F-1/A: Roze AI Files Amended F-1 for Nasdaq Direct Listing

Roze AI Inc. has filed an amended F-1 registration statement detailing its plan for a direct listing on the Nasdaq Capital Market, including the resale of up to 18,138,565 common shares.

Summary

• Roze AI Inc. is preparing for a direct listing on the Nasdaq Capital Market, with up to 18,138,565 common shares being registered for resale by existing shareholders.
• The company specializes in AI-driven disaster prevention technology, particularly fire detection and prevention systems (DAP).
• Roze AI Korea Co., Ltd., a subsidiary, is the primary operating entity, established in 2015.
• The company plans to develop a System on Chip (SoC) for disaster prevention, with commercialization expected no earlier than 2027.
• Roze AI will be a controlled company, with CEO Young Jin Cho holding a majority of the voting power.
• The company has experienced a significant revenue decrease in 2025 due to macroeconomic factors and a slowdown in the South Korean construction sector.
• The company has a substantial backlog of contracted projects totaling $526,767,647 as of December 31, 2025.
• The company's auditor has expressed substantial doubt about its ability to continue as a going concern, though a private placement of Class C Preferred Shares is expected to resolve this.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing as having a negative sentiment due to the significant revenue decline, increased net loss, going concern issues, and reliance on a private placement to address financial stability, despite the potential of its technology.

Positives

• Roze AI has a proprietary AI technology platform (DAP) for disaster prevention, certified for stability and functionality in Korean national facilities.
• The company has a significant backlog of $526,767,647 in contracted projects as of December 31, 2025.
• The company is developing its own AI-optimized System on Chip (SoC) for disaster detection.
• Roze AI has secured patents in the US, Korea, and other countries for its AI wireless fire detection and prevention systems.
• The company has a strategy to expand into global markets, particularly North America, through partnerships.
• The company has a strong R&D focus with six core technology areas, including AIoE devices, AI engines, and SoC development.
• The company has a history of government certifications and selections as an innovative company in South Korea.
• A private placement of $9 million in Class C Preferred Shares is expected to close, addressing going concern issues.

Negatives

• The company experienced a significant revenue decrease in 2025 ($2.3 million from $8.2 million in 2024) due to macroeconomic uncertainties and a construction sector slowdown in South Korea.
• The company has a history of operating losses and expects to continue incurring significant expenses, with its auditor expressing substantial doubt about its ability to continue as a going concern.
• The direct listing process on Nasdaq may lead to higher volatility in share price compared to a traditional underwritten IPO.
• The company will be a controlled company, with the CEO holding majority voting power, potentially limiting minority shareholder influence.
• The company's reliance on the South Korean construction market makes it vulnerable to economic downturns and project financing issues.
• The company has a substantial amount of debt, including convertible debt, totaling $6.45 million as of December 31, 2025.
• The company's Class C Preferred Shares have conversion price reset provisions that could lead to significant dilution for common shareholders.
• The company has not generated material subscription revenue and its B2C model is in early planning stages.

Risks

• Operating results are likely to vary significantly and be unpredictable due to various external factors.
• Component shortages (chips, etc.) and supply chain disruptions could adversely affect the business.
• The company's business is subject to warranty claims, product liability, and product defects.
• Intellectual property rights may be difficult to enforce, and the company may face infringement claims.
• The company will be a controlled company, potentially limiting shareholder protections regarding corporate governance.
• The direct listing process may result in a more volatile trading price and uncertain trading volume.
• The company's substantial indebtedness could adversely affect its financial condition and results of operations.
• The company may not be able to manage its expansion of operations effectively.

Future Outlook

The company expects previously secured backlog projects, which experienced delays due to macroeconomic conditions and the construction sector slowdown in South Korea, to resume in the second and third quarters of 2026. This is anticipated to lead to a gradual recovery in Average Order Value (AOV). The company plans to expand its B2G and B2B contracts and explore strategic partnerships and other financing activities to meet future capital requirements. Commercialization of the SoC is not expected before 2027.

Management Comments

• Young Jin Cho, CEO, founded Roze AI Korea in 2015 and has over 20 years of experience in the IT field.
• Seog Hun Cho, COO, has experience in new channel development and holds business licenses for fire facility construction and information/communication construction.
• Seon Ho Lee, CFO, has experience in IPO accounting audits and due diligence for KOSDAQ listing.
• O Jang Jeong, CTO-R&D Strategy, has over 30 years of experience in ICT hardware and software integrated engineering solutions.
• Seung Ju Lee, CTO-DAP, has deep expertise in IoT, wireless communication, and hardware-based firmware technologies.
• Chang Sik Jung, CTO-SoC & Communication, is an expert in big data processing platforms and has extensive research experience in wireless communication.

Industry Context

StockSavvy.ai notes that Roze AI operates in the growing global fire prevention market, which is driven by increasing safety regulations and technological advancements like wireless and AI integration. However, the company's significant revenue decline in 2025 highlights the sensitivity of the sector to macroeconomic conditions and construction market downturns, particularly in its primary market of South Korea.

Corporate Governance

Legal Proceedings

• The company is not currently a party to, and its property is not the subject of, any material legal proceedings.

Related Party Transactions

• Compensation paid to key management (CEO, COO, CFO, CTOs) for 2025 totaled $331,448.
• As of December 31, 2025, there was a loan receivable from the CFO of $69,226.
• As of December 31, 2025, there was a loan payable to the CEO of $358,706.
• The company issued 1,000,000 Common Shares and 61,000,000 Class A Preferred Shares to the CEO as consulting fees and for capital contribution, respectively.
• DT Lab Co., Ltd., previously a related party, was sold to a third party on January 13, 2025, and is no longer considered a related party.

Stakeholder Impact

• Shareholders: Potential for dilution from Class C Preferred Share conversion, volatility in share price due to direct listing process, and reduced corporate governance protections due to controlled company status.
• Employees: The company's financial situation and potential need for future financing could impact job security and compensation.
• Creditors: The company has substantial debt, and its ability to meet obligations depends on future financing and operational performance.
• Customers: The company's technology is deployed in critical infrastructure, and any operational disruptions or financial instability could impact service reliability.

Next Steps

• Complete the private placement of Class C Preferred Shares.
• Obtain approval for the Nasdaq Capital Market listing.
• Commence trading on the Nasdaq Capital Market via a direct listing.
• File a resale registration statement for Advisory Stock and Common Shares underlying Class C Preferred Shares within 10 days of listing.
• Expand B2G and B2B contracts and pursue strategic partnerships for growth.
• Continue R&D for SoC development and commercialization.

Key Dates

Recommendation

While Roze AI possesses innovative technology in a growing market, the significant revenue decline, increased net loss, going concern issues, and the inherent volatility of a direct listing warrant a cautious approach. The company's ability to execute its growth strategy, secure further funding, and navigate the competitive landscape will be critical. A 'hold' recommendation reflects the balance between the technological potential and the current financial and operational risks.

Keywords

Roze AI, Direct Listing, Nasdaq, F-1 Filing, Disaster Prevention Technology, AI Platform, Digital Twin, Fire Safety