Shares of Serve Robotics Inc. (NASDAQ: SERV) plummeted 12.90% in intraday trading on Friday following the company's announcement of a $100 million registered direct offering of common stock. The significant drop reflects investors' concerns about potential share dilution and its impact on existing stockholders.

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

The timing of this offering is particularly noteworthy, coming just a day after Serve Robotics announced a partnership with DoorDash, which had driven the stock up by 28.6% to $17.68. This sequence of events has led some market observers to speculate that the company may have timed the DoorDash announcement to inflate the stock price ahead of the offering. The sharp reversal in stock price suggests that investors are reassessing the stock's value in light of the potential dilution, despite the recent positive developments in the company's business operations.