Astrotech (ASTC) risk factors, FY2026 10-K

Other

1. 01We have incurred significant losses since inception and anticipate that we will incur continued losses for the foreseeable future100% rewritten
2. 02We may not be able to obtain patents, other intellectual property protection or licenses for the technologies contained in the products we develop
3. 03A failure of a key information technology system, process, or site could have a material adverse impact on our ability to conduct business74% rewritten
4. 04Repair or replacement costs due to warranties we provide on our products could have a material adverse effect on our business, financial condition and results of operations99% rewritten
5. 05We and our suppliers may not meet regulatory quality standards applicable to our device-manufacturing processes, which could have an adverse effect on our business, financial condition, and results of operations
6. 06Legislative or regulatory healthcare reforms may make it more difficult and costly for us to obtain reimbursement for our products or regulatory clearance or approval of our future products, if any, and to produce, market and distribute those products after clearance or approval is obtained
7. 07Our financial performance may be adversely affected by medical device tax provisions in healthcare reform laws

Risks Related to Our Business and Industry

1. 08We have incurred significant losses since inception and anticipate that we will incur continued losses for the foreseeable future100% rewritten
2. 09Our business units are in the development stage. They have earned limited revenues and it is uncertain whether they will earn any revenues in the future or whether any of them will ultimately be profitable
3. 10We may need to raise additional capital to fund the operations of our business units and commercialize our products
4. 11finance capital expenditures and general and administrative expenses
5. 12the potential cost of and delays in product development as a result of any regulatory oversight that may be applicable to our products
6. 13Third parties have infringed on our intellectual property rights, and may claim in the future that we are infringing on their intellectual property rights, and we could suffer significant litigation or licensing expenses or be prevented from selling products
7. 14We may not be able to successfully develop the BreathTest-1000 or any other new products or services25% rewritten
8. 15Our sales and operations in international markets expose us to operational, financial and regulatory risks
9. 16Our business, financial condition and results of operations may be adversely impacted by the effects of inflation
10. 17We generate substantial revenue from a limited number of customers and the loss of any such customer may harm our business, results of operations and financial results
11. 18Our success depends significantly on the establishment and maintenance of successful relationships with our customers
12. 19Third parties may claim we are infringing their intellectual property rights, and we could suffer significant litigation or licensing expenses or be prevented from selling products
13. 20Our ongoing success is dependent upon the continued availability of certain key employees
14. 21Our operating results may be adversely affected by increased competition
15. 22Our facilities located in Austin are susceptible to damage caused by hurricanes or other natural disasters
16. 23If we are unable to anticipate technological advances and customer requirements in the commercial and governmental markets, our business and financial condition may be adversely affected
17. 24We incur substantial upfront, non-reimbursable costs in preparing proposals to bid on contracts or to receive research and development grants that we may not be awarded
18. 25Our manufacturing operations are mostly dependent upon third party suppliers, including single source suppliers, making us vulnerable to external factors such as supply shortages and price fluctuations, which could harm our business
19. 26fluctuation in delivery by our suppliers due to changes in demand from us or their other customers82% rewritten

Risks Related to our Strategic Initiatives

1. 27We intend to explore expanding our business into the Lunar Initiatives and we may not be able to successfully transition our business and may not realize the anticipated synergies and benefits of such proposed transitionnew
2. 28We are substantially dependent on the outcome of government solicitations and awards, including the Appendix A Program and the CLPS2 Program, and there can be no assurance that we will submit a proposal or be selected for any contract, award or fundingnew
3. 29Many of our Lunar Initiatives involve significant technical complexity, unproven technologies, or technologies that do not exist or may require significant advancement, and such Lunar Initiatives may not achieve commercial viabilitynew
4. 30We expect to face significant competition from well-capitalized commercial entities and government-sponsored programs in the markets we intend to enter, and if we are unable to compete effectively, our business, financial condition and results of operations could be harmednew
5. 31Our activities to evaluate and pursue strategic alternatives may not be successful, including the announcement and pendency of the proposed sale of 1st Detect, and may present certain risks to our ongoing business and operationsnew

Legal and Regulatory Risks

1. 32Our products and operations are subject to extensive governmental regulation, and failure to comply with applicable requirements could cause our business to suffer
2. 33recalls and field‑safety corrective actions
3. 34the manufacturing process or facilities we use may not meet applicable requirements46% rewritten
4. 35seize or detain products or require a product recallnew
5. 36Legislative or regulatory healthcare reforms may adversely affect our business and our ability to obtain regulatory clearance or approval for, and successfully commercialize, our productsnew
6. 37Although we do not grow, sell or distribute cannabis products, our products are closely tied to the hemp and cannabis industry and could subject us to regulatory, financial, operational and reputational risks and challenges24% rewritten
7. 38Evolving federal and state laws and regulations pertaining to the use or cultivation of hemp and cannabis, as well active enforcement by federal or state authorities of the laws and regulations governing the use and cultivation of hemp and cannabis may indirectly affect our business, our revenues and our profits
8. 39As the possession and use of marijuana is illegal under the CSA, it is possible that our manufacture and sale of equipment that is used to cultivate marijuana or marijuana products may be deemed to be aiding and abetting illegal activities
9. 40We may become subject to FDA or ATF regulation with respect to our AgLab business
10. 41The hemp and cannabis industry could face strong opposition from other industries
11. 42There may be difficulty enforcing certain of our commercial agreements and contracts
12. 43A drop in the retail price of hemp and cannabis products may negatively impact our business
13. 44We may be subject to constraints on and differences in marketing our products under varying state laws
14. 45We are subject to differing tax rates in several jurisdictions in which we operate, which may adversely affect our business, financial condition, results of operations and prospects
15. 46Changes in U.S. trade policy, including changes to existing trade agreements and any resulting changes in international trade relations, may have a material adverse effect on us and our export compliance as it relates to our international customers

Risks Related to Ownership of Our Common Stock

1. 47Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future, and as a result, investors in our common stock could incur substantial losses32% rewritten
2. 48general economic, industry and market conditions; and
3. 49We can sell additional shares of common stock without consulting shareholders and without offering shares to existing shareholders, which would result in dilution of shareholders’ interests in the Company and could depress our stock price
4. 50Our Certificate of Incorporation provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any disputes between us and our stockholders, which could limit stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors or officers
5. 51A sale of a substantial number of shares of the common stock may cause the price of our common stock to decline
6. 52We are a smaller reporting company and, as a result of the reduced disclosure and governance requirements applicable to such companies, our common stock may be less attractive to investors
7. 53Our failure to maintain compliance with Nasdaq’s continued listing requirements could result in the delisting of our Common Stock
8. 54Increased cybersecurity requirements, vulnerabilities, threats, and more sophisticated and targeted computer crime could pose a risk to our systems, networks, products, services, and data
9. 55Increased costs associated with corporate governance compliance may significantly impact our results of operations
10. 56Our insurance coverage may be inadequate to cover all significant risk exposures