Serve Robotics Inc. (NASDAQ: SERV), a leading autonomous sidewalk delivery company, saw its stock plummet 6.62% in pre-market trading on Friday. This significant drop comes on the heels of the company's announcement of a $100 million registered direct offering of common stock.

The company revealed that it has entered into securities purchase agreements with certain institutional investors for a registered direct offering of 6,250,000 shares of common stock. This move is expected to generate approximately $100 million in gross proceeds before deducting placement agent fees and other offering expenses. Serve Robotics stated that it intends to use the net proceeds for general corporate purposes, including working capital.

While the influx of capital could potentially fuel the company's growth and operations, the market's immediate reaction appears negative. This is likely due to concerns about stock dilution, as the introduction of new shares can decrease the value of existing stockholders' shares. The pre-market plunge suggests that investors are reassessing the stock's value in light of this new offering.