Serve Robotics Guides for 60-75% Delivery Surge in Q2: Too Bold?

Serve Robotics SERV is betting big on growth. Following a first quarter marked by rapid fleet expansion and entry into new markets, the autonomous delivery startup has guided for a 60% to 75% quarter-over-quarter increase in delivery volume for the second quarter of 2025. This projection builds on a 75% jump seen between the first and last weeks of the first quarter as 250 third-generation robots came online in cities like Miami, Dallas, and Los Angeles.

The bullish forecast reflects Serve’s growing geographic footprint, merchant base, and improved robot utilization. The company now serves more than 1,500 restaurants—five times more than a year ago—and has increased its daily supply hours by more than 40% since the fourth quarter of 2024. With Atlanta set to launch in the second quarter and another 700 robots expected by the end of the third quarter, Serve aims to hit a 2,000-robot deployment by 2025-end.

Yet, despite this momentum, questions linger. Revenues for the first quarter rose 150% sequentially to just $440,000, while adjusted EBITDA remained negative at $7.1 million. Although gross margins improved and Serve ended the quarter with $198 million in cash, the path to profitability remains uncertain. Additionally, the company is banking on software platform monetization and long-term tech licensing, which are still in early stages.

Serve’s guidance is undeniably ambitious. But in a competitive delivery landscape where scale, efficiency, and capital discipline matter, the company’s ability to execute on this bold forecast will be a key test for investors in the quarters ahead.

Facing the Competition: Can Serve Keep Pace With Uber and DoorDash?

As Serve targets 60% to 75% delivery volume growth in the second quarter, it finds itself increasingly in the orbit of larger players like Uber Technologies UBER and DoorDash DASH. Both Uber and DoorDash have invested heavily in autonomous and last-mile logistics, testing robotic delivery in select markets and partnering with startups to accelerate deployment.

Uber, through its Uber Eats segment, has piloted sidewalk delivery robots in collaboration with Cartken and Motional, aiming to reduce last-mile costs. Meanwhile, DoorDash is expanding its own robotic trials while leveraging its scale and logistics infrastructure to stay ahead. Serve may be more nimble, but Uber’s global delivery volume and DoorDash’s deep merchant network create serious competitive pressure.

As SERV aggressively scales its robot fleet, the question is whether it can compete on speed, reliability, and market coverage against giants like Uber and DoorDash. Their dominance could test Serve’s ability to capture sustained share in urban delivery.

SERV Stock’s Price Performance & Valuation Trend

Shares of this leading autonomous sidewalk delivery company have surged 79.7% in the past three months, significantly outperforming the Zacks Computers - IT Services industry, the Zacks Computer and Technology sector and the S&P 500 index, as you can see below.

SERV Share Price Performance

From a valuation standpoint, SERV trades at a forward price-to-sales ratio of 26.11, significantly higher than the industry’s average, as shown below.

SERV Valuation

Earnings Estimate Trend of SERV Stock

SERV’s bottom-line estimates for 2025 have remained unchanged at a loss of 93 cents over the past 30 days. The estimated figure for 2025 implies a decline from a loss of 67 cents per share reported a year ago.

SERV’s Earnings Estimate Revision

SERV stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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