AerSale (ASLE) risk factors, FY2025 10-K

Risks Related to AerSale’s Business and Industry

1. 01Supply chain disruptions could have adverse effects on our ability to provide certain services
2. 02We are affected by factors that adversely impact the commercial aviation industry
3. 03Market values for our aviation products fluctuate, and we may be unable to recover our costs incurred with respect to engines, rotable components and other aircraft parts69% rewritten
4. 04demand for the affected engine and aircraft types and the values of such Flight Equipment, which may adversely impact our financial condition or results of operationsNew
5. 05Success at our MRO facilities is dependent upon continued outsourcing by the airlines
6. 06Our operations would be adversely affected by a shortage of skilled personnel or work stoppages
7. 07The inability to obtain certain components and raw materials from suppliers could harm our business
8. 08We operate in highly competitive markets, and competitive pressures may adversely affect us
9. 09We are exposed to risks associated with operating internationally
10. 10Measures that we have or will adopt to reduce the potential impact of losses resulting from the risks of doing business internationally may not be adequate, and the regions in which we operate might not continue to be stable enough to allow us to operate profitably or at all35% rewritten
11. 11Business acquisitions expose us to risks, including the risk that we may be unable to effectively integrate acquired businesses
12. 12Further consolidation in the aerospace industry could adversely affect our business and financial results
13. 13Our business could be negatively affected by cyber or other security threats or other disruptions
14. 14We may need to make significant capital expenditures to keep pace with technological developments in our industry
15. 15We do not own certain intellectual property and tooling that is important to our business
16. 16We could become involved in intellectual property litigation, which could have a material and adverse impact on our profitability
17. 17Our operations depend on our facilities, which are subject to physical and other risks that could disrupt production31% rewritten
18. 18Our reputation, ability to do business and financial position, results of operations and/or cash flows may be impacted by the improper conduct of employees, agents, subcontractors, suppliers, business partners or joint ventures in which we participate
19. 19Our business might suffer if we were to lose the services of certain key employees
20. 20If our subcontractors or suppliers fail to perform their contractual obligations, our contract profitability and our ability to win new contracts may be adversely affected
21. 21Future outbreaks and infectious diseases could have a material adverse impact on our business, operating results, financial condition, and liquidity

Strategic and Financial Risks

1. 22We are dependent upon continued availability of financing to manage our business and to execute our business strategy, and additional financing may not be available on terms acceptable to us
2. 23Our existing debt includes restrictive and financial covenants
3. 24Restrictive covenants in the documents governing our existing and any future indebtedness may limit our current and future operations, particularly our ability to respond to changes in our business or to pursue our business strategies
4. 25Unanticipated changes in our tax provision or exposure to additional income tax liabilities could affect our profitability
5. 26Our financial results of operations could be adversely affected by impairment of our goodwill or other intangible assets
6. 27Our exposure to variable interest rates and foreign currency exchange rates could materially and adversely affect our business, operating results and financial condition

Legal and Regulatory Risks

1. 28We are subject to significant government regulation and may need to incur significant expenses to comply with new or more stringent governmental regulation
2. 29Any revocation or suspension of our material licenses, certificates, authorizations, or approvals by the FAA or equivalent regulatory agencies in other countries, may adversely impact our financial condition or results of operations
3. 30We are subject to the FCPA and other anti-corruption laws, as well as export control laws, import and customs laws, trade and economic sanctions laws and other laws governing our operations
4. 31Our business and financial results may be affected by various litigation and regulatory proceedings
5. 32Liens on our Flight Equipment could exceed the value of such Flight Equipment, which could negatively affect our ability to repossess, lease or sell such Flight Equipment
6. 33In certain countries, an engine affixed to an aircraft may become an accession to the aircraft and we may not be able to exercise our ownership rights over the engine
7. 34Our industry is susceptible to product and other liability claims, and claims not adequately covered by insurance may adversely affect our results of operations and financial condition
8. 35We must comply with extensive environmental requirements, and any exposure to environmental liabilities may adversely affect us
9. 36We may be adversely affected by global climate change, or by legal, regulatory or market responses to such change
10. 37Our share price may be volatile, and an active, liquid trading market for our common stock may not continue
11. 38If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our common stock, the price of our common stock could decline
12. 39Substantial future sales of our common stock, or the perception in the public markets that these sales may occur, may depress our stock price
13. 40We do not intend to pay dividends on our common stock in the foreseeable future
14. 41If any of our customers were to become insolvent or experience substantial financial difficulties, our business, financial condition and results of operations may be adversely affected
15. 42Our results of operations and liquidity needs could be materially negatively affected by market fluctuations or an economic downturn