FF to Establish the First Scaled EAI Education System in the United States With Deployment of Its EAI Robotics Products and Technology

Faraday Future Intelligent Electric Inc. (NASDAQ: FFAI) (“Faraday Future”, “FF” or the “Company”), a California-based global Embodied AI (EAI) ecosystem company, today shared a weekly business update from YT Jia, Founder and Global Co-CEO of FF. This week’s update will be in the form of a Q&A session with YT.

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Faraday Future Founder and Co-CEO YT Jia Shares Weekly Investor Update: FF to Establish the First Scaled EAI Education System in the United States with Deployment of its EAI Robotics Products and Technology

“Q1: YT, you mentioned that, in your opinion, the most important highlight of this annual financial report is that the Company’s net equity turned from negative to positive. What happened behind the scenes? Why is it so important?

A1: Actually, there’s quite a story behind this. Last year, two days before the release of our third-quarter financial report, we were dealt with a severe blow. Based on what we believe were extremely conservative accounting principles, the audit firm recorded a one-time, large impairment of approximately $130 million related to equipment and tooling for the FF 91, given the lower-than-expected utilization in the near term. This amount accounted for nearly two-thirds of the Company’s total loss for the period and directly contributing to the Company’s net equity turning negative, as well as a two-day delay in the release of the third-quarter financial report. At the time, in order to file the financial report, we had no choice but to accept this outcome. We were deeply frustrated and we sympathize with our investors about that.

After that, we conducted deep internal reflection and quickly initiated debt optimization and a series of remedial measures. Through ongoing communications with creditors like suppliers, the company gained their understanding for its strategic direction. The company successfully completed approximately $100 million in debt optimization and reduction, which made restoring net equity to a positive position possible. We are truly grateful for their support.

Q2: The EAI robotics business achieved a positive gross margin on products in its very first quarter of delivery and has set a target of over 1,000 units shipment by the end of 2026. What does this mean for the company overall? In which areas will you focus on your main efforts?