Technology
Serve Robotics Announces Second Quarter 2024 Results
Published
2 years agoon
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Manufacturing activities commenced on 2,000-robot fleet deployment following entry into manufacturing agreement with Magna and amendment to lidar supply agreement with Ouster Cash position bolstered by proceeds of $40 million equity offering, as well as post-quarter $15 million private placement transaction
SAN FRANCISCO, Aug. 13, 2024 /PRNewswire/ — Serve Robotics Inc. (the “Company” or “Serve”) (Nasdaq: SERV), a leading autonomous sidewalk delivery company, today announced financial results for the second quarter 2024 ended June 30, 2024.
“We are pleased to report another strong quarter, extending our 30-month track record of double-digit month-over-month growth and improvements in key operational metrics,” said Dr. Ali Kashani, Serve’s Co-founder and CEO. “This quarter, we expanded into Koreatown in Los Angeles, signed important agreements with Magna International Inc. (“Magna”) and expanded on our supply agreement with Ouster Inc. (“Ouster”), and appointed our Chief Hardware & Manufacturing Officer to spearhead our fleet expansion efforts. I am particularly pleased to announce that Serve has completed the design of our third-generation robot. Looking ahead, we are focused on executing Serve’s fleet expansion plan to deploy at least 250 additional robots in Los Angeles by the end of Q1 2025. We believe our continued execution of this plan through year end 2025 will position Serve to deploy all 2,000 robots under our Uber Eats agreement, which at full utilization is expected to generate $60 to $80 million in run-rate revenue annually.”
Second Quarter 2024 and Recent Highlights
Public Offering & Follow-on Transaction: On April 18, 2024, Serve completed a successful public equity offering, which generated $40.0 million in gross proceeds, and through which Serve’s common stock began trading on The Nasdaq Capital Market under the ticker symbol “SERV”. Post quarter-end, the company also completed a private placement transaction with gross proceeds of $15.0 million.Operational Performance: Serve averaged 385 daily supply hours during the second quarter 2024, a 106% increase year-over-year and a 28% increase quarter-over-quarter. The Company also achieved an 85% increase in daily active robots year-over-year and a 23% increase quarter-over-quarter. Los Angeles Expansion: In June 2024, Serve announced the expansion of its delivery operations into Koreatown and began onboarding new local merchants through its partnership with Uber Eats. The coverage expansion represents execution of Serve’s long-term plan to broaden its geographic reach in Los Angeles and across the U.S. Manufacturing activities commenced following Magna and Ouster agreements: In the second quarter Serve commenced manufacturing activities on its 2,000-robot fleet, led by Euan Abraham, the Company’s newly promoted Chief Hardware & Manufacturing Officer. Serve also entered into a purchase and production agreement with Magna, under which Magna will become the contract manufacturer of Serve’s delivery robots, and signed an amendment expanding its supply agreement with Ouster to equip its next-generation robots with upgraded sensors for enhanced performance.
Second Quarter Financial Highlights
Second quarter revenue was $0.47 million, including $0.30 million of software service revenue derived from the Company’s software services agreement with Magna. As forecasted, Serve’s services contract with Magna was significantly completed during the second quarter, and the Company does not anticipate material software services revenue in Q3 2024.As of June 30, 2024, the Company had $28.8 million of cash and cash equivalents.As of June 30, 2024, the Company had 36.5 million shares of common stock outstanding, and 42.6 million shares outstanding on a fully diluted basis. Following the Company’s July 2024 private placement, the Company had approximately 48.2 million shares outstanding on a fully diluted basis.
Quarterly Conference Call
Company management will host a conference call and webcast today at 2:00 p.m. PT / 5:00 p.m. ET to discuss the financial results and provide a corporate update. A live webcast and replay can be accessed from the investor relations page of Serve’s website at investors.serverobotics.com.
Individuals interested in listening to the conference call may do so by dialing (646) 968-2525 and referencing conference ID#: 1640108.
About Serve
Serve develops advanced, AI-powered, low-emissions sidewalk delivery robots that endeavor to make delivery sustainable and economical. Spun off from Uber in 2021 as an independent company, Serve has completed tens of thousands of deliveries for enterprise partners such as Uber Eats and 7-Eleven. Serve has scalable multi-year contracts, including a signed agreement to deploy up to 2,000 delivery robots on the Uber Eats platform across multiple U.S. markets.
For further information about Serve (Nasdaq: SERV), please visit www.serverobotics.com or follow us on social media via X (Twitter), Instagram, or LinkedIn @serverobotics.
Supplemental Financial Information
The key metrics and financial tables outlined below are metrics that provide management with additional understanding of the drivers of business performance and the Company’s ability to deliver stockholder return. Investors should not place undue reliance on these metrics as indicators of future or expected results. The Company’s presentation of these metrics may differ from similarly titled metrics presented by other companies and therefore comparability may be limited.
Table 1: Key Metrics
Three Months Ended
Six Months Ended
June 30, 2024
March 31, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Key Metrics
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Daily Active Robots (1)
48
39
23
44
25
Daily Supply Hours (2)
385
300
152
342
169
(1)
Daily Active Robots: The Company defines daily active robots as the average number of robots performing daily deliveries during the period.
(2)
Daily Supply Hours: The Company defines daily supply hours as the average number of hours the Company’s robots are ready to accept offers and perform daily deliveries during the period.
Table 2: Revenue
Three Months Ended
Six Months Ended
June 30, 2024
March 31,
June 30, 2023
June 30, 2024
June 30, 2023
Revenue
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Software services
$ 296,035
$ 851,101
$ –
$ 1,147,136
$ –
Delivery services
75,540
51,760
32,467
127,300
57,719
Branding fees
96,800
43,850
29,542
140,650
44,542
$ 468,375
$ 946,711
$ 62,009
$ 1,415,086
$ 102,261
Forward Looking Statements
This press release contains “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward- looking statements may be identified by the context of the statement and generally arise when we or our management are discussing our beliefs, estimates or expectations. Such statements generally include the words “believes,” “plans,” “intends,” “targets,” “may,” “could,” “should,” “will,” “expects,” “estimates,” “suggests,” “anticipates,” “outlook,” “continues,” or similar expressions. These statements are not historical facts or guarantees of future performance, but represent management’s belief at the time the statements were made regarding future events which are subject to certain risks, uncertainties and other factors, many of which are outside of our control. Actual results and outcomes may differ materially from what is expressed or forecast in such forward-looking statements. Forward-looking statements include, without limitation, statements regarding the Company’s partnership with Magna, timing of the Company’s robot deployment, the Company’s ability to expand to additional markets, and the Company’s timing and ability to scale to commercial production.
The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission (“SEC”), including in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023, our Quarterly Report on Form 10-Q for the three months ended June 30, 2024 that will be filed following this earnings release, and in our subsequent SEC filings. We can give no assurance that the plans, intentions, expectations or strategies as reflected in or suggested by those forward-looking statements will be attained or achieved. The forward-looking statements in this release are based on information available 3 to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements, except as required by law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.
Contacts
Aduke Thelwell, Head of Communications & Investor Relations
Serve Robotics
aduke.thelwell@serverobotics.com
347-464-8510
Investor Relations
investor.relations@serverobotics.com
Serve Robotics Inc.
Unaudited Condensed Consolidated Balance Sheets
As of June 30, 2024 and December 31, 2023
(unaudited)
June 30,
2024
December 31,
2023
ASSETS
Current assets:
Cash
28,780,034
$ 6,756
Accounts receivable
93,132
2,955
Inventory
709,289
774,349
Prepaid expenses
1,119,995
676,969
Escrow Receivable
180,000
–
Total current assets
30,882,450
1,461,029
Property and equipment, net
819,244
48,422
Right of use asset
552,143
782,439
Deposits
512,659
512,659
Total assets
32,766,496
$ 2,804,549
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable
1,387,559
$ 2,050,605
Accrued liabilities
46,079
255,849
Deferred revenue
52,863
–
Note payable, current
750,000
1,000,000
Note payable – related party
—
70,000
Right of use liability, current portion
413,800
496,963
Lease liability, current portion
1,617,224
2,363,807
Total current liabilities
4,267,525
6,237,224
Note payable, net of current portion
—
230,933
Restricted stock award liability
—
158,617
Right of use liability
35,230
211,181
Total liabilities
4,302,755
6,837,955
Stockholders’ equity (deficit):
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of both June 30, 2024 and December 31, 2023
—
–
Common stock, $0.0001 par value; 300,000,000 shares authorized, 36,642,064 and 24,832,814 shares issued and 36,529,574 and 24,508,795 shares outstanding as of both June 30, 2024 and December 31, 2023
3,651
2,450
Additional paid-in capital
114,869,809
64,468,141
Subscription receivable
—
(169,616)
Accumulated deficit
(86,409,719)
(68,334,381)
Total stockholders’ equity (deficit)
28,463,741
(4,033,406)
Total liabilities and stockholders’ equity (deficit)
$ 32,766,496
$ 2,804,549
Serve Robotics Inc.
Unaudited Condensed Consolidated Statements of Operations
For the Three and Six Months Ended June 30, 2024 and 2023; and Three Months Ended March 31, 2024
(unaudited)
Three Month Ended
Six Months Ended
June 30, 2024
March 31, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Revenues
$ 468,375
$ 946,711
$ 62,009
$ 1,415,086
$ 102,261
Cost of revenues
326,013
352,438
391,367
678,451
758,628
Gross profit (loss)
142,362
594,273
(329,358)
736,635
(656,367)
Operating expenses:
General and administrative
1,873,320
1,008,071
970,819
2,881,392
1,986,806
Operations
871,211
540,974
592,648
1,412,185
1,114,335
Research and development
5,787,906
6,638,441
2,125,685
12,426,347
4,208,634
Sales and marketing
165,612
118,236
83,136
283,848
362,718
Total operating expenses
8,698,049
8,305,722
3,772,288
17,003,772
7,672,493
Loss from operations
(9,055,688)
(7,711,449)
(4,101,646)
(16,267,137)
(8,328,860)
Other income (expense), net:
Interest expense, net
(260,120)
(1,326,522)
(496,862)
(1,586,642)
(538,606)
Change in fair value of derivative liability
(221,560)
–
–
(221,560)
–
Change in fair value of simple agreements for future equity
–
–
(367,748)
–
(1,236,912)
Total other income (expense), net
(481,680)
(1,326,522)
(864,610)
(1,808,202)
(1,775,518)
Provision for income taxes
–
–
–
–
–
Net loss
$ (9,037,367)
$ (9,037,971)
$ (4,966,256)
$ (18,075,339)
$ (10,104,378)
Weighted average common shares outstanding – basic and diluted
33,795,009
24,556,343
6,678,372
29,176,370
6,678,372
Net loss per common share – basic and diluted
$ (0.27)
$ (0.37)
$ (0.74)
$ (0.62)
$ (1.51)
Serve Robotics Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 2024 and 2023
(unaudited)
Six Months Ended
June 30,
2024
2023
Cash flows from operating activities:
Net loss
$ (18,075,338)
$ (10,104,378)
Adjustments to reconcile net loss to net cash used in
Depreciation
27,500
931,279
Stock-based compensation
7,735,469
200,872
Amortization of debt discount
1,677,942
466,706
Loss on conversion of note payable
221,560
–
Change in fair value of simple agreements for future equity
–
1,236,912
Interest on recourse loan
(2,504)
Changes in operating assets and liabilities:
Accounts receivable
(90,177)
23,697
Inventory
65,060
(4,704)
Prepaid expenses
(443,026)
16,253
Escrow receivable
(180,000)
–
Accounts payable
(663,046)
704,870
Accrued liabilities
(120,232)
(36,045)
Deferred revenue
52,863
–
Right of use liabilities, net
(28,818)
(23,163)
Net cash used in operating activities
(9,820,242)
(6,590,205)
Cash flows from investing activities:
Purchase of property and equipment
(798,322)
–
Net cash used in investing activities
(798,322)
–
Cash flows from financing activities:
Proceeds from simple agreement for future equity
–
2,666,953
Proceeds from convertible notes payable
4,844,625
2,798,410
Proceeds from note payable, related party
–
399,000
Exercise of warrants
5,907
–
Exercise of options
8,757
–
Proceeds from issuance of common stock pursuant to offering, net of offering costs
35,849,136
–
Repayments of note payable
(500,000)
(500,000)
Repayments of notes payable, related party
(70,000)
–
Deferred offering costs
–
(352,617)
Repayment of lease liability financing
(746,583)
(1,118,348)
Net cash provided by financing activities
39,391,842
3,893,398
Net change in cash and cash equivalents
28,773,277
(2,696,807)
Cash and cash equivalents at beginning of period
6,756
2,715,719
Cash and cash equivalents at end of period
$ 28,780,033
$ 18.912
View original content:https://www.prnewswire.com/news-releases/serve-robotics-announces-second-quarter-2024-results-302221504.html
SOURCE Serve Robotics Inc.
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Global AI Leader and Enterprise Transformation Visionary Zeya Ottomone Appointed Chief Executive Officer of Integrow
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ATLANTA, July 24, 2026 /PRNewswire-PRWeb/ — Integrow announced the appointment of Zeya Ottomone as Chief Executive Officer, marking a significant milestone in the company’s evolution as it accelerates its vision to become a global leader in Agentic AI-powered enterprise software and business transformation.
With more than three decades of executive leadership spanning Fortune 500 enterprises, global technology organizations, and enterprise software innovation, Ottomone joins Integrow at a defining moment in the evolution of artificial intelligence.
Widely recognized for helping organizations modernize operations, simplify complex business ecosystems, and deliver measurable transformation outcomes, Ottomone has led some of the industry’s largest enterprise modernization initiatives across ERP, CRM, workforce management, cloud computing, cybersecurity, artificial intelligence, and intelligent automation. His appointment signals Integrow’s commitment to redefining how enterprises execute strategy in the era of autonomous AI.
“Artificial Intelligence is no longer about automation alone, it’s about empowering organizations to execute faster, make smarter decisions, and fundamentally rethink how work gets done,” said Zeya Ottomone, Chief Executive Officer of Integrow. “We’re entering the Agentic Era, where intelligent AI agents become trusted digital teammates capable of planning, reasoning, collaborating and executing alongside people. At Integrow, we’re building the enterprise platform that makes that future practical, secure and measurable for every organization.”
Ottomone is internationally recognized as a leader in enterprise technology, SaaS transformation, digital modernization and AI-enabled business strategy. Throughout his career he has held executive leadership and C-level positions with ABB, Honeywell, AmerisourceBergen, Cable & Wireless, Chicago Tribune and Rimini Street, leading global organizations through large-scale transformation initiatives across North America, Europe, Asia-Pacific and the Middle East. His expertise spans enterprise applications, Salesforce ecosystems, ServiceNow, ERP modernization, customer experience, intelligent operations, data strategy, and the emerging field of Agentic AI.
Before joining Integrow, Ottomone led global SaaS Centers of Excellence focused on enterprise transformation, helping organizations modernize critical business operations while reducing technology complexity and accelerating innovation. A certified Lean Six Sigma Master Black Belt and recognized executive advisor, Ottomone has consistently delivered operational excellence by combining strategic leadership with emerging technologies to create sustainable business value.
His appointment also coincides with the upcoming publication of his new book, Empowered to Execute in the Agentic Era, which explores how organizations can bridge the gap between strategy and execution by leveraging AI, empowering people, and building intelligent enterprises capable of continuous innovation. The book reflects many of the same principles that will guide Integrow’s next phase of growth: human-centered AI, intelligent automation, operational excellence, and measurable business outcomes.
Under Ottomone’s leadership, Integrow will accelerate investment across:
Agentic AIEnterprise AI PlatformsIntelligent ERPAI-powered CRMHuman Capital ManagementIT Service ManagementPredictive AnalyticsAutonomous WorkflowsEnterprise CopilotsIndustry-specific AI Solutions
The company’s vision is to deliver a unified enterprise platform where AI is embedded into every business process, enabling organizations to eliminate operational silos, automate decision-making, increase productivity, and create competitive advantage through intelligent execution. “Zeya represents exactly the type of visionary leader required for the next generation of enterprise software,” said Harvey Nicholson, Chair of Corporate Governance and Member of Integrow’s Board of Directors. “His global experience, deep understanding of enterprise technology, and forward-looking vision for Agentic AI position Integrow to become one of the industry’s most innovative AI-powered enterprise software companies.”
Wayne Gadson, Chair of Growth Strategy, added: “The future belongs to organizations that can execute strategy with intelligence, speed and confidence. Zeya has spent his career helping enterprises achieve exactly that. His appointment marks the beginning of an exciting new chapter for Integrow, our customers and our partners worldwide.” As enterprises face mounting pressure to modernize operations, reduce costs, improve workforce productivity and harness the power of artificial intelligence, Integrow is uniquely positioned to help organizations transform through a single AI-powered enterprise platform that unifies finance, operations, customer engagement, workforce management, projects and service delivery.
“Our mission is simple,” Ottomone concluded. “We don’t believe AI should replace people. We believe AI should elevate people. The organizations that will define the next decade won’t simply adopt AI—they’ll empower every employee to execute better decisions every day. That’s the future Integrow is building.”
About Integrow
Integrow is a global enterprise software company delivering next-generation AI-powered business applications built on Salesforce. The platform unifies ERP, CRM, Human Capital Management, IT Service Management, Project Management, Field Service, Finance and Operations into a single intelligent ecosystem enhanced by Agentic AI.
By embedding artificial intelligence into every workflow, Integrow enables organizations to modernize operations, accelerate innovation, improve decision-making and execute strategy with confidence.
For more information, visit www.integrow.com.
Media Contact
Media Team, Integrow, Inc., 1 855-333-4769, info@integrow.com, www.integrow.com
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SOURCE Integrow, Inc.
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Lufax Announces Board and Management Changes
Published
32 minutes agoon
July 24, 2026By
SHANGHAI, July 24, 2026 /PRNewswire/ — Lufax Holding Ltd (“Lufax” or the “Company”) (NYSE: LU and HKEX: 6623), a leading financial services enabler for small business owners in China, today announced changes to its board of directors and senior management, effective July 25, 2026.
Ms. Fangfang Cai (“Ms. Cai”), Mr. Shibang Guo (“Mr. Guo”) and Mr. Peifeng Li (“Mr. Li”) have resigned as non-executive directors of the Company and from their respective positions on the Board’s committees. Mr. Tongzhuan Xi (“Mr. Xi”) has resigned as an executive director, the chief financial officer and the authorised representative of the Company (“Authorised Representative”) under Rule 3.05 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (“Hong Kong Listing Rules”), with effect from July 25, 2026. Each of the four directors cited personal work arrangements as the reason for their resignation and confirmed there is no disagreement with the Board and no matter relating to their departure that needs to be brought to shareholders’ attention.
The Company has begun a search for a new chief financial officer. During the transition, the CFO’s duties will be temporarily assumed by the Company’s internal team to ensure continuity of the Company’s financial functions. Mr. Xiang Ji, an executive director and the Company’s chief executive officer, has been appointed as the Authorised Representative, the Company’s designated liaison with the Stock Exchange under the Hong Kong Listing Rules, in place of Mr. Xi, with effect from July 25, 2026.
The Board has appointed Mr. Wai Kin Chim (“Mr. Chim”) as an independent non-executive director for an initial three-year term commencing July 25, 2026.
Mr. Chim, aged 65, has over 40 years of experience in international banking and extensive board experience in Asia Pacific, having worked in Hong Kong, Singapore and Beijing. He specializes in risk management and internal control, with a strong emphasis on corporate governance, credit risk, market risk and capital management.
Mr. Chim served as a loan officer at Standard Chartered Bank, Hong Kong Branch, from October 1985 to August 1988. He was then employed by Bankers Trust Company, Hong Kong Branch, as a vice president of the Asia Credit Department from September 1988 to October 1996. He subsequently served as the managing director and the chief credit officer for Deutsche Bank AG, a company listed on the Frankfurt Stock Exchange under ticker symbol DBK, for Asia Pacific (non-Japan Asia), from October 1996 to November 2006. He joined Bank of China Limited, a company listed on the Main Board of the Stock Exchange under stock code 3988, as the chief credit officer from March 2007 to March 2015.
Mr. Chim was an independent non-executive director of Standard Chartered Bank (China) Limited from October 2015 to October 2017. He served as an independent non-executive director of HDR Global Trading Limited, owner and operator of the BitMEX digital asset trading platform, from February 2021 to February 2022. Mr. Chim served as a non-executive director of China Chengtong Hong Kong Company Limited from July 2022 to June 2025. Mr. Chim is currently an independent non-executive director of OCBC Bank (Hong Kong) Limited, since November 2017; an independent non-executive director of Banco OCBC (Macau), S.A., since August 2023; an independent non-executive director of China Intellogis Technology Co., Ltd., since June 2024; and a director of Hong Kong Dance Company Limited since June 2026.
Mr. Chim obtained a Bachelor of Science degree from the Chinese University of Hong Kong in 1983 and an MBA degree from Indiana State University, USA, in 1985. He also graduated from the Senior Executive Program at Columbia University in 2000.
In connection with these changes, with effect from July 25, 2026, Ms. Cai will step down from the Nomination and Remuneration Committee, and Mr. Koon Wing Ernest Ip has been appointed as a member to that committee. The Company’s Special Committee will comprise Mr. Dicky Peter Yip, Mr. Koon Wing Ernest Ip and Mr. Siu Hong Cheng, continuing under the chairmanship of Mr. Dicky Peter Yip, with effect from July 25, 2026.
The Board would like to take this opportunity to thank Ms. Cai, Mr. Guo, Mr. Li and Mr. Xi for their service during the tenure of their office and warmly welcome Mr. Chim to the Board.
About Lufax
Lufax is a leading financial services enabler for small business owners in China. The Company offers financing products designed principally to address the needs of small business owners. In doing so, the Company has established relationships with 85 financial institutions in China as funding partners, many of which have worked with the Company for over three years.
Investor Relations Contact
Lufax Holding Ltd
Email: Investor_Relations@lu.com
ICR, LLC
Robin Yang
Tel: +1 (646) 308-0546
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UMD Smith School Researchers Warn AI Security Lapses Highlight Urgent Need for Independent Oversight
Published
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July 24, 2026By
COLLEGE PARK, Md., July 24, 2026 /PRNewswire/ — A series of recent AI security lapses—including the OpenAI–Hugging Face breach—raises a fundamental question, say a pair of researchers at the University of Maryland’s Robert H. Smith School of Business: Can tech companies safely govern the powerful AI systems they build, or is stronger outside oversight now essential?
In its incident report, OpenAI confirmed that one of its experimental AI agents exploited a weakness in its testing environment while working on a routine benchmark task. The system wasn’t instructed to behave maliciously; instead, its persistence turned a small design flaw into a real escape. Earlier tests showed similar behavior, including agents that learned to bypass security checks by manipulating authentication tokens.
This pattern echoes findings from Dean’s Professor of Information Systems Siva Viswanathan at the Smith School, who studies how large technology platforms enforce rules. His research on mobile app privacy—published in Management Science—examined Google’s rollout of Android 6.0, which gave users more control over what data apps could collect. Developers were granted a flexible window to update their apps. Many used that flexibility to delay compliance for months, continuing to gather user data until Google imposed consequences such as lower search rankings and reduced visibility in its app store.
Viswanathan’s takeaway: when companies rely on voluntary compliance, self‑interested actors often exploit the slack. Real accountability requires pairing flexibility with firm, enforceable penalties.
That lesson now reverberates across the AI sector. As companies race to build increasingly capable systems, Viswanathan says oversight must treat these AI systems as strategic actors and must include strong safeguards that can pause or reverse a system before harm occurs.
He notes that a separate study from Anthropic underscores the stakes. In controlled tests, even an AI system designed to monitor another AI inherited the same flaws it was supposed to catch. In some cases, the “judge” model failed to flag clear sabotage because it agreed with the agent’s goals, allowing dangerous behavior to pass without human review.
Balaji Padmanabhan, Dean’s Professor of Decisions, Operations and Information Technologies and director of the Smith School’s Center for Artificial Intelligence in Business, extends Viswanathan’s governance argument into the realm of autonomous AI agents, warning that the same structural weaknesses now carry far higher stakes.
“The fact that this breach occurred organically without the AI agent being asked to be malicious is itself notable. Imagine what someone who actually intends to do harm can do. It’s also not terribly reassuring that the same firms we depend on for AI infrastructure, who are facing these issues, are the ones assuring enterprises that their systems with guardrails are perfectly safe,” says Padmanabhan. “We have to wake up to the fact that we’ve created capabilities that let software become as powerful as we want it to be—and then some. It’s time we seriously ask what’s needed to create an infrastructure to play defense well.”
Across the independent studies, the pattern is consistent, says Viswanathan: Voluntary compliance fails when the governed actor is more capable than the regulator. And AI systems cannot be governed by trust or good intentions alone. Oversight must be preventive, independent and capable of stopping harmful behavior before it spreads.
About the University of Maryland’s Robert H. Smith School of Business
The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and flex MBA, executive MBA, online MBA, business master’s, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia.
Contact: Greg Muraski, gmuraski@umd.edu
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