achr-20220630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-39668

Archer Aviation Inc.

(Exact name of registrant as specified in its charter)


Delaware									85-2730902
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

190 West Tasman Drive, San Jose, CA 95134

(Address of principal executive offices, including zip code)

(650) 272-3233

Registrant's telephone number, including area code

N/A

(Former name, former address, and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	ACHR	New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share	ACHR WS	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of August 5, 2022, the number of shares of the registrant’s Class A common stock outstanding was 174,387,280, and the number of shares of the registrant’s Class B common stock outstanding was 67,154,783.

Table of Contents

Archer Aviation Inc.

For 10-Q

For the Quarterly Period Ended June 30, 2022

Table of Contents


		Page
Special Note Regarding Forward-Looking Statements		ii
Part I—Financial Information
Item 1.	Financial Statements	1
	Consolidated Condensed Balance Sheets	1
	Consolidated Condensed Statements of Operations and Comprehensive Loss	2
	Consolidated Condensed Statements of Stockholders’ Equity	3
	Consolidated Condensed Statements of Cash Flows	4
	Notes to Consolidated Condensed Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29

Part II—Other Information
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34
Signatures		35

Table of Contents

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements. All statements, other than statements of present or historical fact included or incorporated by reference, in this Quarterly Report regarding our future financial performance, as well as our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this Quarterly Report, the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “future,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “seek,” “should,” “will,” “would,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.

These forward-looking statements are based on information available as of the date of this Quarterly Report, and current expectations, assumptions, hopes, beliefs, intentions and strategies regarding future events. Accordingly, forward-looking statements in this Quarterly Report and in any document incorporated herein by reference should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include those described in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) on March 14, 2022 (the “Annual Report”) and in Part II, Item 1A, “Risk Factors” in our Quarterly Report on Form 10-Q filed with the SEC on May 12, 2022 (the “Q1 2022 10-Q”), which are restated under “Risk Factors” in our Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on July 1, 2022. Readers are urged to carefully review and consider the various disclosures made in the Annual Report, the Q1 2022 10-Q, and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business. Moreover, new risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business 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 we may make. In light of these risks and uncertainties, the future events and circumstances discussed in this Quarterly Report and the Annual Report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.

As used herein, “Archer,” “the Company,” “Registrant,” “we,” “us,” “our,” and similar terms include Archer Aviation Inc. and its subsidiaries, unless the context indicates otherwise.

“Archer” and our other registered and common law trade names and trademarks of ours appearing in this Quarterly Report are our property. This Quarterly Report contains additional trade names and trademarks of other companies. We do not intend our use or display of other companies’ trade names or trademarks to imply an endorsement or sponsorship of us by such companies, or any relationship with any of these companies.

Table of Contents

Part I - Financial Information

Item 1. Financial Statements

Archer Aviation Inc.

Consolidated Condensed Balance Sheets

(In millions, except share and per share data; unaudited)


	June 30, 2022		December 31, 2021
Assets
Current assets
Cash and cash equivalents	$	654.8	$	746.6
Restricted cash	2.9		0.3
Prepaid expenses	10.1		7.6
Other current assets	1.4		0.3
Total current assets	669.2		754.8
Property and equipment, net	8.3		5.9
Intangible assets, net	0.4		0.5
Right-of-use assets	12.1		4.5
Other long-term assets	1.2		2.7
Total assets	$	691.2	$	768.4
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	2.0	$	3.4
Current portion of lease liabilities	4.3		3.1
Current portion of notes payable	9.4		9.5
Accrued expenses and other current liabilities	28.0		12.3
Total current liabilities	43.7		28.3
Notes payable, net of current portion	4.7		9.3
Lease liabilities, net of current portion	8.2		1.2
Warrant liabilities	15.4		30.3
Other long-term liabilities	1.0		0.4
Total liabilities	73.0		69.5
Commitments and contingencies (Note 7)
Stockholders’ equity
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; no shares issued and outstanding as of June 30, 2022 and December 31, 2021	—		—
Class A common stock, $0.0001 par value; 700,000,000 shares authorized; 170,725,779 and 162,789,591 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively	—		—
Class B common stock, $0.0001 par value; 300,000,000 shares authorized; 65,729,445 and 74,937,945 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively	—		—
Additional paid-in capital	1,122.7		1,072.5
Accumulated deficit	(504.5)		(373.6)
Total stockholders’ equity	618.2		698.9
Total liabilities and stockholders’ equity	$	691.2	$	768.4

See accompanying notes to consolidated condensed financial statements.

Table of Contents

Archer Aviation Inc.

Consolidated Condensed Statements of Operations and Comprehensive Loss

(In millions, except share and per share data; unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Operating expenses
Research and development	$	37.8	$	11.4	$	65.3	$	21.5
General and administrative	42.4		22.4		80.2		29.0
Other warrant expense	—		—		—		78.2
Total operating expenses	80.2		33.8		145.5		128.7
Loss from operations	(80.2)		(33.8)		(145.5)		(128.7)
Gain on forgiveness of PPP loan	—		0.9		—		0.9
Other income, net	8.0		—		14.5		—
Interest income, net	0.5		—		0.1		—
Loss before income taxes	(71.7)		(32.9)		(130.9)		(127.8)

Net loss and comprehensive loss	$	(71.7)	$	(32.9)	$	(130.9)	$	(127.8)

Net loss per share, basic and diluted	$	(0.30)	$	(0.56)	$	(0.55)	$	(2.24)
Weighted-average shares outstanding, basic and diluted	238,062,232		58,482,421		238,927,711		57,147,078

See accompanying notes to consolidated condensed financial statements.

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Archer Aviation Inc.

Consolidated Condensed Statements of Stockholders’ Equity

(In millions, except share data; unaudited)


	Common Stock						Additional Paid-in Capital
	Class A			Class B					Accumulated Deficit		Total
	Shares	Amount		Shares	Amount
Balance as of December 31, 2021	162,789,591	$	—	74,937,945	$	—	$	1,072.5	$	(373.6)	$	698.9
Conversion of Class B common stock to Class A common stock	1,757,980	—		(1,757,980)	—		—		—		—
Issuance of restricted stock and restricted stock expense	300,014	—		—	—		16.0		—		16.0
Exercise of stock options	353,640	—		399,621	—		0.1		—		0.1
Issuance of warrants and warrant expense	—	—		—	—		1.2		—		1.2
Stock-based compensation	—	—		—	—		6.7		—		6.7
Net loss	—	—		—	—		—		(59.2)		(59.2)
Balance as of March 31, 2022	165,201,225	—		73,579,586	—		1,096.5		(432.8)		663.7
Conversion of Class B common stock to Class A common stock	4,190,561	—		(4,190,561)	—		—		—
Issuance of restricted stock and restricted stock expense	992,006	—		—	—		17.9		—		17.9
Exercise of stock options	341,987	—		1,342,726	—		0.2		—		0.2
Issuance of warrants and warrant expense	—	—		—	—		1.6		—		1.6
Cancellation of Class B common stock (Note 9)	—	—		(5,002,306)	—		—		—		—
Stock-based compensation	—	—		—	—		6.5		—		6.5
Net loss	—	—		—	—		—		(71.7)		(71.7)

SEC Form 10-Q filed by Archer Aviation Inc.