AIRGAIN INC

Previous wording

The markets for our antenna and wireless systems solutions are developing and may not develop as we expect;

Current wording

The markets for our wireless systems solutions, embedded and external antennas, and loT solutions are developing and may not develop as we expect;

Previous wording

If we are unable to manage our growth and expand our operations successfully, our business and operating results will be harmed, and our reputation may be damaged.

Current wording

If we are unable to manage our growth and expand our operations successfully, or navigate the transition to integrated system solutions, including increased business complexity and execution risk, our business and operating results will be harmed, and our reputation may be damaged;

Previous wording

We have a history of losses, including an accumulated deficit of $87.2 million at December 31, 2024, and we may not be profitable in the future;

Current wording

We have a history of losses, including an accumulated deficit of $93.6 million at December 31, 2025, and we may not be profitable in the future;

Previous wording

We are developing a number of our new products and wireless connectivity solutions in partnership with other companies. If any of these companies were to fail to perform, or our partnerships were to be unsuccessful, we may not be able to bring our solutions to market successfully or on a timely basis.

Current wording

We are developing a number of our wireless connectivity solutions and new products in partnership with or under strategic alliances with other companies. If any of these companies were to fail to perform, or our partnerships or strategic alliances were to be unsuccessful, we may experience delays in new product development or may not be able to bring our solutions to market successfully or on a timely basis;

Previous wording

Changes to United States tax, tariffs, Department of Defense’s Section 1260H List, and import/export regulations may have a negative effect on global economic conditions, financial markets and our business. China’s 2024 export ban on critical minerals such as gallium, germanium, and antimony has disrupted and may continue to disrupt global supply chains, driving up costs for semiconductors, sensors, and LEDs.

Current wording

Changes to United States tax, tariffs, Department of Defense’s Section 1260H List, and import/export regulations may have a negative effect on global economic conditions, financial markets and our business.

Previous wording

The wireless industry is characterized by rapidly evolving technologies, and the markets for our wireless connectivity solutions, embedded and external antennas, and IoT products may not develop as we expect. It is difficult to predict customer demand for our wireless system solutions and components, customer adoption rates, the size and growth rate of our target markets, the entry of competitive solutions and products, or the success of existing competitive solutions and products. We have historically driven revenue growth primarily through our embedded antennas, external antennas, embedded modems, and custom IoT products, largely in the consumer market. Moving forward, our goal is to drive growth in complex system solutions in the enterprise and automotive markets, including AC-Fleet, Lighthouse, Lantern, and asset tracking solutions. These markets may develop at varying growth rates, and our success in penetrating these markets will depend on various competitive factors across a number of developing industries.

Current wording

The wireless industry is characterized by rapidly evolving technologies, and the markets for our wireless connectivity solutions, embedded and external antennas, and IoT solutions may not develop as we expect. It is difficult to predict customer demand for our wireless system solutions and components, customer adoption rates, the size and growth rate of our target markets, the entry of competitive solutions and products, or the success of existing competitive solutions and products. We have historically driven revenue growth primarily through our embedded antennas, external antennas, embedded modems, and custom IoT products, largely in the consumer market. Moving forward, our goal is to drive growth in complex system solutions in the enterprise and automotive markets, including Lighthouse and AC-Fleet. These markets may develop at varying growth rates, and our success in penetrating these markets will depend on various competitive factors across a number of developing industries.

Previous wording

Any expansion in our markets depends on several factors. For example, any growth in demand will depend on, among other things, the cost, performance, and perceived value associated with our components and the ability for our components to meet increased performance demands, refresh cycles, and device form factors. Further, as we continue to transition to a wireless systems solution provider, increased growth in the enterprise and automotive markets will depend on, among other things, acceptance of our solutions by our customers and performance of the networks on which our products operate. For example, AC-Fleet, Lighthouse, Lantern, and asset tracking solutions are dependent on the carriers’ networks that they operate on and require widespread commitments across multiple customer markets and budgets. The growth potential for these solutions may be limited, and we will need to introduce new products in the AirgainConnect, Lighthouse, Lantern, and asset tracking platforms in order to continue to grow.

Current wording

Any expansion in our markets depends on several factors. For example, any growth in demand will depend on, among other things, the cost, performance, and perceived value associated with our components and the ability for our components to meet increased performance demands, refresh cycles, and device form factors. Further, as we continue to transition to a wireless systems solution provider, increased growth in the enterprise and automotive markets will depend on, among other things, acceptance of our solutions by our customers and performance of the networks on which our products operate. For example, AC-Fleet and Lighthouse solutions are dependent on the carriers’ networks that they operate on and require widespread commitments across multiple customer markets and budgets. The growth potential for these solutions may be limited, and we will need to introduce new products in the AirgainConnect and Lighthouse platforms in order to continue to grow.

Previous wording

If our wireless solutions do not achieve widespread adoption, if there is a slower rollout than we expect in certain markets, or if there is a reduction in demand for our wireless connectivity solutions or components including AC-Fleet, Lighthouse, Lantern, and asset trackers, caused by a lack of customer acceptance, technological challenges, competing technologies and products, decreases in corporate spending, weakening economic conditions, or otherwise, it could result in reduced customer orders and decreased sales, which would adversely affect our business, operating results, and financial condition.

Current wording

If our wireless solutions do not achieve widespread adoption, if there is a slower rollout than we expect in certain markets, or if there is a reduction in demand for our wireless connectivity solutions or components including AC-Fleet and Lighthouse, caused by a lack of customer acceptance, technological challenges, competing technologies and products, decreases in corporate spending, weakening economic conditions, or otherwise, it could result in reduced customer orders and decreased sales, which would adversely affect our business, operating results, and financial condition.

Previous wording

Our quarterly and annual operating results have fluctuated in the past and may fluctuate significantly in the future, which makes it difficult for us to predict our future operating results. The timing and size of sales of our wireless system solutions and components are variable and difficult to predict and can result in fluctuations in our net sales from period to period. In addition, our budgeted expense levels depend in part on our expectations of future sales. Because any substantial adjustment to expenses to account for lower levels of sales is difficult and takes time, we may not be able to reduce our costs sufficiently to compensate for an unexpected shortfall in net sales, and even a small shortfall in net sales could disproportionately and adversely affect our operating margin and operating results for a given quarter. Our net loss decreased from $12.4 million in the year ended December 31, 2023 to $8.7 million in the year ended December 31, 2024, and the net loss or income will fluctuate in the future. Prior to 2024, our net losses were $12.2 million, $8.7 million and $10.1 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Current wording

Our quarterly and annual operating results have fluctuated in the past and may fluctuate significantly in the future, which makes it difficult for us to predict our future operating results. The timing and size of sales of our wireless system solutions and components are variable and difficult to predict and can result in fluctuations in our net sales from period to period. In addition, our budgeted expense levels depend in part on our expectations of future sales. Because any substantial adjustment to expenses to account for lower levels of sales is difficult and takes time, we may not be able to reduce our costs sufficiently to compensate for an unexpected shortfall in net sales, and even a small shortfall in net sales could disproportionately and adversely affect our operating margin and operating results for a given quarter. Our net loss was $6.4 million in the year ended December 31, 2025, and the net loss or income will fluctuate in the future. Prior to 2025, our net losses were $8.7 million, $12.4 million and $8.7 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Previous wording

Our operating results may also fluctuate due to a variety of other factors, many of which are outside of our control, including any change or volatility in U.S., European, Asian and global economic environments, and any of which may cause our stock price to fluctuate. Besides the other risks in this “Risk Factors” section, factors that may affect our operating results include:

Current wording

Our operating results may also fluctuate due to a variety of other factors, many of which are outside of our control, including any change or volatility in U.S., Asian, European and global economic environments, and any of which may cause our stock price to fluctuate. Besides the other risks in this “Risk Factors” section, factors that may affect our operating results include:

Previous wording

global supply shortage including, but not limited to chips and modules, supply constraints relating to other materials and potential increasing shipping costs and related limitations on our ability to acquire mission critical components and our CM’s abilities to obtain sufficient human resources to meet our global demand;

Current wording

global supply shortage including, but not limited to semiconductors and modules, supply constraints relating to other materials and potential increasing shipping costs and related limitations on our ability to acquire mission critical components and our CM’s abilities to obtain sufficient human resources to meet our global demand;

Previous wording

Additionally, our transition into more system-based solutions may bring more competitors into our markets than we have traditionally faced. As our solutions begin to contain more system components and commensurate higher average selling prices, the resulting product categories may attract additional competitors, or our customers may be more likely to begin to develop competing products. We face new competition from established telematics, networking, and IoT platform providers, which may create barriers to our market entry and limit our ability to grow in these sectors.

Current wording

Additionally, our transition into more system-based solutions may bring more competitors into our markets than we have traditionally faced. As our solutions begin to contain more system components and commensurate with higher average selling prices, the resulting product categories may attract additional competitors, or our customers may be more likely to begin to develop competing products. We face new competition from established telematics, networking, and IoT platform providers, which may create barriers to our market entry and limit our ability to grow in these sectors.

Previous wording

Our sales depend on our ability to anticipate our existing and prospective customers’ needs and develop products and systems solutions that address those needs. Our future success will be contingent on our ability to introduce new solutions for wireless applications, anticipate improvements and enhancements in wireless technology and wireless standards, and to develop solutions that are competitive in the rapidly evolving wireless industry. In furtherance of these efforts, we will continue to invest significantly in ongoing research and development. However, such investments may not translate into material enhancements to our wireless solutions, which are important for us to compete effectively. As we complete our transition into a wireless systems solutions provider, our investment in research and development will grow to stay on the leading edge of next generation development and to align ourselves with the rapidly evolving technology needs of the industry. Moreover, the introduction of newly integrated wireless platforms and product and system enhancements will require coordination of our engineering efforts with those of our customers, carriers, suppliers, and manufacturers to efficiently achieve our growth objectives. As our business transitions to more complex system-based solutions, we must provide enhanced post-sales support, ongoing firmware/software updates, and higher levels of technical assistance. If we are unable to effectively support our customers in deploying and maintaining these solutions, we may experience reputational harm, reduced customer adoption, or an increase in warranty and service costs. If we fail to coordinate these efforts, develop product enhancements or introduce new solutions that meet the needs of our customers as scheduled, our operating results will be materially and adversely impacted, and our business and prospects will be harmed. We cannot assure that our new wireless solutions will meet customer expectations or that our wireless solutions will be competitive in the market.

Current wording

Our sales depend on our ability to anticipate our existing and prospective customers’ needs and develop products and systems solutions that address those needs. Our future success will be contingent on our ability to introduce new solutions for wireless applications, anticipate improvements and enhancements in wireless technology and wireless standards, and to develop solutions that are competitive in the rapidly evolving wireless industry. In furtherance of these efforts, we will continue to invest significantly in ongoing research and development. However, such investments may not translate into material enhancements to our wireless solutions, which are important for us to compete effectively. As we transition into a wireless systems solutions provider, our investment in research and development will be required to grow to stay on the leading edge of next generation development and to align ourselves with the rapidly evolving technology needs of the industry. Moreover, the introduction of newly integrated wireless platforms and product and system enhancements will require coordination of our engineering efforts with those of our customers, carriers, suppliers, and manufacturers to efficiently achieve our growth objectives. As our business transitions to more complex system-based solutions, we must provide enhanced post-sales support, ongoing firmware/software updates, and higher levels of technical assistance. If we are unable to effectively support our customers in deploying and maintaining these solutions, we may experience reputational harm, reduced customer adoption, or an increase in warranty and service costs. If we fail to coordinate these efforts, develop product enhancements or introduce new solutions that meet the needs of our customers as scheduled, our operating results will be materially and adversely impacted, and our business and prospects will be harmed. We cannot assure you that our new wireless solutions will meet customer expectations or that our wireless solutions will be competitive in the market.

Previous wording

The introduction of the next generation AirgainConnect, Lighthouse, Lantern and asset tracking platforms, and the transition to a more expansive level of advanced solutions, requires coordination of efforts and increased time and resources. If we fail to develop competitive solutions for customers with outstanding quality within the identified market window, our operating results may be materially and adversely impacted. As we rollout follow-on products and accessories for the AC-Fleet, Lighthouse, Lantern and asset tracker solutions, we may not be able to successfully develop to conform to carrier PTCRB certifications, and specific country and regulatory certifications and approvals of such products. Furthermore, our transition to full wireless system solutions introduces additional regulatory compliance challenges for new classes of devices such as Lighthouse. Our products must meet stringent equipment authorization and carrier certification requirements (such as PTCRB, FCC, and industry-specific and regional standards). Failure to secure timely authorizations or certifications or unexpected changes in regulatory requirements could delay product launches, increase costs, or impact on our ability to sell our solutions in key markets.

Current wording

The introduction of the next generation AirgainConnect and Lighthouse platforms, and the transition to a more expansive level of advanced solutions, require coordination of efforts and increased time and resources. If we fail to develop competitive solutions for customers with outstanding quality within the identified market window, our operating results may be materially and adversely impacted. As we rollout follow-on products and accessories for the AC-Fleet and Lighthouse solutions, we may not be able to successfully develop to conform to carrier approvals, PTCRB certifications, and specific country and regulatory certifications and approvals of such products. Furthermore, our transition to full wireless system solutions introduces additional regulatory compliance challenges for new classes of devices such as Lighthouse. Our products must meet stringent equipment authorization and carrier certification requirements (such as carrier, PTCRB, FCC, and industry-specific and regional standards). Failure to secure timely authorizations or certifications or unexpected changes in regulatory requirements could delay product launches, increase costs, or impact on our ability to sell our solutions in key markets.

Previous wording

The successful deployment of our wireless system solutions depends on the reliability and security of our embedded software and firmware. Software bugs, cybersecurity vulnerabilities, or delays in providing necessary updates could result in product malfunctions, compromise the confidentiality, integrity, and availability of our customers’ own IT systems and/or our customers’ proprietary or other sensitive information, customer dissatisfaction, or reputational harm. Any failure to maintain robust software and cybersecurity protocols may negatively impact our business and financial performance. Furthermore, the stringent customer demands for these advanced solutions requires substantial ongoing effort and investment for solution maintenance, support, and evolution. If we are unable to continually provide such effort and investment to customers, our customers’ business could be adversely impacted, or customers could switch to competitor solutions, which would have an adverse impact on our operating results.

Current wording

The successful deployment of our wireless system solutions depends on the reliability and security of our embedded software and firmware. Software bugs, cybersecurity vulnerabilities, or delays in providing necessary updates could result in product malfunctions, compromise the confidentiality, integrity, and availability of our customers’ own IT systems and/or our customers’ proprietary or other sensitive information, customer dissatisfaction, or reputational harm. Any failure to maintain robust software and cybersecurity protocols may negatively impact our business and financial performance. Furthermore, the stringent customer demands for these advanced solutions require substantial ongoing effort and investment for solution maintenance, support, and evolution. If we are unable to continually provide such effort and investment to customers, our customers’ business could be adversely impacted, or customers could switch to competitor solutions, which would have an adverse impact on our operating results.

Previous wording

Sales cycles for some of our products can be lengthy, often lasting several months to a year or longer. In addition, it can take additional time before a customer commences volume production of equipment that incorporates our products. Sales cycles can be lengthy for several reasons, including:

Current wording

Sales cycles for some of our products can be lengthy, generally ranging between three and twelve months for our components, and six to twenty-four months and sometimes longer for our wireless systems solutions due to a lengthy customer evaluation, trial and approval process. In addition, it can take additional time before a customer commences volume production of equipment that incorporates our products. Sales cycles can be lengthy for several reasons, including:

Previous wording

certain customers of advanced antenna systems and integrated wireless solutions require successful field trials before committing to purchase our solutions, which could delay the customer decision making process.

Current wording

customers of integrated wireless solutions require successful field trials before committing to purchase our solutions, which could delay the customer decision making process.

Previous wording

A significant portion of our operating expense is relatively fixed and is based in large part on our forecasts of volume and timing of orders. The lengthy sales cycles make forecasting the volume and timing of product orders difficult. In addition, the delays inherent in lengthy sales cycles raise additional risks of customer decisions to cancel or change product phases. If customer cancellations or product changes were to occur, this could result in the loss of anticipated sales without sufficient time for us to reduce our operating expenses. We currently maintain significant inventories to meet forecasted future demand due to the supply chain shortages. If the forecasted demand does not materialize into purchase orders for these products, we may be required to write off our inventory balances or reduce the value of our inventory, based on a reduced sales price. A write off of the inventory, or a reduction in the inventory value due to a sales price reduction, could have an adverse effect on our financial condition and operating results.

Current wording

The length of this process can be affected by factors over which we have little or no control, including the customer’s budgetary constraints and procurement cycles. As a result, sales cycles for customer orders vary substantially among different customers. A significant portion of our operating expenses is relatively fixed and is based in large part on our forecasts of volume and timing of orders. The lengthy sales cycles make forecasting the volume and timing of product orders difficult. In addition, the delays inherent in lengthy sales cycles raise additional risks of customer decisions to cancel or change product phases. In addition, we may incur substantial expenses and devote significant effort to develop potential relationships that do not result in agreements or revenues. If customer cancellations or product changes were to occur, this could result in the loss of anticipated sales without sufficient time for us to reduce our operating expenses. We currently maintain significant inventories to meet forecasted future demand due to the supply chain shortages. If the forecasted demand does not materialize into purchase orders for these products, we may be required to write off our inventory balances or reduce the value of our inventory, based on a reduced sales price. A write-off of the inventory, or a reduction in inventory value due to a sales price reduction, could have an adverse effect on our financial condition and operating results.

Previous wording

Before 2013 we had incurred net losses in each year since our inception. As a result, we had an accumulated deficit of $87.2 million on December 31, 2024. Airgain is transitioning to a wireless systems solutions company. Because the market for wireless systems solutions is rapidly evolving, it is difficult for us to predict our operating results. We expect our operating expenses to increase over the next several years as we hire additional personnel, particularly in engineering, sales support, customer service and experience, and marketing, and continue to develop new wireless ecosystems to address new and evolving markets. In addition, as a public company we will continue to incur significant legal, accounting, and other expenses. If our sales do not increase to offset these increases in our operating expenses, we may not be profitable in future periods. Our historical sales growth has been inconsistent and should not be considered indicative of our future performance. Any failure to sustain or increase our profitability consistently could cause the value of our common stock to materially decline.

Current wording

Before 2013 we had incurred net losses in each year since our inception. As a result, we had an accumulated deficit of $93.6 million on December 31, 2025. Airgain is transitioning to a wireless systems solutions company. Because the market for wireless systems solutions is rapidly evolving, it is difficult for us to predict our operating results. We expect our operating expenses to increase over the next several years as we hire additional personnel, particularly in engineering, sales support, customer service and experience, and marketing, and continue to develop new wireless ecosystems to address new and evolving markets. In addition, as a public company we will continue to incur significant legal, accounting, and other expenses. If our sales do not increase to offset these increases in our operating expenses, we may not be profitable in future periods. Our historical sales growth has been inconsistent and should not be considered indicative of our future performance. Any failure to sustain or increase our profitability consistently could cause the value of our common stock to materially decline.

Previous wording

Customers that accounted for 10% or more of our total revenue provided approximately 54% of sales in the aggregate for the year ended December 31, 2024. Although our top customers that pay for our products have historically been ODMs and distributors, it is primarily the OEMs, carrier customers and retail-focused end-customers that drove the use of our antenna solutions and the purchase by the ODMs and distributors of our antenna solutions. In addition, a few end-customer devices which incorporate our antenna products comprise a significant amount of our sales, and the discontinuation or modification of such devices may materially and adversely affect our sales and results of operations. Moving forward, as we transition to a wireless systems solutions provider, we expect a shift toward external wireless solutions and antenna technologies in the automotive and enterprise markets that may result in a corresponding shift in the customer mix. Any significant loss of, or a significant reduction in purchases by, these other significant customers or customers that drive the use of our antenna solutions or a modification or discontinuation of a device which constitutes a significant portion of sales could have an adverse effect on our financial condition and operating results.

Current wording

Customers that accounted for 10% or more of our total revenue provided approximately 54% of sales in the aggregate for the year ended December 31, 2025. Although our top customers that pay for our products have historically been ODMs and distributors, it is primarily the OEMs, carrier customers and retail-focused end-customers that drove the use of our antenna solutions and the purchase by the ODMs and distributors of our antenna solutions. In addition, a few end-customer devices which incorporate our antenna products comprise a significant amount of our sales, and the discontinuation or modification of such devices may materially and adversely affect our sales and results of operations. Moving forward, as we transition to a wireless systems solutions provider, we expect a shift toward external wireless solutions in the automotive and enterprise markets that may result in a corresponding shift in the customer mix. Any significant loss of, or a significant reduction in purchases by, these other significant customers or customers that drive the use of our antenna solutions or a modification or discontinuation of a device which constitutes a significant portion of sales could have an adverse effect on our financial condition and operating results.

Previous wording

We outsource the manufacturing, assembly and some of the testing of our products to CMs, and also engage with ODMs to substantially contribute to the development of certain of our products in addition to production and shipping. We have over the past two years engaged additional CMs and ODMs outside of China, including Vietnam, Taiwan and Mexico, to expand our capacity, and to diversify the global regions in which our products are manufactured. These CMs and ODMs are relied upon to develop, manufacture, control quality of, and ship our products. We do not have long-term contracts that commit CMs to manufacture products for us. Furthermore, political unrest or political instability, military conflict in any country in which our CMs and ODMs are located could experience political unrest, tensions and uncertainty. Global and regional, terrorism or other geopolitical events may have an adverse effect on our contract manufacturer’s ability to deliver quality products on time. Any significant change in our relationship with these manufacturers could have a material adverse effect on our business, operating results, and financial condition. We make substantially all of our purchases from our CMs and ODMs on a purchase order basis. Our CMs and ODMs are not required to manufacture our products for any specific period or in any specific quantity. We expect that it would take approximately six to nine months to transition manufacturing, quality assurance, and shipping services to new providers. Relying on CMs for manufacturing, quality assurance, and shipping also presents significant risks to us, including the inability of our CMs to:

Current wording

We outsource the manufacturing, assembly, and some of the testing of our products to CMs, and we also engage with ODMs to substantially contribute to the development of certain products in addition to production and shipping. We have over the past two years engaged additional CMs and ODMs outside of China, including Vietnam, Taiwan and Mexico, to expand our capacity, and to diversify the global regions in which our products are manufactured. These CMs and ODMs are relied upon to develop, manufacture, control quality of, and ship our products. We do not have long-term contracts that commit CMs to manufacture products for us. Furthermore, political unrest or political instability, military conflict in any country in which our CMs and ODMs are located could experience political unrest, tensions and uncertainty. Global and regional, terrorism or other geopolitical events may have an adverse effect on our contract manufacturer’s ability to deliver quality products on time. Any significant change in our relationship with these manufacturers could have a material adverse effect on our business, operating results, and financial condition. We make all of our purchases from our CMs and ODMs on a purchase order basis. Our CMs and ODMs are not required to manufacture our products for any specific period or in any specific quantity. We expect that it would take approximately six to nine months to transition manufacturing, quality assurance, and shipping services to new providers. Relying on CMs for manufacturing, quality assurance, and shipping also presents significant risks to us, including the inability of our CMs to:

Previous wording

We may experience delays in obtaining product from manufacturers and may not be a high priority for our manufacturers.

Current wording

We may experience delays in obtaining products from manufacturers and may not be a high priority for our manufacturers.

Previous wording

The ability and willingness of our CMs to perform is largely outside of our control. We believe that our orders may not represent a material portion of our CMs’ total orders and, as a result, fulfilling our orders may not be a priority if our CMs are constrained in their abilities or resources to fulfill all of their customer obligations in a timely manner. If any of our CMs suffers an interruption in its business, experiences delays, disruptions, or quality control problems in its manufacturing operations or we have to change or add additional CMs, our ability to ship products to our customers would be delayed and our sales could become volatile, and our cost of sales may increase. For example, throughout 2021 and 2022, we experienced a disruption in our supply chain for certain components located in Asia and made several purchases of available inventory in order to secure supply for our customers, sometimes at higher than our traditional prices. Additionally, any or all of the following could either limit supply or increase costs, directly or indirectly, to us or our CMs:

Current wording

The ability and willingness of our CMs to perform is largely outside of our control. We believe that our orders may not represent a material portion of our CMs’ total orders and, as a result, fulfilling our orders may not be a priority if our CMs are constrained in their abilities or resources to fulfill all of their customer obligations in a timely manner. If any of our CMs suffers an interruption in its business, experiences delays, disruptions, or quality control problems in its manufacturing operations or we have to change or add additional CMs, our ability to ship products to our customers would be delayed and our sales could become volatile, and our cost of sales may increase. For example, throughout 2021 and 2022, we experienced a disruption in our supply chain for certain components located in Asia and made several purchases of available inventory in order to secure supply for our customers, sometimes at higher than our traditional prices. Although supply chain conditions have improved since 2022, they have not fully normalized, and structural risks related to capacity constraints, supplier prioritization, and external disruptions continue to expose us to potential delays and cost increases. Increased component and manufacturing costs may not be recoverable through pricing adjustments, particularly when customer contracts limit repricing or where customers resist price increases, which could result in margin compression and adversely affect our operating results. Additionally, any or all of the following could either limit supply or increase costs, directly or indirectly, to us or our CMs:

Previous wording

changes or uncertainty in U.S and non-U.S. tariffs and trade policy, economic sanctions, and other trade barriers, political unrest, or military conflict in regions where manufacturers are located; and potential conflicts involving other countries;

Current wording

changes or uncertainty in U.S and non-U.S. tariffs and trade policy, economic sanctions, and other trade barriers where manufacturers are located;

Previous wording

industry consolidation occurring within one or more component supplier markets, such as the semiconductor market; and

Current wording

industry consolidation occurring within one or more component supplier markets, such as the semiconductor market;

Previous wording

labor strikes or shortages, or restrictions imposed to limit pandemic or epidemics.

Current wording

labor strikes or shortages, or restrictions imposed to limit pandemics or epidemics; and

Previous wording

We cannot predict with certainty in the future whether a pandemic or epidemic will cause delays or disrupt our product shipments or impact manufacturing. If such disruption were to extend over a prolonged period, it could have a material impact on our sales and business and those of our customers.

Current wording

We cannot predict with certainty in the future whether a pandemic, epidemic, or AI demand surge impacting the supply of certain components, will cause delays or disrupt our product shipments or impact manufacturing. If such disruption were to extend over a prolonged period, it could have a material impact on our sales and business and those of our customers.

Previous wording

We rely on third-party components and technology companies to provide contents of our bills of material to that ultimately configure the devices that are deployed in our integrate solutions. Thus, we rely on our CMs to obtain the components and subassemblies necessary for the manufacture of our devices. In 2024 we experienced continued relief from the shortages in supply of components that we experienced from 2021 to 2022, but we expect that we will experience shortages, constraints, hoarding, and higher prices due to export controls on critical minerals for semiconductors and tariffs in 2025. In 2023 we saw relief on supply disruptions due to over correction. A return to such shortages or other supply disruptions are possible, as well as inflation of prices of certain components, and our ability to predict the availability and pricing of such components is limited. Over the past four years, there have been and continue to exist fluctuations between shortages of certain electronic components used in our industry and a surplus that have led to ongoing uncertainty regarding lead times for the manufacture of certain components in some of our products. If shortages return or occur in the future, as, our business, operating results and financial condition would be materially adversely affected. Unpredictable price increases of such components due to market demand may occur as well. While components and supplies are generally available from a variety of sources, our CMs depend on a single or limited number of suppliers for several components for our products. Further, certain products may utilize custom components available from only one or a limited number of sources. When a component or product uses new technologies, capacity constraints may exist until the suppliers’ manufacturing capacity has increased. Many factors may affect the continued availability of these components at acceptable prices, including if those suppliers decide to concentrate on the production of common components instead of components customized to meet our requirements. There is no assurance that the supply of such components will not be delayed or constrained. If our suppliers of these components or technology were to enter into exclusive relationships with other providers of wireless networking equipment or were to discontinue providing such components and technology to us and we were unable to replace them cost effectively, or at all, our ability to provide our products would be impaired. Additionally, poor quality in any of the single or limited sourced components in our products could result in lost sales or lost sales opportunities. Our CMs generally rely on purchase orders rather than long-term contracts with these suppliers. As a result, even if available, our CMs may not be able to secure sufficient components at reasonable prices or of acceptable quality to build our products in a timely manner. Therefore, we may be unable to meet customer demand for our products, whi…

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Current wording

While components and supplies are generally available from a variety of sources, our CMs depend on a single or limited number of suppliers for several components for our products. Further, certain products may utilize custom components available from only one or a limited number of sources. When a component or product uses new technologies, capacity constraints may exist until the suppliers’ manufacturing capacity has increased. Many factors may affect the continued availability of these components at acceptable prices, including if those suppliers decide to concentrate on the production of common components instead of components customized to meet our requirements. There is no assurance that the supply of such components will not be delayed or constrained. If our suppliers of these components or technology were to enter into exclusive relationships with other providers of wireless networking equipment or were to discontinue providing such components and technology to us and we were unable to replace them cost effectively, or at all, our ability to provide our products would be impaired. Additionally, poor quality in any of the single or limited sourced components in our products could result in lost sales or lost sales opportunities. Our CMs generally rely on purchase orders rather than long-term contracts with these suppliers. As a result, even if available, our CMs may not be able to secure sufficient components at reasonable prices or of acceptable quality to build our products in a timely manner. Therefore, we may be unable to meet customer demand for our products, which would have a material adverse effect on our business, operating results, and financial condition.

Previous wording

We have partnered, and expect to continue to partner, with certain companies to further advance or develop our wireless connectivity solutions and develop or expand on new and existing technologies. These arrangements involve the commitment by each company of various resources, including technology, and research and development. If these arrangements do not develop as expected, especially those that involve our proprietary technologies, or if the products and/or services produced by our partners do not meet the required quality standards, our ability to introduce new antenna products and wireless connectivity solutions successfully and on schedule may be limited. Further, we cannot provide any assurances that our existing partnerships will be maintained successfully or at all, the failure of which could have a material adverse effect on our business and results of operations. If existing partnership entity has any technical difficulties, if our partnership with them does not continue to develop, or if the technology developed in partnership does not develop or the partnership entity does not perform as expected or suffers market-launch delay or project-cost overrun, our sales may decrease, and our operating results could suffer.

Current wording

We have partnered, and expect to continue to partner, with certain companies to further advance or develop our wireless connectivity solutions and develop or expand on new and existing technologies. These arrangements involve the commitment of each company of various resources, including technology, and research and development. If these arrangements do not develop as expected, especially those that involve our proprietary technologies, or if the products and/or services produced by our partners do not meet the required quality standards, our ability to introduce new wireless connectivity solutions successfully and on schedule may be limited. Further, we cannot provide any assurances that our existing partnerships will be maintained successfully or at all, the failure of which could have a material adverse effect on our business and results of operations. If an existing partnership entity has any technical difficulties, if our partnership with them does not continue to develop, or if the technology developed in partnership does not develop or the partnership entity does not perform as expected or suffers market-launch delay or project-cost overrun, our sales may decrease, and our operating results could suffer.

Previous wording

We enter into strategic alliances and other relationships with companies whose capabilities complement our own. For example, we recently entered into a strategic partnership with Omantel, a telecommunications provider in Oman, regarding 5G connectivity solutions in the Middle East and North Africa. The objectives and goals for a strategic alliance can include one or more of the following: technology exchange, product development, joint sales and marketing, or new-market creation. To be successful, we must first be able to define, identify and secure alliance partners which align with our growth and technological plans. We cannot be certain that our alliance partners will provide us with the support we anticipate, or that such alliance or other relationships will be successful in creating new or improved products. Our success is also highly dependent upon our ability to manage the alliances, promote the benefits to us, and to not prohibit or discourage other opportunities which may be beneficial to us in the future. Also, certain provisions of alliance agreements may include restrictions that limit our ability to independently pursue or exploit the developments under such strategic alliances. If a strategic alliance fails to perform as expected or if the relationship is terminated, we could experience delays in new product development or impairment of our relationships with customers, and our ability to develop new solutions in response to industry trends or changing technology may be impaired and our results of operations could be adversely affected.

Current wording

We enter into strategic alliances and other relationships with companies whose capabilities complement our own. For example, we entered last year into a strategic partnership with Omantel, a telecommunications provider in Oman, regarding 5G connectivity solutions in the Middle East and North Africa. The objectives and goals for a strategic alliance can include one or more of the following: technology exchange, product development, joint sales and marketing, or new market creation. To be successful, we must first be able to define, identify and secure alliance partners which align with our growth and technological plans. We cannot be certain that our alliance partners will provide us with the support we anticipate, or that such alliances or other relationships will be successful in creating new or improved products. Our success is also highly dependent upon our ability to manage the alliances, promote the benefits to us, and to not prohibit or discourage other opportunities which may be beneficial to us in the future. Also, certain provisions of alliance agreements may include restrictions that limit our ability to independently pursue or exploit the developments under such strategic alliances. If a strategic alliance fails to perform as expected or if the relationship is terminated, we could experience delays in new product development or impairment of our relationships with customers, and our ability to develop new solutions in response to industry trends or changing technology may be impaired and our results of operations could be adversely affected.

Previous wording

If our available cash balances and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, including because of lower demand for our products as a result of other risks described in this “Risk Factors” section and elsewhere in this annual report on Form 10-K, we may seek to raise additional capital through equity offerings, debt financings, collaborations or licensing arrangements. We may also consider raising additional capital in the future due to liquidity considerations or to expand our business, pursue strategic investments, take advantage of financing opportunities, or other reasons. For example, in March 2024, we entered into an at-the-market issuance sales agreement (the Sales Agreement) with Craig-Hallum Capital Group LLC (the Agent), pursuant to which we may, from time to time, sell shares of our common stock having an aggregate offering price of up to $5 million in “at the market” offerings through or to the Agent, as sales agent or principal. However, there can be no assurance that the Agent will be successful in consummating future sales based on prevailing market conditions or in the quantities or at the prices that we deem appropriate. In addition, the Sales Agreement may be terminated by us or the Agent at any time upon specified notice to the other party, or by the Agent at any time in certain circumstances, including the occurrence of a material adverse change.

Current wording

If our available cash balances and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, including because of lower demand for our products as a result of other risks described in this “Risk Factors” section and elsewhere in this annual report on Form 10-K, we may seek to raise additional capital through equity offerings, debt financings, collaborations or licensing arrangements. We may also consider raising additional capital in the future due to liquidity considerations or to expand our business, pursue strategic investments, take advantage of financing opportunities, or other reasons. For example, in May 2025, we amended and restated the At-the-Market Issuance Sales Agreement (as amended, the Sales Agreement) with Craig-Hallum Capital Group LLC (the Agent) originally entered into in March 2024, pursuant to which we may, from time to time, sell shares of our common stock having an aggregate offering price of up to an amount registered under an effective registration statement and for which we have filed a prospectus “at the market” (ATM) offerings through or to the Agent, as sales agent or principal. In May 2025, we filed a registration statement on Form S-3, which was declared effective, including a prospectus for ATM offerings pursuant to the Sales Agreement for up to an aggregate of $5.0 million in shares of our common stock. As of December 31, 2025, $4.6 million remained available for future sales under the Sales Agreement. However, there can be no assurance that the Agent will be successful in consummating future sales based on prevailing market conditions or in the quantities or at the prices that we deem appropriate. In addition, the Sales Agreement may be terminated by us or the Agent at any time upon specified notice to the other party, or by the Agent at any time in certain circumstances, including the occurrence of a material adverse change.

Previous wording

Additional funding may not be available to us on acceptable terms, or at all. If we raise funds by issuing equity securities, dilution to our stockholders could result. Any equity securities issued also may provide for rights, preferences or privileges senior to those of holders of our common stock. The terms of debt securities issued, or borrowings could impose significant restrictions on our operations. The incurrence of indebtedness or the issuance of certain equity securities could result in increased fixed payment obligations and could also result in restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license intellectual property rights, and other operating restrictions that could adversely affect our ability to conduct our business. In addition, the issuance of additional equity securities by us, or the possibility of such issuance, may cause the market price of our common stock to decline. The global credit and financial markets have in the past experienced extreme volatility and disruptions (including as a result of pandemic, war and conflict and liquidity concerns regarding financial institutions and others in the financial services industry). If the equity and credit markets are volatile or deteriorate, or if adverse developments are experienced by financial institutions, it may make any necessary debt or equity financing more difficult to obtain, more costly, more onerous with respect to financial and operating covenants, and more dilutive. If we do not have, or are not able to obtain, sufficient funds, we may have to delay development or commercialization of our products or license to third parties the rights to commercialize products or technologies that we would otherwise seek to commercialize. If we raise additional funds through collaboration and licensing arrangements with third parties, it may be necessary to relinquish some rights to our technologies or our products, or to grant licenses on terms that are not favorable to us. If we are unable to raise adequate funds, we may have to liquidate some or all of our assets, or delay, reduce the scope of or eliminate some or all of our development programs. We also may have to reduce marketing; customer support or other resources devoted to our products or cease operations. Any of these actions could harm our business, operating results and financial condition.

Current wording

Additional funding may not be available to us on acceptable terms, or at all. If we raise funds by issuing equity securities, dilution to our stockholders could result. Any equity securities issued also may provide for rights, preferences or privileges of senior to those of holders of our common stock. The terms of debt securities issued, or borrowings, could impose significant restrictions on our operations. The incurrence of indebtedness or the issuance of certain equity securities could result in increased fixed payment obligations and could also result in restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license intellectual property rights, and other operating restrictions that could adversely affect our ability to conduct our business. In addition, the issuance of additional equity securities by us, or the possibility of such issuance, may cause the market price of our common stock to decline. The global credit and financial markets have in the past experienced extreme volatility and disruptions (including as a result of public health crises, war and conflict and liquidity concerns regarding financial institutions and others in the financial services industry). If the equity and credit markets are volatile or deteriorate, or if adverse developments are experienced by financial institutions, it may make any necessary debt or equity financing more difficult to obtain, more costly, more onerous with respect to financial and operating covenants, and more dilutive. If we do not have, or are not able to obtain, sufficient funds, we may have to delay development or commercialization of our products or license to third parties the rights to commercialize products or technologies that we would otherwise seek to commercialize. If we raise additional funds through collaboration and licensing arrangements with third parties, it may be necessary to relinquish some rights to our technologies or our products, or to grant licenses on terms that are not favorable to us. If we are unable to raise adequate funds, we may have to liquidate some or all of our assets, or delay, reduce the scope of or eliminate some or all of our development programs. We also may have to reduce marketing; customer support or other resources devoted to our products or cease operations. Any of these actions could harm our business, operating results, and financial condition.

Previous wording

As of December 31, 2024, the Company had net operating loss (NOL) carryforwards of approximately $19.6 million for federal income tax purposes and $11.9 million for state income tax purposes, subject to limitations may be available to offset our future taxable income, if any. Our federal and state NOL carryforwards begin to expire in 2029, and 2026, respectively. Federal NOLs generated in taxable years beginning after December 31, 2018 however, will carryforward indefinitely and may generally only be used to offset 80% of future taxable income in taxable years. As of December 31, 2024, we also had federal and state research and development and other tax credit carryforwards of approximately $2.4 million and $2.0 million, respectively, available to reduce future income tax liabilities, subject to limitations.

Current wording

As of December 31, 2025, the Company had net operating loss (NOL) carryforwards of approximately $26.4 million for federal income tax purposes and $14.0 million for state income tax purposes that, subject to limitations, may be available to offset our future taxable income, if any. Our federal and state NOL generally begin to expire in 2029 and 2028, respectively. Federal NOLs generated in taxable years beginning after December 31, 2017 can be carried forward indefinitely; however, such NOLs may generally only be used to offset up to 80% of future taxable income. As of December 31, 2025, we also had federal and state research and development and other tax credit carryforwards of approximately $3.5 million and $2.8 million, respectively, available to reduce future income tax liabilities, subject to limitations. Our federal tax credit carryforwards begin to expire in 2026, and our state tax credit carryforwards will begin to expire in 2032. These NOL and tax credit carryforwards could expire unused, to the extent subject to expiration, and be unavailable to offset future taxable income or income tax liabilities.

Previous wording

Furthermore, in general, under Sections 382 and 383 of the U.S. Internal Revenue Code of 1986, as amended (the Code), a corporation that undergoes an “ownership change” is subject to limitations on its ability to use pre-change NOL and tax credit carryforwards to offset future taxable income and income taxes, respectively. For these purposes, an ownership change generally occurs where the aggregate change in stock ownership of one or more stockholders or groups of stockholders owning at least 5% of a corporation’s stock exceeds 50 percentage points over a rolling three-year period. The Company’s use of U.S. federal and state NOL and tax credit carryforwards could be limited further by ownership changes. We have recorded a $16.7 million valuation allowance related to our

Current wording

Furthermore, the Company’s use of federal and state NOL and tax credit carryforwards could be limited by certain ownership changes. In general, under Sections 382 and 383 of the U.S. Internal Revenue Code of 1986, as amended (the Code), a corporation that undergoes an “ownership change” is subject to limitations on its ability to use pre-change NOL and tax credit carryforwards to offset future taxable income and income taxes, respectively. For these purposes, an ownership change generally occurs where the aggregate change in stock ownership of one or more stockholders or groups of stockholders owning at least 5% of a corporation’s stock exceeds 50 percentage points over a rolling three-year period. We have recorded a $18.5 million valuation allowance related to our NOL carryforwards and other deferred tax assets due to the uncertainty of the ultimate realization of the future tax benefits of such assets.

Previous wording

Future pandemics or other public health epidemics may have material adverse effect on our business, financial condition and results of operations, and may also have the effect of heightening many of the other risks described in this “Risk Factors” section.

Current wording

Future pandemics or other public health epidemics may have a material adverse effect on our business, financial condition and results of operations, and may also have the effect of heightening many of the other risks described in this “Risk Factors” section.

Previous wording

Our ability to compete effectively is dependent in part upon our ability to protect our proprietary technology. We rely on patents, trademarks, trade secret laws, confidentiality procedures and licensing arrangements to protect our intellectual property rights. There can be no assurance these protections will be available in all cases or will be adequate to prevent our competitors from copying, reverse engineering or otherwise obtaining and using our technology, proprietary rights or products. For example, the laws of certain countries in which our products are manufactured or licensed do not protect our proprietary rights to the same extent as the laws of the United States. In addition, third parties may seek to challenge, invalidate or circumvent our patents, trademarks, copyrights and trade secrets, or applications for any of the foregoing. There can be no assurance that our competitors will not independently develop technologies that are substantially equivalent or superior to our technology or design around our proprietary rights. In each case, our ability to compete could be significantly impaired. To prevent substantial unauthorized use of our intellectual property rights, it may be necessary to prosecute actions for infringement and/or misappropriation of our proprietary rights against third parties. Any such action could result in significant costs and diversion of our resources and management’s attention, and there can be no assurance we will be successful in such action. Furthermore, many of our current and potential competitors have the ability to dedicate substantially greater resources to enforce their intellectual property rights than we do. Accordingly, despite our efforts, we may not be able to prevent third parties from infringing upon or misappropriating our intellectual property.

Current wording

We may also need to share our proprietary know-how with current or future partners, collaborators, contractors and others located in countries at heightened risk of theft of trade secrets, including through direct intrusion by private parties or foreign actors, and those affiliated with or controlled by state actors. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. There can be no assurance that our competitors will not independently develop technologies that are substantially equivalent or superior to our technology or design around our proprietary rights. In each case, our ability to compete could be significantly impaired. To prevent substantial unauthorized use of our intellectual property rights, it may be necessary to prosecute actions for infringement and/or misappropriation of our proprietary rights against third parties. Any such action could result in significant costs and diversion of our resources and management’s attention, and there can be no assurance we will be successful in such action. Furthermore, many of our current and potential competitors have the ability to dedicate substantially greater resources to enforce their intellectual property rights than we do. Accordingly, despite our efforts, we may not be able to prevent third parties from infringing upon or misappropriating our intellectual property.

Previous wording

Claims by others that we infringe their intellectual property rights could harm our business.

Current wording

Claims by others that we infringe on their intellectual property rights could harm our business.

Previous wording

Intellectual property claims against us, and any resulting lawsuits, may result in our incurring significant expenses and could subject us to significant liability for damages and invalidate what we currently believe are our proprietary rights. Our involvement in any patent dispute or other intellectual property dispute or action to protect trade secrets and know-how could have a material adverse effect on our business. Adverse determinations in any litigation could subject us to significant liabilities to third parties, require us to seek licenses from third parties and prevent us from manufacturing and selling our products. Any of these situations could have a material adverse effect on our business.

Current wording

Intellectual property claims against us, and any resulting lawsuits, may result in our incurring significant expenses and could subject us to significant liability for damages and invalidate what we currently believe are our proprietary rights. Our involvement in any patent dispute or other intellectual property dispute or action to protect trade secrets and know-how could have a material adverse effect on our business. Adverse determinations in any litigation could subject us to significant liabilities to third parties, require us to seek licenses from third parties which could be costly, and prevent us from manufacturing and selling our products. Because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during litigation. Protracted litigation to defend or prosecute our intellectual property rights could result in our customers or potential customers deferring or limiting their purchase or use of the affected products until resolution of the litigation. Any of these situations could have a material adverse effect on our business.

Previous wording

In the United States, data privacy laws and regulations are promulgated at the federal and state level, some of which are enforced by the Federal Trade Commission (FTC). There are also laws regulating the use of personal information for direct marketing purposes, including the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003, which establishes specific requirements for commercial email messages, and the Telephone Consumer Protection Act, and the Telemarketing Sales Rule as interpreted and implemented by the FCC and United States courts, or TCPA, which imposes significant restrictions on the use of telephone calls and text messages to residential and mobile telephone numbers. At the state level, California enacted legislation, the California Consumer Privacy Act of 2018, or CCPA, which provides new data privacy rights for California consumers and the California Privacy Rights Act, or CPRA, which took effect on January 1, 2023. The CPRA modifies the CCPA by providing significant new data privacy rights. The enactment of the CCPA is prompting a wave of similar legislative developments in other states in the United States, which has created the potential for a patchwork of overlapping but different state laws. Since the CCPA went into effect, general privacy statutes that share similarities with the CCPA are now in effect and enforceable in Virginia, Colorado, Connecticut, Utah, Connecticut, Utah, Texas, Montana, Oregon, Delaware, Iowa, New Hampshire, Nebraska, and New Jersey, and will soon be enforceable in several other states as well. Many other states are also currently reviewing or proposing the need for greater regulation of the collection, sharing, use and other processing of information related to individuals for marketing purposes or otherwise, and there remains increased interest at the federal level.

Current wording

In the United States, data privacy laws and regulations are promulgated at the federal and state level, some of which are enforced by the Federal Trade Commission (FTC). For example, at the federal level, there are laws regulating the use of personal information for direct marketing purposes, including the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003, which establishes specific requirements for commercial email messages, and the Telephone Consumer Protection Act (TCPA) and the Telemarketing Sales Rule as interpreted and implemented by the FCC, FTC and/or United States courts, which imposes significant restrictions on the use of telephone calls and text messages to residential and mobile telephone numbers. At the state level, California enacted legislation, the California Consumer Privacy Act of 2018 (CCPA), which provides new data privacy rights for California consumers and the California Privacy Rights Act, or CPRA, which took effect on January 1, 2023 and amended the CCPA to include significant additional data privacy rights for consumers. The enactment of the CCPA prompted a wave of similar legislative developments in other states in the United States, which has created a patchwork of overlapping but different state laws. Since the CCPA went into effect, general privacy statutes that share similarities with the CCPA are now in effect and enforceable in numerous states, and amendments to such laws are regularly proposed. Many other states are also currently reviewing or proposing the need for greater regulation of the collection, sharing, use and other processing of information related to individuals for marketing purposes or otherwise, and there remains increased interest at the federal level.

Previous wording

Foreign data protection laws, including the EU General Data Protection Regulation 2016/679, (GDPR) and the U.K. data protection regime consisting primarily of the UK General Data Protection Regulation and the UK Data Protection Act 2018 (together, UK GDPR) (the EU GDPR and UK GDPR together referred to as the GDPR), may also apply to other personal information obtained outside of the United States. The GDPR impose stringent requirements for entities processing personal information, including specific requirements regarding transfers of data outside of the European Economic Area (EEA) and UK. In relation to such cross border transfers of personal data, we expect the existing legal complexity and uncertainty regarding international personal data transfers to continue. In particular, we expect the European Commission approval of the current EU-US Data Privacy Framework for data transfers to certified entities in the United States to be challenged and international transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators. As the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints and/or regulatory investigations or fines; we may have to stop using certain tools and vendors and make other operational changes; we may have to implement alternative data transfer mechanisms under the GDPR and/ or take additional compliance and operational measures; and/or it could otherwise affect the manner in which we provide our services, and could adversely affect our business, operations and financial condition. Since we are under the supervision of relevant data protection authorities in both the EEA and the UK, we may be fined under both the EU GDPR and UK GDPR for the same breach. In addition, there are other European laws and regulations regarding ePrivacy, that apply in addition to the GDPR and UK GDPR, to cookies and similar tracking technologies, electronic communications and marketing. Recent European court and regulator decisions are driving increased attention to cookies and tracking technologies. If the trend of increasing enforcement by regulators of the strict approach to opt-in consent for all but essential use cases, as seen in recent guidance and decisions continues, this could lead to additional costs, require systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, and subject us to additional liabilities. In light of the complex and evolving nature of EU, EU Member State and UK privacy laws on cookies and tracking technologies, there can be no assurances that we will be successful in our efforts to comply with such laws; violations of such laws could result in regulatory investigations, fines, orders to cease/ change our use of such technologies, as well as civil claims including class actions,…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Foreign data protection laws, including the EU General Data Protection Regulation 2016/679, (GDPR) and the U.K. data protection regime consisting primarily of the UK General Data Protection Regulation and the UK Data Protection Act 2018 (together, UK GDPR) (the EU GDPR and UK GDPR together referred to as the GDPR), may also apply to other personal information obtained outside of the United States. The GDPR imposes stringent requirements for entities processing personal information, including specific requirements regarding transfers of data outside of the European Economic Area (EEA) and UK. In 2024, the National Security Division of the U.S. Department of Justice (DOJ) also issued a new rule, referred to as the “Data Security Program” (DSP), to implement Executive Order 14117 aimed at preventing access to “bulk U.S. sensitive personal data” and “government-related data” by “countries of concern” (including China, Russia, Iran, North Korea, Cuba, and Venezuela) and “covered persons” (as all such terms are defined in the DSP). The DSP imposes stringent obligations on companies within its scope and prohibits or restricts “covered data transactions” that grant countries of concern or covered persons access to bulk U.S. sensitive personal data or any amount of government-related data. The DSP is new, complex and has yet to be enforced, and as such, there is a risk that our interpretation of its applicability, scope, and requirements is incorrect, incomplete, or misapplied. In relation to such cross-border transfers of personal data, we expect existing legal complexity and uncertainty regarding international personal data transfers to continue.