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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Form 10-K

Commission file number 000-31511

At Road, Inc.

47200 Bayside Parkway

Registrant’s telephone number, including area code: 510-668-1638

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes þ          No o

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.     þ

     Indicate by check mark whether the registrant is an accelerated filer (as defined in the Exchange Act Rule 12b-2).     Yes þ          No o

     The aggregate market value of the voting stock held by non-affiliates of the registrant was approximately $297,962,137 as of June 30, 2003, based upon the closing sale price on the Nasdaq National Market reported for such date. Shares of Common Stock held by each officer and director and by each person who owns 5% or more of the outstanding Common Stock have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

     There were 53,838,699 shares of the registrant’s Common Stock issued and outstanding as of February 27, 2004.

DOCUMENTS INCORPORATED BY REFERENCE

     Part III incorporates information by reference from the definitive proxy statement to be filed in connection with the registrant’s 2004 annual meeting of stockholders.

TABLE OF CONTENTS

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      Except for the historical information contained in this Report, the matters discussed in this Report are forward-looking statements involving risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. Potential risks and uncertainties include, but are not limited to, fluctuations in quarterly results, our limited operating history, the infancy of the mobile resource management industry where there is no established market for our products and services, our ability to adapt to rapid technological change, our dependence on wireless networks, network infrastructure and positioning systems owned and controlled by others and general economic and political conditions. Further information regarding these and other risks is included in this Report and in our other filings with the Securities and Exchange Commission (“SEC”).

      Our primary Internet address is www.road.com. We make our periodic SEC reports (Forms 10-Q and Forms 10-K) and current reports (Forms 8-K) available free of charge through our website as soon as reasonably practicable after they are filed electronically with the SEC. We may from time to time provide important disclosures to investors by posting them in the investor relations section of our website, as allowed by the SEC rules.

Overview

      We are a leading provider of mobile resource management services, a rapidly growing category of business productivity solutions that enable the effective management of mobile resources. We market and sell our services to a broad range of customers in the United States and Canada that vary in size, geographic location and industry. In 2003, our largest customers based on revenues were Verizon Communications, Waste Management and Qwest Communications. We have grown our subscriber base from approximately 35,000 subscribers as of December 31, 2000 to approximately 125,000 subscribers as of December 31, 2003.

The @Road Solution

      Our mobile resource management (“MRM”) services allow customers to improve productivity by enabling the effective management of the activities of their mobile workers and assets and their goods and services. In addition, our services allow customers to increase the utility of their mobile resources and decrease costs of operations by facilitating business processes, such as event confirmation, signature verification, forms processing, project management and timekeeping while their workers are in the field. Our services also provide location, reporting, dispatch, messaging, and other management services and are designed to be easy to implement and use. Our customers can manage their mobile workers in several ways, including by logging onto our website, receiving their data directly into their existing software applications, using any wireline or wireless telephone to access our speech-to-text voice portal or requesting information from our data centers using application programming interfaces.

      Our services are built on our LocationSmart technology platform, an end-to-end solution that seamlessly combines wireless communications, Global Positioning System (“GPS”) technology, hosted software applications and Internet technologies. The information technology infrastructure and network application software used in our LocationSmart technology platform reside at our co-located data centers in Virginia and California. Because we host our services, our customers do not need to make a substantial

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@Road LocationSmart Technology Platform

      Our service delivery architecture is designed to serve a growing number of subscribers with increasing data transmission volumes without compromising performance, delivery times or data accuracy. Because key technology components of our solution can be expanded to accommodate additional users, as in the case of wireless networks or the Internet, or are designed to accommodate a practically unlimited number of users, as in the case of GPS, we believe that we can support a significantly expanding customer base. With the addition of our services that run on a location- or wireless application protocol-enabled mobile telephone, a customer can easily expand the deployment of our services to existing or new handsets.

      We believe that customers use return on investment as a primary selection criterion when evaluating MRM solutions. We believe that benefits of our services that drive a rapid return on investment for our customers include the following:

	•	Improved productivity of mobile resources. Customers use location, personalized mapping landmarks and path sequencing features to maximize the time spent completing work orders in the field and minimize non-productive time. Customers also monitor the progress of jobs in the field and re-allocate resources to better meet project deadlines. Customers measure improvements in their mobile workers’ productivity from using our services in many ways, including by an increase in the number of jobs a mobile worker can complete per day or by an increase in revenue earned by a mobile worker per day.
	•	Decreased costs of operations of mobile resources. Customers use our two-way communications services for low-cost transmission of completed business forms, signature verification and messaging. Customers also use our services to automatically monitor and schedule maintenance activities for assets in the field. Customers measure decreases in their costs from using our services in many ways, including by a decrease in the cost of having a mobile worker in the field or by a decrease in the cost of insuring mobile workers and assets.
	•	Improved efficiency of a customer’s overall operations. Customers use our services to capture timekeeping, workflow and inventory information in the field. This information can be delivered directly to our customers’ existing software applications or downloaded from our website and

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		imported into a payroll or customer invoicing system. These services can minimize the need for back-office data entry services, minimize data entry errors and accelerate invoicing processes. Customers measure improvements in their efficiency from using our services in many ways, including by a decrease in costs of general and administrative expenses and by a reduction in days sales outstanding of accounts receivable.
	•	Improved responsiveness to our customers’ customers. Customers use location and workflow information to update our customers’ customers about pending work orders or deliveries. Our customers also use our location-on-demand feature to assign a pending work order to the closest or best-equipped mobile worker to provide the quickest response that meets the end-customer’s demands. Customers enhance their customer relationship management operations by accessing stored information about end-customers, including workflow data records, audit trails of mobile worker messages, and daily mobile worker activity data. Customers measure improvements in their responsiveness from using our services in many ways, including by a reduction in aged receivables and by an improvement in internal customer satisfaction indexes.

      In addition, we offer multi-year subscription contracts that allow our customers to pay us on a monthly basis and minimize upfront cash commitments. We believe a monthly payment subscription model further accelerates a customer’s return on investment in our services.

      We believe that leaders in the MRM market are evaluated on a number of criteria, including size, technology leadership, financial strength, strength of customer base, strategic relationships with wireless carriers and management experience. We believe that based on these criteria, we are a leader in the MRM market. Our objective is to enhance our leadership position in the MRM market. Key elements of our strategy are:

	•	Further penetrate vertical markets in which we have or are developing leading reference customers. We have developed a relationship with leading companies in some vertical markets, such as telecommunications, construction and facilities/waste management. We are leveraging our relationships with these customers and our knowledge of their MRM needs to attract other potential medium- to large-sized customers in these markets. In other vertical markets, we intend to replicate the model of deploying our services with a leading reference customer and leveraging this relationship and our MRM market expertise to attract other customers in those markets.
	•	Create new value-added services for our customers. We will continue to add new features and functionality to our services and develop new platforms that take advantage of advances that are being made in wireless communications. We expect to continue to release new features that synthesize the information currently retrieved by our existing services and which arise from working closely with our customers. We expect some of these features to be incorporated into our services as free enhancements, while others will be offered for additional fees. We intend to continue to use our capabilities in the U.S. and our wholly-owned subsidiary in India to help develop and support new features and functionality for our services. In addition, we are continuing to develop an open platform architecture to allow our customers and partners to integrate third-party applications with our services.
	•	Expand our services internationally. We intend to identify new geographic markets for which our services and our LocationSmart technology platform satisfy evolving customer demands. We believe that leveraging our technology leadership position, our broad experience with customers in the United States and Canada and the distribution resources of established vendors and wireless carriers will help us to establish customer awareness and acceptance of our services in international markets.
	•	Acquire complementary businesses and technologies. We intend to supplement our subscriber base, revenue and service offerings by selectively acquiring complementary businesses and technologies.

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		We continually evaluate opportunities to accelerate our growth and broaden our market share in the United States and abroad.

      Our current family of MRM services includes GeoManager, GeoManager Pocket Edition, @Road Pathway, RoadREPORT, RoadFORCE and ConnectBusiness. Together, these service offerings are designed to meet the needs of customers in a variety of vertical markets, including telecommunications, field service, construction, facilities/waste management, freight and passenger transportation, courier/delivery, distribution, security, cable/broadband and utilities.

      Our services provide current and historical data relating to a customer’s mobile resources in a variety of formats, including activity reports, maps and completed business forms. We provide these formats in a standard configuration, and customers can configure certain elements and views themselves to help achieve compliance with their internal business rules. Customers can choose to have reports delivered on a pre-scheduled basis, or they can submit queries to our databases to create reports and views on demand. Customers can also download reports to manipulate and store data as desired. Mobile resource data is typically stored by us for 14 days, unless the customer purchases our extended data storage service.

      Our services are enabled by the deployment of a device, which we call a platform, to each of the customer’s mobile resources. We call each mobile resource with a platform a “subscriber.” Our services operate with three independent platforms. First, a mobile worker can use our proprietary hardware device embedded with software that integrates a GPS receiver with a wireless modem. Second, a mobile worker can use our proprietary hardware device embedded with software and an integrated GPS receiver and which is tethered by cable to a wireless telephone. Each of these proprietary hardware devices is called an Internet Location Manager. The Internet Location Manager is installed in a mobile worker’s vehicle. Installation in any type of vehicle typically takes less than an hour, and is completed by our subcontracted installation agents. Third, a mobile worker can use a location- or wireless application protocol-enabled mobile telephone installed with our software application.

      These platforms send and receive a variety of information from time to time and on demand. Such data include location, velocity, time and operational diagnostics. These data are transmitted to our data centers using wireless networks and the Internet. If a wireless connection is not available, then the platform will store up to five days of captured data and seek to transmit the data when a wireless connection is available.

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      The following table describes our current family of MRM services, selected features and enhancements of these services and platforms that operate with those services:

						@Road-Supported
Service		Description		Selected Features and Options		Platforms
GeoManager		Flagship service designed to provide detailed mobile resource management for customers in all of our markets. Provides services on a hosted basis using a web browser on demand, continuously streamed to customer applications or by providing connections to other applications with application programming interfaces (APIs).		4  DirectData— continuous streaming of subscriber data to customer applications 4   Two-Way Communications— text messaging and storage using multiple devices 4   Exception Services—alerts and reports identifying incidents where mobile workers meet or exceed customer-defined business rules 4   MobileForms—conduct business transactions, signature capture and document workflow in the field using a ruggedized personal digital assistant 4   Voice Solutions—speech-to-text translation engine for oral and text messaging 4   Mapping—provides automatic geocoding of location data and configurable map views
GeoManager, Pocket Edition		Provides much of the same functionality as the GeoManager service. Runs a java application on a location-enabled wireless telephone.		4  DirectData 4   Field Landmarking— subscribers can use wireless telephones to generate location-specific icons for use with mapping, reports and other features 4   Mapping
@Road Pathway		Provides customers a cost- effective, entry-level MRM solution using a location- enabled wireless telephone.		4  Activity Reports— detailed reporting of individual mobile workers and groups 4   Ping— locate workers in the field on demand using any web browser 4   Mapping
RoadREPORT		Provides detailed historical reporting of mobile resources and their activities. Cost-effective solution for companies in all of our markets that do not need current information from the field.		4  Multiple Report Retrieval Methods— reports are accessible using a web browser or can be delivered by email or file transfer protocol 4   Advanced Reports Scheduling— customers can configure reporting formats and delivery times in advance

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						@Road-Supported
Service		Description		Selected Features and Options		Platforms
RoadFORCE		Provides companies with mobile professionals detailed information about their teams’ activities. Available in two modules, one focused on managing a mobile staff and one focused on managing company assets.		4  Productivity Reports 4   Customer Call Reports 4   Personal/ Business Mileage Management
ConnectBusiness		Provides project managers in construction and related industries an application for managing contractors, remote workers and multiple job sites. Data is available over the Internet using a web browser. Uses any wireless application protocol (WAP) enabled mobile telephone to send and receive data from our data centers.		4  Project Management Module 4   Timekeeping 4   Two-Way Communications 4   Easy Import into Accounting, Project Management and other Applications

We believe the following features and benefits of each of our services provide a variety of competitive advantages over other solutions:

	•	Cost-effective. Our services are cost-effective for our customers because we utilize existing infrastructure, such as the Internet and wireless networks, developed by other companies, and GPS technology developed by the U.S. government. Our customers are not required to make substantial capital investment because our services can be deployed on an existing location- or wireless application protocol-enabled mobile telephone, customer data and our software reside at our data centers, and our services can be accessed by using the Internet or any wireline or wireless telephone.
	•	Ease of implementation. The implementation of our services is designed to be quick and easy for our customers. When deploying our services using a location- or wireless application protocol-enabled mobile telephone as the hardware platform, customers install a software program on the telephone. Once launched, this software program communicates with our data centers, and the customer deployment is complete. When deploying our services using an Internet Location Manager, an optional Internet Data Terminal device or a ruggedized personal digital assistant as the hardware platform, we install this hardware in the customer’s vehicles. As our customers grow, they can install software on additional mobile telephones or our hardware platform in additional vehicles to continue to expand their use of our services.
	•	Ease of use. Our services are designed to be deployed as end-to-end solutions. That is, a customer does not incur incremental information technology costs associated with the deployment or use of our services. Our services are designed to be available over the Internet and by telephone 24 hours a day, seven days a week, with the exception of scheduled maintenance. Our user interfaces, including those used with the Internet, mobile telephones, Internet Data Terminals and our ruggedized personal digital assistant, are designed to be intuitive and easy to use, require minimal training and be modified by the customer to meet each customer’s particular requirements. Additionally, our DirectData service streams customer data directly to a customer’s existing software applications, and the business intelligence arising from use of our services with a customer’s existing operations models enables a customer to maximize the value of its existing investments in information technology and productivity solutions.
	•	Ease of maintenance. We host and maintain all the services we provide. We also manage the wireless network and Internet connections between and among the platforms in the field, our data

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		centers and the Internet. Additionally, we implement service and software upgrades centrally at our data centers and remotely to the platforms in the field over the same wireless connection used to transmit mobile resource information. For these reasons, customers benefit from enhancements to our services while avoiding information technology and infrastructure maintenance expenses and the daily interruption of the operations of their mobile resources.
	•	Wireless data connectivity. Our services operate with a number of wireless networks offered by some of the largest wireless carriers in the United States and Canada including: General Packet Radio Services, Code Division Multiple Access 1XRTT, Integrated Digital Enhanced Network and Cellular Digital Packet Data. With our wireless carrier partners, we deliver services in more than 200 of the top metropolitan statistical areas in the United States and Canada. Subject to a customer’s preferences, we typically configure our services with the most cost-effective and efficient wireless network available in the customer’s geographic area of operations. In some cases, a single customer with geographically disperse operations may receive services that seamlessly use more than one wireless network. Wireless network configuration typically occurs in the background and does not require significant time or effort of the customer.
	•	Store-and-forward functionality. Our services are designed to address common geographic limitations and network difficulties associated with wireless networks. When a subscriber travels outside a wireless network’s coverage area, the Internet Location Manager or mobile telephone, as the case may be, continues to collect and stores up to five days of information. These data are transmitted to our data centers when the subscriber returns to the wireless coverage area. Our services are designed to be tolerant of wireless network difficulties and to have the ability to confirm receipt of data from the field and re-transmit data when errors are detected.
	•	Robust reporting and mapping capabilities. Our services offer customers comprehensive, detailed reporting of workforce activity, either individually or for all or a selected group of a customer’s mobile resources. Reports can be formatted by customers and downloaded for additional sorting and analysis. A customer’s preferences are stored at our data centers and can be modified by the customer at any time to meet its changing needs. The current and past locations of each subscriber can be displayed on a map, making monitoring simple. Map views can be personalized by customers to graphically display different information about their mobile resources, including locating positions on maps by address or customer-defined landmarks.
	•	Location by Global Positioning System. Our services use the Global Positioning System to determine the location of a mobile resource. We believe GPS technology is more reliable than other positioning technologies because of its proven accuracy, the large number of deployed satellites and its ability to determine location regardless of velocity and altitude. The Global Positioning System uses pre-existing infrastructure developed by the U.S. government, which minimizes our costs of service delivery.
	•	Communications capabilities. Our customers may enhance their field operations by using our two-way communications services. These services operate using either a wireless telephone or the Internet Location Manager with our optional Internet Data Terminal. These services enable our customers to communicate regularly and quickly with mobile workers. While the services permit free-text messages, they also enable customers to pre-program a set of messages that can be transmitted with the push of a button to minimize distractions in the field. Messages are stored at our data centers, and are accessible by our customers using a web browser. Customers can use the message database for customer relationship management, proof of service, auditing and minimizing the occurrence of lost change orders, missed appointments or other communications.

      We market and sell our services to a broad range of customers in the United States and Canada that vary in size, geographic location and industry. The number of mobile resources enabled with our services has grown from 135 as of December 31, 1998 to approximately 125,000 as of December 31, 2003. We

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      In 2003, one customer, Verizon Communications, represented 17% of total revenues. No other customers comprised 10% or more of total revenues. In 2002 and 2001, no single customer or group of related customers comprised 10% or more of total revenues.

      We concentrate our research and development activities on services and platform engineering. Our U.S. research and development activities are supplemented by resources and personnel at our subsidiary in India. To enhance our existing services and to introduce new services to our existing and potential customers, we focus on the following key areas:

	•	Services. We intend to continue to develop our services by offering new features while enhancing existing features. For example, in March 2003, we launched GeoManager Pocket Edition service, which is designed to deliver our standard mobile resource management application using a location-enabled mobile telephone in lieu of an Internet Location Manager. In July 2003, we launched Electronic Driver Logs service, which eliminates paperwork for mobile workforces and office staff by generating reports by subscriber showing hours worked, hours available and regulatory violations. Also in July 2003, we launched Automated State Mileage Reports service, which enables companies to automatically record how many miles each subscriber has traveled, information that can be used when preparing state-mandated quarterly fuel tax reports. In September 2003, we launched @Road Pathway service, which is designed to provide a cost-effective mobile resource management solution using a location-enabled Nextel Communications cellular telephone.
	•	Platform. We intend to continue to develop and release platform upgrades to add new features as well as to enhance existing features. For example, in April 2003, we announced the availability of an Internet Location Manager with AT&T’s wireless General Packet Radio Service network. This new hardware platform enables customers to experience increased data transmission rates, enhanced security capabilities and wide geographic coverage. In June 2003, we announced the availability of an Internet Location Manager with Sprint’s Code Division Multiple Access 1XRTT wireless network. This new hardware platform enables customers to use our services on a third-generation wireless network that enables faster data transmission speeds than older wireless networks.

      We spent $5.4 million, $5.9 million and $7.6 million on research and development activities in the years 2003, 2002 and 2001, respectively. As of December 31, 2003, we had 56 employees in research and development.

      Our technology efforts focus on creating new services and enhancing the reliability, availability and features of our services while maintaining a scalable and cost effective architecture. Our proprietary technologies are designed to work with technologies from other companies, including our partners, competitors, and other third parties. While we have integrated wireless communications into our services in three ways, including a wireless modem embedded in our Internet Location Manager, an Internet Location Manager tethered to a Nextel Communications cellular telephone and installation of our thin client

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	•	Wireless technology. Our services currently operate on several wireless networks offered by a number of wireless carriers, including the General Packet Radio Services, Code Division Multiple Access 1XRTT, Integrated Digital Enhanced Network and Cellular Digital Packet Data. One of our objectives is to continue to maintain our technological independence from any one wireless protocol or platform, enabling our customers to communicate with our data centers in the way or ways which best suit their needs.
	•	Access and Internet technology. The delivery of our services is complex in part because it involves the continuous collection, storage and processing of data from over one hundred thousand subscribers in the field as well as processing requests from thousands of users accessing our data centers. To manage the throughput of customer information and to deliver our services to our customers, we use secure Internet connections between our data centers and customers accessing our services as well as the wireless networks transmitting customer information. In addition to providing access to our services using any Internet connected computer, we provide access via any wireline or wireless telephone with our speech-to-text interface technology. We also facilitate the integration of customer data collected by our services with a customer’s existing software applications through our DirectData streaming service and application programming interfaces. We plan to further enhance access to customer data and our services by developing additional access methods for customers to obtain their data.
	•	Information technology. We have an information technology organization dedicated to maintaining and enhancing our data centers. By managing our services at our data centers, we relieve our customers of the development and operations burden of managing services resulting from the integration of wireless communications, location technologies, hosted software applications, transaction processing infrastructure and Internet technologies. Our data centers are composed of servers co-located in Redwood City, California and Ashburn, Virginia. We maintain variable-speed capacity connections between our data centers and the Internet and dedicated connections to the wireless networks we use. In addition, our data centers automatically replicate customer data on a minute-by-minute basis. In the event of a power failure, our systems would be powered by a backup power supply.
	•	Location technology. The Global Positioning System is a worldwide radio-navigation system formed from a constellation of satellites and ground systems that are used as reference points to calculate positions. We have developed a patented GPS chipset and algorithm designed to be optimized for our services. As a result, our Internet Location Manager is designed to determine its location in less time than that which is required by other commercial receivers.

      We will continue to establish relationships with a number of companies to accelerate the adoption of our services. We believe that establishing strategic relationships will facilitate our technological leadership and provide early access to emerging technologies and new customers. Some of our existing relationships include:

	•	Wireless carriers. We have established strategic relationships with ALLTEL, AT&T Wireless, Bell Mobility, Cingular Wireless, Nextel Communications, Nextel Partners, Sprint, TELUS Mobility and Verizon Wireless to provide wireless connectivity between our subscribers and the Internet. We contract directly with ALLTEL, AT&T Wireless, Sprint and TELUS Mobility for the provision of wireless communications, which are bundled with our services. With Bell Mobility, Cingular Wireless, Nextel Communications and Nextel Partners our customers have separate contracts for

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		wireless communications with their carrier. With Verizon Wireless, in some geographic areas we bundle our services with wireless communications, and in other areas our customers have separate contracts for wireless communications.
	•	Manufacturers. Symbol Technologies manufactures the ruggedized personal digital assistant for use with our services. Orient Semiconductor Electronics manufactures and tests our Internet Location Manager.

      Our sales and marketing objective is to achieve broad market penetration through vertical marketing and targeted sales activities. We currently market and sell our solution through a number of sales channels, including the following:

	•	Strategic sales force. We have a team of sales employees focused on marketing and selling our services to large-sized customers. Large-sized customers are defined as customers with greater than 750 mobile resources. This sales force is geographically dispersed throughout the United States near target sales prospects. The sales process with large-sized customers often requires many months of activity, is competitive and typically requires a pilot test of our services.
	•	Mid-market sales force. We have a team of sales employees focused on marketing and selling our services to small- and medium-sized customers. This sales force is geographically dispersed throughout the United States where major wireless networks are available. Additionally, our mid-market sales force works with our wireless carrier partners to increase our subscriber base.
	•	Inside sales force. We have a team of sales employees focused on marketing and selling our services to small-sized customers. This sales force is located at our headquarters in Fremont, CA. Additionally, our inside sales force works with our direct sales force to increase our subscriber base.
	•	Agent sales force. We have a team of employees who manage a network of independent sales agents focused on marketing and selling our services. These independent sales agents are geographically dispersed throughout the United States and Canada. Participants in the agent sales program are compensated for the sale of our services and for the length of time during which a customer is under contract with us. Independent sales agents facilitate sales of our services through their own efforts and work with wireless carrier partners to increase our subscriber base.
	•	Wireless carrier partners. Our wireless carrier partners are ALLTEL, AT&T Wireless, Bell Mobility, Cingular Wireless, Nextel Communications, Nextel Partners, Sprint, TELUS Mobility and Verizon Wireless. Certain of these partners market or facilitate sales of our services through their own sales channels and work with our mid-market sales force to increase our subscriber base.

      Our marketing department is engaged in a wide variety of activities, such as awareness and lead generation programs and product management. These activities include public relations, seminars, direct mail, trade shows, and co-marketing and co-branding with partners.

      As of December 31, 2003, our sales and marketing team consisted of 86 employees.

      We face strong competition for our services. We compete primarily on the basis of functionality, ease of use, quality, price, service availability, geographic coverage of services and corporate financial strength. As the demand by businesses for mobile resource management services increases, the quality, functionality and breadth of competing products and services will likely improve and new competitors will likely enter our market. In addition, the widespread adoption of industry standards may make it easier for new market entrants or existing competitors to improve their existing services, to offer some or all of the services we offer or may offer in the future, or to offer new services that we do not offer. We also do not know to what extent network infrastructure developers and wireless network operators will seek to provide integrated

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      The market for our services is competitive and is expected to become even more competitive in the future. If we are unable to compete successfully, it may harm our business or increase our sales cycles, resulting in a loss of market share and revenues. We face competition from a number of different business productivity solutions, including:

	•	Solutions developed internally by our prospective customers’ information technology staffs;
	•	Discrete means of communication with mobile workers, such as pagers, two-way radios, handheld devices and wireless telephones;
	•	Solutions targeted at specific vertical markets, such as services offered by Qualcomm that monitor assets in the long-haul transportation sector; and
	•	Solutions offered by smaller market entrants.

      Many of our existing and potential competitors have substantially greater financial, technical, marketing and distribution resources than we do. Additionally, many of these companies have greater name recognition and more established relationships with our target customers. Furthermore, these competitors may be able to adopt more aggressive pricing policies and offer customers more attractive terms than we can.

      We rely on a combination of patent, trade secret, trademark and copyright laws, and nondisclosure and other contractual restrictions to protect our proprietary technology. As of December 31, 2003, we possessed ten patents, which we believe cover our GPS chipset technology and some of the methods and structures for distributing information over a network as well as applications of those methods, and had approximately 35 patent applications pending in jurisdictions around the world. We have filed numerous additional patent applications to further protect and extend our technology leadership position. Although we have applied for patent protection primarily in the United States, we have filed and intend to continue to file patent applications in other countries where there is a strategic, technological or business justification.

      As part of our confidentiality procedures, we generally enter into nondisclosure agreements with our employees, consultants, distributors and corporate partners and limit access to and distribution of our software, documentation and other proprietary information. In the event that a third party breaches the confidentiality provisions or other obligations in one or more of our agreements or misappropriates or infringes on our intellectual property or the intellectual property licensed to us by third parties, our business would be seriously harmed. Third parties may independently discover or invent competing technologies or reverse engineer our trade secrets, software or other technology. Furthermore, laws in some foreign countries may not protect our proprietary rights to the same extent as the laws of the United States. Therefore, the measures we take to protect our proprietary rights may not be adequate.

      Third parties may claim that our current or future products or services infringe their proprietary rights or assert other claims against us. As the number of entrants into our market increases, the possibility of an intellectual property or other claim against us grows. Any intellectual property or other claim, with or without merit, would be time-consuming and expensive to litigate or settle and could divert management attention from focusing on our core business. As a result of such a dispute, we may have to pay damages, incur substantial legal fees, develop costly non-infringing technology, if possible, or enter into license agreements, which may not be available on terms acceptable to us, if at all. Any of these results would increase our expenses and could decrease the functionality of our services, which would make our services less attractive to our current or potential customers. We have agreed in some of our agreements, and may agree in the future, to indemnify other parties for any expenses or liabilities resulting from claimed infringements of the proprietary rights of third parties.

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      As of December 31, 2003, we had 314 employees, 276 of whom were located in the U.S. and 38 of whom were located in Chennai, India. We believe relationships with our employees are good.

      We have offices in Fremont, California and Chennai, India.

      From time to time, we are subject to claims in legal proceedings arising in the normal course of our business. We do not believe that we are party to any pending legal action that could reasonably be expected to have a material adverse effect on our business, financial condition or operating results.

      None.

PART II

Price Range of Common Stock

      Our common stock has been listed for quotation on the Nasdaq National Market under the symbol “ARDI” since our initial public offering on September 28, 2000. The following table shows the high and low sales prices of our common stock as reported by the Nasdaq National Market for the period indicated.

      At December 31, 2003, there were approximately 106 holders of record of our common stock. This does not include the number of persons whose stock is held in nominee or “street name” accounts through brokers.

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      The market price of our common stock has been and may continue to be subject to wide fluctuations in response to a number of events and factors, such as quarterly variations in our operating results, announcements of technological innovations or new products or services by us or our competitors, changes in financial estimates and recommendations by securities analysts, the operating and stock performance of other companies that investors may deem comparable to us, and news reports relating to trends in our markets. In addition, the stock market in recent years has experienced extreme price and volume fluctuations that have particularly affected the market prices of many high technology companies that have often been unrelated or disproportionate to the operating performance of those companies. These fluctuations, as well as general political, economic and market conditions, may adversely affect the market price for our common stock.

Dividend Policy

      We have never paid cash dividends on our common stock. We currently intend to retain any future earnings to fund the development and growth of our business. Therefore, we do not currently anticipate paying any cash dividends in the foreseeable future.

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      The selected consolidated financial data set forth below should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations, the consolidated financial statements, the related notes and other information contained in this Report.