TuSimple Holdings Inc 10-K for FY2021

TuSimple Holdings Inc. (TSPH)

10-K 2022-02-24 For: 2021-12-31

Added on April 06, 2026

About this 10-K

TuSimple Holdings Inc filed this 10-K on February 24, 2022, covering the fiscal year ended December 31, 2021 (FY2021).

Headline figures

Fiscal year ended December 31, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $6.26M; up 239.7% from $1.84M a year earlier
Net loss: $732.67M; compared with a net loss of $177.87M a year earlier
Diluted EPS: -$4.36; compared with -$3.37 a year earlier

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Delaware						86-2341575
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)
9191 Towne Centre Drive, Suite 600 San Diego, CA						92122
(Address of Principal Executive Offices)						(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001 per share	TSP	The Nasdaq Stock Market LLC (Nasdaq Global Select Market)


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☐
		Emerging growth company	☒


			Page(s)
Part I			1
Item 1. Business			3
Item 1A. Risk Factors			8
Item 1B. Unresolved Staff Comments			37
Item 2. Properties			37
Item 3. Legal Proceedings			37
Item 4. Mine Safety Disclosures			37
Part II			38
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			39
Item 6. [ Reserved ]			40
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations			40
Item 7A. Quantitative and Qualitative Disclosures About Market Risk			51
Item 8. Financial Statements and Supplementary Data			52
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosures			79
Item 9A. Controls and Procedures			79
Item 9B. Other Information			80
Item 9C. Disclosure Regarding Foreign Jurisdiction that Prevent Inspections.			80
Part III			81
Item 10. Directors, Executive Officers and Corporate Governance			81
Item 11. Executive Compensation			81
Item 12. Security Ownership of Certain Beneficial Owner and Management and Related Stockholder Matters			81
Item 13. Certain Relationships and Related Transactions, and Director Independence			81
Item 14. Principal Accounting Fees and Services			81
Part IV			82
Item 15. Exhibits, Financial Statement Schedules			82
Item 16. Form 10-K Summary			84
Signatures			85


	Years Ended December 31,
	2019		2020		2021
Revenue	$	710	$	1,843	$	6,261
Cost of revenue	1,595		5,293		12,369
Gross loss	(885)		(3,450)		(6,108)
Operating expenses:
Research and development (1)	63,619		132,001		287,167
Selling, general and administrative (1)	22,776		38,613		118,076
Total operating expenses	86,395		170,614		405,243
Loss from operations	(87,280)		(174,064)		(411,351)
Change in fair value of related party convertible loan	—		(5,556)		—
Change in fair value of warrants liability	—		1,816		(326,900)
Gain on loan extinguishment	—		—		4,183
Other income (expense), net	2,397		(66)		1,395
Loss before provision for income taxes	(84,883)		(177,870)		(732,673)
Provision for income taxes	—		—		—
Net loss	(84,883)		(177,870)		(732,673)
Net loss attributable to noncontrolling interests	43		—		—
Net loss attributable to TuSimple	$	(84,840)	$	(177,870)	$	(732,673)
Accretion of redeemable convertible preferred stock	(201)		(20,959)		(4,135)
Deemed dividend on exchange of Series A-2 redeemable convertible preferred stock for common stock	(60,000)		—		—
Net loss attributable to common stockholders	$	(145,041)	$	(198,829)	$	(736,808)


	Years Ended December 31,						2019 to 2020 % Change		2020 to 2021 % Change
(In thousands, except percentages)	2019		2020		2021
Revenue	$	710	$	1,843	$	6,261	160	%	240	%


	Year Ended December 31,
	2019		2020		2021
Loss from Operations	$	(87,280)	$	(174,064)	$	(411,351)
Stock-based compensation expense	—		12,763		122,596
Depreciation and amortization	5,565		7,683		9,450
Capital lease interest expense	164		333		418
Adjusted EBITDA	$	(81,551)	$	(153,285)	$	(278,887)


			Page(s)
Report of Independent Registered Public Accounting Firm (KPMG LLP, San Diego, California, PCAOB ID: 185)			53
Consolidated Balance Sheets			54
Consolidated Statements of Operations			55
Consolidated Statements of Comprehensive Loss			56
Consolidated Statements of Redeemable Convertible Preferred S tock and S tock holders’ Equity (Deficit)			57
Consolidated Statements of Cash Flows			58
Notes to the Consolidated Financial Statements			60


	December 31,
	2020		2021
Assets
Current assets:
Cash and cash equivalents	$	310,815	$	1,337,586
Accounts receivable, net	1,144		1,599
Prepaid expenses and other current assets	3,816		13,995
Amounts due from related parties	3,708		—
Total current assets	319,483		1,353,180
Property and equipment, net	22,116		36,053
Other assets	4,986		7,090
Total assets	$	346,585	$	1,396,323
Liabilities, Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit)
Current liabilities:
Accounts payable	$	4,542	$	4,544
Amounts due to related parties	4,360		—
Amounts due to joint development partners	1,355		7,394
Accrued expenses and other current liabilities	22,961		41,698
Short-term debt	4,623		1,524
Warrants liability	42,452		—
Capital lease liabilities, current	805		766
Total current liabilities	81,098		55,926
Capital lease liabilities, noncurrent	3,767		2,872
Long-term debt	1,807		5,543
Other liabilities	595		5,004
Total liabilities	87,267		69,345
Commitments and contingencies (Note 7)
Redeemable convertible preferred stock, $0.0001 par value; 138,102,770 and zero shares authorized as of December 31, 2020 and 2021, respectively; 102,074,703 and zero shares issued and outstanding as of December 31, 2020 and 2021, respectively; aggregate liquidation preference of $598,842 and $0 as of December 31, 2020 and 2021, respectively	664,791		—
Stockholders’ equity (deficit):
Common Stock, $0.0001 par value, 361,897,230 and 4,876,000,000 Class A shares authorized as of December 31, 2020 and 2021, respectively; 60,543,337 and 197,833,195 Class A shares issued and outstanding as of December 31, 2020 and 2021, respectively; zero and 24,000,000 Class B shares authorized as of December 31, 2020 and 2021; zero and 24,000,000 Class B shares issued and outstanding as of December 31, 2020 and 2021, respectively	6		22
Additional paid-in capital	—		2,464,730
Accumulated deficit	(405,178)		(1,137,851)
Accumulated other comprehensive income (loss)	(301)		77
Total stockholders’ equity (deficit)	(405,473)		1,326,978
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit)	$	346,585	$	1,396,323


	Redeemable Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Tusimple Holdings, Inc. Stockholders’ Equity (Deficit)		Noncontrolling Interests		Total Stockholders’ Equity (Deficit)
	Shares	Amount		Shares	Amount
Balance as of December 31, 2018	60,249,352	$	181,236	64,734,628	$	6	$	—	$	(440)	$	(73,677)	$	(74,111)	$	(11)	$	(74,122)
Exchange of Series A-2 redeemable convertible preferred shares for ordinary shares	8,218,203	60,000		(8,218,203)	—		—		—		(60,000)		(60,000)		—		(60,000)
Issuance of Series D-1 redeemable convertible preferred shares, net of issuance costs	6,471,833	52,299		—	—		—		—		—		—		—		—
Accretion of Series D-1 redeemable convertible preferred shares to redemption value	—	201		—	—		—		—		(201)		(201)		—		(201)
Foreign currency translation adjustment	—	—		—	—		—		(218)		—		(218)		10		(208)
Net loss	—	—		—	—		—		—		(84,840)		(84,840)		(43)		(84,883)
Balance as of December 31, 2019	74,939,388	293,736		56,516,425	6		—		(658)		(218,718)		(219,370)		(44)		(219,414)
Issuance of Series D-1 redeemable convertible preferred shares, net of issuance costs	1,854,177	3,098		—	—		—		—		—		—		—		—
Reclassification of Series D-1 redeemable convertible preferred share warrants from equity to liabilities	—	—		—	—		(394)		—		—		(394)		—		(394)
Issuance of Series D-1 redeemable convertible preferred shares from the exercise of warrants	308,182	2,894		—	—		—		—		—		—		—		—
Issuance of Series E redeemable convertible preferred shares, net of issuance costs	21,044,019	288,548		—	—		—		—		—		—		—		—
Conversion of related party convertible loan to Series E-1 redeemable convertible preferred shares	3,928,937	55,556		—	—		—		—		—		—		—		—
Issuance of ordinary shares from exercise of options	—	—		2,127,232	—		—		—		—		—		—		—
Issuance of restricted ordinary shares	—	—		1,899,680	—		—		—		—		—		—		—
Accretion of redeemable convertible preferred shares to redemption value	—	20,959		—	—		(12,369)		—		(8,590)		(20,959)		—		(20,959)
Share-based compensation	—	—		—	—		12,763		—		—		12,763		—		12,763
Acquisition of noncontrolling interest in subsidiary	—	—		—	—		—		(44)		—		(44)		44		—
Foreign currency translation adjustment	—	—		—	—		—		401		—		401		—		401
Net loss	—	—		—	—		—		—		(177,870)		(177,870)		—		(177,870)
Balance as of December 31, 2020	102,074,703	$	664,791	60,543,337	$	6	$	—	$	(301)	$	(405,178)	$	(405,473)	$	—	$	(405,473)
Issuance of Series E redeemable convertible preferred Stock, net of issuance costs	4,650,999	61,631		—	—		—		—		—		—		—		—
Issuance of Series E redeemable convertible preferred Stock from exercise of warrants	9,477,073	379,084		—	—		—		—		—		—		—		—
Issuance of Series E-2 redeemable convertible preferred Stock from exercise of warrants	4,331,644	173,275		—	—		—		—		—		—		—		—
Accretion of redeemable convertible preferred stock to redemption value	—	4,135		—	—		(4,135)		—		—		(4,135)		—		(4,135)
Conversion of redeemable convertible preferred stock to common stock in connection with initial public offering	(120,534,419)	(1,282,916)		120,534,419	12		1,282,904		—		—		1,282,916		—		1,282,916
Issuance of common stock in connection with initial public offering, net of offering costs	—	—		27,027,027	3		1,027,371		—		—		1,027,374		—		1,027,374
Issuance of common stock related to private placement	—	—		874,999	—		35,000		—		—		35,000		—		35,000
Issuance of common stock from exercise of options	—	—		8,580,984	1		910		—		—		911		—		911
Issuance of common stock related to release of RSUs and SVAs	—	—		4,272,429	—		—		—		—		—		—
Vesting of early exercised stock options	—	—		—	—		84		—		—		84		—		84
Stock-based compensation	—	—		—	—		122,596		—		—		122,596		—		122,596
Foreign currency translation adjustment	—	—		—	—		—		378		—		378		—		378
Net loss	—	—							—		(732,673)		(732,673)		—		(732,673)
Balance as of December 31, 2021	—	$	—	221,833,195	$	22	$	2,464,730	$	77	$	(1,137,851)	$	1,326,978	$	—	$	1,326,978


Property and Equipment						Estimated Useful Life
Electronic equipment						1-4 years
Vehicles						5-6 years
Office and other equipment						4-6 years
Leasehold improvements						Shorter of lease term or estimated useful life of the asset


	As of December 31, 2020
	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents:
Certificates of deposit	$	279,279	$	279,279	$	—	$	—
Total	$	279,279	$	279,279	$	—	$	—
Liabilities:
Warrants liability	$	42,452	$	—	$	—	$	42,452
Total	$	42,452	$	—	$	—	$	42,452


	As of December 31, 2021
	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents:
Money market funds	$	1,077,550	$	1,077,550	$	—	$	—
Total	$	1,077,550	$	1,077,550	$	—	$	—


	As of
	December 31, 2020	February 26, 2021	March 19, 2021
Discount for lack of marketability	9.00% - 30.00%	—	—
Fair value of underlying securities	$14.14	$40.00	$40.00
Expected volatility	53.90% - 76.90%	62.95%	60.85%
Expected term (in years)	0.33 - 1.91	1.76	0.79
Risk-free interest rate	0.10% - 0.13%	0.14%	0.08%


	Warrant Liabilities
Balance as of December 31, 2019	$	—
Issuance of warrants	44,268
Reclassification of warrants from equity to liability	394
Exercises during the period	(394)
Change in fair value of warrants	(1,816)
Balance as of December 31, 2020	$	42,452
Change in fair value of warrants	326,900
Exercises during the period	(369,352)
Balance as of December 31, 2021	$	—


	Years Ended December 31,
	2019		2020		2021
Net cash (used in) provided by:
Operating activities	$	(76,333)	$	(103,848)	$	(259,033)
Investing activities	(10,435)		(4,412)		(13,637)
Financing activities	51,830		356,495		1,299,151


	Capital Leases		Operating Leases
2022	$	1,253	$	7,660
2023	978		7,891
2024	963		5,126
2025	1,761		3,435
2026	—		3,049
Thereafter	—		22,524
Total minimum lease payments	4,955		$	49,685
Amount representing interest	(1,317)
Present value of minimum lease payments	$	3,638


Series	Shares Authorized	Shares Issued and Outstanding	Per Share Liquidation Preference		Aggregate Liquidation Preference		Per Share Initial Conversion Price		Net Carrying Value
A	20,000,000	20,000,000	$	0.3925	$	7,850	$	0.3925	$	7,850
A-2	8,218,203	8,218,203	—		—		7.3009		60,000
B-1	7,080,000	7,080,000	2.5000		17,700		2.5000		17,700
B-2	3,000,000	3,000,000	0.7667		2,300		0.7667		2,300
B-3	3,465,372	3,465,372	0.8657		3,000		0.8657		3,000
C	14,993,041	14,993,041	3.6941		55,386		3.6941		55,386
D-1	20,345,131	20,345,131	8.1121		165,042		8.1121		165,435
E	50,000,000	35,172,091	14.1401		497,336		14.1401		742,414
E-1	3,928,937	3,928,937	12.7261		50,000		12.7261		55,556
E-2	7,072,086	4,331,644	11.3121		49,000		11.3121		173,275
	138,102,770	120,534,419			$	847,614			$	1,282,916


	Options Outstanding	Weighted- Average Exercise Price		Weighted- Average Remaining Life (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2020	13,295,497	$	1.29	7.99	$	97,986
Granted	3,767,968	22.36
Exercised	(8,580,984)	0.14
Cancelled/Forfeited	(797,703)	1.27
Outstanding at December 31, 2021	7,684,778	$	12.91	9.04	$	188,722
Vested and exercisable at December 31, 2021	1,996,923	$	4.38	8.80	$	62,843


	As of December 31,
	2020		2021
Electronic equipment	$	11,429	$	12,761
Office and other equipment	6,152		9,423
Vehicles	12,775		21,043
Leasehold improvements	7,340		11,984
Construction in progress	225		5,258
Property and equipment, gross	37,921		60,469
Accumulated depreciation and amortization	(15,805)		(24,416)
Property and equipment, net	$	22,116	$	36,053


			Year Ended December 31, 2021
Risk-free interest rate			0.06%
Expected dividend yield			—
Expected volatility			97.10%
Expected term (in years)			0.50
Fair value of common stock			$44.39


	RSUs Outstanding	Weighted- Average Grant Date Fair Value per Share
Unvested and Outstanding at December 31, 2020	1,100,000	$	14.14
Granted	6,197,229	47.57
Vested	(1,217,573)	22.42
Cancelled	(129,858)	47.42
Unvested and outstanding at December 31, 2021	5,949,798	$	46.54
Vested and outstanding at December 31, 2021	15,603	$	40.35


	SVAs Outstanding	Weighted- Average Grant Date Fair Value per Share
Unvested and Outstanding at December 31, 2020	3,653,146	$	3.20
Vested	(3,070,459)	3.08
Cancelled	(267,128)	5.77
Unvested and outstanding at December 31, 2021	315,559	$	5.29
Vested and outstanding at December 31, 2021	—	$	—



TUSIMPLE HOLDINGS INC.

By:						/s/ Cheng Lu
						Name: Cheng Lu
						Title: President and Chief Executive Officer


			•						4,876,000,000 shares are designated Class A common stock;


			•						24,000,000 shares are designated Class B common stock; and


			•						amend, alter, or repeal any provision of our amended and restated certificate of incorporation or amended and restated bylaws that modifies the voting, conversion or other powers, preferences, or other special rights or privileges, or restrictions of our Class B common stock; or


			•						reclassify any of our outstanding shares of Class A common stock into shares having rights as to dividends or liquidation that are senior to our Class B common stock or the right to more than one (1) vote for each share thereof.


			•						if we were to seek to amend our amended and restated certificate of incorporation to increase the authorized number of shares of a class of stock, or to increase or decrease the par value of a class of stock, then that class would be required to vote separately to approve the proposed amendment;


			•						so long as our outstanding shares of Class B common stock represent 40% or more of the total voting power of the company, any transaction that would result in a change in control of our company will require the approval of a majority of our outstanding Class B common stock voting as a separate class.


			•						any transfer of Class B common stock by a holder that is a record holder of such Class B common stock prior to the date that our amended and restated certificate of incorporation was accepted for filing by the Secretary of State of the State of Delaware to (i) a trust for the benefit of such record holder or one or more family members of such record holder, (ii) any general partnership, limited partnership, limited liability company, corporation or other entity owned exclusively by such record holder or (iii) a Founder; and


			•						any grant of a voting proxy with respect to Class B common stock by either Founder to the other Founder.


			•						the transaction is approved by the board of directors prior to the time that the interested stockholder became an interested stockholder;


			•						upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction began, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or


			•						at or subsequent to such time that the stockholder became an interested stockholder the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.


			•						Dual Class Stock. As described above in “—Common Stock—Voting Rights,” our amended and restated certificate of incorporation provides for a dual class common stock structure pursuant to which our Founders and their permitted affiliates holding Class B common stock will have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the shares of our outstanding Class A and Class B common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets.


			•						Separate Class B Vote for Certain Transactions. Our amended and restated certificate of incorporation provides that so long as our outstanding shares of Class B common stock represent 40% or more of the total voting power of the company, any transaction that would result in a change in control of our company will require the approval of a majority of our outstanding Class B common stock voting as a separate class. This provision could delay or prevent the approval of a change in control that might otherwise be approved by a majority of outstanding shares of our Class A and Class B common stock voting together on a combined basis.


			•						Supermajority Approvals. Our amended and restated certificate of incorporation and amended and restated bylaws provide that certain amendments to our amended and restated certificate of incorporation or amended and restated bylaws by stockholders will require the approval of two-thirds of the combined vote of our then-outstanding shares of Class A and Class B common stock. This may have the effect of making it more difficult to amend our amended and restated certificate of incorporation or amended and restated bylaws to remove or modify certain provisions.


			•						Board of Directors Vacancies. Our amended and restated certificate of incorporation and amended and restated bylaws authorize our board of directors to fill vacant directorships, including newly-created seats. In addition, the number of directors constituting our board of directors is set only by resolution adopted by a majority vote of our entire board of directors. These provisions may prevent a stockholder from increasing the size of our board of directors and gaining control of our board of directors by filling the resulting vacancies with its own nominees.