Pony AI Inc (NASDAQ: PONY) saw its stock plummet by 5.10% in Wednesday's intraday trading session, following the release of its disappointing first-quarter 2025 earnings report and a price target cut by Bank of America Global Research.

The autonomous vehicle technology company reported mixed results for Q1 2025, with full-year revenue increasing by 4.3% to $75 million. However, the company's Robotaxi services revenue, a key focus area, declined by 5.3% year-over-year to $7.3 million. This decrease was primarily attributed to reduced service fees from autonomous vehicle engineering solutions. Additionally, Pony AI's total operating expenses surged by 85.4% to $296.9 million, driven by accelerated R&D investment for the launch of its seventh-generation Robotaxi vehicles.

Adding to investor concerns, Pony AI reported a significant increase in net loss, reaching $275 million compared to $125.3 million in the previous year. The company's gross margin also contracted from 23% in 2023 to 15.2% in 2024. In light of these financial challenges, Bank of America Global Research cut its price objective for Pony AI from $18 to $17.7, further pressuring the stock. Despite the setbacks, Pony AI's management remains optimistic about the company's technological readiness for mass commercialization of Robotaxi services and its strong partnerships with major automakers for scaling up production.