TuSimple Holdings Inc 10-K for FY2022

TuSimple Holdings Inc. (TSPH)

10-K 2023-09-07 For: 2022-12-31

Added on April 06, 2026

About this 10-K

TuSimple Holdings Inc filed this 10-K on September 7, 2023, covering the fiscal year ended December 31, 2022 (FY2022).

Headline figures

Fiscal year ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $9.37M; up 49.6% from $6.26M a year earlier
Net loss: $472.05M; compared with a net loss of $732.67M a year earlier
Diluted EPS: -$2.11; compared with -$4.36 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			1
Item 1A. Risk Factors			17
Item 1B. Unresolved Staff Comments			48
Item 2. Properties			48
Item 3. Legal Proceedings			48
Item 4. Mine Safety Disclosures			50
Part II			50
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			51
Item 6. [Reserved ]			52
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations			52
Item 7A. Quantitative and Qualitative Disclosures About Market Risk			64
Item 8. Financial Statements and Supplementary Data			65
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosures			101
Item 9A. Controls and Procedures			101
Item 9B. Other Information			102
Item 9C. Disclosure Regarding Foreign Jurisdiction s that Prevent Inspections			102
Part III			103
Item 10. Directors, Executive Officers and Corporate Governance			103
Item 11. Executive Compensation			109
Item 12. Security Ownership of Certain Beneficial Owner s and Management and Related Stockholder Matters			126
Item 13. Certain Relationships and Related Transactions, and Director Independence			128
Item 14. Principal Account ant Fees and Services			129
Part IV			131
Item 15. Exhibits and Financial Statement Schedules			131
Item 16. Form 10-K Summary			133
Signatures			134


Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (#)	Weighted Average Exercise Price of Outstanding Options, Warrants and Rights(2) ($)	Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans(3) (#)
Equity compensation plans approved by stockholders(1)	20,602,012	15.16	18,041,005
Equity compensation plans not approved by stockholders	—	—	—
Total	20,602,012	15.16	18,041,005


	Year Ended December 31,
	2020		2021		2022
Revenue	$	1,843	$	6,261	$	9,369
Cost of revenue	5,293		12,369		19,780
Gross loss	(3,450)		(6,108)		(10,411)
Operating expenses:
Research and development (1)	132,001		287,167		351,599
Selling, general and administrative (1)	38,613		118,076		127,053
Total operating expenses	170,614		405,243		478,652
Loss from operations	(174,064)		(411,351)		(489,063)
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		—
Interest income	454		1,563		16,906
Other income (expense), net	(520)		(168)		112
Loss before provision for income taxes	(177,870)		(732,673)		(472,045)
Provision for income taxes	—		—		—
Net loss	(177,870)		(732,673)		(472,045)
Accretion of redeemable convertible preferred stock	(20,959)		(4,135)		—
Net loss attributable to common stockholders	$	(198,829)	$	(736,808)	$	(472,045)


(1)			Includes stock-based compensation expense as follows (in thousands):


	Year Ended December 31,						2020 to 2021 % Change		2021 to 2022 % Change
(In thousands, except percentages)	2020		2021		2022
Revenue	$	1,843	$	6,261	$	9,369	240	%	50	%


			Page(s)
Report s of Independent Registered Public Accounting Firm (PCAOB ID: 1195)			66
Consolidated Balance Sheets			68
Consolidated Statements of Operations			69
Consolidated Statements of Comprehensive Loss			70
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)			71
Consolidated Statements of Cash Flows			72
Notes to the Consolidated Financial Statements			74


	December 31,
	2021		2022
Assets
Current assets:
Cash and cash equivalents	$	1,337,586	$	615,386
Short-term investments	—		377,312
Accounts receivable, net	1,599		1,377
Prepaid expenses and other current assets	13,995		13,477
Total current assets	1,353,180		1,007,552
Property and equipment, net	36,053		17,083
Operating lease right-of-use assets	—		44,952
Other assets	7,090		4,692
Total assets	$	1,396,323	$	1,074,279
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	4,544	$	9,855
Amounts due to joint development partners	7,394		5,753
Accrued expenses and other current liabilities	41,698		48,260
Short-term debt	1,524		1,645
Capital lease liabilities, current	766		—
Operating lease liabilities, current	—		6,007
Total current liabilities	55,926		71,520
Capital lease liabilities, noncurrent	2,872		—
Operating lease liabilities, noncurrent	—		42,169
Long-term debt	5,543		3,668
Other liabilities	5,004		2,441
Total liabilities	69,345		119,798
Commitments and contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.0001 par value; 100,000,000 shares authorized as of December 31, 2021 and 2022; zero shares issued and outstanding as of December 31, 2021 and 2022	—		—
Common Stock, $0.0001 par value, 4,876,000,000 Class A shares authorized as of December 31, 2021 and 2022; 197,833,195 and 201,707,557 Class A shares issued and outstanding as of December 31, 2021 and 2022, respectively; 24,000,000 Class B shares authorized, issued and outstanding as of December 31, 2021 and 2022, respectively	22		22
Additional paid-in capital	2,464,730		2,567,723
Accumulated other comprehensive income (loss)	77		(3,559)
Accumulated deficit	(1,137,851)		(1,609,705)
Total stockholders’ equity	1,326,978		954,481
Total liabilities and stockholders’ equity	$	1,396,323	$	1,074,279


	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, 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
Adjustments for prior periods from adopting ASC 842	—	—		—	—		—		—		191		191		—		191
Issuance of common stock from exercise of options	—	—		980,696	—		1,872		—		—		1,872		—		1,872
Issuance of common stock from release of RSUs and SVAs	—	—		2,643,835	—		—		—		—		—		—		—
Issuance of common stock under the Employee Stock Purchase Plan	—	—		249,831	—		2,286		—		—		2,286		—		2,286
Vesting of early exercised stock options	—	—		—	—		168		—		—		168		—		168
Stock-based compensation	—	—		—	—		98,667		—		—		98,667		—		98,667
Unrealized loss on available-for-sale debt securities, net	—	—		—	—		—		(2,298)		—		(2,298)		—		(2,298)
Foreign currency translation adjustment	—	—		—	—		—		(1,338)		—		(1,338)		—		(1,338)
Net loss	—	—		—	—		—		—		(472,045)		(472,045)		—		(472,045)
Balance as of December 31, 2022	—	$	—	225,707,557	$	22	$	2,567,723	$	(3,559)	$	(1,609,705)	$	954,481	$	—	$	954,481


Property and Equipment						Estimated Useful Life
Electronic equipment						1-4 years
Vehicles						5-6 years
Office and other equipment						5-7 years
Leasehold improvements						Shorter of lease term or estimated useful life of the asset
Buildings						Shorter of lease term or estimated useful life of the asset


	As of December 31, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value		Cash and Cash Equivalents		Short-term Investments
Available-for-sale debt securities:
U.S. treasury securities	$	9,843	$	—	$	(86)	$	—	$	9,757	$	—	$	9,757
U.S. government agency securities	97,139		34		(521)		—		96,652		—		96,652
Commercial paper	138,973		10		(207)		—		138,776		25,390		113,386
Corporate debt securities	159,045		55		(1,583)		—		157,517		—		157,517
Total	$	405,000	$	99	$	(2,397)	$	—	$	402,702	$	25,390	$	377,312


	As of December 31, 2022
	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents:
Money market funds	$	530,674	$	530,674	$	—	$	—
Commercial paper	25,390		—		25,390		—
Total cash equivalents	$	556,064	$	530,674	$	25,390	$	—
Short-term investments:
U.S. treasury securities	$	9,757	$	9,757	$	—	$	—
U.S. government agency securities	96,652		—		96,652		—
Commercial paper	113,386		—		113,386		—
Corporate debt securities	157,517		—		157,517		—
Total short-term investments	$	377,312	$	9,757	$	367,555	$	—
Total	$	933,376	$	540,431	$	392,945	$	—


	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	$	—	$	—


	Year Ended December 31,
	2020		2021		2022
Net cash (used in) provided by:
Operating activities	$	(103,848)	$	(259,033)	$	(329,865)
Investing activities	(4,412)		(13,637)		(392,173)
Financing activities	356,495		1,299,151		1,394


	As of
	February 26, 2021	March 19, 2021
Discount for lack of marketability	—	—
Fair value of underlying securities	$40.00	$40.00
Expected volatility	62.95%	60.85%
Expected term (in years)	1.76	0.79
Risk-free interest rate	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	$	—


	As of December 31,
	2021		2022
Electronic equipment	$	12,761	$	4,385
Office and other equipment	9,423		8,697
Vehicles	21,043		4,046
Leasehold improvements	11,984		12,267
Buildings	—		1,841
Construction in progress	5,258		358
Property and equipment, gross	60,469		31,594
Accumulated depreciation and amortization	(24,416)		(14,511)
Property and equipment, net	$	36,053	$	17,083


	As of December 31, 2022
Operating leases:
Operating lease right-of-use assets	$	44,952

Operating lease liabilities, current	$	6,007
Operating lease liabilities, noncurrent	42,169
Total operating lease liabilities	$	48,176

Finance leases:
Property and equipment, at cost	$	2,465
Accumulated depreciation	(882)
Property and equipment, net	$	1,583

Accrued expenses and other current liabilities	$	1,116
Other liabilities	2,429
Total finance lease obligations	$	3,545


	Year Ended December 31, 2022
Operating lease expense:
Operating lease expense (1)(2)	$	9,112

Finance lease expense:
Amortization of leased assets	$	1,454
Interest on lease liabilities	592
Total finance lease expense	$	2,046

Total lease expense	$	11,158


	As of December 31, 2022
Weighted-average remaining lease term:
Operating leases	8.5 years
Finance leases	2.8 years

Weighted-average discount rate:
Operating leases	4.4	%
Finance leases	11.2	%


	Year Ended December 31, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	6,768
Operating cash flows from finance leases (interest payments)	$	420
Financing cash flows from finance leases	$	1,252
Right-of-use assets obtained in exchange for lease obligations:
Operating lease liabilities	$	48,523
Finance lease liabilities	$	11,056


	Operating Leases		Finance Leases
2023	$	7,649	$	1,433
2024	7,711		1,430
2025	7,608		1,157
2026	7,818		106
2027	6,884		—
Thereafter	21,605		—
Total minimum lease payments	59,275		4,126
Less: lease incentives receivable(1)	(646)		—
Less: imputed interest	(10,453)		(581)
Present value of minimum lease payments	48,176		3,545
Less: current portion	(6,007)		(1,116)
Lease obligations, noncurrent	$	42,169	$	2,429


	Operating Leases		Capital Leases
2022	$	7,660	$	1,253
2023	7,891		978
2024	5,126		963
2025	3,435		1,761
2026	3,049		—
Thereafter	22,524		—
Total minimum lease payments	$	49,685	4,955
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
Total	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, 2021	7,684,778	$	12.91	9.04	$	188,722
Exercised	(980,696)	1.91
Cancelled/Forfeited	(4,080,571)	14.10
Outstanding at December 31, 2022	2,623,511	$	15.16	6.72	$	798
Vested and exercisable at December 31, 2022	1,654,756	$	8.17	6.06	$	489


	RSUs Outstanding	Weighted- Average Grant Date Fair Value per Share
Unvested and Outstanding at December 31, 2021	5,949,798	$	46.54
Granted	17,518,282	5.74
Vested	(2,495,482)	38.02
Cancelled	(3,125,125)	29.18
Unvested and outstanding at December 31, 2022	17,847,473	$	10.73
Vested and outstanding at December 31, 2022	51,590	$	45.29


	SVAs Outstanding	Weighted- Average Grant Date Fair Value per Share
Unvested and Outstanding at December 31, 2021	315,559	$	5.29
Vested	(184,340)	4.67
Cancelled	(51,781)	2.97
Unvested and outstanding at December 31, 2022	79,438	$	8.24
Vested and outstanding at December 31, 2022	—	$	—


	Years Ended December 31,
	2020		2021		2022
Unrecognized tax benefit, beginning of year	$	4,029	$	4,766	$	6,900
Decreases related to prior year tax positions	—		—		(538)
Increases related to current year tax positions	737		2,134		3,453
Unrecognized tax benefit, end of year	$	4,766	$	6,900	$	9,815


	Year Ended December 31, 2022
Research and development	$	23,864
Selling, general and administrative	2,991
Total restructuring and related cost	$	26,855


	Severance and Other Termination Benefits		Long-Lived Asset Costs (1)		Stock-based Compensation (2)		Total
Balance as of December 31, 2021	$	—	$	—	$	—	$	—
Charges	11,759		18,147		(3,051)		26,855
Cash payments	(1,568)		—		—		(1,568)
Non-cash adjustments	—		(18,147)		3,051		(15,096)
Balance as of December 31, 2022	$	10,191	$	—	$	—	$	10,191


	Year Ended December 31, 2022
U.S.	$	19,921
APAC	6,934
Total restructuring and related cost	$	26,855


Board Diversity Matrix (as of August 8, 2023)
Part I: Gender Identity			Number of Directors
Female			2
Male			5
Non Binary			0
Did Not Disclose Gender			0

Part II: Demographic Background
African American or Black			0
Alaskan Native or Native American			0
Asian			5
Hispanic or Latinx			0
Native Hawaiian or Pacific Islander			0
White			2
Two or More Races or Ethnicities			0
Did Not Disclose Demographic Background			0

Total Number of Directors			7


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BTRS	InterDigital	PubMatic
C3.ai	Model N	Sumo Logic
Cardlytics	Momentive Global	Telos
Cerence	PagerDuty	Vertex
Domo	Ping Identity	Zuora


Name	2022 Base Salary ($)	2021 Base Salary ($)	Special Considerations
Cheng Lu(1)	450,000	450,000	—
Xiaodi Hou	500,000(2)	350,000	Promoted to CEO
Eric Tapia	360,000(3)	265,000(4)	Promoted to CFO
Ersin Yumer	426,000	426,000(5)	Served as Interim CEO
Patrick Dillon	450,000(6)	350,000	—
James Mullen	450,000(6)	350,000	—