UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM
For the Quarterly Period Ended
OR
For the transition period from _______ to ________.
Commission file number:
(Exact name of Registrant as specified in its charter)
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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 | ||
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The
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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. ☒
Indicate by check mark whether the registrant
has submitted electronically, every Interactive Data File required to be submitted 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). ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 | ☐ |
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☒ | Smaller Reporting Company |
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| Emerging Growth Company |
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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
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Indicate by check mark whether the registrant
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As of November 14, 2025, there were
VEEA INC.
FORM 10-Q
TABLE OF CONTENTS
i
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
VEEA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| (unaudited) | ||||||||
| ASSETS | ||||||||
| Cash | $ |
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$ |
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| Receivables, net |
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| Inventory, net |
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| Prepaid and other current assets |
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| Total current assets |
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| Property and equipment, net |
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| Goodwill |
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| Intangible assets, net |
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| Investments |
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| Other assets |
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| TOTAL ASSETS | $ |
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$ |
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| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Revolving line of credit | $ |
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$ |
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| Accounts payable |
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| Accrued expenses |
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| Related party liabilities |
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| Share issuance liability |
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| Deferred payables, current |
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| Notes payable |
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| Convertible note payable, net ,current |
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| Other current liabilities |
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| Total current liabilities |
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| Convertible note payable, net |
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| Conversion option liability |
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| Warrant liability |
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| Earn-out Share Liability |
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| Deferred payables |
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| TOTAL LIABILITIES |
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| STOCKHOLDERS’ DEFICIT | ||||||||
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Preferred stock, $
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Common Stock, $
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| Additional paid-in capital |
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| Accumulated deficit |
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| Accumulated other comprehensive income |
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| TOTAL STOCKHOLDERS’ DEFICIT |
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| TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ |
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$ |
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
1
VEEA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
|
For the
Three Months Ended September 30, |
For the
Nine Months Ended September 30, |
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| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Sales, net | $ |
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$ |
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$ |
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$ |
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| Cost of goods sold |
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| Gross profit |
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| Operating Expenses: | ||||||||||||||||
| Product development |
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| Sales and marketing |
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| General and administrative, net |
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| Transaction costs |
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| Depreciation and amortization |
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| Total operating expenses |
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| Loss from operations |
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(
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(
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| Other income (expense): | ||||||||||||||||
| Other income |
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| UK R&D tax credit |
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| Loss on initial issuance of convertible note |
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| Change in fair value of convertible note option liability |
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| Change in fair value of warrant liabilities |
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| Change in fair value of Earn-out Share Liability |
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| Other expense |
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| Interest expense |
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| Total other income |
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| Net income (loss) | $ |
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(
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(
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| Net income (loss) per share: | ||||||||||||||||
| Basic | $ |
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$ |
(
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) | $ |
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| Diluted | $ |
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$ |
(
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) | $ |
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| Weighted-average common stock outstanding used in per share amounts: | ||||||||||||||||
| Basic |
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| Diluted |
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| Other comprehensive income (loss): | ||||||||||||||||
| Foreign currency translation adjustment |
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(
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(
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| Comprehensive income (loss) | $ |
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$ |
(
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) | $ |
(
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) | $ |
(
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
2
VEEA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEEMBER 30, 2025
| Common Stock |
Additional
Paid-in- |
Accumulated |
Accumulated
Other Comprehensive |
Total
Stockholders’ |
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| Shares | Amount | Capital | Deficit | Income | Deficit | |||||||||||||||||||
| Balance, June 30, 2025 |
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$ |
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$ |
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$ |
(
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) | $ |
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$ |
(
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) | |||||||||||
| Stock based compensation | - |
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| Common stock issued in connection with public offering, net of transaction costs |
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| Common stock issued upon exercise of stock options |
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| Common stock issued upon vesting of RSUs |
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(
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| Foreign currency translation gain | - |
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| Net income | - |
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| Balance, September 30, 2025 |
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$ |
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$ |
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$ |
(
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) | $ |
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$ |
(
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) | |||||||||||
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024
| Common Stock |
Additional
Paid-in- |
Accumulated |
Accumulated
Other Comprehensive |
Total
Stockholders’ |
||||||||||||||||||||
| Shares | Amount | Capital | Deficit | Loss | Deficit | |||||||||||||||||||
| Balance, June 30, 2024 |
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$ |
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$ |
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$ |
(
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) | $ |
(
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) | $ |
(
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) | ||||||||||
| Stock based compensation | - |
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| Common stock issued upon exercise of stock options, pre Business Combination |
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| Exercise of Common Stock Warrants - related party |
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| Issuance of Common Stock in exchange for services in connection with A-2 Preferred Stock Issuances, recasted |
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| Issuance of Common Stock upon conversion of debt at Business Combination |
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| Issuance of Common Stock upon conversion of Sponsor and related party notes and warrants at Business Combination |
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| Issuance of Common Stock to Plum Sponsors and Investors at Business Combination |
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| Issuance of Common Stock to Plum Shareholders at Business Combination |
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(
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| Issuance of Common Stock related to new financing |
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| Common Stock issued for services |
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| Common stock issued upon exercise of stock options, post Business Combination |
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(
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| Foreign currency translation loss |
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(
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| Net loss |
(
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(
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| Balance, September 30, 2024 |
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$ |
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$ |
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$ |
(
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) | $ |
(
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) | $ |
(
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) | ||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3
VEEA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
(Unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025
| Common Stock |
Additional
Paid-in- |
Accumulated |
Accumulated
Other Comprehensive |
Total
Stockholders’ |
||||||||||||||||||||
| Shares | Amount | Capital | Deficit | Income | Deficit | |||||||||||||||||||
| Balance, December 31, 2024 |
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$ |
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$ |
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$ |
(
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) | $ |
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$ |
(
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) | |||||||||||
| Stock based compensation |
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| Common stock issued in connection with public offering, net of transaction costs |
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| Common stock issued upon exercise of stock options |
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| Common stock issued upon vesting of RSUs |
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(
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| Common stock issued upon draw on the equity line of credit |
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| Common stock issued as compensation for equity line of credit commitment fee |
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| Common stock issued as consideration for Crowdkeep |
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| Common stock issued for services |
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| Settlement of convertible note agreement for shares issued |
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| Foreign currency translation gain |
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| Net loss |
(
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) |
(
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) | ||||||||||||||||||||
| Balance, September 30, 2025 |
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$ |
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$ |
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$ |
(
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) | $ |
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$ |
(
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) | |||||||||||
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
| Common Stock |
Additional
Paid-in- |
Accumulated |
Accumulated
Other Comprehensive |
Total
Stockholders’ |
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| Shares | Amount | Capital | Deficit | Loss | Deficit | |||||||||||||||||||
| Balance, December 31, 2023 |
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$ |
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$ |
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$ |
(
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) | $ |
(
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) | $ |
(
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) | ||||||||||
| Class A Common Stock Issuances, net of transaction costs |
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| Common stock issuances, net of transaction costs |
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| Conversion of vendor payable to Common Stock |
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| Common stock issued upon exercise of stock options |
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| Stock based compensation | - |
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| Common stock issued upon exercise of stock options, pre Business Combination |
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| Exercise of Common Stock Warrants - related party |
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(
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) | ||||||||||||||||||||
| Issuance of Common Stock in exchange for services in connection with A-2Preferred Stock Issuances, recasted |
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(
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| Issuance of Common Stock upon conversion of debt at Business Combination |
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| Issuance of Common Stock upon conversion of Sponsor and related party notes and warrants at Business Combination |
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| Issuance of Common Stock to Plum Sponsors and Investors at Business Combination |
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| Issuance of Common Stock to Plum Shareholders at Business Combination |
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(
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) |
(
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| Issuance of Common Stock related to new financing |
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| Common Stock issued for services |
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| Common stock issued upon exercise of stock options, post Business Combination |
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(
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| Foreign currency translation loss |
(
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(
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| Net loss |
(
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) |
(
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) | ||||||||||||||||||||
| Balance, September 30, 2024 |
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$ |
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$ |
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$ |
(
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) | $ |
(
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) | $ |
(
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) | ||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
VEEA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
Nine Months Ended
September 30, |
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| 2025 | 2024 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ |
(
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) | $ |
(
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) | ||
| Adjustments to reconcile net loss to net cash used for operating activities: | ||||||||
| Depreciation and amortization |
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| Amortization of debt issuance costs |
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| Loss on initial issuance of debt |
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| Change in fair value of convertible note option liability |
(
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(
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| Change in fair value of warrant liabilities |
(
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| Earn-out liability initial loss |
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| Change in fair value of Earn-out Share Liability |
(
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(
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| Interest income on investment |
(
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| Share based compensation |
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| Share based vendor payments as compensation for services |
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| Share based payment as compensation for ELOC commitment fee |
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| Interest expense on convertible notes converted |
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| Unrealized foreign currency transaction (gain) loss |
(
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(
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| Amortization of operating lease right of use assets |
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| Changes in operating assets and liabilities: | ||||||||
| Receivables |
(
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(
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| Inventories |
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| Prepaid and other current assets |
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| Other assets |
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| Accounts payable |
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| Accrued expenses |
(
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| Other liabilities |
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| Operating lease payments |
(
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(
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| Net cash used in operating activities |
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(
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| Cash flows from investing activities | ||||||||
| Purchase of property and equipment |
(
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| Purchase of intangible assets and trademarks |
(
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(
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| Net cash used in investing activities |
(
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(
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| Cash flows from financing activities | ||||||||
| Proceeds from revolving line of credit |
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| Proceeds from related party notes |
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| Proceeds from issuance of convertible notes |
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| Proceeds from the issuance of shares under equity line of credit facility |
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| Proceeds from reverse recapitalization |
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| Proceeds from lock-up share release |
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| Proceeds from the issuance of common stock, net of transaction costs |
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| Proceeds from exercise of stock options for common stock |
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| Net cash provided by financing activities |
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| Effect of exchange rate changes on cash |
(
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| Net decrease in cash and cash equivalents |
(
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(
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| Cash and cash equivalents at beginning of period |
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| Cash and cash equivalents at end of period | $ |
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$ |
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| Non-cash activities | ||||||||
| Initial measurement of debt discount on the convertible note |
(
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) | ||||||
| Conversion of related party notes to Common Stock |
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| Conversion of interest on related party notes to Common Stock |
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| Initial measurement of the convertible note option liability |
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| Conversion of principal on related party notes to Common Stock |
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| Crowdkeep asset acquisition |
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| Settlement of convertible notes for shares issued |
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| Conversion of vendor payable to Common Stock |
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| Supplemental cash flow information | ||||||||
| Interest paid |
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|
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
Veea Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
1 - DESCRIPTION OF BUSINESS
The Company is dedicated to simplifying the journey towards creating a world in which virtually everyone and everything is intelligently connected, while bringing applications and artificial intelligence to the edge of the network. Most service providers, equipment suppliers, system integrators and even hyperscalers have adopted or advocated for similar solutions to various degrees either independently or in collaboration with the Company. However, to our knowledge, we are the first to market with patented technologies that (a) bring virtualized data center capabilities to the far edge of the network, commonly referred to as the Device Edge, where all wired and wireless devices connect to the network, (b) spawns hyperconvergence of computing, multiaccess communications and storage, (c) provides for Cloud-managed applications at the Edge (“Hybrid Edge-Cloud Computing”), and (d) enables machine learning with AI training, inferencing, and agentic AI at the edge (“Edge AI”) including AI-driven cybersecurity for heterogenous networks. Such networks have given rise through any combination of our developed devices and third-party devices, with CPUs, GPUs, TPUs, DPUs and/or NPUs, that run on the VeeaONE platform’s software stack. Our end-to-end edge-cloud platform is referred to as VeeaONETM (“VeeaONE”) platform.
Veea has developed several generations of highly integrated all-in-one devices that incorporate a Linux server, with a virtualized software environment, supporting our patented secured docker containers, together with a Wi-Fi Access Point with a mesh router, a firewall, an IoT gateway, NVMe data storage and 4G/5G modules. With an extensive patent portfolio of 123 granted patents and 32 pending patent applications that cover 26 patent families, our end-to-end Hybrid Edge-Cloud Computing platform represents a new product category that has the potential for wide scale customer adoption in large segments of consumer and enterprise markets.
VeeaONE platform’s products, applications, and services with a distributed computing architecture, offered as a Platform-as-a-Service capability, empowering companies to capitalize on the transformative potential of Edge AI, where most of the data from smartphones, tablets, laptops, cameras, sensors, and other devices is generated, with data privacy and sovereignty, reliability, low latency for real-time decisions, bandwidth efficiency, scalability, and reduced costs compared to alternatives.
VeeaHub products, about the size of a typical Wi-Fi Access Point, are offered in variety of form factors with different capabilities for indoor and outdoor coverage and are both locally- and cloud-managed. VeeaONE architecture and business model, VeeaHub and third-party devices on VeeaONE platform with Hybrid Edge-Cloud Computing and AI-enabled applications and services.
The VeeaONE platform offers an alternative to cloud computing by enabling the formation of highly secure, but easily accessible, private clouds and networks across one or multiple user(s) or enterprise location(s) across the globe. The benefits include optimal latency, lower data transport costs, data privacy, security and ownership, Edge AI, as well as “always-on” availability for mission critical applications, and contextual awareness for people, devices and things connected to the Internet.
Our products and services have been deployed across multiple countries and industries; however, we are focused on high-growth market segments such as fixed-line or 5G-based fixed wireless broadband access, and subscription-based managed Wi-Fi for unserved and underserved communities. In both cases, broadband or Internet connectivity services are offered with a variety of Edge applications and value-added services, including advanced AI-driven cybersecurity, through Mobile Network Operators, Multiple System Operators, Internet Service Providers and other types of Managed Service Providers. The industrial applications include climate smart buildings, smart farming with precision agriculture, smart warehouses and smart retail as cloud-managed converged private networks.
6
Gartner recognized the innovativeness and capabilities of the platform by naming the Company a Leading Smart Edge Platform in 2023 and Cool Vendor in Edge Computing in 2021. Market Reports World in its research report published in October 2023 named the Company as one of the top 10 Edge AI solution providers alongside of IBM, Microsoft, Amazon Web Services and others.
Private Veea was founded in 2014 by Allen Salmasi, our Chief Executive Officer and a pioneering wireless technology leader. Mr. Salmasi helped to drive industry transformation through his contributions to the development of CDMA/TDMA-based OmniTRACS, the largest mobile satellite messaging and position reporting system with integrated IoT solutions during the 1980s and 1990s; CDMA-based 2G/3G technologies and products at Qualcomm in 1990s; OFDMA-based 4G technologies and products at NextWave during the 2000s, and hyper-converged edge computing and communications during the 2010s; and beyond with the Company.
The Company has six wholly owned subsidiaries,
VeeaSystems Inc., formerly known as Veea Inc. a Delaware corporation, (“Private Veea”), Veea Solutions Inc., a Delaware corporation,
VeeaSystems Development Inc., formerly known as Veea Systems Inc., a Delaware corporation, Veea Systems Ltd., a company organized under
the laws of England and Wales, VeeaSystems SAS, a French simplified joint stock company and VeeaSystems CK Inc., a Delaware corporation;
and one majority owned subsidiary, VeeaSystems Mexico, S. de R.L. de C.V., a limited capital company organized under the laws of Mexico
(“VeeaSystems MX”). VeeaSystems MX is
2 - LIQUIDITY AND MANAGEMENT’S PLAN
During the three months ended September
30, 2025 and 2024, the Company incurred operating losses of $
Although the Company has had recurring
losses each year since inception, the Company plans to fund its operations and capital funding needs for the next 12 months with revenue
generated from operations and through a combination of private and public equity offerings including, without limitation, anticipated
revenue generated under the Supply Agreement entered into with Telcel, the proceeds of the Company’s Common Stock Offering completed
on August 14, 2025, receipt of the cash tax refund of approximately $
Based in part on the above-referenced opportunities and initiatives, the Company has a reasonable basis to believe it has alleviated substantial doubt regarding its ability to continue as a going concern. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company, if at all.
7
3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, certain information and footnote disclosures normally included in consolidated financial statements in accordance with GAAP have been omitted. In the opinion of management, all adjustments considered necessary for a fair presentation have been included.
All significant intercompany balances and transactions have been eliminated in consolidation. We consolidate any variable interest entity (“VIE”) where we have determined we are the primary beneficiary. The primary beneficiary is the entity which has both: (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance; and (ii) the obligation to absorb losses or receive benefits of the entity that could potentially be significant to the VIE. The Company has one VIE, VeeaSystems MX. Transactions with VeeaSystems MX were immaterial during all the periods presented and are not separately disclosed.
The condensed consolidated balance sheet as of September 30, 2025, has been derived from the unaudited consolidated financial statements at that date, but does not include all disclosures, including notes required by GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for its year ended December 31, 2024.
Basis of Accounting
The accompanying condensed consolidated financial statements have been prepared on the accrual basis in accordance with accounting principles generally accepted under GAAP.
Use of Estimates
Management of the Company is required to make certain estimates, judgments, and assumptions during the preparation of its condensed consolidated financial statements in accordance with GAAP. The Company believes that these estimates, judgments and assumptions are reasonable under the circumstances. These estimates, judgments, and assumptions impact the reported amounts of assets, liabilities, revenue, and expenses, and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. Changes in such estimates could affect amounts reported in future periods. On an ongoing basis, the Company evaluates its estimates and judgments including those related to: liquidity and going concern, the useful lives and recoverability of property and equipment and definite-lived intangible assets; the recoverability of goodwill and indefinite-lived intangible assets; the carrying value of accounts receivable, including the determination of the allowance for credit losses; inventory, including the determination of allowances for estimated excess or obsolescence; the fair value of warrants; the fair value of acquisition-related contingent consideration arrangements; the fair value of the ELOC; unrecognized tax benefits; legal contingencies; the incremental borrowing rate for the Company’s leases; and the valuation of stock-based compensation, among others.
Emerging Growth Company Status
The Company is an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.
8
Segment Information
Recent Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The ASU requires that an entity disclose specific categories in the effective tax rate reconciliation as well as reconciling items that meet a quantitative threshold. Further, the ASU requires additional disclosures on income tax expense and taxes paid, net of refunds received, by jurisdiction. The new standard is effective for annual periods beginning after December 15, 2024, on a prospective basis with the option to apply it retrospectively. Early adoption is permitted. The adoption of this guidance results in the Company being required to include enhanced income tax-related disclosures. The Company adopted this guidance effective January 1, 2025; however, as there is a full valuation allowance on its deferred tax assets, income tax disclosures are not material to the condensed consolidated financial statements and are not included in this Quarterly Report on Form 10-Q but will be evaluated quarterly going forward necessary disclosures.
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures . This ASU includes amendments that expand the existing reportable segment disclosure requirements and requires disclosure of (i) significant expense categories and amounts by reportable segment as well as the segment’s profit or loss measure(s) that are regularly provided to the chief operating decision maker (the “CODM”) to allocate resources and assess performance; (ii) how the CODM uses each reported segment profit or loss measure to allocate resources and assess performance; (iii) the nature of other segment balances contributing to reported segment profit or loss that are not captured within segment revenues or expenses; and (iv) the title and position of the individual or name of the group or committee identified as the CODM. This guidance requires retrospective application to all prior periods presented in the financial statements and is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The adoption of this guidance results in the Company being required to include enhanced disclosures relating to its reportable segments. The Company adopted this guidance effective December 31, 2024, and it did not have a material effect 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). In January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date to clarify the effective date of ASU 2024-03. The amendments in this ASU require a public business entity to disclose specific information about certain costs and expenses in the notes to its financial statements for interim and annual reporting periods. The objective of the disclosure requirements is to provide disaggregated information about a public business entity’s expenses to help investors (a) better understand the entity’s performance, (b) better assess the entity’s prospects for future cash flows, and (c) compare an entity’s performance over time and with that of other entities. The additional disclosures under this update include (1) disclosing the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depreciation, depletion, and amortization recognized as part of oil and gas-producing activities (DD&A) (or other amounts of depletion expense) that are included in each relevant expense caption, (2) include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements, (3) disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and (4) disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its condensed consolidated financial statements.
9
4 - ACQUISITION
On May 13, 2025, the Company entered
into an Asset Purchase Agreement with Crowdkeep, Inc., a Delaware corporation (the “Seller”), pursuant to which the Company
acquired certain assets of Seller relating to Seller’s IoT technology platform business, free and clear of any liens other than
certain specified liabilities of Seller that were assumed. In consideration for the acquisition, the Company issued
The transaction was accounted for as
an asset acquisition, as the Company determined that substantially all of the fair value was concentrated in a single identifiable intangible
asset, proprietary technology, and therefore applied a model consistent with asset acquisition accounting. The total purchase consideration
of $
The transaction was considered a related party transaction due to the involvement of a Company board member who was also the CEO and shareholder of Crowdkeep. The Company established a special committee of the Board comprised of independent members of the Board, that evaluated and approved the transaction, concluding that the terms were commercially reasonable and negotiated at arm’s length.
The patented technology, which is recorded
as part of intangible assets, net in the condensed consolidated balance sheet, will be amortized over its estimated useful life of
5 - REVERSE RECAPITALIZATION
As discussed in Note 1, the Business Combination was consummated on September 13, 2024, which, for accounting and reporting purposes under GAAP, was treated as the equivalent of Private Veea issuing stock for the net assets of Plum, accompanied by an equity recapitalization of Private Veea, which was determined to fall within the scope of Accounting Standards Codification (“ASC”) 805, “ Business Combinations ”. Plum was treated as the acquired company, and its net assets were stated at historical cost, with no goodwill or other intangible assets recorded. The excess of the fair value of shares issued to Plum over the fair value of Plum’s identifiable net assets acquired represented compensation for the service of a stock exchange listing for its shares and was expensed as incurred.
The warrants issued at the time of Plum’s initial public offering (the “Public Warrants”), and warrants issued in connection with private placement at the time of Plum’s initial public offering (the “SPAC Private Placement Warrants”) remain outstanding and are now outstanding warrants for the Company.
Earn-out Share Liability
Following the Closing, stockholders
who previously held certain capital stock of Private Veea have the contingent right to receive up to
Under accounting principles, the Company’s obligation to issue the earn-out shares is recorded as a contingent liability (the “Earn-out Share Liability”) in the Company’s financial statements and the initial value of the Earn-out Share Liability was recorded as a transaction cost within operating expenses in the Company’s financial statements for the year ended December 31, 2024. For each subsequent reporting period, changes in the fair value of the Earn-Out Share Liability are reported in the Company’s financial statements.
10
6 - BALANCE SHEET COMPONENTS
Inventory
Inventory consists of the following:
|
September 30,
2025 |
December 31,
2024 |
|||||||
| Inventory | $ |
|
$ |
|
||||
| Inventory allowance |
(
|
) |
(
|
) | ||||
| Consigned parts |
|
|
||||||
| Total | $ |
|
$ |
|
||||
Property and Equipment, net
Property and equipment, net consists of the following:
|
September 30,
2025 |
December 31,
2024 |
|||||||
| Furniture and fixtures | $ |
|
$ |
|
||||
| Computer equipment |
|
|
||||||
| Leasehold improvements |
|
|
||||||
| Total property and equipment gross |
|
|
||||||
| Less - Accumulated depreciation |
(
|
) |
(
|
) | ||||
| Total property and equipment net | $ |
|
$ |
|
||||
Depreciation expense for the three
months ended September 30, 2025 and 2024, totaled $
11
7 - GOODWILL AND INTANGIBLE ASSETS
Goodwill
The following is a summary of activity in goodwill for the nine months ended September 30, 2025 and 2024:
|
September 30,
2025 |
||||
| Balance at December 31, 2024 | $ |
|
||
| Foreign exchange transactions |
|
|||
| Balance at September 30, 2025 |
|
|||
|
September 30,
2024 |
||||
| Balance at December 31, 2023 | $ |
|
||
| Foreign exchange transactions |
|
|||
| Balance at September 30, 2024 |
|
|||
Intangible Assets
Intangible assets consist of the following:
| As of September 30, 2025 | ||||||||||||||||||||||||||||||
|
Amortization
Period |
Costs as of
December 31, 2024 |
Additions | Disposals |
Ending
Costs |
Accumulated
Amortization |
Accumulated
Impairment |
Net Book
Value |
|||||||||||||||||||||||
| Patents |
|
$ |
|
$ |
|
$ | $ |
|
$ |
(
|
) | $ | $ |
|
||||||||||||||||
| Proprietary technology |
|
|
|
(
|
) |
|
||||||||||||||||||||||||
| Intangible assets, net | $ |
|
$ |
|
$ | $ |
|
$ |
(
|
) | $ | $ |
|
|||||||||||||||||
| As of December 31, 2024 | ||||||||||||||||||||||||||||||
| Amortization |
Costs as of
January 1, |
Ending | Accumulated | Accumulated | Net Book | |||||||||||||||||||||||||
| Period | 2024 | Additions | Disposals | Costs | Amortization | Impairment | Value | |||||||||||||||||||||||
| Patents |
|
$ |
|
$ |
|
$ | $ |
|
$ |
(
|
) | $ | $ |
|
||||||||||||||||
| IPR&D |
|
|
|
(
|
) |
(
|
) | |||||||||||||||||||||||
| Intangible assets, net | $ |
|
$ |
|
$ | $ |
|
$ |
(
|
) | $ |
(
|
) | $ |
|
|||||||||||||||
Intangible assets primarily consist
of proprietary technology, patents, patent applications, and in-process research and development (“IPR&D”) and other identifiable
intangible assets. Intangible assets are generally amortized on a straight-line basis over the periods of benefit. The Company’s
patents have estimated remaining economic useful lives ranging from
Intangible asset amortization expense
for the three months ended September 30, 2025 and 2024, totaled $
12
Future estimated amortization expense for the Company’s intangible assets is approximately as follows:
| Future estimated amortization as of September 30, 2025 | ||||
| Remainder of 2025 | $ |
|
||
| 2026 |
|
|||
| 2027 |
|
|||
| 2028 |
|
|||
| 2029 |
|
|||
| Thereafter |
|
|||
| $ |
|
|||
8 - DEBT
Total outstanding debt of the Company is comprised of the following, including convertible notes:
| September 30, 2025 | Principal |
Debt
Discount |
Total | |||||||||
| Revolving Loan Facility | $ |
|
$ | $ |
|
|||||||
| Convertible note payable, net |
|
(
|
) |
|
||||||||
| Notes payable |
|
|
||||||||||
| Total | $ |
|
$ |
(
|
) | $ |
|
|||||
| December 31, 2024 | Principal |
Debt
Discount |
Total | |||||||||
| Revolving Loan Facility | $ |
|
$ | $ |
|
|||||||
| Convertible note payable |
|
(
|
) |
|
||||||||
| Total | $ |
|
$ |
(
|
) | $ |
|
|||||
Revolving Loan Facility
In June 2021, Private Veea entered
into a revolving loan agreement (the “2021 Revolving Loan Agreement”) with First Republic Bank, which was subsequently acquired
by JPMorgan Chase, (the “Bank”) providing up to $
Convertible Notes Payable
Business Combination Convertible Notes Payable
Simultaneously with the closing of
the Business Combination, the Company and Private Veea issued convertible notes under note purchase agreements (the “Note Purchase
Agreements”) with certain accredited investors unaffiliated with the Company and Private Veea (each, an “Investor”)
for the sale of unsecured subordinated convertible promissory notes (the “September 2024 Notes”) as part of a private placement
offering of up to $
13
The Transferred Shares were recorded
at a fair value of $
The Company and VeeaSystems Inc. (“VeeaSystems”)
are co-borrowers under each September 2024 Note (together, the “Borrowers”) and are jointly responsible for the obligations
to each Investor thereunder. Each September 2024 Note has a maturity date of
The outstanding obligations under each
September 2024 Note are convertible in whole or in part into shares of Common Stock (the “Conversion Shares”) at a conversion
price of $
The Conversion Shares were initially
subject to a lock-up for a period of 6 months after the Financing Closing. The Transferred Shares were not subject to any lock-up restrictions,
but for a period of 6 months after the Closing they were separately designated by the Transfer Agent and kept as book entry shares on
the Transfer Agent’s records and were not be eligible to be held by DTC without the Investor first notifying the Company of its
intent to transfer any such Transferred Shares to a brokerage account and/or to be held by DTC or another nominee (a “Brokerage
Transfer”). If the Investor provided such notice or otherwise has any Transferred Shares subject to a Brokerage Transfer within
6 months after the Closing, a portion of the outstanding obligations under such Investor’s Note would automatically convert into
a number of Conversion Shares equal to the number of Transferred Shares subject to such Brokerage Transfer, and the lock-up period for
such Conversion Shares would be extended for an additional 6 months to 12 months after the Financing Closing. As of September 30, 2025,
$
14
The Company reviewed the conversion feature granted in the notes under ASC 815, “ Derivatives and Hedging ” (“ASC 815”), and concluded that the conversion price was based on a variable (enterprise value) that was not an input to the fair value of a “fixed-for-fixed” option as defined under ASC 815 - 40 and is therefore considered a conversion option liability that should be bifurcated from the debt host. As the fair value of the conversion option liability exceeded the net proceeds received, in accordance with ASC 470-20, the Company recorded the conversion option liability at fair value with the excess of the fair value over the net proceeds received recognized as a loss in earnings. See Note 15 for further information.
Convertible Notes Payable Issued in connection with Crowdkeep Acquisition
On April 17, 2025,
and May 13, 2025, the Company and the majority stockholder of the Seller (“Crowdkeep Investor”), entered into two Note Purchase
Agreements (the “Crowdkeep Note Purchase Agreements”). Pursuant to the Crowdkeep Note Purchase Agreements, the Crowdkeep Investor
loaned to the Company an aggregate of $
Pursuant to the terms of the Convertible
Notes, upon an event of default, the outstanding principal amount of the applicable Crowdkeep Convertible Note, plus accrued but unpaid
interest, will become immediately due and payable in full. Events of default include failure to pay any principal or interest amounts
under the Crowdkeep Convertible Notes, failure to perform covenants in the Crowdkeep Convertible Notes and certain bankruptcy and insolvency
conditions of the Company. The Company may prepay all or any portion of the Crowdkeep Convertible Notes at any time. The Crowdkeep Convertible
Notes are convertible, in whole or in part, into shares of Common Stock (the “Crowdkeep Conversion Shares”) at the option
of the Crowdkeep Investor, at a price per share of $
9 - INVESTMENTS
The Company accounts for its private
company investments without readily determinable fair values under the cost method. These investments, for which the Company is not able
to exercise significant influence over any one individual investee, is measured and accounted for using an alternative measurement basis
of a) the security’s carrying value at cost, b) less any impairment and c) plus or minus any qualifying observable price changes.
Observable price changes or impairments recognized on the Company’s private company investments would be classified as a Level 3
financial instrument within the fair value hierarchy based on the nature of the fair value inputs. Any adjustments to the carrying values
are recognized in other income, net in the Company’s consolidated statements of operations and comprehensive loss. As of December
31, 2024, the Company performed the qualitative assessment for impairment of its investments. Based on this qualitative assessment, impairment
indicators were present for one of its investments; therefore, the company performed an analysis to estimate its fair value and recognized
an impairment loss of $
15
10 - STOCKHOLDERS’ EQUITY
On September 13, 2024, the Company
consummated the Business Combination which was accounted for as a reverse recapitalization. In connection with the consummation of
the Business Combination (i) the Company de-registered from the Register of Companies in the Cayman Islands by way of continuation out
of the Cayman Islands and into the State of Delaware, migrating to and domesticating as a Delaware corporation (the “Domestication”)
and (ii) restated our certificate of incorporation (“Restated Certificate of Incorporation”). In connection with the Domestication,
each share of outstanding Class A ordinary shares were converted by operation of law into shares of Common Stock, on a one-for-one basis.
Upon filing of the Restated Certificate of Incorporation, each issued and outstanding share of Class B stock outstanding immediately prior
to the filing of the Restated Certificate of Incorporation was converted into shares of Common Stock on a one-for-one basis. Under the
Restated Certificate of Incorporation, the Company is authorized to issue
Holders of Common Stock are entitled
vote on all matters submitted to the stockholders vote or approval, other than on any amendment to the Restated Certificate of Incorporation
(including any certificate of designations relating to any series of Preferred Stock) that relates solely to the terms of one or more
outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together as a class with
the holders of one or more other such series, to vote thereon pursuant to the Restated Certificate of Incorporation (including any certificate
of designations relating to any series of Preferred Stock). Holders of Common Stock are entitled to
Equity Line of Credit
On December 2, 2024, the Company entered
into a common stock purchase agreement (“Common Stock Purchase Agreement”) and related registration rights agreement (the
“Registration Rights Agreement”) with White Lion Capital, LLC (“White Lion”). Pursuant to the Common Stock
Purchase Agreement, the Company has the right, but not the obligation, to direct White Lion to purchase up to $
The Company controls the timing and
amount of any sales to White Lion, which depend on a variety of factors including, among other things, market conditions, the trading
price of the Common Stock, and determinations by the Company as to appropriate sources of funding for its business and operations. However,
White Lion’s obligation to purchase shares is subject to certain conditions, including the daily trading volume of the Company’s
stock. In all instances, the Company may not sell shares of Common Stock under the Purchase Agreement if it would result in White Lion
and its affiliate beneficially owning more than
The Company did not draw on the ELOC
during the three months ended September 30, 2025, and received $
The Company agreed to issue to White
Lion shares of Common Stock as a commitment fee (the “Commitment Shares”). The fair value of the Commitment Shares was $
16
August 2025 Public Offering
On August 14, 2025, the Company closed a public offering (the “August
2025 Public Offering”) of
11 - STOCK INCENTIVE PLANS
In September 2014, the Private Veea’s
Board of Directors adopted the Max2 Inc. Equity Incentive Plan (“2014 Plan”). Upon adoption of the 2014 Plan, the aggregate
number of shares of Common Stock reserved for awards under the Plan were
On June 4, 2024, the stockholders of
the Company approved the Veea Inc. 2024 Incentive Award Plan (the “2024 Incentive Plan”, collectively with the Private Veea
Plans, the “Plans”), which became effective upon the Closing. The Company initially reserved
On June 4, 2024, the stockholders of
the Company approved Veea Inc. 2024 Employee Stock Purchase Plan (the “ESPP”), which became effective upon the Closing. An
aggregate of
17
In connection with the Business Combination,
each Private Veea option that was outstanding immediate prior to Closing, whether vested or unvested, was exchanged for a stock option
under the 2024 Plan (each an “Exchanged Option”) to acquire a number of shares of Common Stock equal to the product of (i)
the number of shares of Private Veea’s common stock subject to such Private Veea option immediately prior to the Business Combination
and (ii) the Exchange Ratio, at an exercise price per share equal to (A) the exercise price per share of such Private Veea option immediately
prior to the consummation of the Business Combination, divided by (B) the Exchange Ratio. Following the Business Combination, each Exchanged
Option continues to be governed by the same terms and conditions (including vesting and exercisability terms) as were applicable to the
corresponding former Private Veea option immediately prior to the consummation of the Business Combination. Unvested Private Veea options
did not accelerate nor vest on the consummation of the Business Combination. All stock option activity was retroactively restated to reflect
the effect of the Exchange Ratio. Generally, stock options vest
Stock Options
Stock option activity under the Plan was as follows:
|
Number of
Options |
Weighted-
Average Exercise Price per Share |
Weighted-
Average Remaining Contractual Term (years) |
||||||||||
| Outstanding at December 31, 2024 |
|
$ |
|
|
||||||||
| Granted |
|
|
||||||||||
| Exercised |
(
|
) | ||||||||||
| Forfeited / Expired |
(
|
) |
|
|||||||||
| Outstanding at September 30, 2025 |
|
|
|
|||||||||
| Exercisable at September 30, 2025 |
|
$ |
|
|
||||||||
On September 29, 2025, the compensation
committee of the Board of Directors approved equity awards to certain Named Executive Officers (“NEO”), employees, and consultants
in the form of options to purchase
The fair value of each stock option
granted is estimated using the Black-Scholes option-pricing model using the single-option award approach.
|
September 30,
2025 |
||||
| Stock Price | $ |
|
||
| Expected term (years) |
|
|||
| Volatility |
|
% | ||
| Risk-Free Rate |
|
% | ||
Stock compensation expense related
to the common stock options outstanding for the nine months ended September 30, 2025 and 2024, was $
18
Restricted Stock Units
RSU activity under the Plan was as follows:
|
Number of
RSUs |
Weighted-
Average Grant Date Fair Value |
|||||||
| Unvested at December 31, 2024 | $ | |||||||
| Granted |
|
|
||||||
| Vested |
(
|
) |
|
|||||
| Forfeited |
(
|
) |
|
|||||
| Unvested at September 30, 2025 |
|
$ |
|
|||||
Stock compensation expense related
to the RSUs for the nine months ended September 30, 2025 was $
12 - WARRANTS
Public Warrants
As part of Plum’s initial public
offering (“IPO”), Plum issued warrants to third-party investors where each whole warrant entitles the holder to purchase
The Public Warrants are exercisable
at per share, subject to adjustment, provided that the Company has an effective registration statement under the Securities Act covering
the shares of Common Stock issuable upon exercise of the Public Warrants and a current prospectus relating to them is available (or the
Company permits holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement) and
such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of
the holder. The warrants will expire
The Company filed with the SEC a registration statement for the registration, under the Securities Act, of the shares of Common Stock issuable upon exercise of the SPAC Private Placement Warrants. Such registration statement was declared effective by the SEC on January 15, 2025.
With the exception of the SPAC Private Placement Warrants, in no event will the Company be required to net cash settle any warrant. In the event that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit solely for the shares of Common Stock underlying such Warrant.
19
Redemption of SPAC Warrants When the Price per Share of Common Stock
Equals or Exceeds $
Once the SPAC Warrants become exercisable, the Company may redeem the outstanding Warrants (except with respect to the SPAC Private Placement Warrants):
| ● | in whole and not in part; |
| ● |
at a price of $
|
| ● |
upon not less than
|
| ● |
if, and only if, the last reported sale price of our Common Stock equals or exceeds $
|
Redemption of SPAC Warrants When the Price per Share of Common Stock
Equals or Exceeds $
Once the SPAC Warrants become exercisable, the Company may redeem the outstanding SPAC Warrants:
| ● | in whole and not in part; |
| ● |
at $
|
| ● |
if, and only if, the closing price of our Common Stock equals or exceeds $
|
| ● |
if the closing price of our Common Stock for any
|
The SPAC Private Placement Warrants were initially issued in the same form as the Public Warrants with the exception that the SPAC Private Placement Warrants: (i) would not be redeemable by the Company and (ii) may be exercised for cash or on a cashless baseless so long as they are held by the initial purchasers or their permitted transferees, the SPAC Private Placement Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the Public Warrants.
The Public Warrants were initially classified as a derivative liability instrument. Upon the closing of the Business Combination, the Public Warrants in accordance with the guidance contained in ASC 815 are no longer precluded from equity classification. Equity-classified contracts are initially measured at fair value (or allocated value). Subsequent changes in fair value are not recognized as long as the contracts continue to be classified in equity.
The Company continues to recognize the SPAC Private Placement Warrants as liabilities at fair value as of the Closing Date, with an offsetting entry to additional paid-in capital and adjusts the carrying value of the instruments to fair value through other income (expense) on the condensed consolidated statement of operations and comprehensive income (loss) at each reporting period until they are exercised. As of September 30, 2025, the SPAC Private Placement Warrants are presented within warrant liabilities on the condensed consolidated balance sheet.
20
Private Veea Warrants
Upon the closing of the Business Combination,
the Related Party Common Stock Warrants were exercised in whole, on a net basis, for
In connection with the Business Combination, Private Veea’s outstanding
equity-classified Preferred stock warrants were exchanged for common stock warrants of the Company (each an “Exchanged Warrant”)
to purchase a number of shares of Common Stock, after adjustment for anti-dilutive shares, equal to the product of (i) the number of shares
of Private Veea’s common stock subject to such Preferred Stock warrant immediately prior to the Business Combination and (ii) the
Exchange Ratio, at an exercise price per share equal to (A) the exercise price per share of such Preferred Stock warrant immediately prior
to the consummation of the Business Combination, divided by (B) the Exchange Ratio. On November 6, 2024, the warrant holder exercised
warrants to purchase
2025 Investor Warrants
In connection with the August 2025 Public Offering, the Company issued
the warrants to purchase up to
Each 2025 Investor Warrant is exercisable, at the option of the holder thereof, in whole or in part, by delivering to a duly executed exercise notice accompanied by payment in full in immediately available funds for the number of shares of our common stock purchased upon such exercise (except in the case of a cashless exercise as described below).
A holder (together with its affiliates)
may not exercise any portion of the 2025 Investor Warrant to the extent that the holder would own more than
If the holder of 2025 Investor Warrants exercises its warrants and a registration statement registering the issuance of the shares of common stock underlying the warrants under the Securities Act is not then effective or available (or a prospectus is not available for the resale of shares of common stock underlying the warrants), then in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the aggregate exercise price, the holder shall instead receive upon such exercise (either in whole or in part) only the net number of shares of common stock determined according to a formula set forth in the common warrants. Notwithstanding anything to the contrary, in the event the Company does not have or maintain an effective registration statement, there are no circumstances that would require the Company to make any cash payments or net cash settle the common warrants to the holders.
21
Subject to applicable laws, the 2025 Investor Warrants may be offered for sale, sold, transferred or assigned at the option of the holder upon surrender of such holder’s warrants to the Company together with the appropriate instruments of transfer.
In the event of a fundamental transaction,
as described in the 2025 Investor Warrants and generally including any reorganization, recapitalization or reclassification of our common
stock, the sale, transfer or other disposition, in each case, of all or substantially all of our properties or assets, our consolidation
or merger with or into another person, the acquisition of more than
The Company recognized the 2025 Investor Warrants as liability-classified at fair value as of the closing date, with an offsetting entry to additional paid-in capital and adjusts the carrying value to fair value through other income (expense) on the condensed consolidated statement of operations and comprehensive income (loss) at each reporting period until they are exercised. As of September 30, 2025, the 2025 Investor Warrants are presented within warrant liability on the condensed consolidated balance sheet.
13 - RELATED PARTY TRANSACTIONS
Lease Agreements
On March 1, 2014, Private Veea entered
into a sublease agreement with NLabs Inc., an affiliate of the Company’s CEO that held approximately
In April 2017, Private Veea entered into a lease agreement with 83
rd
Street
LLC to lease office space for an initial term of
22
Related Party Debt
At the Closing of the Business Combination,
promissory notes evidencing loans made by NLabs to the Company from 2021 through the Closing (the “Related Party Notes”) in
the aggregate amount, including accrued interest, of $
During the nine months ended September
30, 2025, NLabs made loans to the Company in the aggregate principal amount of $
In October and November 2025, NLabs
made additional loans to the Company in the aggregate principal amount of $
14 - COMMITMENTS AND CONTINGENCIES
Purchase Commitments with Contract Manufacturers and Suppliers
As of September 30, 2025, the Company had no unconditional purchase obligations for the purchase of goods or services from suppliers and contract manufacturers. Unconditional purchase obligations are obligations that are enforceable and legally binding on the Company and specify all significant terms, including quantities to be purchased, fixed, minimum or variable price provisions and the approximate timing of the transaction. Unconditional purchase obligations exclude agreements that are cancellable without penalty.
Leases
The Company leases office space in the U.S., including office space from related parties as disclosed in Note 13. Under the terms of the various lease agreements, the Company may bear certain costs such as maintenance, insurance and taxes. Lease agreements may provide for increasing rental payments at fixed intervals. The Company’s CEO has guaranteed the obligations under the office space leased in New Jersey. The Company also leases offices in the United Kingdom, France, and Mexico under short-term arrangements of twelve months or less.
Indemnifications
In the normal course of business, the Company has indemnification obligations to other parties, including customers, lessors, and parties to other transactions with us, with respect to certain matters. The Company has agreed to indemnify against losses arising from a breach of representations or covenants or out of intellectual property infringement or other claims made against certain parties. These agreements may limit the time or circumstances within which an indemnification claim can be made and the amount of the claim.
It is not possible to determine the maximum potential amount for claims made under the indemnification obligations due to uncertainties in the litigation process, coordination with and contributions by other parties and the defendants in these types of cases, and the unique facts and circumstances involved in each particular case and agreement. To date, the Company has made no indemnity payments. In addition, the Company has entered into indemnification agreements with its officers and directors, and its Amended and Restated Bylaws contain similar indemnification obligations to its agents.
Litigation
In the normal course of business, the Company may become involved in various lawsuits and legal proceedings. The Company accrues contingent liabilities when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. While the ultimate results of these matters cannot be predicted with certainty, management does not expect them to have a material adverse effect on the financial position or results of operations of the Company.
Other Commitments
In connection with the Business Combination,
the Company agreed to pay certain legal expenses contingent upon the closing of the Business Combination, certain of which expenses were
mutually agreed to be deferred to periods after the Closing. As of September 30, 2025, the amount of the deferred fees totaled $
23
15 - FAIR VALUE MEASUREMENTS
Recurring Fair Value Measurements
| September 30, 2025 | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
| SPAC Private Placement Warrant liability | $ |
|
$ |
|
$ | |||||||||||
| 2025 Investor Warrant liability |
|
|
||||||||||||||
| Convertible note option liability | ||||||||||||||||
| Earn-out share liability |
|
|
||||||||||||||
| Total | $ |
|
$ |
|
$ |
|
||||||||||
| December 31, 2024 | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
| SPAC Private Placement Warrant liability | $ |
|
$ |
|
$ | |||||||||||
| Convertible note option liability |
|
|
||||||||||||||
| Earn-out Share Liability |
|
|
||||||||||||||
| Total | $ |
|
$ |
|
$ |
|
||||||||||
Warrant Liabilities
The Company’s initial value of the SPAC Private Placement Warrant liability as of September 13, 2024, was based on a valuation model utilizing management judgment and pricing inputs from observable and unobservable markets with less volume and transaction frequency than active markets and was classified as level 3. The subsequent measurement of the SPAC Private Placement Warrants is classified as Level 2 because these warrants are economically equivalent to the Public Warrants, based on the terms of the SPAC Private Placement Warrant agreement, and as such their value is principally derived by the value of the Public Warrants. Significant deviations from these estimates and inputs could result in a material change in fair value.
2025 Investor Warrants
The Company established the initial fair value of the 2025 Investor Warrants liability as of August 14, 2025, the date of the August 2025 Public Offering. As of September 30, 2025, the fair value was remeasured using an option pricing model. The option pricing model was used to value the liability for the initial period and subsequent measurement periods.
The 2025 Investor Warrant liability
was classified within Level 3 of the fair value hierarchy due to the use of unobservable inputs.
|
September 30,
2025 |
August 14, 2025 | |||||||
| Stock Price | $ |
|
$ |
|
||||
| Expected term (years) |
|
|
||||||
| Volatility |
|
% |
|
% | ||||
| Risk-Free Rate |
|
% |
|
% | ||||
|
Nine Months
Ended September 30, 2025 |
||||
| Balance, beginning of period | $ | |||
| Initial value, August 14, 2025 |
|
|||
| Change in fair value |
(
|
) | ||
| Balance, end of period | $ |
|
||
24
Convertible Note Option Liability
The Company established the initial fair value for the convertible note option liability as of September 13, 2024, which was the date the Convertible Note was executed. As of September 30, 2025, the fair value was remeasured using an option pricing model. The option pricing model was used to value the convertible note option liability for the initial periods and subsequent measurement periods.
The conversion feature of the Convertible Promissory Notes is measured at fair value using a Monte Carlo model that fair values the conversion option.
The convertible note option liability
was classified within Level 3 of the fair value hierarchy due to the use of unobservable inputs.
|
September 30,
2025 |
December 31,
2024 |
|||||||
| Stock Price | $ |
|
$ |
|
||||
| Expected term (years) |
|
|
||||||
| Volatility |
|
% |
|
% | ||||
| Risk-Free Rate |
|
% |
|
% | ||||
| Interest rate |
|
% |
|
% | ||||
|
Nine Months
Ended September 30, 2025 |
||||
| Balance, beginning of period, December 31, 2024 | $ |
|
||
| Change in fair value |
(
|
) | ||
| Balance, end of period | $ | |||
Earn-out Share Liability
Following the closing of the Business
Combination, holders of certain capital stock of Private Veea immediately prior to the closing have the contingent right to receive up
to
The following table presents the changes in fair value of the Earn-Out Share Liability:
|
Nine Months
Ended September 30, 2025 |
||||
| Balance, beginning of period, December 31, 2024 | $ |
|
||
| Change in fair value |
|
|||
| Balance, end of period | $ |
|
||
The key inputs for the Earn-out Share Liability were as follows:
|
September 30,
2025 |
December 31,
2024 |
|||||||
| Stock Price | $ |
|
$ |
|
||||
| Expected term (years) |
|
|
||||||
| Volatility |
|
% |
|
% | ||||
| Risk-Free Rate |
|
% |
|
% | ||||
25
16 - EARNINGS PER SHARE
The computation of basic and dilutive net loss per share attributable to common stockholders for the nine months ended September 30, 2025 and 2024, are as follows:
|
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Basic: | ||||||||||||||||
| Numerator: | ||||||||||||||||
| Net income (loss) attributable to common shareholders | $ |
|
$ |
(
|
) | $ |
(
|
) | $ |
(
|
) | |||||
| Denominator: | ||||||||||||||||
| Weighted-average common shares outstanding |
|
|
|
|
||||||||||||
| Net income (loss) per share – basic: | $ |
|
$ |
(
|
) | $ |
(
|
) | $ |
(
|
) | |||||
| Diluted: | ||||||||||||||||
| Numerator: | ||||||||||||||||
| Net income (loss) attributable to common and common equivalent shareholders |
|
(
|
) |
(
|
) |
(
|
) | |||||||||
| Denominator: | ||||||||||||||||
| Weighted-average common stock outstanding |
|
|
||||||||||||||
| Stock options, RSUs, warrants, Earn-Out Liability, and convertible notes outstanding to purchase shares of common stock |
|
|||||||||||||||
| Total common and common equivalent shares outstanding |
|
|
|
|||||||||||||
| Net income (loss) per share – diluted: | $ |
|
$ |
(
|
) | $ |
(
|
) | $ |
(
|
) | |||||
The weighted average potential shares of common stock that were excluded from the calculation of net income (loss) per share-diluted for the periods presented because including them would have been anti-dilutive consisted of the following:
|
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Stock options outstanding to purchase shares of common stock and RSUs |
|
|
||||||||||||||
| Public Warrants |
|
|
|
|
||||||||||||
| SPAC Private Placement Warrants |
|
|
|
|
||||||||||||
| Private Veea Warrants |
|
|
|
|
||||||||||||
| 2025 Investor Warrants |
|
|
||||||||||||||
| Convertible Notes |
|
|
|
|
||||||||||||
The weighted average potential shares of common stock that were excluded from the calculation of net income (loss) per share-diluted because the performance or market conditions associated with these awards were not met are as follows for the periods presented:
|
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Earn-Out Liability |
|
|
||||||||||||||
17 - EMPLOYEE 401(k) PLAN
The Company sponsors a 401(k) plan (the “Plan”) to provide retirement benefits for its employees.
As allowed under Section 401(k) of
the Internal Revenue Code, the Plan provides for tax-deferred salary contributions and after-tax contributions for eligible employees.
The Plan provides for tax-deferred salary contributions and after-tax contributions for eligible employees. Employee contributions are
limited to a maximum annual amount as set periodically by the Internal Revenue Code. The Company matches pretax and Roth employee contributions
up to
18 - SUBSEQUENT EVENTS
The Company evaluated subsequent events from September 30, 2025, the date of these financial statements, through the date on which the financial statements were issued (the “Issuance Date”), for events requiring recording or disclosure in the financial statements as of and for the nine months ended September 30, 2025. The Company concluded that no events have occurred that would require recognition or disclosure in the financial statements.
26
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of the financial condition and results of operations of Veea should be read together with our audited consolidated financial statements and unaudited consolidated condensed financial statements. In addition to our historical consolidated financial information, this discussion includes forward-looking information regarding our business, results of operations and cash flows, and contractual obligations and arrangements that involve risks, uncertainties, and assumptions. Our actual results may differ materially from any future results expressed or implied by such forward-looking statements as a result of various factors, including, but not limited to, those discussed in the Company’s most recent Annual Report on Form 10-K filed with the SEC on April 15, 2025 (the “2024 10-K”).
Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “Veea,” “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Business Combination, the business and operations of Veea Inc. and its consolidated subsidiaries, and (ii) prior to the Business Combination, Private Veea (the predecessor entity in existence prior to the consummation of the Business Combination) and its consolidated subsidiaries.
Throughout this report, the terms “our,” “we,” “us,” “Veea” and the “Company” refer to Veea Inc.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995, including statements regarding, among other things, the plans, strategies and prospects, both business and financial, of the Company. These statements are based on the beliefs and assumptions, whether or not identified in this Quarterly Report, of the management of the Company. Although the Company believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, the Company cannot assure you that it will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, and any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. These statements may be preceded by, followed by or include the words “anticipate,” “believe,” “could,” “continue,” “estimate,” “expect,” “forecast,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “project,” “scheduled,” “seek,” “should,” “will” or similar expressions, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements contained in this Quarterly Report include, but are not limited to, statements about the ability of the Company to:
| ● | failure to maintain adequate operational and financial resources or raise additional capital or generate sufficient cash flows; |
| ● | risks related to its current growth strategy and the Company’s ability to generate revenue and become profitable; |
| ● | market acceptance of its platform and products; |
| ● | the length and unpredictable nature of its sales cycles; |
27
| ● | Veea’s reliance on distribution and partnering arrangements and third-party manufacturers; |
| ● | cybersecurity incidents, security vulnerabilities, and real or perceived errors, failures, defects, or bugs in its platforms or products; |
| ● | the ability to maintain the listing of our common stock and public warrants on Nasdaq, and the potential liquidity and trading of such securities; |
| ● | our public securities’ potential liquidity and trading; |
| ● | our success in retaining or recruiting, or changes required in, our officers, key employees or directors, and our ability to attract and retain key personnel; |
| ● | macroeconomic conditions; and |
| ● | each of the other factors detailed under the section entitled “ Risk Factors .” |
Forward-looking statements are provided for illustrative purposes only and are not guarantees of performance. You should not put undue reliance on these statements which speak only as of the date hereof. You should understand that the factors discussed under the heading “ Risk Factors ” and elsewhere in this Quarterly Report and as disclosed on the 2024 10-K, could affect the future results of the Company, and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements in this Quarterly Report.
In addition, the risks described under the heading “ Risk Factors ” in this Quarterly Report are not exhaustive. Other sections of this Quarterly Report describe additional factors that could adversely affect the businesses, financial conditions, or results of operations of the Company. New risk factors emerge from time to time and it is not possible to predict all such risk factors, nor can the Company assess the impact of all such risk factors on the business of the Company, or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements attributable to the Company or persons acting on their behalf are expressly qualified in their entirety by the foregoing cautionary statements. The Company undertakes no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
In addition, this Quarterly Report contains statements of belief and similar statements that reflect the beliefs and opinions of the Company on the relevant subject. These statements are based upon information available to the Company as of the date of this Quarterly Report, and while the Company believes such information forms a reasonable basis for such statements, such information may be limited or incomplete, and statements should not be read to indicate that the Company has conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and you are cautioned not to unduly rely upon these statements
28
Company Overview
We are dedicated to simplifying the journey towards creating a world in which virtually everyone and everything is intelligently connected, while bringing applications and AI to the edge of the network. Most service providers, equipment suppliers, system integrators and even hyperscalers have adopted or advocated for similar solutions to various degrees either independently or in collaboration with the Company. However, to our knowledge, we are the first to market with patented technologies that a) bring virtualized data center capabilities to the far edge of the network, commonly referred to as the Device Edge, where all wired and wireless devices connect to the network, b) spawns hyperconvergence of computing, multiaccess communications and storage, c) provides for Cloud-managed applications at the Edge, d) enables machine learning with AI training, inferencing, and agentic AI at the Edge including AI-driven cybersecurity for heterogenous networks. Such networks are given rise through any combination of our developed devices and third-party devices, with CPUs, GPUs, TPUs, DPUs and/or NPUs, that run the Veea Edge Platform Ô software stack.
Veea has developed several generations of highly integrated all-in-one devices that incorporate a Linux server, with a virtualized software environment, supporting our patented secured docker containers, together with a Wi-Fi Access Point with a mesh router, a firewall, an IoT gateway, NVMe data storage and 4G/5G modules, referred to as the “VeeaHub” product. With an extensive patent portfolio of approximately 125 granted patents and 25 pending patent applications that cover 26 patent families, our end-to-end Hybrid Edge-Cloud Computing platform represents a new product category that has the potential for wide scale customer adoption in large segments of consumer and enterprise markets.
VeeaONE Platform’s products, applications, and services with a distributed computing architecture, offered as a Platform-as-a-Service capability, empower companies to capitalize on the transformative potential of Edge AI, where most of the data from smartphones, tablets, laptops, cameras, sensors, and other devices is generated, with data privacy and sovereignty, reliability, low latency for real-time decisions, bandwidth efficiency, scalability, and reduced costs compared to alternatives.
VeeaHub products, about the size of a typical Wi-Fi Access Point, are offered in variety of forms with different capabilities for indoor and outdoor coverage and are both locally- and cloud-managed. Veea Edge Platform architecture and business model, VeeaHub Ò and third-party devices on Veea Edge Platform with Hybrid Edge-Cloud Computing and AI-enabled applications and services resemble the Android OS platform architecture and business model for Android devices.
The VeeaONE Platform offers a complement, and in some cases an alternative, to cloud computing by enabling the formation of highly secure, but easily accessible, private clouds and networks across one or multiple user(s) or enterprise location(s) across the globe. Benefits of the Veea Edge Platform include optimal latency, lower data transport costs, data privacy, security and ownership, Edge AI, as well as “always-on” availability for mission critical applications, and contextual awareness for people, devices and things connected to the Internet.
Veea earns revenue primarily from the sale of its VeeaHub® devices, licenses, and subscriptions.
Recent Developments
August 2025 Public Offering
On August 14, 2025, the Company closed a public offering of 9,189,096 shares of common stock and warrants to purchase up to 9,189,096 shares of common stock at a combined offering price of $1.00 per share and accompanying warrant (the “August 2025 Public Offering”). The Company received aggregate cash gross process of approximately $6.0 million, before deducting placement agent fees and other offering expenses. The warrants have an exercise price of $1.10 per share, are exercisable immediately, and will expire five years from the original issuance date. Included in the aggregate securities issued are 3,239,096 shares of common stock and accompanying warrants that were issued to NLabs Inc. in consideration and satisfaction of the NLabs 2025 Notes. The Company is using the net proceeds from the August 2025 Public Offering for investments in inventory and the Company’s customer support infrastructure and for other working capital and general corporate purposes.
29
Supply Agreement
On August 7, 2025, Private Veea entered into a Framework Agreement for the Licenses, Equipment and Services (the “Supply Agreement”) with RadioMovil Dipsa, S.A. De C.V. (“Telcel”), a Mexican wireless telecommunications company owned by América Móvil, effective August 7, 2025. The Supply Agreement was signed by the parties following the completion of an extensive certification and homologation process with Telcel; and the successful completion of trials with certain Telcel enterprise customers of the Company’s VeeaHub STAX Ò -5G product, incorporating Telcel SIM cards.
The Supply Agreement sets forth the general guidelines, terms and conditions that govern the solution implementation and marketing, as well as the provisioning of the services provided by VeeaSystems. Under the agreement, VeeaSystems will supply a comprehensive Platform-as-a-Service solution featuring 5G-based Fixed Wireless Access (FWA) through its VeeaHub STAX Ò -5G device, which incorporates 4G and 5G cellular connectivity, Wi-Fi 6 Access Point, IoT gateway, storage and Linux server capabilities to deliver connectivity with integrated AI-driven cybersecurity services, managed connectivity, and monitoring tools while capable of hosting applications on STAX-5G including third-party application. The parties have agreed to work together in the development of the marketing strategy, branding and promotion of Private Veea’s services to Telcel’s customers in Mexico. The agreement provides for an initial term of three years and automatically renews for successive one-year terms, unless either party elects not to renew upon 90-day prior notice.
Appointment of Acting Chief Financial Officer
On July 15, 2025, Randal V. Stephenson was appointed as the Company’s Acting Chief Financial Officer.
Appointment of Acting Chief Revenue Officer
On July 15, 2025, Mr. Helder Antunes, a current member of the Company’s Board of Directors, was appointed as the acting Chief Revenue Officer.
Acquisition of Assets of Crowdkeep, Inc.
Asset Purchase Agreement
On May 13, 2025, the Company entered into an Asset Purchase Agreement with Crowdkeep, Inc., a Delaware corporation (the “Seller”), pursuant to which, subject to the terms and conditions set forth in the APA, the Company acquired upon the closing certain assets of Seller relating to Seller’s IoT technology platform business, free and clear of any liens other than certain specified liabilities of Seller that are being assumed in consideration for the issuance to the Seller of 4,065,689 shares of common stock.
Note Purchase Agreements and Convertible Promissory Notes
On April 17, 2025, and May 13, 2025, the Company and the majority stockholder of the Seller (“Crowdkeep Investor”), entered into two Note Purchase Agreements (the “Crowdkeep Note Purchase Agreements”). Pursuant to the Crowdkeep Note Purchase Agreements, the Crowdkeep Investor loaned to the Company an aggregate of $1,000,000 in two tranches (the “Crowdkeep Loans”), of which $500,000 was provided on April 17, 2025 and $500,000 was provided on May 13, 2025. In connection with the entry into the Crowdkeep Note Purchase Agreements, the Company issued to the Crowdkeep Investor unsecured convertible promissory notes (the “Crowdkeep Convertible Notes”). The Crowdkeep Convertible Notes have an aggregate principal amount of $1,000,000, and the interest accrues at an annual rate of 8%. The maturity dates of the Crowdkeep Convertible Notes are April 17, 2026, and May 13, 2026, respectively.
30
Pursuant to the terms of the Convertible Notes, upon an event of default, the outstanding principal amount of the applicable Crowdkeep Convertible Note, plus accrued but unpaid interest, will become immediately due and payable in full. Events of default include failure to pay any principal or interest amounts under the Crowdkeep Convertible Notes, failure to perform covenants in the Crowdkeep Convertible Notes and certain bankruptcy and insolvency conditions of the Company. The Company may prepay all or any portion of the Crowdkeep Convertible Notes at any time. The Crowdkeep Convertible Notes are convertible, in whole or in part, into shares of the common stock (the “Crowdkeep Conversion Shares”) at the option of the Crowdkeep Investor, at a price per share of $5.00 subject to certain equitable adjustments. The Crowdkeep Convertible Notes will automatically convert on the date that the closing price of the common stock is at $7.50 or above for ten (10) consecutive trading days within any consecutive thirty (30) trading day period, equal to the lesser of (i) $7.50 per share and (ii) 20% multiplied by the VWAP (calculated as set forth in the Crowdkeep Convertible Notes) for the prior consecutive thirty (30) trading day period, in each case subject to certain equitable adjustments. The Crowdkeep Note Purchase Agreements and Crowdkeep Convertible Notes include other customary terms and conditions.
Lock-Up Agreements
In connection with the Crowdkeep APA and the Crowdkeep Note Purchase Agreements, the Seller and the Crowdkeep Investor entered into lock-up agreements pursuant to which the Seller and the Crowdkeep Investor agreed not to effect any sale, distribution or transfer of any of the shares of Common Stock received in the transaction or any Crowdkeep Conversion Shares will be subject to transfer restrictions and restrictions against selling short or hedging the Company’s securities for a period of six (6) months following the applicable closing of the APA or the Crowdkeep Note Purchase Agreement, respectively, subject to certain limited exceptions.
The form of lock-up agreement signed by the Seller is herein referred to as the “Crowdkeep Lock-Up Agreement” and the form of lock-up agreement signed by the Investor is herein referred to as the “Crowdkeep Noteholder Lock-Up Agreement.” The Crowdkeep Lock-Up Agreement and the Crowdkeep Noteholder Lock-Up Agreement have substantially similar terms, but the Crowdkeep Lock-Up Agreement provides for distributions by the Seller to the Seller’s stockholders, pro rata based on their ownership of Seller, subject to certain conditions.
31
Components of Results of Operations
Sales, net
The Company recognizes revenue based on the satisfaction of distinct obligations to transfer goods and services to customers. The Company generates revenue from hardware sales and the sale of licenses and subscriptions. The Company applies a five-step approach as defined in ASC 606, “ Revenue from Contracts with Customers ”, in determining the amount and timing of revenue to be recognized: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when a corresponding performance obligation is satisfied. Most contracts with customers are to provide distinct products or services within a single contract. However, if a contract is separated into more than one performance obligation, the total transaction price is allocated to each performance obligation in an amount based on the estimated relative standalone selling price.
For licenses of technology, recognition of revenue is dependent upon whether the Company has delivered rights to the technology, and whether there are future performance obligations under the contract. Revenue from non-refundable upfront payments is recognized when the license is transferred to the customer and the Company has no other performance obligations. Revenue for licenses delivered under a subscription model having terms between one and twelve-months are recognized over time. Subscription revenue is generated through sales of monthly subscriptions. Customers pay in advance for the licenses and subscriptions. Revenue is initially deferred and is recognized using the straight-line method over the term of the applicable subscription period.
Cost of Goods Sold
Cost of goods sold consists primarily of the cost of finished goods, components purchased for manufacturing and freight. Cost of goods sold also includes third-party vendor costs related to cloud hosting fees.
Operating Expenses
We classify our operating expenses into the following categories:
| ● | Product development expenses . Product development expenses primarily consist of employee compensation, employee benefits, stock-based compensation related to technology developers and product management employees, as well as fees paid for outside services and materials. |
| ● | Sales and marketing expenses . Sales and marketing expenses consist of compensation and other employee-related costs for personnel engaged in selling, marketing and sales support functions. Selling expenses also include marketing and the costs associated with customer evaluations. The Company does not currently incur advertising costs. |
| ● | General and administrative expenses . General and administrative expenses consist of compensation expense (including stock-based compensation expense) for employees and executive management, and expenses associated with finance, tax, and human resources. General and administrative expenses also includes transaction costs, expenses associated with facilities, information technology, external professional services, legal costs and settlement of legal claims and other administrative expenses. |
| ● | Depreciation and amortization : Depreciation and amortization expense consists of depreciation of Veea’s property and equipment and amortization of Veea’s patents and other intellectual property. |
| ● | Impairment: Impairment consists of impairment charges related to our in-process research and development (“IPR&D”) |
32
Results of Operations
The following tables set forth the results of our operations for the periods presented, as well as the changes between periods. The period-to-period comparison of financial results is not necessarily indicative of future results.
F or the three months ended September 30, 2025 compared to three months ended September 30, 2024 and the nine months ended September 30, 2025 compared to three months ended September 30, 2024
The following table sets forth Veea’s unaudited statements of operations data for the three and nine months ended September 30, 2025 and 2024, respectively. Veea has prepared the data on a consistent basis with the audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023, included in the 2024 10-K. In the opinion of Veea’s management, the unaudited three and nine month financial information reflects all necessary adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of this data.
| For the Three Months Ended | $ | % | ||||||||||||||
|
September 30,
2025 |
September 30,
2024 |
Change | ||||||||||||||
| Revenues, net | $ | 144,926 | $ | 50,683 | $ | 94,243 | 186 | % | ||||||||
| Cost of Goods Sold | 53,006 | 14,997 | 38,009 | 253 | % | |||||||||||
| Gross profit | 91,920 | 35,686 | ||||||||||||||
| Operating Expenses: | ||||||||||||||||
| Product development | - | 356,761 | (356,761 | ) | -100 | % | ||||||||||
| Sales and marketing | 15,555 | 80,937 | (65,382 | ) | (81 | )% | ||||||||||
| General and administrative | 4,522,588 | 1,989,095 | 2,533,495 | 127 | % | |||||||||||
| Transaction costs including those incurred with contingent earn-out share liability | - | 55,038,544 | (55,038,544 | ) | NM | |||||||||||
| Depreciation and amortization | 216,436 | 67,730 | 148,706 | 220 | % | |||||||||||
| Total operating expenses | 4,754,579 | 57,533,067 | ||||||||||||||
| Loss from operations | (4,622,659 | ) | (57,497,381 | ) | ||||||||||||
| Other Income (Expense): | ||||||||||||||||
| Other income | 879 | 8,739 | (7,860 | ) | (90 | )% | ||||||||||
| UK R&D tax credit | 1,223,328 | 1,251,243 | (27,915 | ) | (2 | )% | ||||||||||
| Loss on initial issuance of convertible note | - | (1,770,933 | ) | 1,770,933 | NM | |||||||||||
| Change in fair value of convertible note option liability | 270 | 607,067 | (606,797 | ) | NM | |||||||||||
| Change in fair value of warrant liabilities | 555,498 | (220,373 | ) | 775,871 | NM | |||||||||||
| Change in fair value of Earn-Out Share Liability | 4,720,000 | 24,750,000 | (20,030,000 | ) | (81 | )% | ||||||||||
| Other expense | (19,155 | ) | (36 | ) | (19,120 | ) | NM | |||||||||
| Interest expense | (442,867 | ) | (451,881 | ) | 9,014 | (2 | )% | |||||||||
| Total other income (expense) | 6,037,953 | (24,173,826 | ) | |||||||||||||
| Net income (loss) | $ | 1,375,294 | $ | (33,323,555 | ) | |||||||||||
33
| For the Nine Months Ended | $ | % | ||||||||||||||
|
September 30,
2025 |
September 30,
2024 |
Change | ||||||||||||||
| Revenues, net | $ | 232,094 | $ | 108,264 | $ | 123,830 | 114 | % | ||||||||
| Cost of Goods Sold | 58,156 | 57,687 | 469 | 1 | % | |||||||||||
| Gross profit | 173,938 | 50,577 | ||||||||||||||
| Operating Expenses: | ||||||||||||||||
| Product development | 164,878 | 1,152,930 | (988,052 | ) | -86 | % | ||||||||||
| Sales and marketing | 364,856 | 459,341 | (94,485 | ) | -21 | % | ||||||||||
| General and administrative | 14,531,883 | 13,091,503 | 1,440,380 | 11 | % | |||||||||||
| Transaction costs including those incurred with contingent earn-out share liability | 25,000 | 55,038,544 | (55,013,544 | ) | NM | |||||||||||
| Depreciation and amortization | 421,096 | 205,111 | 215,985 | 105 | % | |||||||||||
| Total operating expenses | 15,507,713 | 69,947,429 | ||||||||||||||
| Loss from operations | (15,333,775 | ) | (69,896,852 | ) | ||||||||||||
| Other Income (Expense): | ||||||||||||||||
| Other income, net | 2,112 | 21,398 | (19,286 | ) | (90 | )% | ||||||||||
| UK R&D tax credit | 1,223,328 | 1,251,243 | (27,915 | ) | (2 | )% | ||||||||||
| Loss on initial issuance of convertible note | - | (1,770,933 | ) | 1,770,933 | NM | |||||||||||
| Change in fair value of convertible note option liability | 60,000 | 607,067 | (547,067 | ) | (90 | )% | ||||||||||
| Change in fair value of warrant liabilities | 660,622 | (220,373 | ) | 880,995 | NM | |||||||||||
| Change in fair value of Earn-Out Share Liability | 13,520,000 | 24,750,000 | (11,230,000 | ) | (45 | )% | ||||||||||
| Other expense | (46,351 | ) | (9,346 | ) | (37,005 | ) | NM | |||||||||
| Interest expense | (1,822,448 | ) | (1,352,823 | ) | (469,625 | ) | 35 | % | ||||||||
| Total other income (expense) | 13,597,263 | 23,276,233 | ||||||||||||||
| Net income (loss) | $ | (1,736,512 | ) | $ | (46,620,619 | ) | ||||||||||
Revenue, net
The Company generated revenue of $144,926 and $50,683 for the three months ended September 30, 2025 and 2024, and revenue of $232,094 and $108,264 for the nine months ended September 30, 2025 and 2024, respectively. Revenue has been principally earned from paid pilots for our VeeaHub ® devices. Our focus over the past several years has been on field testing and refining our product to meet customer needs as well as market developments. As a result of these efforts, we expect revenue to grow over the next several quarters through the sales of our hardware, licenses and subscriptions. We are especially focused in four principal market opportunities: 1) Digital Equity and Inclusion, 2) Energy and Sustainability solutions for Smart Buildings and Climate Smart Agriculture, 3) Convergence of Fixed, Wireless, and 5G Networks, and 4) Smart Retail and Smart Warehouses.
Cost of Goods Sold
Cost of goods sold increased by $38,009, or 253%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024. Cost of goods sold stayed flat for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The disparity is primarily related to an increase in service-based revenue in the quarter.
34
Product Development Expense
Product development expense decreased by $356,761 or 100%, in the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $988,052 or 86%, in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decrease in product development expenses was due to decreased internal development costs during the period.
Sales and Marketing Expense
Sales and marketing expense decreased by $65,382 or 81%, in the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and sales and marketing expense decreased by $94,485, or 21%, in the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The decrease is primarily due to a reduction in unpaid customer pilots.
General and Administrative Expense
General and administrative expense increased by $2,533,495, or 127%, in the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and increased by $1,440,379, or 11%, in the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The increase is primarily related to certain non-capitalized expenses associated with the August 2025 Public Offering, and increased costs of additional personnel, resources, and administrative costs associated with the Company’s sales activities.
Depreciation and Amortization
Depreciation and amortization increased by $148,704 or 220%, in the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and increased by $215,985 or 105%, in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase was due to additional amortization for the technology assets acquired from Crowdkeep, Inc. in May 2025.
Other income, net
Other income, net relates to immaterial non-operating transactions incurred during the period. These amounts were immaterial for the three months ended September 30, 2025 and 2024 and nine months ended September 30, 2025 and 2024.
Change in fair value of derivative liabilities
Change in fair value of derivative liabilities is comprised of the fair value adjustments to the convertible note option liability, SPAC Private Placement Warrants, the Earn-Out Share Liability, and the 2025 Investors Warrants at balance sheet date. The gain on the change in fair value of conversion note option liability of $270 for the nine months ended September 30, 2025, was determined using a Black-Scholes option pricing model. The gain on the change in fair value of the SPAC Private Placement Warrant of $555,498 for the nine months ended September 30, 2025, was determined based on the trading value of the Public Warrants and the Black-Scholes option pricing model. The gain on the change in fair value of the Earn-Out Share Liability of $4,720,000 for the nine months ended September 30, 2025, was determined using a Monte Carlo simulation. A significant driver of the changes in fair value was due to the decline in the Company’s stock price.
Other expense
Other expenses relate to immaterial non-operating expenses incurred during the period. These amounts were immaterial for the three months ended September 30, 2025 and 2024 and nine months ended September 30, 2025 and 2024.
Interest expense
Interest expense decreased by $9,014 or 2%, in the three months ended September 30, 2025 compared to the three months ended September 30, 2024. Interest expense increased by $469,625, or 35%, in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase was due to additional draws on our revolving line of credit and new related party notes entered into during the nine months ended September 30, 2025.
35
Liquidity and Capital Resources
During the three months ended September 30, 2025 and 2024, we incurred operating losses of $4.7 million and $57.5 million, respectively, and during the nine months ended September 30, 2025 and 2024, we incurred operating losses of $15.3 million and $69.9 million, respectively, and had an accumulated deficit of $219.6 million as of September 30, 2025. Since our inception, we have incurred significant operating losses and negative cash flows. The Company expects to continue to incur net losses as it continues to grow and scale its business. As of September 30, 2025, we had cash of $1,071,151 and outstanding debt of $17.5 million, of which $750,000 was outstanding under the September 2024 Notes, $1.0 million was outstanding under the unsecured convertible promissory notes issued by the Company to the majority stockholder of Crowdkeep in May 2025, $14.0 million was outstanding under the working capital facility, and $1.8 million was outstanding under a notes payable with an inventory vendor.
Although the Company has had recurring losses each year since inception, the Company plans to fund its operations and capital funding needs for the next 12 months with revenue generated from operations and through a combination of private and public equity offerings including, without limitation, anticipated revenue generated under the Supply Agreement entered into with Telcel, the proceeds of the August 2025 Public Offering completed on August 14, 2025, receipt of the cash tax refund of approximately $1.2 million in respect of the Company’s UK subsidiary’s 2023 and 2024 research and development activities, and potential additional investments in the form of debt or equity to fund operating deficits from existing and/or new investors, including related parties, which may include the Company’s CEO and his affiliates.
Based in part on the above-referenced opportunities and initiatives, the Company has a reasonable basis to believe it has alleviated substantial doubt regarding its ability to continue as a going concern. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company, if at all.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use Adjusted EBITDA, as described below, to understand and evaluate our core operating performance. These non-GAAP financial measures, which may differ from similarly titled measures used by other companies, is presented to enhance investors’ overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
Adjusted EBITDA
The primary financial measure we use is Adjusted EBITDA. EBITDA is defined as net (loss) income, before interest, taxes, depreciation, and amortization. We define Adjusted EBITDA as net (loss) income excluding income tax provision, interest expense, net of interest income from related party loans, depreciation and amortization, stock-based compensation expense, and non-core expenses/losses (gains), including transaction-related costs, litigation-related costs, management fees, changes in fair value of liabilities, change in fair value of earn-out share liabilities and other expense, which includes asset impairments. Our management uses this measure internally to evaluate the performance of our business and this measure is one of the primary metrics by which our internal budgets are based. We exclude the above items as some are non-cash in nature, and others are non-recurring that they may not be representative of normal operating results. This non-GAAP financial measure adjusts for the impact of items that we do not consider indicative of the operational performance of our business. While we believe that this non-GAAP financial measure is useful in evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for the related financial information prepared and presented in accordance with GAAP.
The following table provides a reconciliation of net loss to adjusted EBITDA to net loss for the periods presented:
| For the three Months Ended | ||||||||
|
September 30,
2025 |
September 30,
2024 |
|||||||
| ADJUSTED EBITDA: | ||||||||
| Net income (loss) | $ | 1,375,294 | $ | (33,323,555 | ) | |||
| Adjustments: | ||||||||
| UK R&D tax credit | (1,223,328 | ) | (1,251,243 | ) | ||||
| Interest expense | 442,867 | 451,881 | ||||||
| Depreciation and amortization | 216,434 | 67,730 | ||||||
| EBITDA | 811,266 | (34,055,187 | ) | |||||
| Other income, net | (879 | ) | (8,739 | ) | ||||
| Other expense | 19,155 | 36 | ||||||
| Loss of initial issuance of convertible note | - | 1,770,933 | ||||||
| Change in fair value of conversion note option liability | (270 | ) | (607,067 | ) | ||||
| Change in fair value of warrant liabilities | (555,498 | ) | 220,373 | |||||
| Change in fair value of Earn Out Shares Liability | (4,720,000 | ) | (24,750,000 | ) | ||||
| Transaction costs | - | 55,038,544 | ||||||
| Share-based compensation | 319,211 | 59,385 | ||||||
| ADJUSTED EBITDA | $ | (4,127,015 | ) | $ | (2,331,722 | ) | ||
36
| For the nine Months Ended | ||||||||
|
September 30,
2025 |
September 30,
2024 |
|||||||
| ADJUSTED EBITDA: | ||||||||
| Net loss | $ | (1,736,512 | ) | $ | (46,620,619 | ) | ||
| Adjustments: | - | |||||||
| UK R&D tax credit | (1,223,328 | ) | (1,251,243 | ) | ||||
| Interest expense | 1,822,448 | 1,352,823 | ||||||
| Depreciation and amortization | 421,096 | 205,111 | ||||||
| EBITDA | (716,296 | ) | (46,313,928 | ) | ||||
| Other income, net | (2,112 | ) | (21,398 | ) | ||||
| Other expense | 46,351 | 9,346 | ||||||
| Loss of initial issuance of convertible note | - | 1,770,933 | ||||||
| Change in fair value of conversion note option liability | (60,000 | ) | (607,067 | ) | ||||
| Change in fair value of warrant liabilities | (660,622 | ) | 220,373 | |||||
| Change in fair value of Earn-Out Share Liability | (13,520,000 | ) | (24,750,000 | ) | ||||
| Transaction costs | 25,000 | 55,038,544 | ||||||
| Share-based compensation | 759,123 | 394,234 | ||||||
| ADJUSTED EBITDA | $ | (14,128,556 | ) | (14,258,963 | ) | |||
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not Applicable. As a smaller reporting company, we are not required to provide the information required by this Item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation and supervision of our Chief Executive Officer and our Acting Chief Financial Officer, have evaluated our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer and our Acting Chief Financial Officer have concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act 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 our management, including our Chief Executive Officer and Acting Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during our fiscal quarter ended September 30, 2025, that 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
From time to time, we may become involved in actions, claims, suits and other legal proceedings arising in the ordinary course of our business. We are not currently a party to any actions, claims, suits or other legal proceedings, the outcome of which, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, financial condition and results of operations.
Item 1A. Risk Factors
We are a smaller reporting company and accordingly we are not required to provide information required by this Item. Risk factors that may affect our business and financial results are discussed within Item 1A “Risk Factors” of our annual report on the 2024 10-K. There have been no material changes to the disclosures relating to this item from those set forth in our 2024 10-K, other than as set forth below.
Our failure to meet the listing standards of the Nasdaq Stock Market LLC ("Nasdaq") could result in the delisting of our common stock and publicly traded warrants (the “Public Warrants”). Delisting could adversely affect the liquidity of our common stock and the market price of our common stock could decrease, and our ability to obtain sufficient additional capital to fund our operations and to continue to operate as a going concern would be substantially impaired.
On September 29, 2025, we received a notice from the Listing Qualifications Department (the “Staff”) of Nasdaq, notifying us that, because the closing bid price for its common stock has fallen below $1.00 per share for 30 consecutive business days, we no longer comply with the minimum bid price requirement for continued listing on the Nasdaq Global Market under Nasdaq Lising Rule 5550(a)(2) (the “Minimum Bid Price Requirement”). The notice has no immediate effect on the listing of our common stock and Public Warrants on the Nasdaq Global Market and the common stock and the Public Warrants will continue to trade on The Nasdaq Global Market under the symbols “VEEA” and “VEEAW,” respectively, at this time. Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), we have been provided an initial compliance period of 180 calendar days, or until March 30, 2026, to regain compliance with the Minimum Bid Price Requirement. To regain compliance, the closing bid price of our common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days prior to March 30, 2026; provided, however, pursuant to Nasdaq Listing Rule 5810 (c)(3)(H), Nasdaq may, in its discretion, require us to satisfy the Minimum Bid Price Requirement for a period in excess of ten consecutive business days, but generally not more than 20 consecutive business days, before determining that we have demonstrated an ability to maintain long-term compliance with the Minimum Bid Price Requirement.
On September 29, 2025, we received a notice from the Staff notifying us that, based on the market value of publicly held shares for the previous 30 consecutive business days, the listing of our listed securities was not in compliance with Nasdaq Listing Rule 5450(b)(2)(C) to maintain a minimum market value of publicly held shares of $15,000,000 (the “MVPHS Rule”). The notice has no immediate effect on the listing of our securities on The Nasdaq Global Market and the securities will continue to trade on The Nasdaq Global Market at this time. Pursuant to Nasdaq Listing Rule 5810(c)(3)(D), we have been provided a period of 180 calendar days, or until March 30, 2026, to regain compliance with the MVPHS Rule. To regain compliance during this 180-day compliance period, the minimum market value of publicly held shares must close at $15,000,000 or more for a minimum of 10 consecutive business days.
On September 29, 2025, we received a deficiency letter from the Staff notifying the Company that, for at least 30 consecutive business days, our Market Value of Listed Securities (“MVLS”) was below the $50 million minimum requirement for continued inclusion on The Nasdaq Global Market pursuant to Nasdaq Listing Rule 5450(b)(2)(A) (the “MVLS Requirement”). The notice has no immediate effect on the listing of our securities on The Nasdaq Global Market and the securities will continue to trade on The Nasdaq Global Market at this time. Pursuant to Nasdaq Listing Rule 5810(c)(3)(C), we have been provided a period of 180 calendar days, or until March 30, 2026, to regain compliance with the MVLS Requirement. If at anytime during this compliance period our MVLS closes at $50 million or more for a minimum of ten consecutive business days, Nasdaq will provide us written confirmation of compliance. If we do not regain compliance with the MVLS Requirement, its securities will be subject to delisting.
There can be no assurance that we will continue to meet the Bid Price Requirement, the MVPHS Rule, the MVLS Requirement or any other Nasdaq continued listing requirements, in the future. If we fail to meet any of these requirements, including the Bid Price Requirement, the MVPHS Rule or the MVLS Requirement, Nasdaq may again notify us that we have failed to meet the minimum listing requirements and initiate the delisting process. If our common stock were delisted from Nasdaq, trading of our common stock and Public Warrants could be conducted in the over-the-counter market or on an electronic bulletin board established for unlisted securities such as the Pink Sheets or the OTC Bulletin Board, but there can be no assurance that our common stock and Public Warrants will be eligible for trading on such alternative exchange or market. Additionally, if our common stock were delisted from Nasdaq, the liquidity of our common stock would be adversely affected, the market price of our common stock could decrease, our ability to obtain sufficient additional capital to fund our operations and to continue to operate as a going concern would be substantially impaired and transactions in our common stock could lose federal preemption of state securities laws. Furthermore, there could also be a further reduction in our coverage by securities analysts and the news media and broker-dealers may be deterred from making a market in or otherwise seeking or generating interest in our common stock, which could cause the price of our common stock to decline further. Moreover, delisting may also negatively affect our collaborators’, vendors’, suppliers’ and employees’ confidence in us and employee morale.
38
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
(c) Insider Trading Arrangements
Trading Plans
39
Item 6. Exhibits
| Exhibit No . | Description | |
| 31.1* | Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2* | Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1** | Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 32.2** | Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS* | Inline XBRL Instance Document. | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
| * | Filed herewith. |
| ** | Furnished, not filed |
40
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.
VEEA INC.
| By: | /s/ Allen Salmasi | |
| Allen Salmasi | ||
| Chief Executive Officer and Chairman | ||
| (Principal Executive Officer) | ||
| Date: | ||
| By: | /s/ Randal V. Stephenson | |
| Randal V. Stephenson | ||
| Acting Chief Financial Officer | ||
| (Principal Financial Officer and | ||
| Principal Accounting Officer) | ||
| November 14, 2025 | ||
41