Drone manufacturer DJI filed a criticism lawsuit Friday against the US Department of Defense over its inclusion DoD list “Chinese military companies”.

A DJI spokesman said the company filed the lawsuit after “attempting to contact the Department of Defense for over sixteen months” and decided it had “no alternative but to seek relief from federal court.”

“DJI is not owned or controlled by the Chinese military, and the Department of Defense itself acknowledges that DJI produces consumer and commercial drones, not military drones,” the spokesman said.

The Chinese company was included on the Department of Defense’s 2022 list, following similar actions by other government agencies – in 2020 DJI was included on the list Department of Commerce Entity List this essentially prevented American corporations from selling it, and the following yr it was placed on the Treasury Department’s investment block list because of DJI’s alleged involvement in surveillance of Uyghur Muslims. (The company said it had “nothing to do with the treatment of Uyghurs in Xinjiang”).

In its lawsuit, DJI claims that as a result of the listing, it “suffered ongoing financial and reputational harm, including loss of business, and employees were stigmatized and harassed.”

The company says the Department of Defense report justifying the listing “contains a scattered set of claims that are completely inadequate to justify the designation of DJI.”

The lawsuit argues: “Among numerous deficiencies, the report applies improper legal standards, confuses individuals with common Chinese surnames, and relies on outdated facts and weakened ties that fail to establish that DJI is a (Chinese military company).” It also says that founder and CEO Frank Wang and three early-stage investors “collectively own 99% of the company’s voting rights and approximately 87.4% of its stock.”

The Department of Defense didn’t immediately reply to TechCrunch’s request for comment.

Mira Murati, CTO of OpenAI, who announced her departure last month, is raising VC funds for a new AI startup, in accordance with Reuters.

According to reports, this startup will deal with constructing AI products based by itself models and will raise over $100 million on this round.

After her departure, Murati wrote in X that in its recent releases, OpenAI “has fundamentally changed the way AI systems learn and reason through complex problems.” She said: “I’m leaving because I want to create time and space for my own exploration,” but didn’t provide details of her plans.

Before joining OpenAI as vice chairman of applied artificial intelligence and partnerships in 2018, Murati worked at Tesla and Leap Motion. She was promoted to CTO in 2022, and was even named interim CEO through the transient ouster of co-founder and CEO Sam Altman.

Murati is considered one of several OpenAI executives who’ve recently left; OpenAI’s director of research and vice chairman of research announced their departures a few hours afterward. Per week later, OpenAI announced that it had raised $6.6 billion in the most important VC round of all time.

Toyota-backed autonomous vehicle company Pony AI has joined the list of Chinese corporations going public within the US after a years-long ban imposed by Beijing on raising capital abroad.

Zeekr, a Chinese luxury electric vehicle startup, debuted on the New York Stock Exchange in May, and WeRide, one other AV startup, also hopes to launch a U.S. IPO this 12 months at a $5 billion valuation, but its plans have been delayed on account of August.

Pony was valued at $8.5 billion on the time of its 2022 capital raise. Toyota participated on this round as the newest investor after injecting $400 million into the startup in 2020, in line with PitchBook data. The Japanese carmaker’s stake in Pony is 13.4%. The Chinese AV startup has since raised $100 million from Saudi Arabia’s NEOM in 2023 and $27 million from Chinese VC GAC Capital in October.

However, a public filing reveals that Pony’s board recently lowered the minimum IPO valuation to $4 billion. Pony also lowered the minimum goal amount it wants to lift within the deal from $425 million to only $200 million.

That’s not all he stood out for Submission of the Pony public offeringnevertheless, listed below are our top 4 takeaways.

Modest fleet and operations

IPO filings are stuffed with numbers that were previously either unclear or lacking context, and Pony’s is not any exception.

The company says it operates a fleet of 190 “robot trucks” in Beijing and Guangzhou, and greater than 250 robotaxes in Beijing, Guangzhou, Shenzhen and Shanghai. It can charge robot rides in the primary three cities, and is totally autonomous in Guangzhou and Shenzhen.

As for robotaxi, Pony says it receives a median of 15 orders per day for every robotaxi from the 220,000 users registered on the PonyPilot app. Overall, it claims to have collected greater than 20 million miles of “autonomous driving,” though only 2.4 million of them did not have a human behind the wheel.

Pony complements its robotxi service with a growing robotic vehicle business. It says it has already acquired 57 corporate clients, accounting for 73% of total revenues in the primary half of this 12 months. However, most of this money comes from Pony’s three largest customers, who generated 62.8% of total revenue over the identical period.

Revenues up and to the suitable?

It’s no secret that autonomous vehicles are an expensive business. And while Pony says it generated gross profits of $32 million and $17 million in 2022 and 2023, respectively, the corporate lost greater than $270 million in those years.

An enormous reason for these losses was Pony’s research and development expenses. Understandable, considering Pony is an organization developing pioneering technology that features an autonomous stack that is incredibly sensor-intensive. However, we wonder when Pony will actually prioritize operations over R&D. As of June 30, the startup employing roughly 1,300 employees is 44% research and development, 16% technology implementation and production, and only 28.5% operational. In 2023, it spent $73 million on research and development worker salaries alone, and ended the primary half of this 12 months with $335 million in money.

Pony Projects will usher in quite a bit extra money in the approaching years, especially as robotics ticket prices increase. He sounds less optimistic about reducing costs, nevertheless, since the proposal doesn’t indicate that the price of those revenues is anticipated to say no over time – only that these costs “will continue to evolve in the near future.”

Now, Pony’s revenue in the primary half of 2024 has almost doubled to $24.7 million in comparison with the identical period last 12 months. It also made up for year-on-year losses in the primary half of the 12 months. While it looks like Pony’s revenues are growing and moving to the suitable, if we just have a look at the primary half of the 12 months, the corporate still has an extended technique to go if it hopes to exceed its 2023 total revenues of $71.9 million.

SIXTY. PAGES. Z. RISK.

Each company must present the risks related to its business when it goes public. But rattling if Pony wasn’t incredibly thorough and provided 60 pages of disclaimers.

One of the essential threats? This is on account of a shortage of suitably qualified personnel with knowledge of US GAAP (Generally Accepted Accounting Principles) to make sure appropriate compliance with SEC requirements.

While Pony claims to have fixed this weakness by the top of 2023, there’s recent evidence showing how real a risk it could pose to the young company at Fisker. The EV startup’s plunge was largely on account of missing the deadline to report third-quarter financial results last 12 months.

There’s also the mystery of the old People’s Republic of China – something Zeekr is conversant in. Let’s let Pony say it: “The PRC regulatory authorities exercise significant oversight of our business and may influence our business in ways they deem appropriate to pursue their economic, regulatory, political and social objectives.”

Going forward, Pony has factored in the chance of not with the ability to proceed extremely limited robotaxi testing within the U.S. on account of looming regulations on Chinese connected vehicles. The startup has permission to check AVs with a driver behind the wheel in California, but said its U.S. operations generated “less than 1% of our total revenues in 2023 and the six months ended June 30, 2024.”

Pony paints a pleasant picture

We are actually several years removed from the special purpose vehicle merger frenzy that allowed start-ups to make outrageous predictions about their businesses. Remember when Faraday Future predicted would sell over 100,000 electric vehicles in 2024? About 13 units have been sold thus far.

This is a conventional IPO, so Pony doesn’t have that much license to be that concerned about its forecasts. Still, Pony allows himself some flattering ideas about what his technology is able to, which it could be a sin to not share with you.

“On the public roads of China’s metropolises, Pony has achieved what was once only imagined in science fiction – building a car that drives itself,” the corporate writes. “Passengers, wide-eyed in surprise, open the doors using the app and climb into the back seats.”

“As passengers step out of their automobile, they pay their fare via the app and complete this awe-inspiring journey. Meanwhile, the robotaxi departs to choose up its next passenger, leaving him to take into consideration other wonders that the long run will bring.

Wide-eyed indeed.