other current liabilities consisted of the following (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Accrued compensation and benefits | $ | $ | |||||||||
| Accrued expenses | |||||||||||
| Warranty reserves | |||||||||||
| Contract liabilities | |||||||||||
Accrued interest payable and other liabilities | |||||||||||
| Total accrued and other current liabilities | $ | $ | |||||||||
During the three and six months ended June 30, 2025, the Company recorded $0.4 million and $0.5 million, and $10.2 million and $12.5 million for the three and six months ended June 30,2024, respectively, in cost of sales (services) for estimated losses expected to be incurred on NRE service projects with certain customers. The estimated contract losses recorded during the three and six months ended June 30, 2025 were primarily driven by changes in scope of project deliverables agreed upon with a customer.
Note 8. Debt
2026 Convertible Senior Notes and Capped Call Transactions
In December 2021, the Company issued $625.0 million aggregate principal amount of 1.25 % Convertible Senior Notes due 2026 in a private placement, which included $75.0 million aggregate principal amount of such notes pursuant to the exercise in full of the option granted to the initial purchasers to purchase additional notes (collectively, the “2026 Convertible Senior Notes”). The interest on the 2026 Convertible Senior Notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2022. The 2026 Convertible Senior Notes will mature on December 15, 2026, unless repurchased or redeemed earlier by the Company or converted pursuant to their terms.
Each $1,000 principal amount of the 2026 Convertible Senior Notes is initially convertible into 3.3365 shares of the Company’s Class A common stock, par value $0.0001 , which is equivalent to an initial conversion price of approximately $299.70 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events prior to the maturity date but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity date or if the Company delivers a notice of redemption in respect of some or all of the 2026 Convertible Senior Notes, the Company will, under certain circumstances, increase the conversion rate of the 2026 Convertible Senior Notes for a holder who elects to convert its 2026 Convertible Senior Notes in connection with such a corporate event or convert its 2026 Convertible Senior Notes called for redemption during the related redemption period, as the case may be. The 2026 Convertible Senior Notes are redeemable, in whole or in part (subject to certain limitations), at the Company’s option at any time, and from time to time on or before the 40th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the 2026 Convertible Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, but only if certain liquidity conditions are satisfied and the last reported sale price per share of the Class A common stock exceeds 130 % of the conversion price on (1) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice, and (2) the trading day immediately before the date the Company sends such notice. If the Company undergoes a fundamental change (as defined in the indenture governing the 2026 Convertible Senior Notes) prior to the maturity date, holders may require the Company to repurchase for cash all or any portion of their 2026 Convertible Senior Notes in principal amounts of $1,000 or a multiple thereof at a fundamental change repurchase
19
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
price equal to 100 % of the principal amount of the 2026 Convertible Senior Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.
Holders of the 2026 Convertible Senior Notes may convert their 2026 Convertible Senior Notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2026, in multiples of $1,000 principal amount, only under the following circumstances: (1) during any calendar quarter (and only during such calendar quarter) commencing after the calendar quarter ending on March 31, 2022, if the last reported sale price per share of the Class A common stock exceeds 130 % of the conversion price for each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of 2026 Convertible Senior Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price per share of the Class A common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of specified corporate events or distributions on the Class A common stock; and (4) if the 2026 Convertible Senior Notes are called for redemption. On or after June 15, 2026, holders may convert all or any portion of their 2026 Convertible Senior Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of its Class A common stock or a combination of cash and shares of its Class A common stock, at the Company’s election. As of June 30, 2025, the conditions allowing holders of the 2026 Convertible Senior Notes to convert were not met.
The 2026 Convertible Senior Notes are senior unsecured obligations and will rank equal in right of payment with the Company’s future senior unsecured indebtedness; senior in right of payment to the Company’s future indebtedness that is expressly subordinated to the 2026 Convertible Senior Notes; effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing that indebtedness; and structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any, of the Company’s subsidiaries.
The Company has classified the 2026 Convertible Senior Notes as a non-current liability. Debt discount and issuance costs aggregating approximately $16.2 million were initially recorded as a reduction to the principal amount of the 2026 Convertible Senior Notes and is being amortized as interest expense on a straight line basis over the contractual terms of the notes. The Company estimates that the difference between amortizing the debt discounts and the issuance costs using the straight line method as compared to using the effective interest rate method is immaterial.
In connection with the offering of the 2026 Convertible Senior Notes, the Company entered into privately negotiated capped call option transactions with certain counterparties (the “Capped Calls”). The Capped Calls each have an initial strike price of approximately $299.70 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2026 Convertible Senior Notes. The Capped Calls have initial cap prices of $452.40 per share, subject to certain adjustment events. The Capped Calls are generally intended to reduce the potential dilution to the Class A common stock upon any conversion of the 2026 Convertible Senior Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 2026 Convertible Senior Notes, as the case may be, with such reduction and/or offset subject to a cap based on the cap price. The Capped Calls expire on April 6, 2027, subject to earlier exercise. The Capped Calls are subject to either adjustment or termination upon the occurrence of specified extraordinary events affecting the Company, including a merger event, a tender offer, and a nationalization, insolvency or delisting involving the Company. In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including changes in law, failure to deliver, and hedging disruptions. The Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The net cost of $73.4 million incurred to purchase the Capped Calls was recorded as a reduction to additional paid-in capital in the accompanying condensed consolidated balance sheet.
In August 2024, pursuant to a privately negotiated exchange agreement, the Company exchanged $421.9 million in aggregate principal amount of the outstanding 2026 Convertible Senior Notes for $82.3 million in aggregate principal amount of its newly issued 9.0 % convertible second lien senior secured notes due 2030 (the “Series 1 Notes”), and $192.0 million in aggregate principal amount of its newly issued 11.5 % convertible second lien senior secured notes due 2030 (the “Series 2 Notes”, and collectively with the Series 1 Notes, the “2030 Convertible Notes”). Concurrently with the Exchange Transaction, the Company also issued $100.0 million aggregate principal amount of its newly issued first-lien, senior secured floating rate notes due 2028 (the “Senior Notes”) in a private placement for cash consideration of $97.0 million. As a result of the exchange and purchase transactions (the “Note Purchase and Initial Exchange Transaction”), during the third quarter of 2024, the Company recognized $142.2 million gain on debt extinguishment which represented the difference between the carrying value of the 2026 Convertible Senior Notes so exchanged and the collective fair value of 2030 Convertible Notes and the Senior
20
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Notes, net of the cash payment received from the investors. The extinguishment gain was recorded in other income (expense), net in the condensed consolidated statements of operations.
In March 2025, the Company entered into separate, individually negotiated private exchange agreements with certain holders of the Company’s 2026 Convertible Senior Notes to exchange $18.2 million aggregate principal amount of 2026 Convertible Senior Notes (the “March 2025 Exchanged Notes”) for newly issued shares of the Company’s Class A common stock, plus, in certain circumstances, cash in respect of accrued and unpaid interest on the March 2025 Exchanged Notes (such exchanges, collectively, the “March 2025 Exchange Transactions”). The Company canceled the March 2025 Exchanged Notes received in the March 2025 Exchange Transactions.
The March 2025 Exchange Transactions settled in four consecutive daily tranches, each for $4.6 million aggregate principal amount of March 2025 Exchanged Notes, commencing on March 25, 2025. The number of shares of Class A common stock issued for each $1,000 principal amount of March 2025 Exchanged Notes in each tranche was based on a formula set forth in the Exchange Agreements. As of March 28, 2025, which was the final settlement date of the March 2025 Exchange Transactions, the Company had issued an aggregate of 1,951,819 shares of Class A common stock in the March 2025 Exchange Transactions. The Company did not receive any cash proceeds from the March 2025 Exchange Transactions and did not pay cash to the lenders.
In May 2025, the Company entered into separate, individually negotiated private exchange agreements and private repurchase agreements with certain holders of the Company’ 2026 Convertible Senior Notes to exchange $6.2 million aggregate principal amount of 2026 Convertible Senior Notes (the “May 2025 Exchanged Notes”) for an aggregate of 1,098,931 newly issued shares of the Company’s Class A common stock (the “May 2025 Exchange Transactions”) and repurchase $43.8 million aggregate principal amount of 2026 Convertible Senior Notes (the “Repurchased Notes”) for an aggregate of $30.3 million in cash (the “Repurchase Transaction”), in each case, inclusive of accrued and unpaid interest on the May 2025 Exchanged Notes and Repurchased Notes.
As a result of March 2025 and May 2025 Exchange Transactions and Repurchase Transaction, during the three and six months ended June 30, 2025, the Company recognized $15.3 million and $21.5 million gain on debt extinguishment as a result of TDR, respectively, which represented the difference between the carrying value of the 2026 Convertible Senior Notes and fair value of the Class A common stock issued and amount of legal fees incurred. The extinguishment gain was recorded in other income (expense), net in the condensed consolidated statements of operations.
The net carrying amount of the 2026 Convertible Senior Notes was as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Principal | $ | $ | |||||||||
| Unamortized debt discount and issuance costs | ( | ( | |||||||||
| Net carrying amount | $ | $ | |||||||||
The following table sets forth the interest expense recognized related to the 2026 Convertible Senior Notes (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Contractual interest expense | $ | $ | $ | $ | |||||||||||||||||||
| Amortization of debt discount and issuance costs | |||||||||||||||||||||||
| Total interest expense | $ | $ | $ | $ | |||||||||||||||||||
The remaining term over which the debt discount and issuance costs will be amortized is 1.5 years. Contractual interest expense is reflected as a component of other income (expense), net in the condensed consolidated statement of operations for the three and six months ended June 30, 2025 and 2024, respectively.
Senior Notes
On August 8, 2024, the Company issued $100.0 million aggregate principal amount of Senior Notes in a private placement (the “Note Purchase”). At the time of the issuance, the fair value of the Senior Notes was $97.0 million, resulting in a debt discount of $3.0 million.
The Senior Notes will mature on the earlier of (i) August 15, 2028 or (ii) if more than $100.0 million of the 2026 Convertible Senior Notes remain outstanding as of June 30, 2026, then September 15, 2026. The Senior Notes will bear floating
21
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
interest at a rate equal to Term SOFR plus 9.0 %, subject to a Term secured overnight financing rate (“SOFR”) floor of 3.0 %, resulting in an effective interest rate of 15.0 % as of June 30, 2025. Interest is payable quarterly in arrears on February 15, May 15, August 15, and November 15 of each year.
The Company may redeem the Senior Notes at its option, in whole at any time or in part from time to time, at the following redemption prices (expressed as percentages of principal amount) plus accrued and unpaid interest, if redeemed during the following periods, inclusive of the prepayment fee due on any such redemption: on or prior to August 15, 2026: 111 %; after August 15, 2026 and on or prior to August 15, 2027: 108 %; and after August 15, 2027: 103 %. The Senior Notes are also subject to a customary make-whole payment in the event of any redemption or acceleration of the Senior Notes on or prior to August 15, 2025.
In the event of a change of control, as defined in the indenture governing the Senior Notes (the “First Lien Indenture”), the holders of the Senior Notes may require the Company to repurchase their notes at a cash repurchase price equal to 103 % of the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.
The Senior Notes are guaranteed by certain of the Company’s current and future material subsidiaries on a senior secured basis, subject to certain criteria and exceptions. The Senior Notes and the guarantees are secured by a fully perfected first-priority lien on substantially all of the assets of the Company and certain subsidiary guarantors (the “Guarantors”), subject to certain exceptions, including any first-priority liens on customary asset-based lending collateral, including accounts receivable and inventory, pursuant to a revolving credit facility permitted under the First Lien Indenture.
The First Lien Indenture includes restrictive covenants that, among other things, limit the ability of the Company and its subsidiaries to incur additional debt, make restricted payments and grant or incur liens, in addition to a financial covenant to maintain an unrestricted cash and cash equivalents balance, plus any unused commitments then available to be drawn under any revolving credit facility permitted under the First Lien Indenture, of not less than $35.0 million as of the last day, or for more than five days, of any calendar month. The First Lien Indenture also contains customary events of default.
The Company has classified the Senior Notes as a non-current liability. Initial debt discount and issuance costs aggregating approximately $4.9 million were initially recorded as a reduction to the principal amount and will be amortized as interest expense over the contractual terms of the Senior Notes based on the effective interest rate of 16.0 %.
The Company recognized interest expense of $3.6 million and $7.1 million for the Senior Notes during the three and six months ended June 30, 2025, respectively, which included $0.3 million and $0.5 million from the amortization of debt discount and issuance costs, respectively.
The net carrying amount of the Senior Notes was as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Principal | $ | $ | |||||||||
| Unamortized debt discount and issuance costs | ( | ( | |||||||||
| Net carrying amount | $ | $ | |||||||||
The remaining term over which the debt discount and issuance costs will be amortized is 3.1 years.
The Company estimated the fair value of the Senior Notes using a binomial model as of August 8, 2024, with the following valuation inputs: payment interest rate of 12.4 % - 14.3 %, effective borrowing rate of 14.4 %, interest rate volatility of 23.0 %.
The Company estimated the fair value of the Senior Notes using a binomial model as of June 30, 2025, with the following valuation inputs: payment interest rate of 17.8 % - 16.0 %, effective borrowing rate of 13.3 %, interest rate volatility of 30.4 %.
2030 Convertible Notes
On August 8, 2024, the Company issued $82.3 million in aggregate principal amount of the Series 1 Notes (the Series 1 Notes”) and $192.0 million in aggregate principal amount of the Series 2 Notes (the “Series 2 Notes” and together with the Series 1 Notes, the “2030 Convertible Notes”) (the “Initial Exchange Transaction”) in exchange for $421.9 million aggregate principal amount of outstanding 2026 Convertible Senior Notes. At the time of the exchange, the fair value of the Series 1 Notes and the Series 2 Notes was $87.5 million and $186.2 million, respectively, resulting in a debt premium of $5.2 million and a debt discount of $5.7 million, respectively.
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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
The 2030 Convertible Notes will mature on the earlier of (i) January 15, 2030 or (ii) if more than $100.0 million of the 2026 Convertible Senior Notes remain outstanding as of June 30, 2026, then September 15, 2026. The Series 1 Notes bear interest at a rate of 9.0 % per annum, and the Series 2 Notes bear interest at a rate of 11.5 % per annum. Interest is payable quarterly in arrears on January 15, April 15, July 15, and October 15 of each year.
Each $1,000 45.8568 and 27.5141 shares of the Company’s Class A common stock, which is equivalent to an initial conversion price of approximately $21.75 and $36.30 per share, respectively. The conversion rate is subject to adjustment upon the occurrence of certain specified events prior to the maturity date.
The 2030 Convertible Notes are convertible at the option of the holders at any time before the maturity date, at the conversion price then in effect plus a make-whole premium (the “Make-Whole Premium”) equal to the lesser of (i) all regularly scheduled interest payments that would be due on the portion of such 2030 Convertible Notes being redeemed for the succeeding two year period and (ii) all regularly scheduled interest payments that would be due on the portion of such 2030 Convertible Notes being redeemed through the maturity date, and is capped at the maximum number of shares that would be issuable in connection with a conversion following a “Make-Whole Fundamental Change”, as defined in the indenture governing the 2030 Convertible Notes (the “Second Lien Indenture”). The Make-Whole Premium will be payable in either cash or shares, at the Company’s option.
The Company accounted for the conversion option of the Series 1 Notes and Series 2 Notes as bifurcated derivatives and are accounted for separately as derivative instruments. The bifurcated derivative instruments are liability classified and the initial fair value of the derivative instruments of $25.2 million and $24.0 million was recorded in the consolidated balance sheet with the corresponding amount recorded as a discount to the Series 1 Notes and Series 2 Notes, respectively, upon issuance. The Company remeasures the derivative liabilities at each reporting period with any changes recorded in other income (expense), net in the consolidated statements of operations.
If a fundamental change, as defined in the Second Lien Indenture, occurs, then holders may require the Company to repurchase their 2030 Convertible Notes at a cash repurchase price equal to 100 % of the principal amount of the 2030 Convertible Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. A holder that elects to convert its 2030 Convertible Notes in connection with a fundamental change may be entitled to receive a make-whole adjustment in connection with such corporate event in certain circumstances. The definition of fundamental change includes certain business combination transactions involving the Company and certain delisting events with respect to the Company’s Class A common stock.
The Company may redeem the 2030 Convertible Notes at its option, in whole at any time or in part from time to time, if the closing price of the Company’s Class A common stock exceeds 130 % of the conversion price for a given Series then in effect for at least 20 trading days (whether or not consecutive) during any 30 day consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, and certain liquidity conditions are then satisfied, at a redemption price equal to (i) 100 % of the principal amount of the 2030 Convertible Notes to be redeemed, plus (ii) accrued and unpaid interest to, but excluding the redemption date, and (iii) the Make-Whole Premium.
The 2030 Convertible Notes are guaranteed by certain of the Company’s current and future material subsidiaries on a second-priority senior secured basis, subject to certain criteria and exceptions. The 2030 Convertible Notes and the guarantees are secured by a fully perfected second-priority lien on substantially all of the assets of the Company and the Guarantors, subject to the first-priority liens securing or otherwise permitted by the Senior Notes and any first-priority liens on customary asset-based lending collateral, including accounts receivable and inventory, pursuant to a revolving credit facility permitted under the Second Lien Indenture.
The Second Lien Indenture includes restrictive covenants substantially similar to the First Lien Indenture that, among other things, limit the ability of the Company and its subsidiaries to incur additional debt, make restricted payments and grant or incur liens, in addition to a financial covenant to maintain an unrestricted cash and cash equivalents balance, plus any unused commitments then available to be drawn under any revolving credit facility permitted under the Second Lien Indenture, of not less than $31.5 million as of the last day, or for more than five days, of any calendar month. The Second Lien Indenture also contains customary events of default.
The Company has classified the 2030 Convertible Notes as a non-current liability. Initial debt discount (including the initial fair value of the bifurcated derivative liabilities) and issuance costs aggregating approximately $21.6 million and $33.3 million were initially recorded as a reduction to the principal amount of the Series 1 Notes and Series 2 Notes,
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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
respectively, and will be amortized as interest expense over the contractual terms of the 2030 Convertible Notes based on the effective interest rates of 16.3 % and 16.3 %, respectively.
There were no Series 2 Notes converted by the holders during the three months ended June 30, 2025. During the six months ending June 30, 2025, $2.0 million in aggregate principal amount of Series 2 Notes were converted by the holders. The Company issued 127,466 shares of the Class A common stock to settle such conversion. During the six months ended June 30, 2025, the Company recognized a debt extinguishment gain of $0.6 million on such conversions which was recorded in other income (expense), net in the condensed consolidated statements of operations.
The Company recognized interest expense of $1.7 million and $6.2 million for the Series 1 Notes and Series 2 Notes, respectively, during the three months ended June 30, 2025, which included $0.5 million and $1.0 million, respectively, from the amortization of debt discount and issuance costs. The Company recognized interest expense of $3.4 million and $12.4 million for the Series 1 Notes and Series 2 Notes, respectively, during the six months ended June 30, 2025, which included $0.9 million and $2.0 million, respectively, from the amortization of debt discount and issuance costs.
The net carrying amount of the 2030 Convertible Notes was as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||||||||||||||
| Series 1 Notes | Series 2 Notes | Series 1 Notes | Series 2 Notes | ||||||||||||||||||||
Principal | $ | $ | $ | $ | |||||||||||||||||||
Unamortized debt discount and issuance costs | ( | ( | ( | ( | |||||||||||||||||||
Net carrying amount | $ | $ | $ | $ | |||||||||||||||||||
The remaining term over which the debt discount and issuance costs will be amortized is 4.5 years.
The conversion option and other features of the Series 1 Notes and Series 2 Notes are accounted for as bifurcated derivative liabilities. The derivative liabilities are considered a Level 3 valuation and are recorded at the estimated fair value at the end of each reporting period, with the changes in fair value recognized within other expense, net in the condensed consolidated statements of operations.
The following table shows the estimated fair value of the derivative liabilities and the change in fair value:
| June 30, 2025 | June 30, 2024 | ||||||||||||||||||||||||||||||||||
| Series 1 Notes | Series 2 Notes | Series 1 Notes | Series 2 Notes | ||||||||||||||||||||||||||||||||
Derivative liability, beginning of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Change in fair value | ( | ( | |||||||||||||||||||||||||||||||||
Decrease of derivative liability upon exercise of conversion option | ( | ||||||||||||||||||||||||||||||||||
Derivative liability, end of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
The Company estimated the fair value of the 2030 Convertible Notes and derivative liability using a binomial model, with the following valuation inputs:
| Series 1 Notes | Series 2 Notes | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2025 | December 31, 2024 | June 30, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||
| Conversion price | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Risk-free rate | % | % | % | % | |||||||||||||||||||||||||||||||||||||
| Effective borrowing rate | % | % | % | % | |||||||||||||||||||||||||||||||||||||
| Volatility | % | % | % | % | |||||||||||||||||||||||||||||||||||||
| Stock price | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
| Payment interest rate | % | % | % | % | |||||||||||||||||||||||||||||||||||||
| Redemption price | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Credit Facility
In February 2024, the Company entered into two non-recourse loan and securities pledge agreements (the “Loan Agreements”) with The St. James Bank & Trust Company Ltd. (the “Lender”), pursuant to which the Company may borrow up to an aggregate of $50.0 million (the “Credit Facility”). Any loans made by the Lender under the Loan Agreements would be
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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
collateralized by shares of the Company’s Class A common stock or stock the Company holds as investments in other companies. The Loan Agreements require the Company to pay an up-front structure fee of 1.5 % on any amounts borrowed, and any outstanding amounts would bear interest at 8.0 % per annum. The Company has not borrowed any amounts under the Credit Facility and had no outstanding balance as of June 30, 2025.
Note 9. Fair Value Measurements
As of June 30, 2025, the Company carried cash equivalents, marketable investments, bifurcated derivatives associated with the 2030 Convertible Notes and Private Warrants that are measured at fair value on a recurring basis. Additionally, the Company measures its equity-settled fixed value awards at fair value on a recurring basis. See Note 13 for further information on the Company’s fixed value equity awards.
Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 — Observable inputs, which include unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2 — Observable inputs other than Level 1 inputs, such as quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 — Unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined by using pricing models, discounted cash flow methodologies or similar techniques.
The Company determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments.
Given that the transfer of Private Warrants to anyone outside of a small group of individuals constituting the sponsors of Gores Metropoulos, Inc. (“Gores”) would result in the Private Warrants having substantially the same terms as warrants issued in connection with the initial public offering of Gores (“Public Warrants”), management determined that the fair value of each Private Warrant is the same as that of a Public Warrant, with an insignificant adjustment for short-term marketability restrictions. The fair value of Private Warrants was at de minimis as of June 30, 2025 and December 31, 2024.
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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows (in thousands):
Fair Value Measured as of June 30, 2025: | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Money market funds | $ | $ | $ | $ | |||||||||||||||||||
| U.S. treasury securities | |||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
| Total cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Marketable investments: | |||||||||||||||||||||||
| U.S. treasury securities | $ | $ | $ | $ | |||||||||||||||||||
| Commercial paper | |||||||||||||||||||||||
| Corporate bonds | |||||||||||||||||||||||
| Marketable equity investments | |||||||||||||||||||||||
| Total marketable investments | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Derivative liability | $ | $ | $ | ( | $ | ( | |||||||||||||||||
Fair Value Measured as of December 31, 2024: | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Money market funds | $ | $ | $ | $ | |||||||||||||||||||
| U.S. treasury securities | |||||||||||||||||||||||
| Commercial paper | |||||||||||||||||||||||
| Corporate bonds | |||||||||||||||||||||||
| Total cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Marketable investments: | |||||||||||||||||||||||
| U.S. treasury securities | $ | $ | $ | $ | |||||||||||||||||||
| Certificate of deposits | |||||||||||||||||||||||
| Commercial paper | |||||||||||||||||||||||
| Corporate bonds | |||||||||||||||||||||||
| Marketable equity investments | |||||||||||||||||||||||
| Total marketable investments | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Derivative liability | $ | $ | $ | ( | $ | ( | |||||||||||||||||
26
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
As of June 30, 2025 and December 31, 2024, the estimated fair value of the Company’s outstanding 2026 Convertible Senior Notes was $85.1 million and $93.6 million, respectively. The fair value was determined based on the quoted price of the 2026 Convertible Senior Notes in an inactive market on the last trading day of the reporting period and have been classified as Level 2 in the fair value hierarchy. See Note 8 for further information on the Company’s 2026 Convertible Senior Notes.
As of June 30, 2025, the estimated fair value of the Series 1 Notes and Series 2 Notes of the 2030 Convertible Notes, excluding the bifurcated derivative liabilities value was $22.4 million and $83.7 million, respectively. As of December 31, 2024, the estimated fair value of the Series 1 Notes and Series 2 Notes of the 2030 Convertible Notes, excluding the bifurcate derivative liabilities value was $52.1 million and $190.8 million, respectively. As of June 30, 2025 and December 31, 2024, the estimated fair value of the Senior Notes was $98.9 million and $111.0 million, respectively. The fair value was determined based on a binomial lattice model and have been classified as Level 3 in the fair value hierarchy. See Note 8 for further information on these notes.
The Company’s other financial instruments’ fair value, including accounts receivable, accounts payable and other current liabilities, approximate its carrying value due to the relatively short maturity of those instruments. The carrying amounts of the Company’s finance leases approximate their fair value, which is the present value of expected future cash payments based on assumptions about current interest rates and the creditworthiness of the Company.
Note 10. Earnings (Loss) Per Share
Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is calculated by dividing net income by the weighted average number of common shares and potentially dilutive securities outstanding during the period, using the treasury stock method for the employee equity incentive plans and stock-based awards, and the if-converted method for the 2026 Convertible Senior Notes and 2030 Convertible Notes. If the Company reports a net loss, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be antidilutive. The Company computes earnings (loss) per share using the two-class method for its Class A and Class B common stock. Earnings (loss) per share is the same for both Class A and Class B common stock since they are entitled to the same liquidation and dividend rights.
The following table sets forth the computation of basic and diluted loss per share for the three and six months ended June 30, 2025 and 2024 (in thousands, except for share and per share amounts):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Less: Deemed dividend on Series A preferred stock | ( | ( | |||||||||||||||||||||
Net loss attributable to common stockholders | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Denominator: | |||||||||||||||||||||||
Weighted average common shares outstanding—Basic and diluted | |||||||||||||||||||||||
Net loss per share attributable to common stockholders —Basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
27
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
The following table presents the potential shares of common stock outstanding that were excluded from the computation of diluted net loss per share of common stock as of June 30, 2025 because including them would have been antidilutive or related contingencies on issuance of shares had not been met for the as of June 30, 2025:
June 30, 2025 | |||||
| Warrants | |||||
| Stock-based awards—Equity classified | |||||
| Stock-based awards—Liability classified | |||||
| Vendor stock-in-lieu of cash program | |||||
Series 1 Notes | |||||
Series 2 Notes | |||||
2026 Convertible Senior Notes | |||||
Series A preferred stock | |||||
| Earn-out shares | |||||
| Total | |||||
Note 11. Preferred Stock
Series A Preferred Stock Financing
On May 19, 2025, the Company entered into a securities purchase agreement (the “Series A Purchase Agreement”) with certain institutional accredited investors, pursuant to which the Company may issue and sell, in a series of registered direct offerings, up to an aggregate of 200,000 shares of newly designated Series A Convertible Preferred Stock, par value $0.0001 per share, with a stated value of $1,000 per share (the “Series A Preferred Stock”), to the investors at a purchase price of $960.00 per share, subject to the satisfaction of certain conditions upon each closing. The initial offering for 35,000 shares (the “Preferred Shares”) of Series A Preferred Stock was closed on May 22, 2025 (the “First Closing”), for net proceeds to the Company of $33.6 million, before deducting placement agent fees and other offering expenses. As the closing, the Company also issued the lead investor 505,051 shares of the Company’s Class A common stock as a commitment fee pursuant to the Series A Purchase Agreement.
The Company’ Series A Preferred Stock is redeemable at the option of the Company, upon the payment in full of certain Company debt or the occurrence of a “Fundamental Transaction”, each as described below. The Series A Preferred Stock is redeemable at the option of the holders following a period of time after the maturity date of the First Lien Notes and the Second Lien Notes or in connection with a Fundamental Transaction, each as described below, and is classified as mezzanine. The Series A Preferred stock was initially recorded at fair value upon issuance in the amount of $29.4 million, net of issuance cost, commitment fee and discount. As of June 30, 2025, holders of the Company’s Series A Preferred Stock converted an aggregate of 12,000 shares of Series A Preferred Stock into 4,087,889 shares of Class A common stock.
In connection with the First Closing, the Company designated 254,000 shares of its authorized and unissued preferred stock as Series A Preferred Stock and established voting and other relative rights, powers and preferences of the Series A Preferred Stock and the qualification, limitations and restrictions thereof pursuant to the Certificate of Designations of the Series A Preferred Stock (the “Certificate of Designations”), as summarized below:
Ranking
The Series A Preferred Stock, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to all of the Company’s capital stock, unless the Required Holders (as defined in the Certificate of Designations) consent to the creation of other capital stock that is senior or equal in rank to the Series A Preferred Stock.
Liquidation Preference
In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of the Series A Preferred Stock shall be entitled to receive, before any payment or distribution is made to holders of Class A common stock, an amount per share on an as converted basis.
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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Dividends
The holders of Series A Preferred Stock will be entitled to receive dividends on the stated value of their shares of Series A Preferred Stock from and after the occurrence of any “Triggering Event” (as defined in the Certificate of Designations) and during the continuance of the Triggering Event. A Triggering Event includes, but not limited to: suspension from trading or failure of the Class A common stock to be trading or listed within certain time periods; failure to issue conversion shares within certain time periods; failure to pay dividends on any dividend date; and certain bankruptcy or insolvency events. Any such dividends are payable “in kind”, in the form of additional shares of Series A Preferred Stock, quarterly in arrears at the dividend rate of 18 % per annum.
Conversion Rights
Each share of Series A Preferred Stock is convertible, at the option of the holder, into shares of Class A common stock at a conversion price equal to the lesser of (i) a fixed price of $4.752 and (ii) 95 % of the lowest volume weighted average price (“VWAP”) over the five trading days immediately preceding the conversion date, subject to a floor price of $0.792 . The conversion price is subject to adjustment for stock split, combinations, dividends, and similar events. When the effective conversion price is determined based on subclause (ii) above, it is in substance a share-settled redemption feature since the investors would receive a determinable payoff on their investment in the Series A Preferred Stock. As of June 30, 2025, the redemption feature was exercisable because the effective conversion price was determined by subclause (ii) above. Therefore, as of June 30, 2025, it was probable that the Series A Preferred Stock would become redeemable. Accordingly, the carrying amount of the Series A Preferred Stock was required to be accreted to its redemption value. During the three and six months ended June 30, 2025, the Company recorded $7.6
Conversions are subject to certain limitations (i) a beneficial ownership cap of 4.99 % of outstanding common stock; (ii) a monthly conversion cap equal to the greater of $12.5 million or 12.5 % of the aggregate daily dollar trading volume on Nasdaq during the months (unless a Triggering Event has occurred or conversion is at the fixed price); and (iii) a cap on issuances of common stock without shareholder approval under applicable Nasdaq rules, which approval was obtained on July 3, 2025.
Voting Rights
Except as provided in the Certificate of Designations or as otherwise required by law, holders of the Series A Preferred Stock will vote as a single class with the holders of Class A common stock (and any other class or series of capital stock of the Company that votes as a single class with the holders of the Class A common stock) on an “as converted” basis on all matters submitted to a vote of stockholders of the Company; provided, however, that (i) holders of the Series A Preferred Stock are not entitled to vote on any proposal to approve the issuance of Class A common stock pursuant to the Certificate of Designations in excess of the exchange cap and (ii) no holder of the Series A Preferred Stock will have the power to vote any shares beneficially owned or that may be deemed to be beneficially owned by such holder in excess of the maximum percentage.
Transfer Restrictions
A holder may not transfer all or any portion of its shares of Series A Preferred Stock without the Company’s express prior written consent, except to an affiliate of such holder or to the Company.
Company Optional Redemption
At any time at or after the repayment in full of the Company’s Floating Rate Senior Secured Notes due 2028 (the “First Lien Notes”) and the Company’s Convertible Second Lien Senior Secured Notes due 2030 (the “Second Lien Notes”), the Company has the right to redeem all or some of the then outstanding shares of Series A Preferred Stock at a cash redemption price equal to the stated value ($1,000 per share) of such shares, subject to the satisfaction of certain conditions set forth in the Certificate of Designations.
Company Optional Redemption in Connection with a Fundamental Transaction
In connection with any Fundamental Transaction (as described below), the Company has the right to redeem all, and not less than all, of the Series A Preferred Stock then outstanding at a cash redemption price equal to a 105 % redemption premium to the stated value of the Series A Preferred Stock being redeemed (such price, the “Fundamental Transaction Redemption Price”), subject to the satisfaction of certain conditions set forth in the Certificate of Designations, including the prior repayment in full of the First Lien Notes and the Second Lien Notes.
29
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Redemption at the Option of the Holders
At any time beginning on or after the later of the date that is 181 days after the maturity date of the First Lien Notes and the Second Lien Notes, a holder of Series A Preferred Stock may require the Company to repurchase all or any portion of the holder’s Series A Preferred Stock at the stated value of such shares.
Repurchase at the Option of the Holders Upon a Fundamental Transaction
In connection with a Fundamental Transaction, a holder of Series A Preferred Stock may require the Company to repurchase all or any portion of the holder’s Series A Preferred Stock at a 105 % redemption premium, subject to the prior repayment in full of the First Lien Notes and the Second Lien Notes.
Purchase Rights
If at any time the Company grants, issues or sells any options, convertible securities, or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of Class A common stock (the “Purchase Rights”), then each holder of Series A Preferred Stock will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such holder could have acquired if such holder had held the number of shares of Class A common stock acquirable upon complete conversion of all the Series A Preferred Stock held by such holder immediately prior to the date as of which the record holders of shares of Class A common stock are to be determined for the grant, issue or sale of such Purchase Rights, subject to certain limitations on beneficial ownership.
Fundamental Transactions
The Certificate of Designations prohibits the Company from entering into specified fundamental transactions (including, without limitation, mergers, business combinations and similar transactions) (each, a “Fundamental Transaction”) unless the Company (or the Company’s successor) assumes in writing all of the Company’s obligations under the Certificate of Designations and the other Transaction Documents (as defined in the Certificate of Designations) and the successor entity is a publicly traded corporation listed on an eligible market or else the Company redeems the then outstanding Series A Preferred Stock in full in connection with the Fundamental Transaction.
Covenants
The Certificate of Designations contains a variety of obligations on the Company’s part not to engage in specified activities. In particular, the Company will not, and will cause its subsidiaries to not, redeem, repurchase or declare or pay any cash dividend or distribution on any of the Company’s capital stock (other than as required under the Certificate of Designations or permitted under the indentures governing the First Lien Notes and the Second Lien Notes); incur any indebtedness or any liens (other than any indebtedness or any liens permitted under the indenture governing the Second Lien Notes); or enter into or consummate any transaction for any variable price securities (other than sales of shares pursuant to the Company’s existing “at-the-market” facility and certain other exclusions). In addition, the Company will not issue any preferred stock or issue any other securities that would cause a breach or default under the Certificate of Designations.
Reservation Requirements
So long as any shares of Series A Preferred Stock remain outstanding, the Company has agreed to at all times reserve a number of shares of Class A common stock equal to the sum of (i) 100 % of the aggregate number of shares of Class A common stock as shall from time to time be necessary to effect the conversion of all of the Series A Preferred Stock then outstanding at the Floor Price then in effect (without regard to any limitations on conversions) and (ii) 100 % of the aggregate number of shares of Class A common stock that would be necessary to effect the conversion of that number of shares of Series A Preferred Stock equal to 18 months of dividends on the Series A Preferred Stock then outstanding at the floor price then in effect (without regard to any limitations on conversions).
Note 12. Stockholders’ Equity
Class A and Class B Common Stock
The Company’s board of directors (the “Board”) has authorized two classes of common stock, Class A and Class B. As of June 30, 2025, the Company had authorized 715,000,000 shares of Class A common stock and 121,000,000 shares of Class B common stock with a par value of $0.0001 54,830,075 shares issued and 53,372,512 shares outstanding of Class A common stock, and 4,872,578 one vote per share and the holder of the Class B common stock is entitled to ten votes per share. Shares of Class B common stock can be converted to shares of Class A common stock at any time at the option of the stockholder and
30
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
automatically convert upon sale or transfer, except for certain transfers specified in the Company’s Second Amended and Restated Certificate of Incorporation.
Equity Financing Program
On February 28, 2023, the Company entered into an agreement (the “2023 Sales Agreement”) with Virtu Americas LLC (the “Agent”) under which the Company could offer and sell, from time to time in its sole discretion, shares of the Company’s Class A common stock with aggregate gross sales proceeds of up to $75.0 million through an equity offering program under which the Agent will act as sales agent (the “Equity Financing Program”). The Company completed sales of common stock under the 2023 Sales Agreement in March 2024.
On May 3, 2024, the Company entered into an agreement (the “2024 Sales Agreement”) with the Agent, which extended the Equity Financing Program under the 2023 Sales Agreement. Under the 2024 Sales Agreement, the Company may offer and sell, from time to time in its sole discretion, shares of the Company’s Class A common stock with aggregate gross sales proceeds of up to an additional $150.0 million under the Equity Financing Program. The Company intends to use the net proceeds, from offerings under this program for expenditures or payments in connection with strategic investments, partnerships and similar transactions, repurchases of outstanding convertible debt securities, and for general corporate and business purposes.
In August 2024, the Company increased the Equity Financing Program by an additional $50.0 million pursuant to the 2024 Sales Agreement.
Under the 2024 Sales Agreement, the Company sets the parameters for the sale of the shares, including the number of shares to be issued, the time period during which sales are requested to be made, limitations on the number of shares that may be sold in any one trading day and any minimum price below which sales may not be made. Subject to the terms and conditions of the 2024 Sales Agreement, the Agent has agreed to use its commercially reasonable efforts, consistent with its normal trading and sales practices, to sell the shares by methods deemed to be an “at the market” offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, (the “Securities Act”), including sales made through The Nasdaq Global Select Market.
In March 2025, the Company expanded the program under the 2024 Sales Agreement with the Agent, under which the Company may offer and sell, from time to time in its sole discretion, shares of its Class A common stock, with aggregate gross proceeds of up to an additional $75.0 million under the Equity Financing Program. The Company intends to use the net proceeds from offerings under the Equity Financing Program for general corporate purposes, including payment of interest on debt and otherwise to repay, repurchase, or service such debt.
The Company issued 6,177,023 shares and 6,247,076 shares of Class A common stock under the Equity Financing Program during the three and six months ended June 30, 2025 for net proceeds of $21.1 million and $21.5 million, respectively. As of June 30, 2025, the amount available for sale under the 2024 Sales Agreement was $187.4 million.
Private Warrants
As of December 31, 2024, the number of shares of Class A common stock issuable upon exercise of the outstanding Private Warrants were 111,218 shares. No Private Warrants were exercised during the three and six months ended June 30, 2025. The Private Warrants expire on December 2, 2025. Each Private Warrant allows the holder to purchase one share of Class A common stock at $172.50 per share.
31
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Stock-in-lieu of Cash Program
The Company has entered into arrangements with certain vendors and other third parties wherein the Company at its discretion may elect to compensate the respective vendors and third parties for services provided either in cash or by issuing shares of the Company’s Class A common stock. The Company considers the shares issuable under this Stock-in-lieu of Cash Program as liability classified awards when the arrangement with the vendors requires the Company to issue a variable number of shares to settle amounts owed.
During the six months ended June 30, 2025, the Company issued 1,000,000 shares of Class A common stock to an affiliate of a Company vendor, TPK Holding Co., Ltd. (“TPK”), under the Stock-in-lieu of Cash Program. The shares were issued as consideration for service to be rendered or other payment obligations over the next several fiscal quarters, pursuant to contractual arrangements between the Company and TPK.
As of June 30, 2025, the Company had a total of $3.4 million in prepaid expenses and other current and non-current assets related to its Stock-in-lieu of Cash Program.
The Company’s vendor Stock-in-lieu of Cash Program activity for the six months ended June 30, 2025 was as follows:
| Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||
Unvested shares as of December 31, 2024 | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
Unvested shares as of June 30, 2025 | |||||||||||
Note 13. Stock-based Compensation
Prior to becoming a publicly traded entity, the Company issued incentive stock options, non-qualified stock options, and restricted stock to employees and non-employee consultants under its 2015 Stock Plan (the “2015 Plan”). Since the closing of the business combination between Gores Metropoulos, Inc. and Luminar Technologies, Inc. on December 2, 2020 (the “Business Combination”), the Company has not issued any new stock-based awards under the 2015 Plan.
In December 2020, the Board adopted, and the Company’s stockholders approved the 2020 Equity Incentive Plan (the “2020 Plan”). The 2020 Plan became effective upon the closing of the Business Combination. Under the 2020 Plan, the Company was originally authorized to issue a maximum number of 2,439,218 shares of Class A common stock.
In June 2022, the Company’s stockholders approved an amendment and restatement of the Company’s 2020 Plan (the “Amended 2020 Plan”) to increase the number of shares of Class A common stock authorized for issuance by 2,400,000 additional shares and added an evergreen provision under which the number of shares of Class A common stock available for issuance under the Amended 2020 Plan will be increased on the first day of each fiscal year of the Company beginning with the 2023 fiscal year and ending on (and including) the first day of the 2030 fiscal year, in an amount equal to the lesser of (i) 5 % of the outstanding shares of common stock on the last day of the immediately preceding fiscal year, (ii) 2,666,666 shares or (iii) such number of shares determined by the Board. Pursuant to the evergreen provision, 2,073,584 additional shares of Class A common stock were added to the Amended 2020 Plan on January 1, 2025.
In June 2024, the Company’s stockholders approved an amendment and restatement of the Company’s Amended 2020 Plan (the “Amended and Restated EIP”) to increase the number of shares of Class A common stock authorized for issuance by 1,333,333 additional shares of Class A common stock.
Stock Options
Under the terms of the 2015 Plan, incentive stock options had an exercise price at or above the fair market value of the stock on the date of the grant, while non-qualified stock options were permitted to be granted below fair market value of the stock on the date of grant. Stock options granted have service-based vesting conditions only. The service-based vesting conditions vary, though typically, stock options vest over four years with 25 % of stock options vesting on the first anniversary of the grant and the remaining 75 % vesting monthly over the remaining 36 months. Option holders have a 10 -year period to exercise their options before they expire. Forfeitures are recognized in the period of occurrence.
32
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
The Company’s stock option activity for the six months ended June 30, 2025 was as follows:
| Number of Common Stock Options | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Life (Years) | Aggregate Intrinsic Value (In Thousands) | ||||||||||||||||||||
| Outstanding as of December 31, 2024 | $ | $ | |||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Exercised | |||||||||||||||||||||||
| Cancelled/Forfeited | ( | ||||||||||||||||||||||
| Outstanding as of June 30, 2025 | |||||||||||||||||||||||
Restricted Stock Units
Since the closing of the Business Combination, the Company has granted restricted stock units (“RSUs”) under the Amended and Restated EIP (and prior to its amendment and restatement, under the Amended 2020 Plan and the 2020 Plan). Each RSU granted under the Amended and Restated EIP represents a right to receive one share of the Company’s Class A common stock when the RSU vests. RSUs generally vest over a period up to six years . The Company has granted certain performance-based equity awards that vest upon achievement of certain performance milestones. The fair value of RSUs is equal to the fair value of the Company’s common stock on the date of grant.
The Company’s Time-Based RSUs and Performance-Based and Other RSUs activity for the six months ended June 30, 2025 was as follows:
| Time-Based RSUs | Performance-Based and Other RSUs | ||||||||||||||||||||||
| Shares | Weighted Average Grant Date Fair Value per Share | Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||||||||||||
| Outstanding as of December 31, 2024 | $ | $ | |||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Forfeited | ( | ||||||||||||||||||||||
| Vested | ( | ||||||||||||||||||||||
| Outstanding as of June 30, 2025 | |||||||||||||||||||||||
Fixed Value Equity Awards
The Company issues fixed value equity awards to certain employees as a part of their compensation package. These awards are issued as RSUs under the Amended and Restated EIP (and prior to its amendment and restatement, under the Amended 2020 Plan and the 2020 Plan) and are accounted for as liability classified awards under ASC 718 — Stock Compensation. Fixed value equity awards granted have service-based conditions only and vest quarterly over a period of up to six years . These awards represent a fixed dollar amount settled in a variable number of shares determined at each vesting period.
Freedom Photonics Awards
As part of the Freedom Photonics acquisition in April 2022, the Company owed up to $29.8 million of post combination compensation related to certain service and performance conditions including achievement of certain technical and financial milestones. As of June 30, 2025, it is probable that the remaining conditions will be met for an amount equal to approximately $4.5 million of post combination compensation.
33
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Management Awards
Activity of the Company’s management awards that include market conditions for the six months ended June 30, 2025 was as follows:
| Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||
| Outstanding as of December 31, 2024 | $ | ||||||||||
| Granted | |||||||||||
| Forfeited | ( | ||||||||||
| Vested | |||||||||||
| Outstanding as of Change in units based on performance | ( | ||||||||||
| Outstanding as of June 30, 2025 | |||||||||||
During the six months ended June 30, 2025, the Company recorded a reversal of $34.7 million of share based compensation expense in general and administrative in the condensed consolidated statements of operations as a result of the termination of the former CEO.
Compensation expense
Stock-based compensation expense by function was as follows (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Cost of sales | $ | $ | $ | $ | |||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Sales and marketing | |||||||||||||||||||||||
| General and administrative | ( | ( | |||||||||||||||||||||
| Stock-based compensation related to restructuring | ( | ( | |||||||||||||||||||||
| Total | $ | ( | $ | $ | ( | $ | |||||||||||||||||
Stock-based compensation expense by type of award was as follows (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Equity Classified Awards: | |||||||||||||||||||||||
| Stock options | $ | $ | $ | $ | |||||||||||||||||||
| RSUs | |||||||||||||||||||||||
| Management awards | ( | ( | |||||||||||||||||||||
| ESPP | |||||||||||||||||||||||
| Stock-based compensation related to restructuring | ( | ( | |||||||||||||||||||||
| Liability Classified Awards: | |||||||||||||||||||||||
| Equity-settled fixed value | |||||||||||||||||||||||
| Freedom Photonics | ( | ||||||||||||||||||||||
| Other | ( | ||||||||||||||||||||||
| Total | $ | ( | $ | $ | ( | $ | |||||||||||||||||
Note 14. Income Taxes
Provision for income taxes for the three and six months ended June 30, 2025, was $0.2 million and $0.3 million, respectively. The effective tax rate was (0.7 )% and (0.3 )% for the three and six months ended June 30, 2025, respectively. Provision for income taxes for the three and six months ended June 30, 2024, was $(0.6 ) million and $21,000 , respectively. The effective tax rate was 0.4 % and — % for the three and six months ended June 30, 2024, respectively. The effective tax rates differ significantly from the statutory tax rate of 21%, primarily due to the Company’s valuation allowance movement in each period presented and taxes on foreign earnings.
34
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Note 15. Leases
The Company leases office and manufacturing facilities under non-cancelable operating leases expiring at various dates through August 2032. Some of the Company’s leases include one or more options to renew, with renewal terms that if exercised by the Company, extend the lease term from to six years . The exercise of these renewal options is at the Company’s discretion. The Company’s lease agreements do not contain any material terms and conditions of residual value guarantees or material restrictive covenants. The Company’s short-term leases and sublease income were not
In April 2025, the Company terminated a non-cancellable operating lease located in Sunnyvale, California. The lease was originally scheduled to expire in November 2028. In connection with the termination, the Company made a payment of $1.2 million as a termination fee. As a result of the lease termination, the Company derecognized the related right-of-use asset and liability, resulting in a loss on lease termination of $8.3 million was recorded in other income (expense), net in the condensed consolidated statements of operations.
The components of lease expenses were as follows (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Operating lease cost | $ | $ | $ | $ | |||||||||||||||||||
| Variable lease cost | |||||||||||||||||||||||
| Total operating lease cost | $ | $ | $ | $ | |||||||||||||||||||
Supplemental cash flow information related to leases was as follows (in thousands):
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
| Cash paid for operating leases included in operating activities | $ | ( | $ | ( | |||||||
Recognition/(derecognition) of right-of-use asset in exchange for lease obligations: | |||||||||||
| Operating leases | $ | ( | $ | ||||||||
Supplemental balance sheet information related to leases was as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||||||||
| Operating leases: | |||||||||||||||||
| Operating lease right-of-use assets | $ | $ | |||||||||||||||
| Operating lease liabilities: | |||||||||||||||||
| Operating lease liabilities, current | $ | $ | |||||||||||||||
| Operating lease liabilities, non-current | |||||||||||||||||
| Total operating lease liabilities | $ | $ | |||||||||||||||
Weighted average remaining terms were as follows (in years):
| June 30, 2025 | December 31, 2024 | ||||||||||||||||
| Weighted average remaining lease term | |||||||||||||||||
| Operating leases | |||||||||||||||||
35
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Weighted average discount rates were as follows:
| June 30, 2025 | December 31, 2024 | ||||||||||||||||
| Weighted average discount rate | |||||||||||||||||
| Operating leases | % | % | |||||||||||||||
Maturities of lease liabilities were as follows (in thousands):
| Operating Leases | |||||||||||
Year Ending March 31, | |||||||||||
2025 (remaining six months) | $ | ||||||||||
| 2026 | |||||||||||
| 2027 | |||||||||||
| 2028 | |||||||||||
| 2029 | |||||||||||
| Thereafter | |||||||||||
| Total lease payments | |||||||||||
| Less: imputed interest | ( | ||||||||||
| Total leases liabilities | $ | ||||||||||
Note 16. Commitments and Contingencies
Purchase Obligations
The Company purchases goods and services from a variety of suppliers in the ordinary course of business. Purchase obligations are defined as agreements that are enforceable and legally binding and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum, or variable price provisions, and the approximate timing of the transaction. The Company had purchase obligations primarily for purchases of inventory, R&D, and general and administrative activities totaling $93.7 million as of June 30, 2025.
Legal Matters
From time to time, the Company is involved in actions, claims, suits and other proceedings in the ordinary course of business, including assertions by third parties relating to intellectual property infringement, breaches of contract or warranties or employment-related matters. When it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated, the Company records a liability for such loss contingencies. The Company’s estimates regarding potential losses and materiality are based on the Company’s judgment and assessment of the claims utilizing currently available information. Although the Company will continue to reassess its reserves and estimates based on future developments, the Company’s objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from the Company’s current estimates. The Company’s current legal accrual is not material to the financial statements.
Johnson v. Luminar Technologies, Inc., et al.
On May 26, 2023, a putative class action styled Johnson v. Luminar Technologies, Inc., et al., Case No. 6:23-cv-00982-PGB-LHP, was filed in the United States District Court for the Middle District of Florida, against the Company and an employee. The suit asserts purported claims on behalf of purchasers of the Company’s securities between February 28, 2023 and March 17, 2023 under Sections 10(b) and 20(a) of the Exchange Act for allegedly misleading statements regarding the Company’s photonic integrated circuits technology. Defendants filed a motion to dismiss the complaint on December 29, 2023, the motion was granted, and on July 8, 2024 Plaintiff filed a second amended complaint. Defendants filed a motion to dismiss the second amended complaint on August 22, 2024, and the motion was granted on December 12, 2024. Plaintiff filed a third amended complaint and Defendants filed their motion to dismiss the third amended complaint on February 24, 2025. The Company intends to continue to vigorously defend the litigation. The Company presently does not expect this matter to have a material adverse impact on the Company’s financial results and did not accrue anything related to this matter as of June 30, 2025. On October 21, 2023, a shareholder derivative suit entitled Bhavsar v. McAuliffe, et al. Bhavsar v. McAuliffe, et al., No. 6:23-cv-02037 was filed in the United States District Court for the Middle District of Florida against directors of the Company and an employee. The suit avers claims for purported breaches of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, waste, aiding and abetting, and contribution under Sections 10(b) and 21D of the Exchange Act on the basis of
36
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
the same purported wrongdoing alleged in the first lawsuit described above. In November 2023, three additional shareholder derivative suits averring similar claims to Bhavsar were filed in the United States District Court for the District of Delaware: Lance Dechant, et al. v. Alec E. Gores, et al., C.A. No. 23-cv-01318-UNA, Hutchinson v. Russell, et al., C.A. No. 23-cv-01345-UNA, and Ulerio v. Russell, et al., C.A. No. 23-cv-01359-UNA. The Company disputes the allegations in the complaint and intends to vigorously defend the litigation. The Company has determined that the likelihood of this matter resulting in a material adverse impact on the Company’s financial results is remote.
Yskollari v. Luminar Technologies, Inc., et al.
On July 23, 2025, a putative class action styled Yskollari v. Luminar Technologies, Inc., et al., Case No. Case 6:25-cv-01384, was filed in the United States District Court for the Middle District of Florida, against the Company and former and current employees. The suit asserts purported claims on behalf of purchasers of the Company’s securities between March 20, 2025, and May 14, 2025 under Sections 10(b) and 20(a) of the Exchange Act for allegedly misleading statements regarding the former CEO’s conduct and seeks compensatory damages. The Company intends to vigorously defend the litigation.
Note 17. Segment and Customer Concentration Information
Reportable segments are (i) Autonomy Solutions and (ii) ATS, which also represent our operating segments. See Note 2 for additional information on the Company’s operating segments. These segments reflect the way the chief operating decision maker (“CODM”) evaluates the Company’s business performance and manages its operations. Each segment has distinct product offerings, customers and market penetration. The Chief Executive Officer is the CODM of the Company.
The Company’s CODM evaluates segment performance using segment operating loss and segment assets to allocate operating and capital resources to each segment. The CODM also considers other financial information, including revenue data broken down by products and services within the Autonomy Solutions and ATS segments.
Autonomy Solutions
This segment manufactures and distributes commercial LiDAR sensors that measure distance using laser light for automotive mobility applications. This segment is impacted by trends in the automobile and autonomous vehicles sector and the infrastructure/technology sector.
ATS
This segment is in the business of development of semiconductor technology based lasers and sensors. This segment also designs, tests and provides consulting services for development of integrated circuits. This segment is impacted by trends in and the strength of the automobile and aeronautics sectors as well as government spending in military and defense activities.
37
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
The accounting policies of the operating segments are the same as those described in Note 2. Segment operating results and reconciliations to the Company’s condensed consolidated balances are as follows (in thousands):
Three Months Ended June 30, 2025 | |||||||||||||||||
| Autonomy Solutions | ATS | Total | |||||||||||||||
| Revenue: | |||||||||||||||||
Products | $ | $ | $ | ||||||||||||||
Services | |||||||||||||||||
Intersegment revenue | |||||||||||||||||
Reconciliation of revenue | |||||||||||||||||
Elimination of intersegment revenue | ( | ||||||||||||||||
Total revenue | |||||||||||||||||
Less: | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
Other segment items (a) | |||||||||||||||||
Operating loss | $ | ( | $ | ( | $ | ( | |||||||||||
Reconciliation of profit or loss | |||||||||||||||||
Other income (expense), net | |||||||||||||||||
Loss before provision for income taxes | $ | ( | |||||||||||||||
Other significant items: | |||||||||||||||||
Total assets | $ | $ | $ | ||||||||||||||
Inventory | $ | $ | $ | ||||||||||||||
(a) For each reportable segment, the other segment items category includes:
•Autonomy Solutions - Professional and contracting service expenses, travel expenses, insurance and maintenance expenses, utility expenses, restructuring costs and certain overhead expenses.
•ATS - Professional and contracting service expenses, courier & postage expenses, insurance expenses, facility maintenance & utility expenses, restructuring costs and certain overhead expenses.
38
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
| Three Months Ended June 30, 2024 | |||||||||||||||||
| Autonomy Solutions | ATS | Total | |||||||||||||||
| Revenue: | |||||||||||||||||
| Products | $ | $ | $ | ||||||||||||||
| Services | ( | ||||||||||||||||
| Intersegment revenue | |||||||||||||||||
| Reconciliation of revenue | |||||||||||||||||
| Elimination of intersegment revenue | ( | ||||||||||||||||
| Total revenue | |||||||||||||||||
| Less: | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Other segment items (a) | |||||||||||||||||
| Operating loss | $ | ( | $ | ( | $ | ( | |||||||||||
| Reconciliation of profit or loss | |||||||||||||||||
| Other income (expense), net | ( | ||||||||||||||||
| Loss before provision for income taxes | $ | ( | |||||||||||||||
| Other significant items: | |||||||||||||||||
| Total assets | $ | $ | $ | ||||||||||||||
| Inventory | $ | $ | $ | ||||||||||||||
(a) For each reportable segment, the other segment items category includes:
•Autonomy Solutions - Professional and contracting service expenses, travel expenses, insurance and maintenance expenses, utility expenses, restructuring costs and certain overhead expenses.
•ATS - Professional and contracting service expenses, courier & postage expenses, insurance expenses, facility maintenance & utility expenses, restructuring costs and certain overhead expenses.
39
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
Six Months Ended June 30, 2025 | |||||||||||||||||
| Autonomy Solutions | ATS | Total | |||||||||||||||
| Revenue: | |||||||||||||||||
Products | $ | $ | $ | ||||||||||||||
Services | |||||||||||||||||
Intersegment revenue | |||||||||||||||||
Reconciliation of revenue | |||||||||||||||||
Elimination of intersegment revenue | ( | ||||||||||||||||
Total revenue | |||||||||||||||||
Less: | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
Impairment of goodwill and intangible assets | |||||||||||||||||
Other segment items (a) | |||||||||||||||||
Operating loss | $ | ( | $ | ( | $ | ( | |||||||||||
Reconciliation of profit or loss | |||||||||||||||||
Other income (expense), net | |||||||||||||||||
Loss before provision for income taxes | $ | ( | |||||||||||||||
Other significant items: | |||||||||||||||||
Total assets | $ | $ | $ | ||||||||||||||
Inventory | $ | $ | $ | ||||||||||||||
(a) For each reportable segment, the other segment items category includes:
•Autonomy Solutions - Professional and contracting service expenses, travel expenses, insurance and maintenance expenses, utility expenses, restructuring costs and certain overhead expenses.
•ATS - Professional and contracting service expenses, courier & postage expenses, insurance expenses, facility maintenance & utility expenses, restructuring costs and certain overhead expenses.
40
LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
| Six Months Ended June 30, 2024 | |||||||||||||||||
| Autonomy Solutions | ATS | Total | |||||||||||||||
| Revenue: | |||||||||||||||||
| Products | $ | $ | $ | ||||||||||||||
| Services | ( | ||||||||||||||||
| Intersegment revenue | |||||||||||||||||
| Reconciliation of revenue | |||||||||||||||||
| Elimination of intersegment revenue | ( | ||||||||||||||||
| Total revenue | |||||||||||||||||
| Less: | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Impairment of goodwill and intangible assets | |||||||||||||||||
| Other segment items (a) | |||||||||||||||||
| Operating loss | $ | ( | $ | ( | $ | ( | |||||||||||
| Reconciliation of profit or loss | |||||||||||||||||
| Other income (expense), net | ( | ||||||||||||||||
| Loss before provision for income taxes | $ | ( | |||||||||||||||
| Other significant items: | |||||||||||||||||
| Total assets | $ | $ | $ | ||||||||||||||
| Inventory | $ | $ | $ | ||||||||||||||
(a) For each reportable segment, the other segment items category includes:
•Autonomy Solutions - Professional and contracting service expenses, travel expenses, insurance and maintenance expenses, utility expenses, restructuring costs and certain overhead expenses.
Two customers, customer A and customer B of the Autonomy Solutions segment, accounted for 34 % and 22 %, respectively, of the Company’s revenue for the three months ended June 30, 2025. Two customers, customer A and customer B of the Autonomy Solutions segment, accounted for 38 % and 21 %, respectively, of the Company’s revenue for the six months ended June 30, 2025. One customer, customer B of the Autonomy Solutions Segment, accounted for 61 % of the Company’s revenue for the three months ended June 30, 2024. One customer, customer B of Autonomy Solutions segment, accounted for 53 % of the Company’s revenue for the six months ended June 30, 2024. A vast majority of the Company’s long-lived assets are located in North America.
Note 18. Subsequent Events
Deferred Taxes
On July 4, 2025, President Trump signed the One, Big, Beautiful, Bill (OBBB) Act, which includes comprehensive U.S. corporate tax legislation. The legislation includes the modification and permanent extension of prior tax law under the Tax Cuts and Jobs Act (TCJA) and the introduction of new provisions. Examples include permanently restoring bonus depreciation allowances, permanent changes in the limitations for deducting business interest expense and permanent reintroduction of expensing of US research and development costs. The impact on current and deferred taxes for tax law changes is reported in continuing operations in the interim period which includes the enactment date. The company has done a preliminary analysis of the changes impacting the Company’s business and has determined that the aggregate impact would not be significant. As a result of the Company’s valuation allowance, any changes to the Company’s deferred tax assets would not have a material impact to the quarterly financials. The Company will continue to assess the tax accounting impacts, as well as the various state
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LUMINAR TECHNOLOGIES, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)
legislation and conformity rules, as more information is made available and will record the tax impact, if any, in the third quarter of 2025.
Conversion of Series A Preferred Stock
In July 2025, holders of the Company’s Series A Preferred Stock converted an aggregate of additional 16,000 shares of Series A Preferred Stock into 6,104,645 shares of Class A common stock.
Equity Financing Program
In July 2025, the Company issued 2,345,520 shares of Class A common stock under the Equity Financing Program for net proceeds of $6.9 million.
Vendor Share Issuance
On July 29, 2025, the Company issued 1,600,000 shares of Class A common stock to an affiliate of a Company vendor, TPK Holding Co., Ltd. (“TPK”), for services to be rendered or other payment obligations over the next several fiscal quarters under contractual arrangements between the Company and TPK.
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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
You should read the following discussion in conjunction with the condensed consolidated financial statements and notes thereto included elsewhere in this Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”) filed with the SEC on March 28, 2025. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed under the caption “Risk Factors” in our 2024 Annual Report, those discussed under the caption, “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 filed with the SEC on May 20, 2025, and elsewhere in this Form 10-Q. See also “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this Form 10-Q.
Overview
We are a technology company specializing in advanced Light Detection and Ranging (LiDAR) hardware and software solutions to enable the world’s safest and smartest vehicles. Over the past decade, we have been developing proprietary LiDAR hardware, core semiconductor components, and software in-house to meet the demanding performance, safety, reliability, and cost requirements to enable next-generation safety and autonomous capabilities for passenger and commercial vehicles, as well as other adjacent markets.
Beyond sensor hardware, our product portfolio has expanded to include semiconductor components of our LiDAR that have utility in adjacent markets, in-development software capabilities such as perception and high-definition “3D” mapping, certain data sets and other information, all of which we anticipate will monetize the ecosystem of improved safety and autonomy created by our LiDAR. Substantially all of our software products have not achieved technological feasibility or have been commercialized.
Industrialization Update
We continue to execute on our industrialization plan in conjunction with our automaker partners. We have contract manufacturing services agreements to enable series production of our Iris LiDAR sensors with Celestica and Fabrinet, whereby Fabrinet is responsible for assembly and testing of our transceiver sub-component based on our design and components and Celestica is responsible for final assembly and testing of our LiDAR sensor including the transceiver from Fabrinet. We also have a partnership with TPK Group, whereby we established an engineering center in China, staffed by TPK, to assist with our industrialization efforts, including manufacturing process design, development and validation, component process verification and validation, supplier development support, system validation, cost analysis, and benchmarking.
We achieved start of production (“SOP”) for Volvo Cars at the manufacturing facility in Mexico in 2024 and began shipping production LiDAR sensors for the Volvo EX90. Through the second quarter of 2025, we continued to meet all key deliverables for our customer’s production ramp.
We continually evaluate opportunities for optimizing our manufacturing and product design processes, including evaluating our sourcing strategies to reduce future per unit sensor manufacturing costs. In 2023, we commenced a change in sourcing of certain sub-assemblies and components from one supplier to another and our expected transition to new suppliers has essentially been completed. In 2024, we commenced a change in sourcing of final assembly of components from one contract manufacturer to another. This effort included taking scaled down or production downtime at the dedicated manufacturing facility in Mexico. Our continuing optimization of our manufacturing and product design processes may impact estimated useful lives or carrying values of additional property, plant and equipment or other assets.
Business Updates
As part of our ongoing strategic review and focus on operational efficiency, we initiated the wind-down of our data and insurance businesses. The wind-down is expected to be substantially completed in the end of 2025. We do not expect these changes to impact our ability to deliver on our core customer programs or product commitments.
The wind-down of the data business is expected to result in a reduction in total revenue of approximately $16.0 million on a full-year run-rate basis. The revenue impact from the wind-down of the insurance business is not material. We expect the exit of both these businesses will reduce our operating expenses by approximately $23.0 million on a full-year run-rate basis starting in fourth quarter of 2025.
In March 2025, we announced that our LiDAR technology will be equipped in the new Volvo ES90. This marks the second Volvo model to feature our technology, following the launch of the Volvo EX90. Our LiDAR sensors on initial EX90 vehicles are currently being used for road data collection and system training, and we expect will later be activated as part of the vehicle’s active safety system.
In March 2025, we announced a collaboration with Caterpillar Inc. to integrate our LiDAR technology into Caterpillar’s next-generation autonomous solution. Each Caterpillar off-highway truck will feature two Iris LiDARs with a unique
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integration system designed exclusively for the customer.
In 2024, we executed a restructuring and cost reduction plan (the “2024 Restructuring Plan”), consisting of events in both May and September, which included reducing our workforce by a cumulative 30%, as well as sub-leasing of certain facilities and other actions. We expect the actions outlined will be substantially complete by the end of 2025. In May 2025, we began additional restructuring efforts which included a reduction in workforce (the “2025 Restructuring Plan”). We expect the actions associated with the 2025 Restructuring Plan to be substantially completed by the end of 2025.
As of June 30, 2025, we incurred $11.0 million in total charges associated with employee severance and related costs, including both cash and stock from the actions we took in May 2024, September 2024 and May 2025.
In March 2025, we entered into separate, individually negotiated private exchange agreements with certain holders of our 2026 Convertible Senior Notes to exchange $18.2 million aggregate principal amount of 2026 Convertible Senior Notes (the “March 2025 Exchanged Notes”) for newly issued shares of our Class A common stock, plus, in certain circumstances, cash in respect of accrued and unpaid interest on the March 2025 Exchanged Notes (such exchanges, collectively, the “March 2025 Exchange Transactions”). We canceled the March 2025 Exchanged Notes received in the March 2025 Exchange Transactions. The March 2025 Exchange Transactions settled in four consecutive daily tranches, each for $4.6 million aggregate principal amount of March 2025 Exchanged Notes, commencing on March 25, 2025. As of March 28, 2025, which was the final settlement date of the March 2025 Exchange Transactions, we had issued an aggregate of 1,951,819 shares of Class A common stock in the March 2025 Exchange Transactions. We did not receive any cash proceeds from the March 2025 Exchange Transactions. See Note 8 of the notes to condensed consolidated financial statements included in this Form 10-Q for more detail.
In May 2025, we entered into separate, individually negotiated private exchange agreements and private repurchase agreements with certain holders of our 2026 Convertible Senior Notes to exchange $6.2 million aggregate principal amount of 2026 Convertible Senior Notes (the “May 2025 Exchanged Notes”) for an aggregate of 1,098,931 newly issued shares of our Class A common stock (the “May 2025 Exchange Transactions”) and repurchase $43.8 million aggregate principal amount of 2026 Convertible Senior Notes (the “Repurchased Notes”) for an aggregate of $30.2 million in cash (the “Repurchase Transaction”), in each case, inclusive of accrued and unpaid interest on the May 2025 Exchanged Notes and Repurchased Notes. See Note 8 of the notes to condensed consolidated financial statements included in this Form 10-Q for more detail.
In May 2025, we entered into a securities purchase agreement (the “Series A Purchase Agreement”) with certain institutional accredited investors, pursuant to which the Company may issue and sell, in a series of registered direct offerings, up to an aggregate of 200,000 shares of newly designated Series A Convertible Preferred Stock, par value $0.0001 per share, with a stated value of $1,000 per share (the “Series A Preferred Stock”), to the investors at a purchase price of $960.00 per share (the “Series A Preferred Stock Financing”). The initial offering for 35,000 shares (the “Preferred Shares”) of Series A Preferred Stock closed on May 22, 2025, following the satisfaction or waiver of certain closing conditions set forth in the Series A Purchase Agreement. We recorded $33.6 million proceeds, net of placement agent fees and other offering expenses. At the closing, we also issued the lead investor 505,051 shares of our Class A common stock as a commitment fee pursuant to the Series A Purchase Agreement.
Through the six months ended June 30, 2025, we received notices from holders of Series 2 of the 2030 Convertible Notes(the “Series 2 Notes”) to convert the principal amount of $2.0 million of Series 2 Notes, upon which we issued 127,466 shares of Class A common stock on a reverse split-adjusted basis to settle such conversion of the Series 2 Notes.
Given the customary business practices in the automotive industry, the rapidly changing nature of the markets in which we compete, and the fact that LiDAR is a new technology in the industry, there remains potential risk that our major commercial wins or other milestone achievements may not ultimately generate any significant revenue. See the discussion under the heading “The period of time from a major commercial win to implementation is long and we are subject to risks of cancellation or postponement of the contract or unsuccessful implementation” in “Risk Factors” in Item 1A of Part I in our 2024 Annual Report.
Basis of Presentation
Our condensed consolidated financial statements include the accounts of our wholly owned subsidiaries. We have eliminated intercompany accounts and transactions.
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Components of Results of Operations
Revenue
Our business and revenue producing activities are organized in two operating segments: (i) Autonomy Solutions and (ii) Advanced Technologies and Services (“ATS”).
The Autonomy Solutions segment is engaged in the design, manufacturing, and sale of LiDAR sensors catering mainly to OEMs in the automotive, commercial vehicle, robo-taxi and adjacent industries. The Autonomy Solutions segment revenue also includes fees earned from non-recurring engineering services provided to customers in connection with customization of our hardware and software products, as well as revenue generated from licensing of certain data and information.
The ATS segment provides advanced semiconductors and related components, as well as design, testing and consulting services to the Autonomy Solutions segment and to various third-party customers, including government agencies and defense contractors, in markets generally unrelated to autonomous vehicles.
Two customers, customer A and customer B of the Autonomy Solutions segment, accounted for 34% and 22%, respectively, of the Company’s revenue for the three months ended June 30, 2025. Two customers, customer A and customer B of the Autonomy Solutions segment, accounted for 38% and 21%, respectively, of the Company’s revenue for the six months ended June 30, 2025. One customer, customer B of the Autonomy Solutions segment, accounted for 61% of the Company’s revenue for the three months ended June 30, 2024. One customer, customer B of Autonomy Solutions segment, accounted for 53% of the Company’s revenue for the six months ended June 30, 2024. A vast majority of the Company’s long-lived assets are located in North America.
Consideration Payable to Customers
We enter into revenue and purchase contracts with the same customers from time to time. When payments to customers are in exchange for distinct goods and services, we evaluate the underlying economics and fair value of the distinct goods and services. If we determine any portion of the consideration payable to the customer exceeds the fair value of the distinct goods and services, the excess is accounted for as a reduction of the transaction price of the revenue contract.
Cost of sales and gross profit (loss)
Cost of sales includes the fixed and variable manufacturing cost of our LiDAR sensors, which primarily consists of material purchases from third-party contract manufacturers and suppliers that are directly associated with our manufacturing process, as well as personnel-related costs, including stock-based compensation expense for personnel engaged in manufacturing, and engineering. Cost of sales also includes the cost of providing services to customers, depreciation and amortization for manufacturing fixed assets or equipment, cost of components, product testing and launch-related costs, an allocated portion of overhead, facility and information technology (“IT”) costs, write-downs for excess and obsolete inventory, as well as shipping costs.
The ATS segment provides certain services and components to the Autonomy Solutions segment, which are recorded as cost of goods sold or research and development costs depending on the nature and use of such services and components by the Autonomy Solutions segment. These inter-segment transactions are eliminated in the consolidated results.
Gross profit (loss) equals revenue less cost of sales. As we transition from prototype production to series production, average selling prices for our products will be lower. We expect these lower average selling prices to temporarily increase our gross loss until we start to realize the benefits of cost reduction and efficiency measures and production scaling.
Operating Expenses
Research and Development (R&D)
R&D costs are expensed as incurred. Design and development costs for products to be sold under long-term supply arrangements are expensed as incurred. Design and development costs for molds, dies, and other tools involved in developing new technologies are expensed as incurred.
Our R&D efforts are focused on enhancing and developing additional functionality for our existing products and on new product development, including new releases and upgrades to our LiDAR hardware and integrated software solutions. R&D expenses consist primarily of:
•Personnel-related expenses, including salaries, benefits, and stock-based compensation expense, for personnel in our research and engineering functions;
•Expenses related to materials, software licenses, supplies, data labeling and other third-party services;
•Prototype expenses; and
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•An allocated portion of facility and IT costs and depreciation.
The ATS segment provides certain services and components to the Autonomy Solutions segment, which are recorded as cost of goods sold or R&D costs depending on the nature and use of such services and components by the Autonomy Solutions segment. These inter-segment transactions are eliminated in our consolidated results. We expect our R&D costs to remain elevated for the foreseeable future as we continue to invest in research and development activities to achieve our product roadmap, and we expect to continue to incur operating losses for at least the foreseeable future due to continued R&D investments.
Sales and Marketing Expenses
Sales and marketing expenses consist of personnel and personnel-related expenses, including stock-based compensation of our business development team, as well as advertising and marketing expenses. These include the cost of marketing programs, trade shows, promotional materials, demonstration equipment, an allocated portion of facility and IT costs and depreciation.
General and Administrative Expenses
General and administrative expenses consist of personnel and personnel-related expenses, including stock-based compensation of our executive, finance, human resources, information systems and legal departments as well as legal and accounting fees for professional and contract services.
Other income (expense), net
Other income (expense), net includes change in fair value of warrant liabilities, interest expense, interest income, gain of extinguishment of debt, gain on acquisition of EM4, changes in fair value of derivative liability, and losses and impairments related to investments and certain other assets and other income (expense).
Change in Fair Value of Derivative Liabilities
The derivatives are classified as marked-to-market liabilities, and the corresponding increase or decrease in value is reflected in change in fair value of bifurcated derivatives.
Interest Income and Interest Expense
Interest income consists primarily of income earned on our cash equivalents and marketable securities. These amounts will vary based on our cash, cash equivalents, and marketable securities balances, and also with market rates. Interest expense consists primarily of interest on our notes as well as amortization of premium (discount) on marketable securities.
Losses and Impairments to investments and Certain Other Assets, and Other Income (Expense)
Other income (expense), net includes realized gains and losses related to the marketable securities, as well as impact of gains and losses related to foreign exchange transactions, and impairment of investments and certain other assets.
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Results of Operations for the Three and Six Months Ended June 30, 2025 and 2024
The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this Form 10-Q. The following table sets forth our condensed consolidated results of operations data for the periods presented (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ Change | % Change | 2025 | 2024 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||
| Revenue | $ | 15,634 | $ | 16,451 | $ | (817) | (5) | % | $ | 34,520 | $ | 37,419 | $ | (2,899) | (8) | % | |||||||||||||||||||||||||||||||
| Cost of sales | 28,061 | 30,131 | (2,070) | (7) | % | 55,047 | 61,554 | (6,507) | (11) | % | |||||||||||||||||||||||||||||||||||||
| Gross loss | (12,427) | (13,680) | 1,253 | (9) | % | (20,527) | (24,135) | 3,608 | (15) | % | |||||||||||||||||||||||||||||||||||||
| Operating Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||
| Research and development | 39,328 | 65,850 | (26,522) | (40) | % | 77,616 | 133,600 | (55,984) | (42) | % | |||||||||||||||||||||||||||||||||||||
| Sales and marketing | 5,297 | 12,140 | (6,843) | (56) | % | 10,201 | 26,655 | (16,454) | (62) | % | |||||||||||||||||||||||||||||||||||||
| General and administrative | (18,753) | 29,790 | (48,543) | (163) | % | 2,163 | 62,839 | (60,676) | (97) | % | |||||||||||||||||||||||||||||||||||||
| Restructuring costs | 1,180 | 6,262 | (5,082) | (81) | % | 1,244 | 6,262 | (5,018) | (80) | % | |||||||||||||||||||||||||||||||||||||
| Total operating expenses | 27,052 | 114,042 | (86,990) | (76) | % | 91,224 | 229,356 | (138,132) | (60) | % | |||||||||||||||||||||||||||||||||||||
| Loss from operations | (39,479) | (127,722) | 88,243 | (69) | % | (111,751) | (253,491) | 141,740 | (56) | % | |||||||||||||||||||||||||||||||||||||
| Other income (expense), net: | |||||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of warrant liabilities | — | 163 | (163) | (100) | % | — | 985 | (985) | (100) | % | |||||||||||||||||||||||||||||||||||||
| Interest expense | (12,255) | (2,757) | (9,498) | 345 | % | (24,576) | (5,514) | (19,062) | 346 | % | |||||||||||||||||||||||||||||||||||||
| Interest income | 1,269 | 2,519 | (1,250) | (50) | % | 3,036 | 5,949 | (2,913) | (49) | % | |||||||||||||||||||||||||||||||||||||
Gain on extinguishment of debt | 15,281 | — | 15,281 | nm | 22,056 | — | 22,056 | nm | |||||||||||||||||||||||||||||||||||||||
| Gain from acquisition of EM4 | — | — | — | — | (48) | 1,752 | (1,800) | (103) | % | ||||||||||||||||||||||||||||||||||||||
Gain from sale of investment | 2,908 | — | 2,908 | nm | 2,908 | — | 2,908 | nm | |||||||||||||||||||||||||||||||||||||||
| Changes in fair value of derivative liability | 8,991 | — | 8,991 | nm | 5,320 | — | 5,320 | nm | |||||||||||||||||||||||||||||||||||||||
| Losses related to investments and certain other assets, and other income (expense) | 536 | (3,376) | 3,912 | (116) | % | (238) | (5,981) | 5,743 | (96) | % | |||||||||||||||||||||||||||||||||||||
| Total other income (expense), net | 16,730 | (3,451) | 20,181 | (585) | % | 8,458 | (2,809) | 11,267 | (401) | % | |||||||||||||||||||||||||||||||||||||
| Loss before provision for income taxes | (22,749) | (131,173) | 108,424 | (83) | % | (103,293) | (256,300) | 153,007 | (60) | % | |||||||||||||||||||||||||||||||||||||
| Provision for income taxes | 150 | (566) | 716 | (127) | % | 297 | 21 | 276 | 1314 | % | |||||||||||||||||||||||||||||||||||||
| Net loss | $ | (22,899) | $ | (130,607) | $ | 107,708 | (82) | % | $ | (103,590) | $ | (256,321) | $ | 152,731 | (60) | % | |||||||||||||||||||||||||||||||
Revenue
The following table sets forth a breakdown of revenue by segments for the periods presented (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ Change | % Change | 2025 | 2024 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||
| Revenue from sales to external customers: | |||||||||||||||||||||||||||||||||||||||||||||||
Autonomy Solutions | $ | 10,305 | $ | 9,981 | $ | 324 | 3 | % | $ | 24,062 | $ | 26,301 | $ | (2,239) | (9) | % | |||||||||||||||||||||||||||||||
| ATS | 5,329 | 6,470 | (1,141) | (18) | % | 10,458 | 11,118 | (660) | (6) | % | |||||||||||||||||||||||||||||||||||||
| Total | $ | 15,634 | $ | 16,451 | $ | (817) | (5) | % | $ | 34,520 | $ | 37,419 | $ | (2,899) | (8) | % | |||||||||||||||||||||||||||||||
The $0.3 million increase in revenue of our Autonomy Solutions in the three months ended June 30, 2025 compared to the same period in 2024 was primarily due to a $4.2 million increase in service revenue, offset by a $3.9 million decrease in product revenue.
The $2.2 million decrease in revenue of our Autonomy Solutions in the six months ended June 30, 2025 compared to the same period in 2024 was primarily due to a $8.2 million decrease in product revenue, offset by a $6.0 million increase in service revenue.
The $1.1 million decrease in revenue of our ATS segment in the three months ended June 30, 2025 compared to the same period in 2024 was primarily due to a $1.2 million decrease in service revenue, offset by a $0.1 million increase in product revenue.
The $0.7 million decrease in revenue of our ATS segment in the six months ended June 30, 2025 compared to the same period in 2024 was primarily due to a $2.8 million decrease in service revenue, offset by $2.1 million increase in product revenue.
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Cost of Sales
The $2.1 million and $6.5 million decrease in the cost of sales in the three and six months ended June 30, 2025, respectively, compared to the same period in 2024, was primarily due to cost reduction initiatives in 2025 and decrease in costs associated with an Iris+ development contract for non-recurring engineering services terminated in the fourth quarter of 2024.
In 2023, we commenced a change in sourcing strategy of certain sub-assemblies and components from one supplier to another, which resulted in discontinued use of certain plant, property and equipment assets as they were no longer needed for their original intended use and required us to abandon certain equipment at the legacy supplier. As a result, we revised the estimated useful lives of the long-lived assets within the impacted asset group, which resulted in us recording depreciation for these assets over an accelerated period. for certain manufacturing activities is expected to result in discontinued use of certain plant, property and equipment assets as they will no longer be needed for their original intended use. As a result of executing our plan, we revised the estimated useful lives of certain long-lived assets within the impacted asset group. This resulted in recording depreciation for these assets over an accelerated period. We recorded $0.1 million and $0.3 million of incremental accelerated depreciation charges associated with this manufacturing and sourcing change in the three and six months ended June 30, 2025, respectively.
Operating Expenses
Research and Development
The $26.5 million decrease in research and development expenses in the three months ended June 30, 2025 compared to the same periods in 2024 was primarily due to a $19.5 million decrease in personnel-related costs driven mainly by decreased headcount, a $2.1 million decrease in outside consultants and contractor fees, a $2.3 million decrease in purchased materials, a $0.4 million decrease in computer software and other subscriptions and a $0.3 million decrease in lower expenses allocated to research and development expenses.
The $56.0 million decrease in research and development expenses in the six months ended June 30, 2025 compared to the same periods in 2024 was primarily due to a $36.7 million decrease in personnel-related costs driven mainly by decreased headcount, a $9.6 million decrease in outside consultants and contractor fees, a $4.7 million decrease in purchased materials and a $3.3 million decrease in lower expenses allocated to research and development expenses, offset by a $1.3 million increase in computer software and other subscriptions.
Sales and Marketing
The $6.8 million decrease in sales and marketing expenses for the three months ended June 30, 2025 compared to the same periods in 2024 was primarily due a $3.1 million decrease in personnel related costs including stock-based compensation cost due to lower headcount, a $2.6 million reduction in sponsorship fees and a $0.5 million decrease in outside consultant and contractor fees.
The $16.5 million decrease in sales and marketing expenses for the six months ended June 30, 2025 compared to the same periods in 2024 was primarily due a $8.0 million decrease in personnel related costs including stock-based compensation cost due to lower headcount, a $4.9 million reduction in sponsorship fees, a $1.9 million decrease in subscription fees and license expenses and $0.4 million decrease in outside consultant and contractor fees.
General and Administrative
The $48.5 million decrease in general and administrative expenses for the three months ended June 30, 2025 compared to the same period in 2024 was primarily due to a $49.9 million decrease in personnel-related costs, including $34.7 million stock-based compensation expense reversal as a result of the termination of the former CEO and reduction in headcount, a $1.7 million decrease in rent expenses and a $0.6 million decrease in travel expenses, offset by a $4.4 million increase in higher information technology and facility related costs allocated to general and administrative expenses.
The $60.7 million decrease in general and administrative expenses for the six months ended June 30, 2025 compared to the same period in 2024 was primarily due to a $63.9 million decrease in personnel-related costs, including $34.7 million stock-based compensation expense reversal as a result of the termination of the former CEO and reduction in headcount, a $2.4 million decrease in rent expenses and a $1.3 million decrease in travel expenses, offset by a $6.8 million increase in higher information technology and facility related costs allocated to general and administrative expenses and a $1.0 million increase in legal, outside consultants and contractor expenses.
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Restructuring Costs
The change in restructuring costs for the three and six months ended June 30, 2025 was due to actions taken pursuant to the 2024 Restructuring Plan announced in May 2024, and fewer employees impacted by the 2024 Restructuring Plan and the 2025 Restructuring Plan during the three and six months ended June 30, 2025 compared to the same period in 2024.
Change in Fair Value of Warrant Liabilities
The change in fair value of warrant liabilities is a non-cash benefit or charge due to the corresponding decrease or increase in the estimated fair value of warrants issued in a private placement on connection with the initial public offering of Gores Metropoulos, Inc. (“Private Warrants”).
Gain on Extinguishment of Debt
The change in gain on extinguishment of debt for the three and six months ended June 30, 2025 compared to same period in 2024 was primarily due to $15.1 million gain on debt extinguishment from the Exchange Transactions related to the 2026 Convertible Senior Notes and $0.6 million gain on debt extinguishment related to the Series 2 Notes conversion.
Change in Fair Value of Derivative Liability
The change in fair value of derivative liability is a non-cash benefit or charge due to the corresponding decrease or increase in the estimated fair value of the bifurcated derivatives in the 2030 Convertible Notes.
Segment Operating Income or Loss
Segment income or loss is defined as income or loss before taxes. Our segment income or loss breakdown is as follows (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ Change | % Change | 2025 | 2024 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||
| Segment operating income (loss) | |||||||||||||||||||||||||||||||||||||||||||||||
| Autonomy Solutions | $ | (35,150) | $ | (118,949) | $ | 83,799 | (70 | %) | $ | (102,630) | $ | (243,967) | $ | 141,337 | (58 | %) | |||||||||||||||||||||||||||||||
| ATS | (4,329) | (8,773) | 4,444 | (51 | %) | (9,121) | (9,524) | 403 | (4 | %) | |||||||||||||||||||||||||||||||||||||
Autonomy solutions segment operating loss decreased $83.8 million and $141.3 million in the three and six months ended June 30, 2025 compared to the same period in 2024, respectively. The decreases in operating loss was primarily due to decreases in personnel-related costs driven by decreased headcount and a decrease in stock-based compensation expense and travel related expenses, a decrease in purchased materials, and a reduction in supplies expenses.
ATS segment operating loss decreased $4.4 million and $0.4 million in the three and six months ended June 30, 2025 compared to the same period in 2024, respectively. The decrease in operating loss was primarily due to decreases in personnel-related costs driven by decreased headcount and a decrease in stock-based compensation expense.
Liquidity and Capital Resources
Sources of Liquidity and Capital Requirements
Our capital requirements will depend on many factors, including:
•market adoption of new and enhanced products and features;
•production capacity and volume;
•the timing and extent of spending to support R&D efforts;
•investments in manufacturing equipment and facilities; and
•investments in information technology systems.
Until we can generate sufficient revenue and profits from the sale of products and services to cover our operating expenses, working capital, and capital expenditures, we expect our cash, cash equivalents and marketable securities, and proceeds from debt and/or equity financings to fund our cash needs.
Issuances of our equity securities have resulted, and any future issuances of our equity securities will result, in dilution to stockholders. Any equity securities issued may also provide for rights, preferences, and privileges senior to those of existing holders of our common stock and may contain terms which impose significant restrictions on our operations. Issuances of our debt securities have resulted in rights, preferences, and privileges senior to holders of our common stock. The indentures governing our outstanding senior secured floating rate notes and our convertible notes contain, and any future indebtedness that we may incur may contain, financial and other restrictive covenants that limit our ability to operate our business, raise capital or make payments under our other indebtedness.
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In addition, we may from time to time seek to retire or repurchase material amounts of our outstanding debt securities through open-market purchases, privately negotiated transactions, or otherwise, for cash or through exchanges for debt or equity, such as the Exchange Transactions, subject to limitations in the agreements governing our outstanding debt securities. Any repurchases or exchanges would be on terms and at prices that we may determine in our discretion and would depend on prevailing market conditions, our liquidity requirements, our receipt of any necessary corporate approvals, and other factors. The credit market and financial services industry have in the past, and may in the future, experience periods of uncertainty that could impact the availability and cost of equity and debt financing.
We expect to continue to invest in our product and software development, as well as incur efforts to build customer relations and expand into additional markets. Further, we expect to invest in developing advanced manufacturing capabilities, including at our contract manufacturing partners. We expect to fund these product and business development initiatives and associated capital expenditures either through our cash, cash equivalents and marketable securities or through issuance of shares of our Class A common stock to vendors and third parties for services provided under our stock in lieu of cash program (“Stock-in-lieu of Cash Program”)
In February 2024, we entered into two non-recourse loan and securities pledge agreements (the “Loan Agreements”) with The St. James Bank & Trust Company Ltd. (the “Lender”), pursuant to which we may borrow up to an aggregate of $50.0 million. Any loans made by the Lender under the Loan Agreements would be collateralized by shares of our Class A common stock or stock we hold of another company. The Loan Agreements require us to pay an up-front structure fee of 1.5% on any amounts borrowed, and any outstanding amounts would bear interest at 8.0% per annum. We did not borrow any amount from this credit facility and had no outstanding balance as of June 30, 2025.
In May, 2024, we entered into a Sales Agreement (the “2024 Sales Agreement”) with Virtu Americas LLC (the “Agent”) under which we may offer and sell, from time to time at our sole discretion, shares of our Class A common stock with aggregate gross sales proceeds of up to $150.0 million under our equity financing program under which the Agent will act as sales agent in sales of our Class A common stock pursuant to the 2024 Sales Agreement (the “Equity Financing Program”). This was an extension of the Equity Financing Program we established with the Agent in February 2023. In August 2024, we increased the Equity Financing Program by an additional $50.0 million pursuant to the 2024 Sales Agreement and in March 2025, we further increased the program by an additional $75.0 million. We intend to use the net proceeds from offerings under the Equity Financing Program for expenditures or payments in connection with strategic investments, partnerships and similar transactions, repurchases of outstanding debt securities, and for general corporate and business purposes.
Under the 2024 Sales Agreement, we set the parameters for the sale of the shares, including the number of shares to be issued, the time period during which sales are requested to be made, limitations on the number of shares that may be sold in any one trading day, and any minimum price below which sales may not be made. Subject to the terms and conditions of the 2024 Sales Agreement, the Agent has agreed to use its commercially reasonable efforts, consistent with its normal trading and sales practices, to sell the shares by methods deemed to be an “at the market” offering as defined in Rule 415 promulgated under the Securities Act, including sales made through The Nasdaq Global Select Market.
We issued 6,177,023 and 6,247,076 shares of Class A common stock under the Equity Financing Program during the three and six months ended June 30, 2025 for net proceeds of $21.1 million and $21.5 million, respectively. As of June 30, 2025, $187.4 million of Class A common stock was available for sale under the program.
In August 2024, we entered into private, separately negotiated agreements for (i) the private offering and sale of $100 million in aggregate principal amount of first-lien, senior secured floating rate notes due 2028 (the “Senior Notes”) and (ii) the exchange of approximately $421.9 million in aggregate principal amount of 1.25% Convertible Senior Notes due 2026 (the “2026 Convertible Senior Notes”) for approximately $274.2 million in aggregate principal amount of newly issued Convertible Notes due 2030 (the “2030 Convertible Notes”), consisting of two series of second-lien, senior secured notes, both of which have identical terms other than the principal amount, interest rate, and applicable conversion price. We received $97.0 million net of debt discount of $3.0 million, in cash proceeds from the offering and sale of the Senior Notes, but did not receive any cash proceeds from the exchange of the 2026 Convertible Senior Notes for the 2030 Convertible Notes. As a result of this transaction, we extended a significant amount of our 2026 maturities into 2030 and raised additional capital to bolster our liquidity position. We expect to incur higher annual interest expense for the Senior Notes and 2030 Convertible Notes. For additional information regarding the notes, including the financial and other restrictive covenants and contractual obligations contained in the indentures governing the notes, see Note 8 of the notes to condensed consolidated financial statements included in this Form 10-Q.
In March 2025, we entered into separate, individually negotiated private exchange agreements with certain holders of our 2026 Convertible Senior Notes to exchange $18.2 million aggregate principal amount of 2026 Convertible Senior Notes for newly issued shares of the Company’s Class A common stock, plus, in certain circumstances, cash in respect of accrued and unpaid interest on the Exchanged Notes. We canceled the Exchanged Notes received in the Exchange Transactions. The Exchange Transactions settled in four consecutive daily tranches, each for $4.6 million aggregate principal amount of
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Exchanged Notes, commencing on March 25, 2025. As of March 28, 2025, which was the final settlement date of the Exchange Transactions, we had issued an aggregate of 1,951,819 shares of Class A common stock in the Exchange Transactions. We not receive any cash proceeds from the Exchange Transactions. See Note 8 of the notes to condensed consolidated financial statements included in this Form 10-Q for more detail.
In May 2025, we entered into separate, individually negotiated private exchange agreements and private repurchase agreements with certain holders of our 2026 Convertible Senior Notes, to exchange $6.2 million aggregate principal amount of 2026 Convertible Senior Notes for an aggregate of 1,098,931 newly issued shares of our Class A common stock, and repurchase $43.8 million aggregate principal amount of 2026 Convertible Senior Notes for an aggregate of $30.2 million in cash. See Note 8 of the notes to condensed consolidated financial statements included in this Form 10-Q for more detail.
During the six months ending June 30, 2025, $2.0 million in aggregate principal amount of 2030 Convertible Notes were converted by the holders. The Company issued 127,466 shares of Class A common stock to settle such conversion.
In May 2025, we entered into the Series A Purchase Agreement with certain institutional accredited investors, pursuant to which we may issue and sell, in a series of registered direct offerings, up to an aggregate of 200,000 shares of newly designated Series A Preferred Stock, to the investors at a purchase price of $960.00 per share. The initial offering for 35,000 shares of Series A Preferred Stock was closed on May 22, 2025, for net proceeds to the Company of $33.6 million, before deducting placement agent fees and other offering expenses. The Company also issued the lead investor 505,051 shares of the Company’s Class A common stock as a commitment fee pursuant to the Series A Purchase Agreement. As of June 30, 2025, holders of the Company’s Series A Preferred Stock converted an aggregate of 12,000 shares of Series A Preferred Stock into 4,087,889 shares of Class A common stock. See Note 11 of the notes to condensed consolidated financial statements included in this Form 10-Q for more detail.
Since inception, we have not generated positive cash flows from operating activities and have incurred significant losses from operations. As of June 30, 2025, we had accumulated deficit of $2.2 billion. We expect to continue to incur operating losses for at least the foreseeable future due to continued investments in our product and software development, efforts to build customer relations, expansion into additional markets, and investments in developing advanced manufacturing capabilities, including at contract manufacturing partners.
As of June 30, 2025, we had cash and cash equivalents totaling $48.2 million and marketable securities of $59.5 million, totaling $107.6 million of liquidity. For the six months ended June 30, 2025, $98.0 million of cash was used in operations. Our principal sources of liquidity have been proceeds received from issuances of debt and equity. To execute on our strategic initiatives, we will continue to require additional capital resources. We continue to assess our liquidity position and opportunities for additional capital through issuances of equity securities including convertible preferred securities or the incurrence of additional debt. However, we may not be able to obtain funding on acceptable terms, or at all. If we are unable to raise additional capital when desired, our business, financial condition, and results of operations would be adversely affected.
We expect to fund our operations, product and business development initiatives and associated capital expenditures through cash, cash equivalents and marketable securities, issuance of shares of Class A common stock to vendors and third parties for services provided under our stock in lieu of cash program, issuance of Class A common stock under our Equity Financing Program (as defined in Note 12 of the notes to condensed consolidated financial statements included in this Form 10-Q) or the issuance of preferred stock under our Series A Preferred Stock Financing Program (see Note 11 of the notes to condensed consolidated financial statements included in this Form 10-Q), or any combination of the foregoing. Based on current plans and projections as well as trading dynamics of our Class A common stock, we believe our existing sources of liquidity will be sufficient to satisfy our liquidity requirements and enable us to continue to execute our business strategy for at least 12 months from the date of issuance of these condensed consolidated financial statements, though we are reliant on continued access to our Equity Financing Program and Series A Preferred Stock Financing Program.
See the discussion under the heading “We will require additional capital to meet our financial obligations and fund our operations, and this capital may not be available on acceptable terms or at all, or may cause substantial dilution to our existing stockholders” in “Risk Factors” in Item 1A of Part II of this Form 10-Q and the discussion under the heading “The terms of our Senior Notes and 2030 Convertible Notes require us to maintain minimum liquidity and place restrictions on our operating and financial flexibility. If we fail to comply with any covenants contained in the indentures governing the notes, holders may declare all of the applicable series of notes to be due and payable, and in the case of the Senior Notes and 2030 Convertible Notes, exercise rights with respect to collateral securing those notes” in “Risk Factors” in Item 1A of Part I in our 2024 Annual Report.
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Cash Flow Summary
The following table summarizes our cash flows for the periods presented:
| Six months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | $ | (97,954) | $ | (158,936) | |||||||
| Investing activities | 41,417 | 35,511 | |||||||||
| Financing activities | 22,721 | 36,894 | |||||||||
Operating Activities
Net cash used in operating activities was $98.0 million during the six months ended June 30, 2025. Net cash used in operating activities was due to our net loss of $103.6 million adjusted for non-cash items of $0.6 million, primarily consisting of $22.1 million gain on extinguishment of debt, $8.8 million of depreciation and amortization, $5.7 million of vendor stock in lieu of cash program, $5.3 million of change in fair value of the derivatives, $4.7 million of change in product warranty and other, $3.8 million of amortization of debt discount and issuance costs, $3.4 million of inventory write-offs and write-downs, $3.4 million of amortization of operating lease right-of-use assets, $1.3 million of stock-based compensation and cash used for operating assets and liabilities of $5.1 million due to the timing of cash payments to vendors and cash receipts from customers.
Investing Activities
Net cash provided by investing activities of $41.4 million during the six months ended June 30, 2025 was primarily comprised of $80.8 million of proceeds from maturities of marketable securities, $14.5 million of proceeds from sales and redemptions of marketable securities, partially offset by $54.2 million related to purchases of marketable securities.
Financing Activities
Net cash provided by financing activities of $22.7 million during the six months ended June 30, 2025 was primarily comprised of $31.4 million proceeds from the issuance of Series A Preferred Stock, net of issuance costs, discount and commitment fees, $21.5 million cash received from the sale and issuance of shares of Class A common stock under the Equity Financing Program, offset by $30.3 million paid for the repurchase of a portion of outstanding 2026 Convertible Senior Notes.
Critical Accounting Policies and Estimates
Our condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. On an ongoing basis, we evaluate our estimates and assumptions. Our actual results may differ from these estimates under different assumptions or conditions.
We believe our critical accounting policies involve the greatest degree of judgment and complexity and have the greatest potential impact on our condensed consolidated financial statements.
During the three and six months ended June 30, 2025, there were no significant changes to our critical accounting policies and estimates. For a more detailed discussion of our critical accounting policies and estimates, please refer to our 2024 Annual Report and Note 2 of the notes to condensed consolidated financial statements included in this Form 10-Q.
Smaller Reporting Company Status
Based on the Company's public float as of June 30, 2025, and its revenue, the Company is a smaller reporting company and will take advantage of certain reduced disclosure requirements.
Recent Accounting Pronouncements
See Note 2 of the notes to condensed consolidated financial statements included in this Form 10-Q.
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ITEM 3. Quantitative and Qualitative Disclosures about Market Risk.
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
We have established disclosure controls and procedures that are designed to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act and other securities laws is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate to allow timely decision making and timely required disclosure to investors.
Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we have evaluated the effectiveness of our disclosure controls and procedures as required under Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of June 30, 2025. Based on this evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective as of June 30, 2025.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings.
Information with respect to this Item may be found under the heading “Legal Matters” in Note 16 to the condensed consolidated financial statements in this Form 10-Q, which information is incorporated herein by reference.
ITEM 1A. Risk Factors.
There have been no material changes from the “Risk Factors” previously disclosed in Part 1, Item 1A, of our 2024 Annual Report, other than the updates to the risk factors contained in Part II, Item 1A of the Q1 2025 10-Q and as set forth below. You should carefully consider the “Risk Factors” discussed in our 2024 Annual Report, our Q1 2025 10-Q and the risk factors below as they could materially affect our business, financial condition and future results of operation.
Risk Factor Summary
•our ability to access sources of capital to pay our indebtedness, and finance operations and growth, which we may not be able to obtain on favorable terms, if at all, or without substantial dilution to our stockholders; and
Risks Related to Ownership of Our Class A Shares
We will require additional capital to meet our financial obligations and fund our operations, and this capital may not be available on acceptable terms or at all, or may cause substantial dilution to our existing stockholders.
We have been dependent on proceeds from our Equity Financing Program, Series A Preferred Stock Financing and debt financing to make payments on our liabilities and to fund our operations and other activities, and we will need to raise additional capital through equity or debt financing or incurring other indebtedness in order to continue to pay our liabilities, fund operations and execute on our business plan. However, any decline in the market price of our Class A common stock could impair our ability to raise capital. Separately, additional financing may not be available on favorable terms, or at all. If adequate funds are not available on acceptable terms, we may be unable to meet our obligations and fund our operations. Because our decision to issue debt or equity in the future will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, nature, or success of our future capital raising efforts.
Securities and agreements involving the issuance of debt will generally rank senior to the Class A common stock and have priority in the event of a liquidation. Such securities also may be governed by an indenture or other instrument containing covenants restricting the Company’s operating flexibility. For example, the indentures governing our debt financing arrangements contain restrictive covenants and in some cases, a minimum liquidity requirement. For more information relating to these notes, see Note 8 of the Notes to the Condensed Consolidated Financial Statements included in this Form 10-Q.
Additionally, any equity securities or convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of the Class A common stock and would further dilute existing stockholders. For example, we have an at-the-market program, which we entered in May 2024, to issue and sell up to $150.0 million of shares of our Class A common stock through a sales agent under the Equity Financing Program. In August 2024, we increased the Equity Financing Program by an additional $50.0 million and in March 2025, we further increased the program by an additional $75.0 million. We issued and sold $89.4 million under the Equity Financing Program in 2024. We may also issue in a series of registered direct offerings of up to a total of 200,000 shares of our Series A Preferred Stock under our Series A Preferred Stock Financing, subject to the satisfaction of certain conditions upon each closing. Each share of Series A Preferred Stock is convertible at any time at the option of the holder, subject to certain beneficial ownership restrictions and volume limitations, into shares of our Class A common stock based on a conversion price that is the lesser of a fixed conversion price and a variable conversion price based on a discount to the volume-weighted trading price of our Class A common stock, subject to a floor conversion price. For more information relating to our Series A Preferred Stock, see Note 11 of the Notes to the Condensed Consolidated Financial Statements included in this Form 10-Q. In May 2025, we issued and sold 35,000 shares under the Series A Preferred Stock Financing, of which the investors have converted an aggregate of 12,000 shares of Series A Preferred Stock into 4,087,889 shares of Class A common stock as of June 30, 2025. If the investors elect to convert a significant portion of the Series A Preferred Stock, including any additional shares we may issue pursuant to the Series A Preferred Stock Financing, the number of shares of Class A common stock that would be issued upon conversion will cause substantial dilution to our stockholders. In addition, our undrawn credit facility also requires providing collateral in the form of shares of Class A common stock which must equal two times the amount borrowed, which could further cause substantial dilution. In addition, in order to further business relationships with current or potential partners, vendors, or other parties, we have issued, and in the future may issue equity or equity-linked securities to such current or potential partners, vendors, or other parties. Sales of shares of Class A common stock in the public market, or the perception that these sales or conversions might occur, may depress the market price of Class A common stock and could impair our ability to raise capital through the sale of additional equity securities.
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Our largest stockholder has significant influence over us, including influence over decisions that require the approval of stockholders, which could limit our stockholders’ ability to influence the outcome of key transactions.
Austin Russell, a member of our board of directors and our former Chief Executive Officer, through his ownership of Class B common stock, controls approximately 47.7% of the voting power of shares outstanding as of June 30, 2025. Although we are not a “controlled company” within the meaning of the corporate governance standards of Nasdaq, Mr. Russell, through his voting power, will have significant influence over the outcome of corporate actions requiring stockholder approval, including the election of directors, approval of any potential acquisition of us, changes to our organizational documents and significant corporate transactions. Additionally, our largest stockholder’s interests may not align with the interests of our other stockholders.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
On May 22, 2025, the Company entered into Exchange Agreements with certain holders of its outstanding 2026 Convertible Senior Notes to exchange $6.2 million aggregate principal amount of 2026 Convertible Senior Notes for newly issued shares of the Company’s Class A common stock, plus, in certain circumstances, cash in respect of accrued and unpaid interest on the exchanged notes. As of June 30, 2025, which was the final settlement date of the exchange transactions, the Company had issued an aggregate of 3,050,750 shares of Class A common stock in the exchange transactions.
The exchange transactions were conducted pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on Section 4(a)(2) of the Securities Act as transactions by an issuer not involving a public offering.
ITEM 3. Defaults Upon Senior Securities.
None.
ITEM 4. Mine Safety Disclosures.
Not applicable.
ITEM 5. Other Information.
Our Section 16 officers and directors (as defined in Rule 16a-1 under the Exchange Act) may from time to time enter into plans for the purchase or sale of the Company’s stock that are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act. During the fiscal quarter ended June 30, 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted terminated
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ITEM 6. Exhibits.
| Incorporation by Reference | |||||||||||||||||||||||||||||||||||
| Exhibit Number | Description | Form | File Number | Exhibit/Appendix Reference | Filing Date | Filed Herewith | |||||||||||||||||||||||||||||
| 3.1 | 8-K/A | 001-38791 | 3.1 | 12/8/20 | |||||||||||||||||||||||||||||||
| 3.2 | 10-K | 001-38791 | 3.2 | 02/28/24 | |||||||||||||||||||||||||||||||
| 3.3 | 8-K | 001-38791 | 3.1 | 11/22/24 | |||||||||||||||||||||||||||||||
| 3.4 | 8-K | 001-38791 | 3.1 | 05/22/25 | |||||||||||||||||||||||||||||||
| 3.5 | 8-K | 001-38791 | 3.1 | 08/30/24 | |||||||||||||||||||||||||||||||
10.1†^ | 8-K | 001-38791 | 3.1 | 05/21/25 | |||||||||||||||||||||||||||||||
10.2+ | 8-K/A | 001-38791 | 10.1 | 05/27/25 | |||||||||||||||||||||||||||||||
| 10.3 | X | ||||||||||||||||||||||||||||||||||
| 10.4 | X | ||||||||||||||||||||||||||||||||||
| 31.1 | X | ||||||||||||||||||||||||||||||||||
| 31.2 | X | ||||||||||||||||||||||||||||||||||
| 32.1 | Furnished herewith | ||||||||||||||||||||||||||||||||||
| 101.INS | XBRL Instance Document | X | |||||||||||||||||||||||||||||||||
| 101.SCH | XBRL Taxonomy Extension Schema Document | X | |||||||||||||||||||||||||||||||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | X | |||||||||||||||||||||||||||||||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | X | |||||||||||||||||||||||||||||||||
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document | X | |||||||||||||||||||||||||||||||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | X | |||||||||||||||||||||||||||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL). | X | |||||||||||||||||||||||||||||||||
† Certain of the exhibits and schedules to this exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby agrees to furnish a copy of any omitted exhibit and/or schedule to the SEC upon its request.
^ Certain portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The registrant hereby agrees to furnish supplementally an unredacted copy of the exhibit to the SEC upon its request.
+ Indicates a management contract or compensatory plan, contract or arrangement.
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SIGNATURES.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Luminar Technologies, Inc. | ||||||||
Date: August 13, 2025 | By: | /s/ Paul Ricci | ||||||
Paul Ricci | ||||||||
Chief Executive Officer | ||||||||
| (Principal Executive Officer) | ||||||||
/s/ Thomas J. Fennimore | ||||||||
Thomas J. Fennimore | ||||||||
| Chief Financial Officer | ||||||||
| (Principal Financial Officer) | ||||||||
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Exhibit 10.3
FORM OF
LUMINAR TECHNOLOGIES, INC.
SECURITIES EXCHANGE AGREEMENT
LUMINAR TECHNOLOGIES, INC.
SECURITIES EXCHANGE AGREEMENT
May [__], 2025
The undersigned set forth on Exhibit A hereto (each, a “Holder”) enters into this Securities Exchange Agreement (this “Agreement”) with Luminar Technologies, Inc., a Delaware corporation (the “Company”), as of the date first written above whereby the Holders will exchange outstanding 1.25% convertible senior notes due 2026 (CUSIP No. 550424 AA3) issued by the Company (the “Notes”) pursuant to the Indenture, dated as of December 17, 2021 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee (the “Trustee”), for shares of Class A common stock, par value $0.0001 per share (CUSIP No. 550424 303) (the “Common Stock”), of the Company (collectively, the “Consideration”), as calculated in Section 1.1 hereto.
On and subject to the terms hereof, the parties hereto agree as follows:
Article I
EXCHANGE OF NOTES
EXCHANGE OF NOTES
Section 1.1Exchange.
(a)Upon and subject to the terms set forth in this Agreement, at the Closing (as defined below), (i) each Holder shall deliver or cause to be delivered to the Company the Exchanged Notes of such Holder and (ii) in exchange therefor, the Company hereby agrees to issue and deliver to such Holder the Consideration with respect to such Exchanged Notes, comprising such number of shares of Common Stock equal to the Exchange Shares in respect of such Exchanged Notes. The Consideration payable on the Closing Date (as defined below) shall represent satisfaction in full of all principal and interest on the Exchanged Notes of each Holder from and after the Closing Date. The transactions contemplated by this Agreement, including, without limitation, the issuance, delivery and acceptance of the aggregate Consideration contemplated hereby in consideration for the exchange of the Exchanged Notes are collectively referred to herein as the “Transactions.”
(b)For purposes of this Agreement:
“Accrued Interest” shall mean the accrued and unpaid interest that would accrue on the applicable Exchanged Notes from, and including, December 15, 2024, to, but excluding, the Closing Date, calculated in accordance with the Indenture.
“Accrued Interest Shares” shall mean that number of shares of Common Stock equal to the quotient of (i) the Accrued Interest, divided by (ii) the Closing Price.
“Closing Price” shall mean the Nasdaq Official Closing Price as reported on Nasdaq’s website for the Common Stock on the Trading Day immediately preceding the Closing Date.
“Exchange Shares” shall mean, with respect to a Holder’s Exchanged Shares, that number of shares of Common Stock equal to the sum of (i) the Principal Shares plus (ii) the Accrued Interest Shares, rounded down to the nearest whole share.
“Exchanged Notes” shall mean, with respect to each Holder, the aggregate principal amount of Notes set forth opposite such Holder’s name under the heading “Exchanged Notes” on Exhibit A hereto.
“Nasdaq” shall mean The Nasdaq Stock Market LLC.
“Principal Shares” shall mean that number of shares of Common Stock per $1,000 principal amount of the applicable Exchanged Notes equal to [fixed number of shares].
“Trading Day” shall mean a day on which trading in the Common Stock generally occurs on Nasdaq.
Section 1.2Closing. Subject to the satisfaction or valid waiver of all closing conditions set forth in Article IV hereto, on or before 9:00 a.m. (New York City time) on May [●], 2025, or such other date as the parties may mutually agree (the “Closing Date”), (a) each Holder (i) shall deliver or cause to be delivered to the Company all right, title and interest in and to its Exchanged Notes, free and clear of any mortgage, lien, pledge, charge, security interest, encumbrance, title retention agreement, option, equity or other adverse claim thereto (collectively, “Liens”), together with any documents of conveyance or transfer that the Company may reasonably determine to be necessary to transfer to and confirm in the Company all right, title and interest in and to such Exchanged Notes, free and clear of any Liens, and (ii) upon the delivery to such Holder of the Consideration due hereunder for such Exchanged Notes, waives any and all other rights with respect to its Exchanged Notes, and releases and discharges the Company from any and all claims such Holder may now have, or may have in the future, arising out of, or related to, such Exchanged Notes, including, without limitation, any claims arising from any existing or past defaults, or any claims that such Holder is entitled to receive additional interest with respect to the Exchanged Notes; and (b) the Company shall deliver or cause to be delivered to each Holder the Consideration due hereunder with respect thereto (collectively, the “Closing”). The cancellation of such Exchanged Notes and delivery of such Consideration shall be effected by the electronic exchange of documents at the Closing.
Section 1.3Delivery. At the Closing, (A) each Holder shall deliver or cause to be delivered its Exchanged Notes to the Trustee via the Deposit or Withdrawal at Custodian (“DWAC”) settlement system of the Depository Trust Company (“DTC”) for the benefit of the Company and (B) the Company shall deliver or cause to be delivered to each Holder the applicable Exchange Shares to such Holder’s DTC participant as instructed by such Holder through the facilities of DTC. For the convenience of each Holder, attached hereto as Exhibit B is a summary of the delivery instructions that must be followed to settle the Transactions through DTC.
Section 1.4No Joint Liability. The obligations of each Holder under this Agreement are several and not joint, and no Holder shall have liability to any person for the performance or non-performance of any obligation of any other Holder hereunder. Notwithstanding that this is a single agreement amongst multiple Holders, the Company covenants and agrees, for the benefit of each Holder, that it will not share or otherwise make available to any other Holder, any banking or DWAC-related information provided by such Holder to the Company.
2
Article II
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE HOLDERS
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE HOLDERS
Each Holder, severally and not jointly, hereby covenants as follows, and makes the following representations and warranties, each of which is and shall be true and correct on the date hereof and at the Closing, to the Company, and all such covenants, representations and warranties shall survive the Closing.
Section 2.1Power and Authorization. Such Holder is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation, and has the power, authority and capacity to execute and deliver this Agreement, and to perform its obligations hereunder, and to consummate the Transactions. Exhibit A hereto includes the true, correct and complete name, address and other relevant information of such Holder.
Section 2.2Valid and Enforceable Agreement; No Violations. This Agreement has been duly executed and delivered by such Holder and constitutes a legal, valid and binding obligation of such Holder, enforceable against such Holder in accordance with its terms, except as such enforcement may be subject to (a) bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally, or (b) general principles of equity, whether such enforceability is considered in a proceeding at law or in equity (the “Enforceability Exceptions”). The execution and delivery of this Agreement and the consummation of the Transactions will not violate, conflict with or result in a breach of or default under (i) such Holder’s organizational documents, (ii) any agreement or instrument to which such Holder is a party or by which such Holder or any of its assets are bound, or (iii) any laws, regulations or governmental or judicial decrees, injunctions or orders applicable to such Holder, except in the case of clauses (ii) or (iii), where such violations, conflicts, breaches or defaults would not affect such Holder’s ability to consummate the Transactions in any material respect.
Section 2.3Title to the Exchanged Notes. Such Holder (a) is the sole or direct legal and beneficial owner of the Exchanged Notes set forth opposite its name on Exhibit A hereto; (b) has good, valid and marketable title to its Exchanged Notes, free and clear of any Liens (other than pledges or security interests that such Holder may have created in favor of a prime broker under and in accordance with its prime brokerage agreement with such broker and any restrictions on transfer arising by operation of applicable securities laws); and (c) has not, in whole or in part, except as described in the preceding clause (b), (i) assigned, transferred, hypothecated, pledged, exchanged or otherwise disposed of any of its Exchanged Notes or its rights, title or interest in and to its Exchanged Notes or (ii) given any person or entity, except for its investment advisor, agents and affiliates, any transfer order, power of attorney or other authority of any nature whatsoever with respect to its Exchanged Notes. Upon such Holder’s delivery of its Exchanged Notes to the Company pursuant to the Transactions, such Exchanged Notes shall be free and clear of all Liens created by the Holder or any other person acting for the Holder.
Section 2.4Institutional Accredited Investor or Qualified Institutional Buyer. Such Holder is either: (a) an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”) or (b) a “qualified institutional buyer” within the meaning of Rule 144A promulgated under the Securities Act.
Section 2.5No Affiliate Status. The Holder is not, and has not been at any time during the consecutive three-month period preceding the date hereof, a director, officer or “affiliate” within the meaning of Rule 144 promulgated under the Securities Act (an “Affiliate”)
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of the Company. Such Holder and its Affiliates collectively beneficially own, and will beneficially own as of the Closing Date, (i) less than 5% of the outstanding shares of Common Stock and (ii) less than 5% of the aggregate number of votes that may be cast by holders of those outstanding securities of the Company that entitle the holders thereof to vote generally on all matters submitted to the Company’s stockholders for a vote, in each case, based on the outstanding shares of common stock of the Company set forth in Section 3.4 hereof. To such Holder’s reasonable knowledge, and without inquiry, a period of at least one year (calculated in the manner provided in Rule 144(d) under the Securities Act) has lapsed since the Exchanged Notes set forth opposite its name on Exhibit A hereto were acquired from the Company or from a person known by the Holder to be an Affiliate of the Company.
Section 2.6No Prohibited Transactions. Such Holder has not, directly or indirectly, and no person acting on behalf of or pursuant to any understanding with it has, disclosed to a third party (other than (i) its advisors or as required by Applicable Law (as defined below) or (ii) with the Company’s prior approval or consent) any information regarding the Transactions, engaged in any transactions in the securities of the Company (including, without limitation, any Short Sales (as defined below) involving any of the Company’s securities) since the time that investment professionals affiliated with such Holder (i.e., persons other than compliance personnel affiliated with such Holder) were first restricted via a “wall-cross” by either the Company, Matthews South, LLC (the “Placement Agent”) or any other person acting on the Company’s behalf, in each case, regarding the Transactions or this Agreement, and such Holder shall not engage in any such activities until the Disclosure Time (as defined below). “Short Sales” include, without limitation, all “short sales” as defined in Rule 200 of Regulation SHO promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and all types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, short sales, swaps, derivatives and similar arrangements (including, without limitation, on a total return basis), and sales and other transactions through non-U.S. broker-dealers or foreign regulated brokers. Solely for purposes of this Section 2.6, subject to such Holder’s compliance with its obligations under the U.S. federal securities laws and such Holder’s internal policies, (a) “Holder” shall not be deemed to include any employees, subsidiaries, desks, groups or affiliates of such Holder that are effectively walled off by appropriate “fire wall” information barriers approved by such Holder’s legal or compliance department (and thus such walled off parties have not been privy to any information concerning the Transactions), and (b) the foregoing representations and covenants of this Section 2.6 shall not apply to any transaction by or on behalf of an affiliate of a Holder that was effected without the advice or participation of, or such affiliate’s receipt of information regarding the Transactions provided by, such Holder.
Section 2.7Adequate Information; No Reliance. Such Holder acknowledges and agrees that (a) such Holder has been furnished with all materials it considers relevant to making an investment decision to enter into the Transactions and has had the opportunity to review the Company’s filings and submissions with the Securities and Exchange Commission (the “SEC”), including, without limitation, all information filed or furnished pursuant to the Exchange Act on or prior to the date hereof (collectively, the “Public Filings”); (b) such Holder has had the opportunity to ask questions of the Company concerning the Company, its business, operations, financial performance, financial condition and prospects and the terms and conditions of the Transactions; (c) such Holder has had the opportunity to consult with its accounting, tax, financial and legal advisors to be able to evaluate the risks involved in the Transactions and to make an informed investment decision with respect to such Transactions; (d) such Holder has evaluated the tax and other consequences of the Transactions and receipt and ownership of the Consideration with its tax, accounting or legal advisors; (e) the Company and the Placement Agent are not acting as a fiduciary or financial or investment advisor to such Holder; and (f) such Holder is not relying, and has not relied, upon any statement, advice (whether accounting, tax, financial, legal or other), representation or warranty made by the Company, the Placement Agent or any of their respective affiliates or representatives except for (i) the Public Filings and (ii) the
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representations and warranties made by the Company in this Agreement. Such Holder (w) is able to fend for itself in the Transactions; (x) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of its prospective investment in the Exchange Shares; (y) has the ability to bear the economic risks of its prospective investment and can afford the complete loss of such investment; and (z) acknowledges that investment in the Exchange Shares involves a high degree of risk. Such Holder understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Exchange Shares or the fairness or suitability of the investment in the Exchange Shares nor have such authorities passed upon or endorsed the merits of the Transactions.
Section 2.8Acknowledgements. Such Holder acknowledges that (a) the issuance of the Exchange Shares pursuant to the Transactions has not been registered or qualified under the Securities Act or any state securities laws, and the Exchange Shares are being offered and sold in reliance upon exemptions provided in the Securities Act and state securities laws for transactions not involving any public offering and, therefore, cannot be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of unless they are subsequently registered and qualified under the Securities Act and applicable state laws or unless an exemption from such registration and qualification is available; (b) the Company is under no obligation to register the Exchange Shares under any securities laws of the United States or any other jurisdiction or to comply with the terms and conditions of any exemption thereunder; and (c) it is acquiring the Exchange Shares for investment purposes only for its own account and not with any view toward a distribution thereof or with any intention of selling, distributing or otherwise disposing of the Exchange Shares in a manner that would violate the registration requirements of the Securities Act. Such Holder further acknowledges and agrees that (x) such Holder’s Exchange Shares will be acquired from the Company solely in exchange for such Holder’s Exchanged Notes, including any accrued and unpaid interest thereon; and (y) such Holder’s participation in the Transactions was not conditioned by the Company on such Holder’s exchange of a minimum principal amount of Notes. Such Holder understands that the Company is relying upon the representations and agreements contained in this Agreement for the purpose of determining whether such Holder’s participation in the Transactions meets the requirements for the exemptions referenced in this Section 2.8.
Section 2.9Taxpayer Information. Such Holder will deliver to the Company a complete and accurate IRS Form W-9 or IRS Form W-8BEN, W-8BEN E or W-8ECI, as appropriate.
Section 2.10Brokers; Finders. No broker, investment banker, financial advisor or other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission, or the reimbursement of expenses in connection therewith, in connection with the Transactions based upon arrangements made by or on behalf of such Holder. Such Holder understands that the Company intends to pay the Placement Agent a fee in respect of the Transactions.
Section 2.11No Reliance on the Placement Agent. Such Holder acknowledges and agrees that the Placement Agent has not acted as a financial advisor or fiduciary to such Holder and that the Placement Agent and its directors, officers, employees, representatives and controlling persons have no responsibility for making, and have not made, any independent investigation of the information contained herein or in the Company’s SEC filings and make no representation or warranty to such Holder, express or implied, with respect to the Company, the Notes or the Consideration or the accuracy, completeness or adequacy of the information provided to such Holder or any other publicly available information, including, without limitation, the Public Filings, nor will any of the foregoing persons be liable for any loss or
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damages of any kind resulting from the use of the information contained therein or otherwise supplied to such Holder.
Section 2.12Further Action. Such Holder agrees that it will, upon request, execute and deliver any additional documents reasonably determined to be necessary by the Company, the Placement Agent, the Trustee or Equiniti Trust Company, LLC, the Company’s transfer agent (the “Transfer Agent”), to complete the Transactions.
Article III
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby covenants as follows, and makes the following representations and warranties, each of which is and shall be true and correct on the date hereof and at the Closing, to the Holders, and all such covenants, representations and warranties shall survive the Closing.
Section 3.1Power and Authorization; Enforceability. The Company has been duly organized, validly existing as a corporation and in good standing under the laws of its jurisdiction of organization. The Company is duly licensed or qualified as a foreign corporation for transaction of business and in good standing under the laws of each other jurisdiction in which its ownership or lease of property or the conduct of its business requires such license or qualification, and has all corporate power and authority necessary to own or hold its properties and to conduct its business as described in the Public Filings, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a Material Adverse Effect (as defined below). The Company has full legal right, power and authority to enter into this Agreement and perform the Transactions. This Agreement has been duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforcement may be subject to the Enforceability Exceptions.
Section 3.2No Consents; No Violations; No Conflicts. Assuming the accuracy of each Holder’s representations and warranties hereunder, no consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or any governmental or regulatory authority is required for the execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the Transactions, except for such consents, approvals, authorizations, orders and registrations or qualifications (i) as may be required under applicable state securities laws, (ii) as may be required under the Securities Act and (iii) as have been previously obtained by the Company. Neither the execution of this Agreement, nor the issuance, offering or sale of the Exchange Shares, nor the consummation of any of the Transactions, will conflict with, or will result in a breach of, any of the terms and provisions of, or has constituted or will constitute a default under, or has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any contract or other agreement to which the Company may be bound or to which any of the property or assets of the Company is subject, except (i) such conflicts, breaches or defaults as may have been waived, (ii) such conflicts, breaches and defaults that would not have a Material Adverse Effect and (iii) Permitted Liens (as defined in the indentures governing the Company’s senior secured indebtedness described in the Public Filings (the “Senior Secured Indentures”)); nor will such action result (x) in any violation of the provisions of the organizational or governing documents of the Company, or (y) in any material violation of the provisions of any statute or any order, rule or regulation applicable to the Company or of any court or of any federal, state or other regulatory authority or other government body having jurisdiction over the Company, except, in the case of this clause (y), where such violation would not have a Material Adverse Effect.
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Section 3.3Validity of the Exchange Shares. The issuance of the Exchange Shares has been duly authorized by the Company and, when issued and delivered to the applicable Holder pursuant to the Transactions against delivery of the Exchanged Notes therefor in accordance with the terms of this Agreement, the Exchange Shares will be validly issued, fully paid and non-assessable and free of any Liens created by the Company, and the issuance of the Exchange Shares will not be subject to any preemptive, participation, rights of first refusal or other similar rights.
Section 3.4Capitalization. The issued and outstanding shares of capital stock of the Company have been validly issued, are fully paid and non-assessable and, other than as disclosed in the Public Filings, are not subject to any preemptive rights, rights of first refusal or similar rights. As of [●], 2025, the Company had [●] shares of Common Stock (excluding treasury shares) and [●] shares of Class B common stock, par value $0.0001 per share, outstanding. The Company otherwise has an authorized, issued and outstanding capitalization as set forth in the Public Filings as of the dates referred to therein (other than (i) the grant of additional equity awards, or the exercise, settlement or forfeiture of outstanding equity awards, under the Company’s existing equity compensation plans, (ii) changes in the number of outstanding shares of Common Stock due to the issuance of shares upon the exercise or conversion of securities described as outstanding in the Public Filings which are exercisable for, or convertible into, Common Stock, (iii) as a result of the issuance of shares of Common Stock pursuant to that certain financing agreement, dated as of May 3, 2024, between the Company and Virtu Americas LLC (as amended and supplemented from time to time, the “Financing Agreement”), (iv) as a result of the issuance of Exchange Shares, (v) as a result of the issuance of shares of Series A Convertible Preferred Stock and Common Stock pursuant to that certain Securities Purchase Agreement, dated as of May 19, 2025, by and among the Company and the investors signatory thereto (the “Series A Preferred Purchase Agreement”), or the conversion of such shares of Series A Convertible Preferred Stock by the holders thereof into shares of Common Stock, or (vi) any repurchases of capital stock of the Company) and such authorized capital stock conforms to the description thereof set forth in the Public Filings. Except as disclosed in or contemplated by the Public Filings, the Company did not have outstanding any options to purchase, or any rights or warrants to subscribe for, or any securities or obligations convertible into, or exchangeable for, or any contracts or commitments to issue or sell, any shares of capital stock or other securities.
Section 3.5Private Placement. Assuming the accuracy of each Holder’s representations and warranties hereunder, the Exchange Shares (a) will be issued in transactions exempt from the registration requirements of the Securities Act, (b) will be issued in compliance with all applicable state and federal laws and (c) will, at the Closing, be free of any restrictions on resale by such Holder pursuant to Rule 144 promulgated under the Securities Act and will not be subject to any restricted or similar legend unless, at the time of issuance, the Holder is an Affiliate of the Company. Neither the Company nor, to the Company’s knowledge, any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the Transactions. For the purposes of Rule 144 promulgated under the Securities Act, the Company acknowledges that, assuming the accuracy of each Holder’s representations and warranties hereunder, the holding period of the Exchanged Notes exchanged by such Holder as of the Closing Date may be tacked onto the holding period of such Holder’s Exchange Shares with respect to such Exchanged Notes, and the Company agrees not to take a position contrary thereto.
Section 3.6Listing. At or prior to the Closing, the Company shall have submitted to Nasdaq a Listing of Additional Shares Notification Form in respect of the Exchange Shares, if required, and shall have received no objection thereto from Nasdaq. At the Closing, the Common Stock is listed on Nasdaq, and the Company has taken no action designed to, or likely to have the
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effect of, delisting the Common Stock from Nasdaq nor, except as disclosed to the Holders, has the Company received any notification that Nasdaq is contemplating terminating such listing.
Section 3.7Disclosure. On or before 8:00 a.m. (New York City time) on the first business day following the date of this Agreement (the “Disclosure Time”), the Company shall file with the SEC a Current Report on Form 8-K disclosing the material terms of the Transactions (to the extent not previously publicly disclosed) (the “Closing 8-K”). From and after the filing of the Closing 8-K, the Company represents to each Holder that such Holder shall not be in possession of any material, nonpublic information provided by the Company or any of its officers, directors, employees or agents that is not disclosed in the Closing 8-K. Without the prior written consent of a Holder, the Company shall not disclose the name of such Holder in any filing or announcement, unless such disclosure is in accordance with Section 5.5 below.
Section 3.8SEC Filings; Disclosure. The Company has filed with the SEC all reports, schedules and statements required to be filed by it under the Exchange Act on a timely basis for the most recent twelve-month period. As of their respective filing dates, the Public Filings filed since January 1, 2024, complied in all material respects with applicable requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such Public Filings. None of such Public Filings, at the time they were filed with the SEC or, if amended or restated, as of the date of such amendment or restatement, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
Section 3.9No Material Adverse Effect. Since December 31, 2024, except as disclosed in the Public Filings, the Company and its subsidiaries, considered as a single enterprise, have conducted their business in the ordinary course, and there has not been any material adverse change in, or any development that would reasonably be expected to have, individually or in the aggregate, a material adverse effect on, the legality, validity or enforceability of this Agreement or the ability of the Company to perform its obligations hereunder in connection with the Transactions on a full and timely basis in all material respects, or in or on the assets, business, operations, earnings, properties, condition (financial or otherwise), stockholders’ equity or results of operations of the Company and its subsidiaries, taken as a whole (collectively, a “Material Adverse Effect”).
Section 3.10Investment Company Act. The Company is not and, after giving effect to the Transactions, will not be required to register as, an “investment company” or an entity “controlled” by an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended.
Section 3.11Brokers. The Company has not incurred any liability for any finder’s fees, brokerage commissions or similar payments in connection with the Transactions for which any Holder may be liable.
Section 3.12Further Action. The Company agrees that (i) it will cancel all Exchanged Notes acquired in connection with the Transactions, and (ii) it will, upon request, execute and deliver any additional documents reasonably deemed necessary or desirable by the Holders, the Trustee or the Transfer Agent to complete the Transactions.
Article IV
CLOSING CONDITIONS & NOTIFICATION
CLOSING CONDITIONS & NOTIFICATION
Section 4.1Conditions to Obligations of each Holder and the Company. The obligations of each Holder to deliver the Exchanged Notes and of the Company to deliver the
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Consideration at the Closing are subject to the satisfaction at or prior to the Closing of the following conditions:
(a)there shall be no action, lawsuit, arbitration, claim or proceeding pending that enjoins the consummation of this Agreement or the Transactions;
(b)solely with regard to the obligations of each Holder to deliver the Exchanged Notes, (i) the representations and warranties of the Company contained in Article III shall be true and correct as of the Closing in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) with the same effect as though such representations and warranties had been made as of the Closing, and, unless notice is given pursuant to Section 4.2 below, each of the representations and warranties contained therein shall be deemed to have been reaffirmed and confirmed as of the Closing Date; and (ii) the Company shall have complied, in all material respects, with all covenants and other agreements in this Agreement required to be performed by the Company at or prior to the Closing; and
(c)solely with regard to the obligation of the Company to deliver the Consideration, (i) the representations and warranties of each Holder contained in Article II shall be true and correct as of the Closing in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) with the same effect as though such representations and warranties had been made as of the Closing, and, unless notice is given pursuant to Section 4.2 below, each of the representations and warranties contained therein shall be deemed to have been reaffirmed and confirmed as of the Closing Date; and (ii) each Holder shall have complied, in all material respects, with all covenants and other agreements in this Agreement required to be performed by them at or prior to the Closing.
Section 4.2Notification. Each Holder hereby covenants and agrees to promptly notify the Company upon the occurrence of any event prior to the Closing that would cause any representation, warranty, or covenant contained in Article II to be false or incorrect in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respects). The Company hereby covenants and agrees to notify the Holders upon the occurrence of any event prior to the Closing that would cause any representation, warranty, or covenant contained in Article III to be false or incorrect in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respects).
Article V
MISCELLANEOUS
MISCELLANEOUS
Section 5.1Entire Agreement. This Agreement and any documents and agreements executed in connection with the Transactions embody the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersede all prior and contemporaneous oral or written agreements, representations, warranties, contracts, correspondence, conversations, memoranda and understandings between or among the parties or any of their agents, representatives or affiliates relative to such subject matter, including, without limitation, any term sheets, emails or draft documents.
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Section 5.2Construction. References in the singular shall include the plural, and vice versa, unless the context otherwise requires. References in the masculine shall include the feminine and neuter, and vice versa, unless the context otherwise requires. Headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meanings of the provisions hereof. Neither party, nor its respective counsel, shall be deemed the drafter of this Agreement for purposes of construing the provisions of this Agreement, and all language in all parts of this Agreement shall be construed in accordance with its fair meaning, and not strictly for or against either party.
Section 5.3Governing Law; Waiver of Jury Trial. This Agreement shall in all respects be construed in accordance with and governed by the substantive laws of the State of New York, without reference to its choice of law rules. Each of the Company and the Holders irrevocably waives any and all right to trial by jury with respect to any legal proceeding arising out of the Transactions.
Section 5.4Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. Any counterpart or other signature hereon delivered by facsimile or any standard form of telecommunication or e-mail shall be deemed for all purposes as constituting good and valid execution and delivery of this Agreement by such party.
Section 5.5Use of Holder Names. Neither the Company nor any of its affiliates and subsidiaries (if any) (collectively, the “Company Group”) shall identify, or permit any of its employees, agents or representatives to identify, any Holder (whether in connection with the Company or in the Holder’s capacity as an investor in the Company) in any written or oral public communications or issue any press release or other disclosure of the Holder’s name or the name of any of its affiliates, or any derivative of any of the foregoing names (collectively, the “Holder Names”), in each case except (i) as authorized in writing in advance by the Holder in each such instance (electronic mail to suffice) or (ii) as required by applicable law, legal process or regulatory request (“Applicable Law”); provided, that prior to any such disclosure such disclosing member of the Company Group as soon as practicable notifies the Holder of such requirement (except where prohibited by Applicable Law) so that the Holder (or its applicable affiliate) may seek a protective order or other appropriate remedy prior to such disclosure. Notwithstanding the foregoing, the Company may make disclosures to an auditor or governmental or regulatory authority pursuant to any routine investigation, inspection, examination or inquiry without providing the Holder with any notification thereof, unless the Holder is the subject of any such investigation, inspection, examination or inquiry (in which case the preceding sentence shall govern).
Section 5.6Fees and Expenses. Except as otherwise set forth in this Agreement, each party to this Agreement shall bear its own fees and expenses in connection with the delivery of the Exchanged Notes and issuance of the Consideration. The Company shall be responsible for the payment of any fees of the Placement Agent, the Trustee or the Transfer Agent relating to or arising out of the Transactions.
Section 5.7Severability. The invalidity or unenforceability of any provision hereof will in no way affect the validity or enforceability of any other provision or the validity and enforceability of this Agreement.
Section 5.8Assignment; Binding Effect. No Holder shall convey, assign or otherwise transfer any of its rights or obligations under this Agreement without the express written consent of the Company, except to an affiliate of such Holder who assumes its obligations hereunder pursuant to a joinder or similar agreement reasonably acceptable to the Company, and the Company shall not convey, assign or otherwise transfer any of its rights and
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obligations under this Agreement without the express written consent of each Holder. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. This Agreement is intended solely for the benefit of the parties hereto and their respective successors and permitted assigns, and, except as set forth in Section 5.9, is not for the benefit of, nor may any provision hereof be enforced by, any other person.
Section 5.9Reliance by the Placement Agent. The Placement Agent, acting as financial advisor to the Company, may rely on each representation and warranty of the Company and of each Holder, made on behalf of itself, herein or pursuant to the terms hereof with the same force and effect as if such representation or warranty were made directly to the Placement Agent. The Placement Agent will be a third-party beneficiary of this Agreement to the extent provided in this Section 5.9.
Section 5.10Waiver; Remedies. No delay on the part of any Holder or the Company in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any waiver on the part of any Holder or the Company of any right, power or privilege under this Agreement operate as a waiver of any other right, power or privilege of such party under this Agreement, nor shall any single or partial exercise of any right, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, power or privilege under this Agreement. All waivers under this Agreement shall be in writing and signed by the party against whom such waiver is to be enforced.
Section 5.11Amendment. This Agreement may be modified or amended only by written agreement of each of the parties to this Agreement.
Section 5.12Survival. The provisions of Article II, Article III, Section 4.2 and Article V shall survive the Closing.
Section 5.13Notice. Any notice or communications hereunder shall be in writing and will be deemed to have been given if delivered in person or by registered or certified first-class mail or courier service or sent by electronic transmission to the following addresses, or such other addresses as may be furnished hereafter by notice in writing:
if to the Company:
Luminar Technologies, Inc.
2603 Discovery Drive, Suite 100
Orlando, FL 32826
Attention: Tom Fennimore, CFO
Email:
with a copy (which will not constitute notice) to:
@luminartech.com
with a copy (which will not constitute notice) to:
Orrick, Herrington & Sutcliffe LLP
631 Wilshire Boulevard
11
Santa Monica, CA 90401
Attention: Daniel S. Kim
Email:
if to the Holders, as set forth on Exhibit A hereto.
Section 5.14Termination. The Company may terminate this Agreement if (i) there has occurred any breach or withdrawal by a Holder of any covenant, representation or warranty set forth in Article II in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respect) or (ii) any of the conditions outlined in Section 4.1(a) or Section 4.1(c) is not satisfied or waived by 5:00 p.m. (New York City time) on the Closing Date. A Holder may terminate this Agreement if (i) there has occurred any breach or withdrawal by the Company of any covenant, representation or warranty set forth in Article III in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respect) or (ii) any of the conditions outlined in Section 4.1(a) or Section 4.1(b) is not satisfied or waived by 5:00 p.m. (New York City time) on the Closing Date. Upon a termination of this Agreement in accordance with this Section 5.14, neither the Company nor any Holder shall have any further obligation or liability (including, without limitation, arising from such termination) to the other.
Section 5.15Other Transactions. Nothing contained herein or in any other document related to the Transactions, and no action taken by any Holder pursuant hereto or thereto or by any other party pursuant to such other documents, shall be deemed to constitute a Holder and any other Holder or any other party hereunder or under such other documents as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that such entities are in any way acting in concert or as a group with respect to their obligations hereunder or thereunder or with respect to the Transactions.
[Signature Page Follows]
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first above written.
THE COMPANY: | |||||
| LUMINAR TECHNOLOGIES, INC. | |||||
By: Name: Title: | |||||
Signature Page to
Securities Exchange Agreement
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first above written.
HOLDER:
________________________________________________
By:
Name:
Title:
Signature Page to
Securities Exchange Agreement
Signature Page to
Securities Exchange Agreement
EXHIBIT A
Holders
| Holder Name and Address | Exchanged Notes (aggregate principal amount of Notes to be exchanged) | ||||
| Total | $[__________] | ||||
EXHIBIT B
LUMINAR TECHNOLOGIES, INC.
NOTICE OF EXCHANGE PROCEDURES
Following are the procedures for the settlement of the exchange of 1.25% convertible senior notes due 2026 (CUSIP No. 550424 AA3) (the “Notes”), of Luminar Technologies, Inc. (the “Company”) for shares of Class A common stock, par value $0.0001 per share (CUSIP No. 550424 303) (the “Common Stock”), of the Company (the “Exchange Shares” and, collectively, the “Consideration”), pursuant to the Securities Exchange Agreement, dated as of May [●], 2025 (the “Exchange Agreement”), between the Company and the Holders party thereto, on the Closing Date (which is expected to occur on May [●], 2025, subject to the satisfaction or waiver of the closing conditions set forth in the Repurchase Agreement). Capitalized terms used herein and not otherwise defined herein have the meaning given to them in the Exchange Agreement.
To ensure timely settlement on the Closing Date, please follow the instructions as set forth below. Your failure to comply with the following instructions may delay your receipt of the applicable Consideration on the Closing Date.
If you have any questions, please contact Jared Kramer of Matthews South, LLC by telephone at (415) 873-4765 or by email to jared@matthewssouth.com.
Thank you.
Delivery of the Exchanged Notes
You must direct the eligible DTC participant through which you hold a beneficial interest in the Exchanged Notes to post on the Closing Date, no later than 9:00 a.m. (New York City time), withdrawal instructions through DTC via DWAC for the aggregate principal amount of Exchanged Notes (CUSIP No. 550424 AA3) to be exchanged on such Closing Date. It is important that this instruction be submitted and the DWAC posted on the Closing Date—if it is posted before the Closing Date, then it will expire unaccepted and will need to be re-posted on the Closing Date.
To Receive the Exchange Shares
You must direct your eligible DTC participant through which you wish to hold a beneficial interest in the Exchange Shares to post on the Closing Date, no later than 9:00 a.m. (New York City time), a deposit instruction through DTC via DWAC for the aggregate number of Exchange Shares (CUSIP No. 550424 303) to which you are entitled to receive on the Closing Date (calculated as described in Section 1.1 of the Exchange Agreement). It is important that this instruction be submitted and the DWAC posted on the Closing Date—if it is posted before the Closing Date, then it will expire unaccepted and will need to be re-posted on the Closing Date.
Exhibit 10.4
FORM OF
LUMINAR TECHNOLOGIES, INC.
NOTE REPURCHASE AGREEMENT
LUMINAR TECHNOLOGIES, INC.
NOTE REPURCHASE AGREEMENT
May [__], 2025
The undersigned set forth on Exhibit A hereto (each, a “Holder”) enters into this Note Repurchase Agreement (this “Agreement”) with Luminar Technologies, Inc., a Delaware corporation (the “Company”), as of the date first written above, whereby the Holders will sell to the Company, and the Company will purchase from the Holders, outstanding 1.25% convertible senior notes due 2026 (CUSIP No. 550424 AA3) issued by the Company (the “Notes”) pursuant to the Indenture, dated as of December 17, 2021 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee (the “Trustee”), for a cash payment (the “Consideration”) as calculated in Section 1.1 hereto.
On and subject to the terms hereof, the parties hereto agree as follows:
Article I
PURCHASE AND SALE OF NOTES
PURCHASE AND SALE OF NOTES
Section 1.1Agreement to Purchase and Sell. Upon and subject to the terms set forth in this Agreement, at the Closing (as defined below), (i) each Holder agrees to sell to the Company the aggregate principal amount of Notes set forth opposite such Holder’s name on Exhibit A hereto (the “Repurchased Notes”) and (ii) the Company hereby agrees to purchase from such Holder all of such Holder’s Repurchased Notes at a cash purchase price equal to (x) $[●] per $1,000 principal amount of Repurchased Notes to be purchased plus (y) the accrued interest on such Repurchased Notes from, and including, December 15, 2024, to, but excluding, the Closing Date (as defined below), calculated in accordance with the Indenture. The Consideration payable on the Closing Date shall represent satisfaction in full of all principal and interest on the Repurchased Notes of each Holder from and after the Closing Date. The transactions contemplated by this Agreement, including, without limitation, the delivery and acceptance of the aggregate Consideration contemplated hereby in consideration for the sale of the Repurchased Notes are collectively referred to herein as the “Transactions.”
Section 1.2Closing. Subject to the satisfaction or valid waiver of all closing conditions set forth in Article IV hereto, on or before 9:00 a.m. (New York City time) on May [●], 2025, or such other date as the parties may mutually agree (the “Closing Date”), (a) each Holder (i) shall deliver or cause to be delivered to the Company all right, title and interest in and to its Repurchased Notes, free and clear of any mortgage, lien, pledge, charge, security interest, encumbrance, title retention agreement, option, equity or other adverse claim thereto (collectively, “Liens”), together with any documents of conveyance or transfer that the Company may reasonably determine to be necessary to transfer to and confirm in the Company all right, title and interest in and to such Repurchased Notes, free and clear of any Liens, and (ii) upon the delivery to such Holder of the Consideration due hereunder for such Repurchased Notes, waives any and all other rights with respect to its Repurchased Notes, and releases and discharges the Company from any and all claims such Holder may now have, or may have in the future, arising out of, or related to, such Repurchased Notes, including, without limitation, any claims arising from any existing or past defaults, or any claims that such Holder is entitled to receive additional interest with respect to the Repurchased Notes; and (b) the Company shall deliver or cause to be delivered to each Holder the Consideration due hereunder with respect thereto (collectively, the
“Closing”). The cancellation of such Repurchased Notes and delivery of such Consideration shall be effected by the electronic exchange of documents at the Closing.
Section 1.3Delivery. At the Closing, (A) each Holder shall deliver or cause to be delivered its Repurchased Notes to the Trustee via the Deposit or Withdrawal at Custodian (“DWAC”) settlement system of the Depository Trust Company (“DTC”) for the benefit of the Company and (B) the Company shall pay or cause to be paid to such Holder the Consideration for such Repurchased Notes by wire transfer of immediately available funds to the account at the bank or broker in the United States of America designated by the Holder in writing to the Company prior to the Closing. For the convenience of each Holder, attached hereto as Exhibit B is a summary of the delivery instructions that must be followed to settle the Transactions through DTC.
Section 1.4No Joint Liability. The obligations of each Holder under this Agreement are several and not joint, and no Holder shall have liability to any person for the performance or non-performance of any obligation of any other Holder hereunder. Notwithstanding that this is a single agreement amongst multiple Holders, the Company covenants and agrees, for the benefit of each Holder, that it will not share or otherwise make available to any other Holder, any banking or DWAC-related information provided by such Holder to the Company.
Article II
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE HOLDERS
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE HOLDERS
Each Holder, severally and not jointly, hereby covenants as follows, and makes the following representations and warranties, each of which is and shall be true and correct on the date hereof and at the Closing, to the Company, and all such covenants, representations and warranties shall survive the Closing.
Section 2.1Power and Authorization. Such Holder is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation, and has the power, authority and capacity to execute and deliver this Agreement, and to perform its obligations hereunder, and to consummate the Transactions. Exhibit A hereto includes the true, correct and complete name, address and other relevant information of such Holder.
Section 2.2Valid and Enforceable Agreement; No Violations. This Agreement has been duly executed and delivered by such Holder and constitutes a legal, valid and binding obligation of such Holder, enforceable against such Holder in accordance with its terms, except as such enforcement may be subject to (a) bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally, or (b) general principles of equity, whether such enforceability is considered in a proceeding at law or in equity (the “Enforceability Exceptions”). The execution and delivery of this Agreement and the consummation of the Transactions will not violate, conflict with or result in a breach of or default under (i) such Holder’s organizational documents, (ii) any agreement or instrument to which such Holder is a party or by which such Holder or any of its assets are bound, or (iii) any laws, regulations or governmental or judicial decrees, injunctions or orders applicable to such Holder, except in the case of clauses (ii) or (iii), where such violations, conflicts, breaches or defaults would not affect such Holder’s ability to consummate the Transactions in any material respect.
Section 2.3Title to the Repurchased Notes. Such Holder (a) is the sole or direct legal and beneficial owner of the Repurchased Notes set forth opposite its name on Exhibit A hereto; (b) has good, valid and marketable title to its Repurchased Notes, free and clear of any Liens (other than pledges or security interests that such Holder may have created in favor of a
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prime broker under and in accordance with its prime brokerage agreement with such broker and any restrictions on transfer arising by operation of applicable securities laws); and (c) has not, in whole or in part, except as described in the preceding clause (b), (i) assigned, transferred, hypothecated, pledged, exchanged or otherwise disposed of any of its Repurchased Notes or its rights, title or interest in and to its Repurchased Notes or (ii) given any person or entity, except for its investment advisor, agents and affiliates, any transfer order, power of attorney or other authority of any nature whatsoever with respect to its Repurchased Notes. Upon such Holder’s delivery of its Repurchased Notes to the Company pursuant to the Transactions, such Repurchased Notes shall be free and clear of all Liens created by the Holder or any other person acting for the Holder.
Section 2.4Institutional Accredited Investor or Qualified Institutional Buyer. Such Holder is either: (a) an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”) or (b) a “qualified institutional buyer” within the meaning of Rule 144A promulgated under the Securities Act.
Section 2.5[Reserved].
Section 2.6No Prohibited Transactions. Such Holder has not, directly or indirectly, and no person acting on behalf of or pursuant to any understanding with it has, disclosed to a third party (other than (i) its advisors or as required by Applicable Law (as defined below) or (ii) with the Company’s prior approval or consent) any information regarding the Transactions, engaged in any transactions in the securities of the Company (including, without limitation, any Short Sales (as defined below) involving any of the Company’s securities) since the time that investment professionals affiliated with such Holder (i.e., persons other than compliance personnel affiliated with such Holder) were first restricted via a “wall-cross” by either the Company, Matthews South, LLC (the “Placement Agent”) or any other person acting on the Company’s behalf, in each case, regarding the Transactions or this Agreement, and such Holder shall not engage in any such activities until the Disclosure Time (as defined below). “Short Sales” include, without limitation, all “short sales” as defined in Rule 200 of Regulation SHO promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and all types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, short sales, swaps, derivatives and similar arrangements (including, without limitation, on a total return basis), and sales and other transactions through non-U.S. broker-dealers or foreign regulated brokers. Solely for purposes of this Section 2.6, subject to such Holder’s compliance with its obligations under the U.S. federal securities laws and such Holder’s internal policies, (a) “Holder” shall not be deemed to include any employees, subsidiaries, desks, groups or affiliates of such Holder that are effectively walled off by appropriate “fire wall” information barriers approved by such Holder’s legal or compliance department (and thus such walled off parties have not been privy to any information concerning the Transactions), and (b) the foregoing representations and covenants of this Section 2.6 shall not apply to any transaction by or on behalf of an affiliate of a Holder that was effected without the advice or participation of, or such affiliate’s receipt of information regarding the Transactions provided by, such Holder.
Section 2.7Adequate Information; No Reliance. Such Holder acknowledges and agrees that (a) such Holder has been furnished with all materials it considers relevant to making an investment decision to enter into the Transactions and has had the opportunity to review the Company’s filings and submissions with the Securities and Exchange Commission (the “SEC”), including, without limitation, all information filed or furnished pursuant to the Exchange Act on or prior to the date hereof (collectively, the “Public Filings”); (b) such Holder has had the opportunity to ask questions of the Company concerning the Company, its business, operations, financial performance, financial condition and prospects and the terms and conditions of the Transactions; (c) such Holder has had the opportunity to consult with its accounting, tax,
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financial and legal advisors to be able to evaluate the risks involved in the Transactions and to make an informed investment decision with respect to such Transactions; (d) such Holder has evaluated the tax and other consequences of the Transactions with its tax, accounting or legal advisors; (e) the Company and the Placement Agent are not acting as a fiduciary or financial or investment advisor to such Holder; and (f) such Holder is not relying, and has not relied, upon any statement, advice (whether accounting, tax, financial, legal or other), representation or warranty made by the Company, the Placement Agent or any of their respective affiliates or representatives except for (i) the Public Filings and (ii) the representations and warranties made by the Company in this Agreement. Such Holder (x) is able to fend for itself in the Transactions and (y) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits, risks and advisability of the Transactions. Such Holder understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the merits of the Transactions.
Section 2.8[Reserved].
Section 2.9Taxpayer Information. Such Holder will deliver to the Company a complete and accurate IRS Form W-9 or IRS Form W-8BEN, W-8BEN E or W-8ECI, as appropriate.
Section 2.10Brokers; Finders. No broker, investment banker, financial advisor or other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission, or the reimbursement of expenses in connection therewith, in connection with the Transactions based upon arrangements made by or on behalf of such Holder. Such Holder understands that the Company intends to pay the Placement Agent a fee in respect of the Transactions.
Section 2.11No Reliance on the Placement Agent. Such Holder acknowledges and agrees that the Placement Agent has not acted as a financial advisor or fiduciary to such Holder and that the Placement Agent and its directors, officers, employees, representatives and controlling persons have no responsibility for making, and have not made, any independent investigation of the information contained herein or in the Company’s SEC filings and make no representation or warranty to such Holder, express or implied, with respect to the Company, the Notes or the Consideration or the accuracy, completeness or adequacy of the information provided to such Holder or any other publicly available information, including, without limitation, the Public Filings, nor will any of the foregoing persons be liable for any loss or damages of any kind resulting from the use of the information contained therein or otherwise supplied to such Holder.
Section 2.12Further Action. Such Holder agrees that it will, upon request, execute and deliver any additional documents reasonably determined to be necessary by the Company, the Placement Agent or the Trustee to complete the Transactions.
Article III
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY
COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby covenants as follows, and makes the following representations and warranties, each of which is and shall be true and correct on the date hereof and at the Closing, to the Holders, and all such covenants, representations and warranties shall survive the Closing.
Section 3.1Power and Authorization; Enforceability. The Company has been duly organized, validly existing as a corporation and in good standing under the laws of its jurisdiction of organization. The Company is duly licensed or qualified as a foreign corporation
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for transaction of business and in good standing under the laws of each other jurisdiction in which its ownership or lease of property or the conduct of its business requires such license or qualification, and has all corporate power and authority necessary to own or hold its properties and to conduct its business as described in the Public Filings, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a Material Adverse Effect (as defined below). The Company has full legal right, power and authority to enter into this Agreement and perform the Transactions. This Agreement has been duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforcement may be subject to the Enforceability Exceptions.
Section 3.2No Consents; No Violations; No Conflicts. Assuming the accuracy of each Holder’s representations and warranties hereunder, no consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or any governmental or regulatory authority is required for the execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the Transactions, except for such consents, approvals, authorizations, orders and registrations or qualifications (i) as may be required under applicable state securities laws, (ii) as may be required under the Securities Act and (iii) as have been previously obtained by the Company. Neither the execution of this Agreement, nor the consummation of any of the Transactions, will conflict with, or will result in a breach of, any of the terms and provisions of, or has constituted or will constitute a default under, or has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any contract or other agreement to which the Company may be bound or to which any of the property or assets of the Company is subject, except (i) such conflicts, breaches or defaults as may have been waived, (ii) such conflicts, breaches and defaults that would not have a Material Adverse Effect and (iii) Permitted Liens (as defined in the indentures governing the Company’s senior secured indebtedness described in the Public Filings (the “Senior Secured Indentures”)); nor will such action result (x) in any violation of the provisions of the organizational or governing documents of the Company, or (y) in any material violation of the provisions of any statute or any order, rule or regulation applicable to the Company or of any court or of any federal, state or other regulatory authority or other government body having jurisdiction over the Company, except, in the case of this clause (y), where such violation would not have a Material Adverse Effect.
Section 3.3[Reserved].
Section 3.4[Reserved].
Section 3.5[Reserved].
Section 3.6[Reserved].
Section 3.7Disclosure. On or before 8:00 a.m. (New York City time) on the first business day following the date of this Agreement (the “Disclosure Time”), the Company shall file with the SEC a Current Report on Form 8-K disclosing the material terms of the Transactions (to the extent not previously publicly disclosed) (the “Closing 8-K”). From and after the filing of the Closing 8-K, the Company represents to each Holder that such Holder shall not be in possession of any material, nonpublic information provided by the Company or any of its officers, directors, employees or agents that is not disclosed in the Closing 8-K. Without the prior written consent of a Holder, the Company shall not disclose the name of such Holder in any filing or announcement, unless such disclosure is in accordance with Section 5.5 below.
Section 3.8SEC Filings; Disclosure. The Company has filed with the SEC all reports, schedules and statements required to be filed by it under the Exchange Act on a timely
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basis for the most recent twelve-month period. As of their respective filing dates, the Public Filings filed since January 1, 2024, complied in all material respects with applicable requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such Public Filings. None of such Public Filings, at the time they were filed with the SEC or, if amended or restated, as of the date of such amendment or restatement, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
Section 3.9No Material Adverse Effect. Since December 31, 2024, except as disclosed in the Public Filings, the Company and its subsidiaries, considered as a single enterprise, have conducted their business in the ordinary course, and there has not been any material adverse change in, or any development that would reasonably be expected to have, individually or in the aggregate, a material adverse effect on, the legality, validity or enforceability of this Agreement or the ability of the Company to perform its obligations hereunder in connection with the Transactions on a full and timely basis in all material respects, or in or on the assets, business, operations, earnings, properties, condition (financial or otherwise), stockholders’ equity or results of operations of the Company and its subsidiaries, taken as a whole (collectively, a “Material Adverse Effect”).
Section 3.10Investment Company Act. The Company is not and, after giving effect to the Transactions, will not be required to register as, an “investment company” or an entity “controlled” by an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended.
Section 3.11Brokers. The Company has not incurred any liability for any finder’s fees, brokerage commissions or similar payments in connection with the Transactions for which any Holder may be liable.
Section 3.12Further Action. The Company agrees that (i) it will cancel all Repurchased Notes acquired in connection with the Transactions, and (ii) it will, upon request, execute and deliver any additional documents reasonably deemed necessary or desirable by the Holders, the Trustee or the Transfer Agent to complete the Transactions.
Article IV
CLOSING CONDITIONS & NOTIFICATION
CLOSING CONDITIONS & NOTIFICATION
Section 4.1Conditions to Obligations of each Holder and the Company. The obligations of each Holder to deliver the Repurchased Notes and of the Company to deliver the Consideration at the Closing are subject to the satisfaction at or prior to the Closing of the following conditions:
(a)there shall be no action, lawsuit, arbitration, claim or proceeding pending that enjoins the consummation of this Agreement or the Transactions;
(b)solely with regard to the obligations of each Holder to deliver the Repurchased Notes, (i) the representations and warranties of the Company contained in Article III shall be true and correct as of the Closing in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) with the same effect as though such representations and warranties had been made as of the Closing, and, unless notice is given pursuant to Section 4.2 below, each of the representations and warranties contained therein shall be deemed to have been
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reaffirmed and confirmed as of the Closing Date; and (ii) the Company shall have complied, in all material respects, with all covenants and other agreements in this Agreement required to be performed by the Company at or prior to the Closing; and
(c)solely with regard to the obligation of the Company to deliver the Consideration, (i) the representations and warranties of each Holder contained in Article II shall be true and correct as of the Closing in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) with the same effect as though such representations and warranties had been made as of the Closing, and, unless notice is given pursuant to Section 4.2 below, each of the representations and warranties contained therein shall be deemed to have been reaffirmed and confirmed as of the Closing Date; and (ii) each Holder shall have complied, in all material respects, with all covenants and other agreements in this Agreement required to be performed by them at or prior to the Closing.
Section 4.2Notification. Each Holder hereby covenants and agrees to promptly notify the Company upon the occurrence of any event prior to the Closing that would cause any representation, warranty, or covenant contained in Article II to be false or incorrect in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respects). The Company hereby covenants and agrees to notify the Holders upon the occurrence of any event prior to the Closing that would cause any representation, warranty, or covenant contained in Article III to be false or incorrect in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respects).
Article V
MISCELLANEOUS
MISCELLANEOUS
Section 5.1Entire Agreement. This Agreement and any documents and agreements executed in connection with the Transactions embody the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersede all prior and contemporaneous oral or written agreements, representations, warranties, contracts, correspondence, conversations, memoranda and understandings between or among the parties or any of their agents, representatives or affiliates relative to such subject matter, including, without limitation, any term sheets, emails or draft documents.
Section 5.2Construction. References in the singular shall include the plural, and vice versa, unless the context otherwise requires. References in the masculine shall include the feminine and neuter, and vice versa, unless the context otherwise requires. Headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meanings of the provisions hereof. Neither party, nor its respective counsel, shall be deemed the drafter of this Agreement for purposes of construing the provisions of this Agreement, and all language in all parts of this Agreement shall be construed in accordance with its fair meaning, and not strictly for or against either party.
Section 5.3Governing Law; Waiver of Jury Trial. This Agreement shall in all respects be construed in accordance with and governed by the substantive laws of the State of New York, without reference to its choice of law rules. Each of the Company and the Holders irrevocably waives any and all right to trial by jury with respect to any legal proceeding arising out of the Transactions.
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Section 5.4Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. Any counterpart or other signature hereon delivered by facsimile or any standard form of telecommunication or e-mail shall be deemed for all purposes as constituting good and valid execution and delivery of this Agreement by such party.
Section 5.5Use of Holder Names. Neither the Company nor any of its affiliates and subsidiaries (if any) (collectively, the “Company Group”) shall identify, or permit any of its employees, agents or representatives to identify, any Holder (whether in connection with the Company or in the Holder’s capacity as an investor in the Company) in any written or oral public communications or issue any press release or other disclosure of the Holder’s name or the name of any of its affiliates, or any derivative of any of the foregoing names (collectively, the “Holder Names”), in each case except (i) as authorized in writing in advance by the Holder in each such instance (electronic mail to suffice) or (ii) as required by applicable law, legal process or regulatory request (“Applicable Law”); provided, that prior to any such disclosure such disclosing member of the Company Group as soon as practicable notifies the Holder of such requirement (except where prohibited by Applicable Law) so that the Holder (or its applicable affiliate) may seek a protective order or other appropriate remedy prior to such disclosure. Notwithstanding the foregoing, the Company may make disclosures to an auditor or governmental or regulatory authority pursuant to any routine investigation, inspection, examination or inquiry without providing the Holder with any notification thereof, unless the Holder is the subject of any such investigation, inspection, examination or inquiry (in which case the preceding sentence shall govern).
Section 5.6Fees and Expenses. Except as otherwise set forth in this Agreement, each party to this Agreement shall bear its own fees and expenses in connection with the delivery of the Repurchased Notes and issuance of the Consideration. The Company shall be responsible for the payment of any fees of the Placement Agent or the Trustee relating to or arising out of the Transactions.
Section 5.7Severability. The invalidity or unenforceability of any provision hereof will in no way affect the validity or enforceability of any other provision or the validity and enforceability of this Agreement.
Section 5.8Assignment; Binding Effect. No Holder shall convey, assign or otherwise transfer any of its rights or obligations under this Agreement without the express written consent of the Company, except to an affiliate of such Holder who assumes its obligations hereunder pursuant to a joinder or similar agreement reasonably acceptable to the Company, and the Company shall not convey, assign or otherwise transfer any of its rights and obligations under this Agreement without the express written consent of each Holder. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. This Agreement is intended solely for the benefit of the parties hereto and their respective successors and permitted assigns, and, except as set forth in Section 5.9, is not for the benefit of, nor may any provision hereof be enforced by, any other person.
Section 5.9Reliance by the Placement Agent. The Placement Agent, acting as financial advisor to the Company, may rely on each representation and warranty of the Company and of each Holder, made on behalf of itself, herein or pursuant to the terms hereof with the same force and effect as if such representation or warranty were made directly to the Placement Agent. The Placement Agent will be a third-party beneficiary of this Agreement to the extent provided in this Section 5.9.
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Section 5.10Waiver; Remedies. No delay on the part of any Holder or the Company in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any waiver on the part of any Holder or the Company of any right, power or privilege under this Agreement operate as a waiver of any other right, power or privilege of such party under this Agreement, nor shall any single or partial exercise of any right, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, power or privilege under this Agreement. All waivers under this Agreement shall be in writing and signed by the party against whom such waiver is to be enforced.
Section 5.11Amendment. This Agreement may be modified or amended only by written agreement of each of the parties to this Agreement.
Section 5.12Survival. The provisions of Article II, Article III, Section 4.2 and Article V shall survive the Closing.
Section 5.13Notice. Any notice or communications hereunder shall be in writing and will be deemed to have been given if delivered in person or by registered or certified first-class mail or courier service or sent by electronic transmission to the following addresses, or such other addresses as may be furnished hereafter by notice in writing:
if to the Company:
Luminar Technologies, Inc.
2603 Discovery Drive, Suite 100
Orlando, FL 32826
Attention: Tom Fennimore, CFO
Email:
with a copy (which will not constitute notice) to:
@luminartech.com
with a copy (which will not constitute notice) to:
Orrick, Herrington & Sutcliffe LLP
631 Wilshire Boulevard
Santa Monica, CA 90401
Attention: Daniel S. Kim
Email:
if to the Holders, as set forth on Exhibit A hereto.
Section 5.14Termination. The Company may terminate this Agreement if (i) there has occurred any breach or withdrawal by a Holder of any covenant, representation or warranty set forth in Article II in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respect) or (ii) any of the conditions outlined in Section 4.1(a) or Section 4.1(c) is not satisfied or waived by 5:00 p.m. (New York City time) on the Closing Date. A Holder may terminate this Agreement if (i) there has occurred any breach or withdrawal by the Company of any covenant, representation or
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warranty set forth in Article III in any material respect (or, with respect to those representations and warranties that are qualified by materiality or material adverse effect, in any respect) or (ii) any of the conditions outlined in Section 4.1(a) or Section 4.1(b) is not satisfied or waived by 5:00 p.m. (New York City time) on the Closing Date. Upon a termination of this Agreement in accordance with this Section 5.14, neither the Company nor any Holder shall have any further obligation or liability (including, without limitation, arising from such termination) to the other.
Section 5.15Other Transactions. Nothing contained herein or in any other document related to the Transactions, and no action taken by any Holder pursuant hereto or thereto or by any other party pursuant to such other documents, shall be deemed to constitute a Holder and any other Holder or any other party hereunder or under such other documents as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that such entities are in any way acting in concert or as a group with respect to their obligations hereunder or thereunder or with respect to the Transactions.
[Signature Page Follows]
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first above written.
THE COMPANY: | |||||
| LUMINAR TECHNOLOGIES, INC. | |||||
By: Name: Title: | |||||
Signature Page to
Note Repurchase Agreement
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first above written.
HOLDER:
________________________________________________
By:
Name:
Title:
Signature Page to
Note Repurchase Agreement
Signature Page to
Note Repurchase Agreement
EXHIBIT A
Holders
| Holder Name and Address | Repurchased Notes (aggregate principal amount of Notes to be sold to the Company) | ||||
| Total | $[__________] | ||||
EXHIBIT B
LUMINAR TECHNOLOGIES, INC.
NOTICE OF SETTLEMENT PROCEDURES
Following are the procedures for the settlement of the purchase and sale of 1.25% convertible senior notes due 2026 (CUSIP No. 550424 AA3) (the “Notes”), of Luminar Technologies, Inc. (the “Company”) for a cash payment (the “Consideration”) pursuant to the Note Repurchase Agreement, dated as of May [●], 2025 (the “Repurchase Agreement”), between the Company and the Holders party thereto, on the Closing Date (which is expected to occur on May [●], 2025, subject to the satisfaction or waiver of the closing conditions set forth in the Repurchase Agreement). Capitalized terms used herein and not otherwise defined herein have the meaning given to them in the Repurchase Agreement.
To ensure timely settlement on the Closing Date, please follow the instructions as set forth below. Your failure to comply with the following instructions may delay your receipt of the applicable Consideration on the Closing Date.
If you have any questions, please contact Jared Kramer of Matthews South, LLC by telephone at (415) 873-4765 or by email to jared@matthewssouth.com.
Thank you.
Delivery of the Repurchased Notes
You must direct the eligible DTC participant through which you hold a beneficial interest in the Repurchased Notes to post on the Closing Date, no later than 9:00 a.m. (New York City time), withdrawal instructions through DTC via DWAC for the aggregate principal amount of Repurchased Notes (CUSIP No. 550424 AA3) to be purchased by the Company on the Closing Date. It is important that this instruction be submitted and the DWAC posted on the Closing Date—if it is posted before the Closing Date, then it will expire unaccepted and will need to be re-posted on the Closing Date.
To Receive the Consideration
Subject to the terms of the Repurchase Agreement, the Company will pay the Consideration with respect to the Repurchased Notes by wire transfer of immediately available funds to the account at the bank or broker in the United States of America designated by the Holder in writing to the Company prior to the Closing.
Exhibit 31.1
CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Paul Ricci, certify that:
1.I have reviewed this quarterly report on Form 10-Q of Luminar Technologies, Inc. for the quarter ended June 30, 2025;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 13, 2025 | By: | /s/ Paul Ricci | ||||||
Paul Ricci | ||||||||
Chief Executive Officer | ||||||||
| (Principal Executive Officer) | ||||||||
Exhibit 31.2
CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
PURSUANT TO RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Thomas J. Fennimore, certify that:
1.I have reviewed this quarterly report on Form 10-Q of Luminar Technologies, Inc. for the quarter ended June 30, 2025;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 13, 2025 | By: | /s/ Thomas J. Fennimore | ||||||
| Thomas J. Fennimore | ||||||||
| Chief Financial Officer | ||||||||
| (Principal Financial and Accounting Officer) | ||||||||
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Paul Ricci, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Luminar Technologies, Inc. (the “Company”) on Form 10-Q for the fiscal quarter ended June 30, 2025 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that information contained in such Quarterly Report on Form 10-Q fairly presents in all material respects the financial condition and results of operations of the Company.
Date: August 13, 2025 | By: | /s/ Paul Ricci | ||||||
Paul Ricci | ||||||||
Chief Executive Officer | ||||||||
| (Principal Executive Officer) | ||||||||
I, Thomas J. Fennimore, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Luminar Technologies, Inc. (the “Company”) on Form 10-Q for the fiscal quarter ended June 30, 2025 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that information contained in such Quarterly Report on Form 10-Q fairly presents in all material respects the financial condition and results of operations of the Company.
Date: August 13, 2025 | By: | /s/ Thomas J. Fennimore | ||||||
| Thomas J. Fennimore | ||||||||
| Chief Financial Officer | ||||||||
| (Principal Financial and Accounting Officer) | ||||||||
This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Luminar Technologies, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.