AUR

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How AUR rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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Unless the context otherwise requires, all references in this section to the “Company,” “Aurora,” “we,” “us,” or “our” refer to the business of Aurora Innovation, Inc. and its subsidiaries.
For more information, see below for more detailed descriptions of each risk factor. • Self-driving technology is an emerging technology, and we face significant technical challenges to commercialize our technology. • We have incurred net losses since our inception, and we expect to incur significant expenses and may not be able to achieve, or maintain profitability. • Our limited operating history makes it difficult to evaluate our future prospects and the risks and challenges we may encounter. • It is possible that our technology will have more limited performance or technology development, and as a result commercial scalability and profitability may take us longer to complete than is currently projected. • We operate in a highly competitive market and some market participants have substantially greater resources.
If one or more of our competitors broadly commercialize their self-driving technology before we do, develop superior technology, or are perceived to have better technology, our business prospects and financial performance would be adversely affected. • Our services and technology may not be accepted and adopted by the market at the pace we expect or at all. • We may require significantly more capital investment to run our business than currently expected. • It is possible that Aurora’s self-driving unit economics do not materialize as expected. • We are highly dependent on the services of our senior management team, without which we may not be able to successfully implement our business strategy. • Our future capital needs may require us to sell additional equity or debt securities that may dilute or subordinate our stockholders. • We may experience difficulties in managing our growth and expanding our operations. • Our operating and financial projections rely in large part upon assumptions and analyses developed by us.
If these assumptions or analyses prove to be incorrect, our actual results of operations may be materially different from our projections and our estimates of certain financial metrics may prove inaccurate. • We could fail to successfully select, execute or integrate past and future acquisitions. • Interruption or failure of Amazon Web Services or other information technology and communications systems that we rely upon could materially and adversely affect our business, financial condition and results of operations. • We are subject to cybersecurity risks to operational systems, security systems, infrastructure, integrated software and partners’ and end-customers’ data processed by us or third-party vendors or suppliers. • Unauthorized control or manipulation of systems in autonomous vehicles may cause them to operate improperly or not at all, or compromise their safety and data security. • Failures, or perceived failures, to comply with privacy, data protection, and cybersecurity requirements in the variety of jurisdictions in which we operate, or may operate, may adversely impact our business. • Issues relating to our use of artificial intelligence and machine learning technologies, combined with an uncertain legal and regulatory environment, could materially and adversely affect our business, financial condition and results of operations. • Our insurance coverage may not be adequate to protect us from all business risks or may be prohibitively expensive. • Our financial instruments, including warrants, are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results. • If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results. • Unanticipated changes in effective tax rates, adverse outcomes resulting from examination of our income, changes in tax laws or regulations, changes in our ability to utilize our net operating loss, or other tax-related changes could materially and adversely affect our business, prospects, financial condition and results of operations. • Our success is contingent on our ability to successfully maintain, manage, execute and expand on our existing partnerships and obtain new partnerships. • We are dependent on others for the supply of vehicles, and are also dependent on our suppliers, some of which are single or limited source suppliers, for the production, provision, and/or full lifecycle support of our current and future generations of the Aurora Driver systems. • In certain cases, we plan to upfit, including by retaining third parties on our behalf, vehicles with the Aurora Driver and the necessary redundancies for driverless operations, and failures or delays in these activities could materially and adversely affect our business, financial condition, and results of operations. • Burdensome regulations, inconsistent regulations, or a failure to receive regulatory approvals or exemptions for our technology could have a material adverse effect on our business, financial condition and results of operation. • We may become involved in legal and regulatory proceedings and commercial or contractual disputes. • We may be subject to product liability that could result in significant direct or indirect costs. • We may not be able to adequately protect or enforce our intellectual property rights, in which case our business and competitive position could be harmed. • We may need to defend ourselves against intellectual property rights infringement claims, which may be time-consuming and could cause us to incur substantial costs. • We could lose the ability to use certain intellectual property rights and technology or materials that we rely upon if the underlying license agreements are terminated or not renewed. • Our software contains third-party open-source software components, and failure to comply with the terms of the underlying open-source software licenses could restrict our ability to sell our products or give rise to disclosure obligations of proprietary software. • The market price of our common stock may be volatile and could decline significantly. • Our dual class structure has the effect of concentrating voting power with our founders, which limits an investor’s ability to influence the outcome of important transactions, including a change in control.
We have incurred net losses since our inception, and we expect to incur significant expenses and may not be able to achieve, or maintain, profitability.
During the twelve months ended December 31, 2025 and 2024, w e incurred net losses of $816 million and $748 million, respectively.
Furthermore, our operations have focused exclusively on research and development of our products and self-driving system through the fiscal quarter ended March 31, 2025.
Although we first recognized revenue in the fiscal quarter ended June 30, 2025, we do not expect to generate significant revenue until after we achieve commercial scale.
As such, our relatively limited operating history, combined with the need to transition from a company with a research and development focus to a company capable of supporting commercial activities, has the potential to intensify the risks and difficulties that we face.
Several companies, including, but not limited to, Waymo, Tesla, Zoox/Amazon, Motional, Torc Robotics, Kodiak Robotics, PlusAI, Waabi, Stack AV and Mobileye are investing heavily in building this technology.
In addition, several of these competitors have substantially greater financial, marketing, R&D, and other resources.
Early in our commercialization, we intend to own or lease and operate an initial fleet and will invest in self-driving system hardware, base vehicles, and commercial facilities (such as freight terminals).
We believe this firsthand experience will help us to harden our operational processes, improve service levels, and enable a more effective transition to working with external partners on operational activities.
Risks Related to Our Business Operations Our business plans require a significant amount of capital, and if we cannot obtain additional financing when needed on acceptable terms, or at all, our business, financial condition and results of operations could be adversely affected.
Beyond the net proceeds raised in the ATM Program (as defined below), we expect we will need to seek equity or debt financing to fund a portion of our future expenditures.
We are spending significant amounts to develop our business and have estimated how much cash we will need on a quarterly basis until we raise additional funds or achieve positive cash flow.
In particular, achieving profitability may take longer than we currently expect or may never occur.
A significant natural disaster, such as an earthquake, fire, flood, hurricane or significant power outage or other similar events, such as infectious disease outbreaks or pandemic events, could materially and adversely affect our business, financial condition and results of operations.
In addition, natural disasters, acts of terrorism or war, could cause disruptions in our remaining operations, our or our partners’ businesses, our suppliers’ or the economy as a whole.
The techniques used by cyber attackers change frequently and may be difficult to detect for long periods of time, and we have faced, and may in the future face difficulties and delays in identifying, responding to, and otherwise addressing security breaches and incidents.
Geopolitical events have increased and may in the future increase our and our service providers’ risks of cyber-attacks.
We cannot be sure that the systems upon which we rely, including those of our third-party vendors or suppliers, are or will be effectively implemented, maintained or expanded as planned, and our third-party vendors or suppliers also have experienced, and may in the future experience cyber incidents caused by software bugs and other technical errors, disasters, insiders, or malicious third parties.
We are at risk of cyber-attacks and other security breaches or incidents, including other means of gaining unauthorized access to our technology, systems, and data.
Geopolitical conflicts and tensions have increased and may in the future increase our risks from cyber-attacks, security breaches or incidents.
Our insurance coverage may not be adequate to protect us from all business risks or may be prohibitively expensive.
In addition, as a general matter, the policies that we do have may include significant deductibles or self-insured retentions, and we cannot be certain that our insurance coverage will be sufficient to cover all future losses or claims against us.
If the actions taken by certain governments and monetary authorities in response to continuing and future extreme market and economic conditions are not successful, the return of adverse economic conditions may negatively impact the demand for our technology and may negatively impact our ability to raise capital, if needed, on a timely basis and on acceptable terms or at all.
Included on our balance sheet as of December 31, 2025 and December 31, 2024 contained elsewhere in this Annual Report are derivative liabilities related to embedded features contained within our public and private placement warrants as well as shares issued to Reinvent Sponsor Y LLC, a Cayman Islands limited liability company (the “Sponsor”) with price-based vesting criteria.
As of December 31, 2025, we had estimated U.S. federal and state net operating loss carryforwards of $2,688 million and $3,142 million, respectively.
Similarly, suppliers and other third parties will be less likely to invest time and resources in developing business relationships with us or to continue supplying components or services to us on acceptable terms if they are not convinced that our business will succeed.
We are dependent on others for the supply of vehicles, and are also dependent on our suppliers, some of which are single or limited source suppliers, for the production, provision, and/or full lifecycle support of the current and future generations of our Aurora Driver system.
We are reliant on others for the supply of vehicles, and are also reliant on suppliers and service providers to design, develop, industrialize, manufacture, install and customize components for us, including components associated with our future generations of our Aurora Driver system.
Such supply and services are subject to multiple risks, including delays in development, manufacturing, implementation and certification of components, vehicles and systems; difficulties integrating components and systems from multiple suppliers; issues meeting required quality, safety, or performance standards; supply chain disruptions; labor availability constraints; and increased costs.
Our ability to maintain, expand or replace these supply, service and manufacturing arrangements is important to our business.
In order for these suppliers to undertake the investment needed to produce these components, they may require us to commit to terms, pricing or purchase volumes that are not favorable to us.
On April 26, 2023, we entered into the Strategic Partnership Agreement with Continental, now AUMOVIO, which was amended and restated on September 27, 2023.
Pursuant to the Strategic Partnership Agreement, AUMOVIO will, as our “Hardware-as-a-Service” partner, develop the necessary hardware, firmware, fallback system integration, and related services to allow for the integration of the Aurora Driver into production vehicles at OEMs.
The Strategic Partnership Agreement provides that we will pay AUMOVIO on a per-mile basis for vehicles operated by the Aurora Driver using the future generation of our Aurora Driver hardware system.
Pursuant to the Strategic Partnership Agreement, Aurora and AUMOVIO are each subject to defined and limited exclusivity periods, subject to various exclusions and early termination triggers.
If the services contemplated by the agreement with AUMOVIO are not performed, including by reason of termination of the agreement, or if AUMOVIO becomes insolvent, ceases or significantly reduces its operations or experiences financial distress, or if any environmental, economic or other outside factors impact their operations, our ability to procure the necessary hardware, firmware, fallback system integration, and related services may be impaired, and we may not be able to obtain, or may face increased costs related to, such hardware, firmware, and services.

and 46 more.

Gone since FY2024

Unless the context otherwise requires, all references in this section to the “Company,” “Aurora,” “we,” “us,” or “our” refer to the business of Aurora Innovation Holdings, Inc. and its subsidiaries prior to the consummation of the Merger, and to Aurora Innovation, Inc. and its subsidiaries after the completion of the Merger.
For more information, see below for more detailed descriptions of each risk factor. • Self-driving technology is an emerging technology, and we face significant technical challenges to commercialize our technology. • We have incurred net losses since our inception, and we expect to incur significant expenses and continuing losses for the foreseeable future. • Our limited operating history makes it difficult to evaluate our future prospects and the risks and challenges we may encounter. • It is possible that our technology will have more limited performance or technology development and commercialization may take us longer to complete than is currently projected. • Our progress and performance metrics are subject to inherent challenges in measurement, and real or perceived inaccuracies in such metrics and metrics and values that are below expectations could materially and adversely affect our business, prospects, financial condition and results. • We operate in a highly competitive market and some market participants have substantially greater resources.
If one or more of our competitors broadly commercialize their self-driving technology before we do, develop superior technology, or are perceived to have better technology, our business prospects and financial performance would be adversely affected. • Our services and technology may not be accepted and adopted by the market at the pace we expect or at all. • We may require significantly more capital investment to run our business than previously expected. • It is possible that Aurora’s self-driving unit economics do not materialize as expected. • We are highly dependent on the services of our senior management team, without which we may not be able to successfully implement our business strategy. • Our future capital needs may require us to sell additional equity or debt securities that may dilute our stockholders. • We may experience difficulties in managing our growth and expanding our operations. • Our operating and financial results projections that were previously provided rely in large part upon assumptions and analyses developed by us.
If these assumptions or analyses prove to be incorrect, our actual results of operations may be materially different from our projections and our estimates of certain financial metrics may prove inaccurate. • We could fail to successfully select, execute or integrate past and future acquisitions. • Interruption or failure of Amazon Web Services or other information technology and communications systems that we rely upon could materially and adversely affect our business, financial condition and results of operations. • We are subject to cybersecurity risks to operational systems, security systems, infrastructure, integrated software and partners’ and end-customers’ data processed by us or third-party vendors or suppliers. • Unauthorized control or manipulation of systems in autonomous vehicles may cause them to operate improperly or not at all, or compromise their safety and data security. • Failures, or perceived failures, to comply with privacy, data protection, and cybersecurity requirements in the variety of jurisdictions in which we operate, or may operate, may adversely impact our business. • Issues relating to our use of artificial intelligence and machine learning technologies, combined with an uncertain legal and regulatory environment, could materially and adversely affect our business, financial condition and results of operations. • Our future insurance coverage may not be adequate to protect us from all business risks or may be prohibitively expensive. • Our financial instruments, including warrants, are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results. • If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results. • Unanticipated changes in effective tax rates, adverse outcomes resulting from examination of our income, changes in tax laws or regulations, changes in our ability to utilize our net operating loss, or other tax-related changes could materially and adversely affect our business, prospects, financial condition and results of operations. • Our success is contingent on our ability to successfully maintain, manage, execute and expand on our existing partnerships and obtain new partnerships. • We are dependent on our suppliers, some of which are single or limited source suppliers (including one partner for the production, provision, and full lifecycle support of the future generation of our Aurora Driver hardware system), and these suppliers may not produce and deliver necessary and industrialized components at prices and volumes and on terms acceptable to us. • Burdensome regulations, inconsistent regulations, or a failure to receive regulatory approvals or exemptions for our technology could have a material adverse effect on our business, financial condition and results of operation. • We may become involved in legal and regulatory proceedings and commercial or contractual disputes. • We may be subject to product liability that could result in significant direct or indirect costs. • We may not be able to adequately protect or enforce our intellectual property rights, in which case our business and competitive position could be harmed. • We may need to defend ourselves against intellectual property rights infringement claims, which may be time-consuming and could cause us to incur substantial costs. • We could lose the ability to use certain intellectual property rights and technology or materials that we rely upon if the underlying license agreements are terminated or not renewed. • Our software contains third-party open-source software components, and failure to comply with the terms of the underlying open-source software licenses could restrict our ability to sell our products or give rise to disclosure obligations of proprietary software. • The market price of our common stock may be volatile and could decline significantly. • Our dual class structure has the effect of concentrating voting power with our founders, which limits an investor’s ability to influence the outcome of important transactions, including a change in control.
We have incurred net losses since our inception, and we expect to incur significant expenses and continuing losses for the foreseeable future.
During the twelve months ended December 31, 2024 and 2023, w e incurred net losses of $748 million and $796 million, respectively.
We publicly disclose certain progress and performance metrics, including the Autonomy Readiness Measure and the Autonomy Performance Indicator.
These metrics are subject to inherent challenges in measurement; real or perceived inaccuracies in such metrics and metrics values that are below expectations could materially and adversely affect our business, prospects, financial condition and results of operations.
We publicly disclose a measure of our progress toward the commercial launch of Aurora Driver for Freight (the “Autonomy Readiness Measure”).
The Autonomy Readiness Measure is the weighted function of completeness of our Safety Case (which is an internally-derived, claims-based approach that provides a generalized structured argument to addressing safety items implicated by developing and operating self-driving technology on public roads).
There are inherent challenges in calculating the Autonomy Readiness Measure, including the fact that management judgment is used when applying weighting to individual pieces of evidence that support the claims that we are making in our Safety Case (e.g., based on complexity, effort required to complete, scope of the Company’s commercial launch route, etc.) as well as when evaluating the percentage complete of a particular piece of evidence.
If individual pieces of evidence supporting the claims of our Safety Case turn out to be more complex, more challenging to complete, insufficiently comprehensive or conclusive, or more time or capital intensive than we originally anticipated, adjustments will be required to be made to our calculations of the Autonomy Readiness Measure.
If our Autonomy Readiness Measure is not an accurate representation of our progress toward commercial launch, or if investors perceive this measure not to be accurate, or if we discover material inaccuracies in the Safety Case or our calculations of the Autonomy Readiness Measure, our reputation may be significantly harmed, the timing of commercial launch of Aurora Driver for Freight could be delayed, and our stock price could decline, any of which could materially and adversely affect our business, prospects, financial condition and results of operations.
We also publicly disclose supplemental information regarding the on-road performance of the Aurora Driver (the “Autonomy Performance Indicator”).
There are inherent challenges in calculating this metric.
For example, one of the components of this indicator is commercially representative miles driven where the vehicle received human assistance via a vehicle operator intervention or other on-site support, but where it is determined, through internal analysis including simulation, that the support received was not required by the Aurora Driver.
There is management judgment involved in using internal analysis to determine whether or not such human assistance was necessary, and third parties may reasonably disagree with positions taken by the Company on such determinations.
Further, it is possible that we could conclude that human assistance was not necessary even where the Aurora Driver did not perform correctly and/or in a way that we intended.
Additionally, we do not expect the Autonomy Performance Indicator to increase linearly as we approach commercial launch, nor do we anticipate that this indicator will be 100% even at launch, because certain situations (e.g., flat tires) will always require on-site support.
If the Autonomy Performance Indicator is not a sufficient or accurate representation of the Aurora Driver’s on-road performance, if investors do not perceive it to be accurate, or it does not convey the level of performance anticipated, our reputation may be significantly harmed, our stock price could decline, and any of which could materially and adversely affect our business, prospects, financial condition and results of operations.
In addition, our internal systems and tools have a number of limitations, and our methodologies for tracking the Autonomy Readiness Measure and the Autonomy Performance Indicator may change over time, which could result in unanticipated changes to the metrics or estimates that we publicly disclose.
If the internal systems and tools we use to track these metrics are not an accurate indicator of our performance or contain other technical errors, the data we report may not be accurate.
While these numbers are based on what we believe to be reasonable estimates of our metrics for the applicable period of measurement, there are inherent challenges in measuring our progress toward commercial launch.
Several companies, including, but not limited to, Waymo, Tesla, Zoox/Amazon, Motional, Torc Robotics, Kodiak Robotics, Stack AV and Intel Mobileye are investing heavily in building this technology.
Material commercialization of self-driving technology first involves pilot deployments, which we and other competitors are currently performing.
Competitors may initiate similar deployments in various different use cases and/or geographies earlier than we will or may perform better than we do in such deployments.
Several of these competitors have substantially greater financial, marketing, R&D, and other resources.
Early in our commercialization, we intend to own or lease and operate a limited fleet and will invest in self-driving system hardware, base vehicles, and commercial facilities (such as freight terminals).
We believe this firsthand experience will help us to harden our operational processes, service level agreements, and enable a more effective transition to working with external partners on operational activities.
Risks Related to Our Business Operations Our business plans require a significant amount of capital.
In addition, our future capital needs may require us to sell additional equity or debt securities that may dilute our stockholders.
Beyond the net proceeds raised in the 2024 Public Offering (as defined below), we expect we will need to seek equity or debt financing to fund a portion of our future expenditures.
We are spending significant amounts to develop our business and have estimated how much cash we will need on a quarterly basis until we raise additional funds or achieve cash flow positive.
In particular, we will continue to incur operating and net losses each quarter until at least the time we begin commercial operation of our self-driving technology, which may take longer than we currently expect or may never occur.
A significant natural disaster, such as an earthquake, fire, flood, hurricane or significant power outage or other similar events, such as infectious disease outbreaks or pandemic events (such as the outbreak of the COVID-19 pandemic), could materially and adversely affect our business, financial condition and results of operations.
In addition, natural disasters, acts of terrorism or war, including the ongoing geopolitical tensions related to Russia’s actions in Ukraine and the conflicts in the Middle East, could cause disruptions in our remaining operations, our or our partners’ businesses, our suppliers’ or the economy as a whole.
The techniques used by cyber attackers change frequently and may be difficult to detect for long periods of time, and we may face difficulties and delays in identifying, responding to, and otherwise addressing security breaches and incidents.
Geopolitical events such as Russia’s actions in Ukraine and the conflicts in the Middle East may increase our and our service providers’ risks of cyber-attacks.
We cannot be sure that the systems upon which we rely, including those of our third-party vendors or suppliers, will be effectively implemented, maintained or expanded as planned, and our third-party vendors or suppliers may also experience cyber incidents caused by software bugs and other technical errors, disasters, insiders, or malicious third parties.
We may also be affected by cyber-attacks and other security breaches or incidents, including other means of gaining unauthorized access to our technology, systems, and data.

and 61 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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