What the changes say
- Government funding now creates execution, dilution, milestone, governance, and commercialization risks through the proposed CHIPS Act award.
- AI, quantum, defense, aerospace, export-control, and regulated-customer exposure is more prominent despite no volume production.
- The filing adds risks from federal-agency changes, strategic transactions, market estimates, FINRA trading limits, and exclusive Delaware forums.
- Cyber threats and customer payment constraints are described more specifically, while several generic financing, insurance, and penny-stock risks were removed.
What changed since the prior 10-K
New
- NewRisks Relating to Our Business, Growth Prospects and Operating Results
We have entered into a letter of intent with the U.S. Department of Commerce for proposed funding under the CHIPS and Science Act, which remains subject to execution of definitive award documents and may result in substantial restrictions on our business and operations
The proposed CHIPS Act award may not close, arrive on schedule, or deliver benefits, and could impose dilution, milestones, governance restrictions, and other constraints.
- NewRisks Relating to Our Business, Growth Prospects and Operating Results
Market opportunity estimates and forecasts regarding our target markets may prove inaccurate and should not be viewed as indicative of our future revenue or growth
Third-party and internal market estimates for mobile, automotive lidar, AI, silicon photonics, quantum computing, and other markets may not translate into revenue.
- NewRisks Relating to Our Business, Growth Prospects and Operating Results
Changes to federal regulatory agencies and policies, including the Department of Commerce, could adversely affect our business operations and financial outlook
DOGE-related restructuring or other federal-agency changes could reduce staffing or funding, delay regulatory reviews, and weaken the Department of Commerce’s semiconductor programs.
- NewRisks Relating to Our Business, Growth Prospects and Operating Results
We may be unable to complete or successfully integrate strategic transactions, which could limit our ability to execute our business strategies
Failed acquisitions, investments, joint ventures, or partnerships—including a strategic manufacturing partnership—could limit geographic expansion, customer growth, and business execution.
- NewRisks Relating to Our Business, Growth Prospects and Operating Results
Dependence on customers in regulated industries and changes in applicable laws and regulations could adversely affect demand for our products and business
Changing environmental, trade, export-control, privacy, tax, and industry regulations could raise regulated customers’ costs or delay, cancel, or restrict their spending.
- NewRisks Relating to Our Business, Growth Prospects and Operating Results
Demand for our technologies may not develop as we expect, and evolving regulation and competition could adversely affect our business, financial condition, and results of operations
AI and other technology demand may fall short because of volatile investment cycles, competing or internal solutions, technical requirements, energy costs, and supply constraints.
- NewRisks Relating to the Semiconductor Industry
Export controls, sanctions, and other trade restrictions applicable to semiconductor, photonics, defense, aerospace, AI, and quantum technologies could limit our ability to sell or transfer our products and technology
Export controls, sanctions, import rules, and trade restrictions could require licenses, delay programs, limit technology transfers, increase costs, or cause penalties.
- NewRisks Relating to Our Common Stock
FINRA sales practice requirements may limit a stockholder’s ability to buy and sell our stock
FINRA suitability requirements for speculative or low-priced securities could make brokers less willing to recommend Aeluma stock, reducing trading liquidity and price support.
- NewRisks Relating to Our Common Stock
We have adopted exclusive forum bylaws for certain matters, which may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders
Exclusive Delaware forum provisions for specified shareholder and fiduciary-duty lawsuits could discourage or complicate litigation against directors, officers, employees, or stockholders.
Dropped
- DroppedRisks Relating to Our Business, Growth Prospects and Operating Results
Changes to regulatory agencies could pose risks related to our business operations and financial outlook
- DroppedRisks Relating to Our Business, Growth Prospects and Operating Results
We may not obtain insurance coverage to adequately cover all significant risk exposures
- DroppedRisks Relating to Our Business, Growth Prospects and Operating Results
Our insurance coverage strategy may not be adequate to protect us from all business risks
- DroppedRisks Relating to Our Business, Growth Prospects and Operating Results
If product liability lawsuits are brought against us, we may incur substantial liabilities
DOGE executive-order changes to regulatory agencies and their potential impact on operations and financial outlook.
- DroppedRisks Relating to Our Business, Growth Prospects and Operating Results
Natural disasters and other business disruptions could cause significant harm to our business operations and facilities and could adversely affect our supply chain and our customer base, any of which may materially adversely affect our business, results of operation, and financial condition
- DroppedRisks Relating to Our Business, Growth Prospects and Operating Results
There is no assurance on the future successful completion of strategic transactions by us to successfully implement our business strategies
- DroppedRisks Relating to Our Common Stock
We may be subject to penny stock regulations and restrictions and if we are subject to such regulations and restrictions you may have difficulty selling shares of our Common Stock
- DroppedRisks Relating to Our Common Stock
Sales of substantial amounts of Common Stock in the public market, or the perception that such sales could occur, could materially adversely affect the market price of the Common Stock, and may make it more difficult for you to sell your securities at a time and price that you deem appropriate
- DroppedRisks Relating to Our Common Stock
Sales of our shares of Common Stock in the public market by investors may cause the market price of our Common Stock to decline
- DroppedRisks Relating to Our Common Stock
Upon dissolution of the Company, you may not recoup all or any portion of your investment
- DroppedRisks Relating to Our Common Stock
We may face risks related to securities litigation that could result in significant legal expenses and settlement or damage awards
- DroppedRisks Relating to Our Common Stock
The Financial Industry Regulatory Authority (“FINRA”) has adopted rules requiring that, in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer
- DroppedRisks Relating to Our Common Stock
If we are unable to comply with the continued listing requirements of The Nasdaq Capital Market, our Common Stock could be delisted, which would adversely affect our common stock market price and liquidity and reduce our ability to raise capital
Reworded
- 90% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
Natural disasters, public health crises, political crises, economic downturns, or other unexpected events could cause significant harm to our business operations and facilities, adversely affect our supply chain and customer base, and materially adversely affect our results of operations and financial condition
The risk now emphasizes specific disruption to Aeluma’s supply chain, product delivery, and product costs, while removing explicit economic-downturn and COVID-variant references.
Was: Our business could be adversely affected by natural disasters, public health crises, political crises, economic downturns or other unexpected events
- 82% rewrittenRisks Relating to Our Common Stock
Provisions in our certificate of incorporation, bylaws and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our common stock
No substantive risk change; the filing changes subject-verb agreement from “contains” to “contain” and otherwise retains the takeover provisions.
Was: Provisions in our amended and restated certificate of incorporation, amended and restated bylaws and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our common stock
- 74% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
If we cannot effectively manage growth by implementing and improving its operational and financial systems, our business, prospects, financial condition, and results of operations could be materially adversely affected
The language shifts from third-person Company references to “we” and adds that failed growth management could materially harm business, prospects, finances, and results.
Was: If the Company cannot effectively manage growth by implementing and improving its operational and financial systems, the Company’s business, prospects, financial condition, and results of operations could be materially adversely affected
- 61% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
Product liability lawsuits, warranty claims, and product recalls could result in substantial liabilities and harm our business, results of operations, and financial condition
The risk adds warranty claims, recalls, defect theories, consumer-protection claims, and defense costs, while removing detailed semiconductor cleanroom and contamination examples.
Was: Warranty claims, product liability claims and product recalls could harm our business, results of operations and financial condition
- 58% rewrittenRisks Relating to Our Common Stock
Substantial future sales of shares of our common stock could cause the market price of our common stock to decline
The existing financing-dilution risk now also states that substantial sales or perceived sales could depress the stock price and hinder investors’ ability to sell.
- 57% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
Our business operations could suffer in the event of information technology systems’ failures or security breaches
The filing adds ransomware and phishing attacks, power outages, and semiconductor-specific cyberattacks targeting intellectual property, manufacturing, and customer or partner data.
- 55% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
Furthermore, if a significant portion of our revenue is derived from customers in certain industries, a downturn or lower sales to customers in such industries could materially adversely affect our business and results of operations. If we cannot successfully market our products, we will not receive revenue
The customer-concentration risk now adds delayed, disputed, or uncollectible payments caused by customers’ budgetary, liquidity, administrative, or other constraints.
- 49% rewrittenRisks Relating to Our Common Stock
We are a smaller reporting company, and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies will make our common stock less attractive to investors
The filing replaces a future disclosure-trigger explanation with specific smaller-reporting-company exemptions and warns reduced disclosure may hinder investor analysis.
- 41% rewrittenRisks Relating to the Semiconductor Industry
Shortages or increased prices of raw materials could materially adversely affect our results of operations
- 38% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
We expect to depend on a limited number of customers and the loss of one or more of these customers could have a material adverse effect on our business, financial condition, and results of operations
Was: We will depend on a limited number of customers and the loss of one or more of these customers could have a material adverse effect on our business, financial condition, and results of operations
- 33% rewrittenRisks Relating to Our Common Stock
We are an emerging growth company and a smaller reporting company, and certain reduced reporting and disclosure requirements could make our common stock less attractive to investors
Was: We are an emerging growth company and a smaller reporting company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies and smaller reporting companies could make our common stock less attractive to investors
- 33% rewrittenRisks Relating to Our Common Stock
Our officers, directors, and significant stockholders own a significant percentage of our outstanding voting securities, which could reduce the ability of minority stockholders to effect certain corporate actions
Was: Our officers, directors, and 5%+ stockholders own a significant percentage of our outstanding voting securities, which could reduce the ability of minority stockholders to effect certain corporate actions
- 31% rewrittenRisks Relating to Our Common Stock
We have identified material weaknesses in our internal control over financial reporting that, if not properly remediated, could result in material misstatements in our consolidated financial statements in future periods
- 28% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
We rely on our management team and other key employees and will need additional personnel to grow our business. The loss of one or more key employees or our inability to attract and retain qualified personnel could harm our business
- 27% rewrittenRisks Relating to the Semiconductor Industry
We will be dependent on the services of third-party suppliers and contract manufacturers, and any disruption in or deterioration of the quality of the services delivered by such third parties could materially adversely affect our business and results of operations
- 24% rewrittenRisks Relating to Our Common Stock
There may be limitations on the effectiveness of our internal controls, and a failure of our control systems to prevent error or fraud may materially harm our company
- 24% rewrittenRisks Relating to the Semiconductor Industry
We may be subject to disruptions or breaches of our secured network that could irreparably damage our reputation and our business, expose us to liability and materially adversely affect our results of operations
- 24% rewrittenRisks Relating to the Semiconductor Industry
We will rely on limited sources of wafer fabrication, packaged products fabrication and product testing, the loss of which could delay and limit our product shipments
- 21% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
Our failure to raise additional capital or generate cash flows necessary to expand our operations and invest in new enterprises in the future could reduce our ability to compete successfully and harm our results of operations
- 20% rewrittenRisks Relating to Our Business, Growth Prospects and Operating Results
Our customers may require our products to undergo a lengthy and expensive qualification process without any assurance of product sales
All 68 risk factors
Headings as the filing states them, in filing order.
Risks Relating to Our Business, Growth Prospects and Operating Results
- 01We cannot make an assurance that it will succeed in addressing these risks
- 02We have entered into a letter of intent with the U.S. Department of Commerce for proposed funding under the CHIPS and Science Act, which remains subject to execution of definitive award documents and may result in substantial restrictions on our business and operationsnew
- 03Our failure to raise additional capital or generate cash flows necessary to expand our operations and invest in new enterprises in the future could reduce our ability to compete successfully and harm our results of operations21% rewritten
- 04The timelines of adoption for our technologies might be longer than we anticipate
- 05Market opportunity estimates and forecasts regarding our target markets may prove inaccurate and should not be viewed as indicative of our future revenue or growthnew
- 06Changes to federal regulatory agencies and policies, including the Department of Commerce, could adversely affect our business operations and financial outlooknew
- 07Compliance with federal securities laws, rules, and regulations, as well as Nasdaq requirements, has become increasingly complex, and the significant attention and expense we must devote to those areas may have an adverse impact on our business
- 08We generate a substantial portion of our revenue from contracts with U.S. federal government agencies, which are subject to a number of challenges and risks that may adversely impact our business, prospects, financial condition, and operating results
- 09We rely on our management team and other key employees and will need additional personnel to grow our business. The loss of one or more key employees or our inability to attract and retain qualified personnel could harm our business28% rewritten
- 10If our estimates or judgments relating to our critical accounting policies are based on assumptions that change or prove to be incorrect, our results of operations could fall below the expectations of investors, resulting in a decline in the market price of our common stock
- 11Changes in accounting rules and regulations, or interpretations thereof, could result in unfavorable accounting charges or require us to change our compensation policies
- 12Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited
- 13We expect to depend on a limited number of customers and the loss of one or more of these customers could have a material adverse effect on our business, financial condition, and results of operations38% rewritten
- 14Furthermore, if a significant portion of our revenue is derived from customers in certain industries, a downturn or lower sales to customers in such industries could materially adversely affect our business and results of operations. If we cannot successfully market our products, we will not receive revenue55% rewritten
- 15Customer concentration could potentially result in volatility of revenues and stock prices
- 16Some of our business may be dependent on a royalty-based business model, which is inherently risky
- 17Uncertainties regarding the timing and amount of customer orders could lead to excess inventory and write-downs of inventory that could materially adversely affect our financial condition and results of operations
- 18Our customers may require our products to undergo a lengthy and expensive qualification process without any assurance of product sales20% rewritten
- 19Our business operations could suffer in the event of information technology systems’ failures or security breaches57% rewritten
- 20If we fail to protect and enforce our intellectual property rights and our confidential information, our business will suffer
- 21A court invalidation or limitation of our key patents could significantly harm our business
- 22We may be involved in material legal proceedings in the future to enforce or protect our intellectual property rights, which could harm our business
- 23Our technologies may infringe on the intellectual property rights of others, which could lead to costly disputes or disruptions
- 24If we cannot effectively manage growth by implementing and improving its operational and financial systems, our business, prospects, financial condition, and results of operations could be materially adversely affected74% rewritten
- 25If our estimates related to expenditures are inaccurate, our business may fail
- 26Product liability lawsuits, warranty claims, and product recalls could result in substantial liabilities and harm our business, results of operations, and financial condition61% rewritten
- 27We may be subject to litigation from time to time during the normal course of business, which may adversely affect our business, financial condition and results of operations
- 28Natural disasters, public health crises, political crises, economic downturns, or other unexpected events could cause significant harm to our business operations and facilities, adversely affect our supply chain and customer base, and materially adversely affect our results of operations and financial condition90% rewritten
- 29We may be unable to complete or successfully integrate strategic transactions, which could limit our ability to execute our business strategiesnew
- 30Our current operations are concentrated in one location and in the event of an earthquake, terrorist attack or other disaster affecting this location or those of our major suppliers, our operations may be interrupted, and our business may be harmed
- 31Our officers and directors allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to carry out all of our operations and goals
- 32Dependence on customers in regulated industries and changes in applicable laws and regulations could adversely affect demand for our products and businessnew
- 33Demand for our technologies may not develop as we expect, and evolving regulation and competition could adversely affect our business, financial condition, and results of operationsnew
Risks Relating to the Semiconductor Industry
- 34We will rely on limited sources of wafer fabrication, packaged products fabrication and product testing, the loss of which could delay and limit our product shipments24% rewritten
- 35Downturns or volatility in general economic conditions could have a material adverse effect on our business and results of operations
- 36The semiconductor industry is highly cyclical, and significant downturns or upturns in customer demand can materially adversely affect our business and results of operations
- 37Rapid innovation and short product life cycles in the semiconductor industry can result in price erosion of older products, which may materially adversely affect our business and results of operations
- 38Shortages or increased prices of raw materials could materially adversely affect our results of operations41% rewritten
- 39Changes in administration may lead to changes in import tariffs, which could impact the semiconductor industry that relies on imports of raw materials and other supplies or equipment
- 40Export controls, sanctions, and other trade restrictions applicable to semiconductor, photonics, defense, aerospace, AI, and quantum technologies could limit our ability to sell or transfer our products and technologynew
- 41Our facilities and processes may be interdependent and an operational disruption at any particular facility could have a material adverse effect on our ability to produce our products, which would materially adversely affect our business and results of operations
- 42We may be unable to maintain manufacturing efficiency, which could have a material adverse effect on our results of operations
- 43The failure to successfully implement cost reduction initiatives, including through restructuring activities, could materially adversely affect our business and results of operations
- 44If we are unable to identify and make the substantial R&D investments required to remain competitive in our business, our business, financial condition, and results of operations may be materially adversely affected
- 45We may be unable to develop new products to satisfy changing customer demands or regulatory requirements, which may materially adversely affect our business and results of operations
- 46The semiconductor industry is highly competitive, and our inability to compete effectively could materially adversely affect our business and results of operations
- 47The semiconductor industry has experienced rapid consolidation and our inability to compete with large competitors or failure to identify attractive opportunities to consolidate may materially adversely affect our business
- 48We will be dependent on the services of third-party suppliers and contract manufacturers, and any disruption in or deterioration of the quality of the services delivered by such third parties could materially adversely affect our business and results of operations27% rewritten
- 49Sales through distributors and other third parties will expose us to risks that, if realized, could have a material adverse effect on our results of operations
- 50Our potential future global operations may subject us to risks inherent in doing business on a global level that could adversely impact our business, financial condition, and results of operations
- 51Special authorizations, permits, and licenses may be required for our operations, which if delayed or denied could materially adversely affect our results of operations and financial condition
- 52Environmental and health and safety liabilities and expenditures could materially adversely affect our results of operations and financial condition
- 53We may be subject to disruptions or breaches of our secured network that could irreparably damage our reputation and our business, expose us to liability and materially adversely affect our results of operations24% rewritten
- 54The failure to comply with the terms and conditions of our contracts could result in, among other things, damages, fines, or other liabilities
Risks Relating to Intellectual Property
- 55If we are unable to protect the intellectual property we use, our business, results of operations and financial condition could be materially adversely affected
- 56If our technologies are subject to claims of infringement on the intellectual property rights of third parties, efforts to address such claims could have a material adverse effect on our results of operations
Risks Relating to Our Common Stock
- 57We are a smaller reporting company, and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies will make our common stock less attractive to investors49% rewritten
- 58We have identified material weaknesses in our internal control over financial reporting that, if not properly remediated, could result in material misstatements in our consolidated financial statements in future periods31% rewritten
- 59There may be limitations on the effectiveness of our internal controls, and a failure of our control systems to prevent error or fraud may materially harm our company24% rewritten
- 60Our officers, directors, and significant stockholders own a significant percentage of our outstanding voting securities, which could reduce the ability of minority stockholders to effect certain corporate actions33% rewritten
- 61We do not currently intend to pay dividends on our Common Stock in the foreseeable future, and consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our Common Stock
- 62FINRA sales practice requirements may limit a stockholder’s ability to buy and sell our stocknew
- 63Substantial future sales of shares of our common stock could cause the market price of our common stock to decline58% rewritten
- 64If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, our stock price and trading volume could decline
- 65Provisions in our certificate of incorporation, bylaws and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our common stock82% rewritten
- 66We have adopted exclusive forum bylaws for certain matters, which may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholdersnew
- 67The market price and trading volume of our common stock may be volatile
- 68We are an emerging growth company and a smaller reporting company, and certain reduced reporting and disclosure requirements could make our common stock less attractive to investors33% rewritten
Other Aeluma 10-Ks
- 2025 10-K risk factors
72 risks. Aeluma depends heavily on future customer adoption, a limited number of early customers, and U.S. government contracts. Semiconductor manufacturing and supply chain reliance present major operating risks.
Filed Sep 09, 2025
About this page
Item 1A of the 10-K on EDGAR was split into its risk factors and, where the company's previous 10-K is on file, each heading was matched to last year's and the text compared word for word. The headings are the filing's own. The one-line readings and the overview were written by a language model from the text of the new, dropped, and rewritten risks; they refer to risks by position and cannot misquote a heading.