authID (AUID) risk factors, FY2024 10-K

Other

1. 01We have a history of losses and we may not be able to achieve profitability going forward
2. 02We have yet to achieve positive cash flow and, given our projected funding needs, our ability to generate positive cash flow is uncertain
3. 03Our limited operating history makes it difficult for us to evaluate our future business prospects and make decisions based on those estimates of our future performance
4. 04There can be no assurance that we will successfully commercialize our products that are currently in development or that our existing products will sustain market acceptance
5. 05We depend upon key personnel and need additional personnel
6. 06Acquisitions present many risks that could have a material adverse effect on our business and results of operations
7. 07The market for our products is characterized by changing technology, requirements, standards and products, is impacted by the growing use of AI technologies and we may be adversely affected if we do not respond promptly and effectively to these changes
8. 08If we are unable to respond promptly and effectively to new cybersecurity threats and attacks, changing technologies and market requirements, we will be unable to compete effectively in the future
9. 09Issues relating to the development and use of AI, including generative AI, in our offerings may result in reputational harm, liability and adverse financial results
10. 10If our technology and solutions are not adopted and used by customer organizations, we will not be able to grow our business and our operations will be negatively affected
11. 11In order for us to achieve our growth objectives, our identity verification and authentication technologies and solutions must be adapted to and adopted in a variety of areas including, among others, computer and online systems access control, and identity verification for transaction authentication purposes
12. 12We have in the past entered into and may seek in the future to enter into contracts with governments, as well as state and local governmental agencies and municipalities, which subjects us to certain risks associated with such types of contracts
13. 13We may have to seek business through a competitive bidding process
14. 14We rely in part on third-party software to develop and provide our solutions
15. 15We depend upon a small number of large sales with contractual commitments ranging from $500,000 up to $10,000,000, which take longer to close and may result in a concentration of business and unpredictable quarterly revenue
16. 16Our efforts to expand our international operations are subject to a number of risks, any of which could adversely reduce our future international sales and increase our losses
17. 17We are exposed to risks in operating in foreign markets, which may make operating in those markets difficult and thereby force us to curtail our business operations
18. 18Cyber-attacks, breaches of network or information technology security, presentation attacks, natural disasters, pandemics, or terrorist attacks could have an adverse effect on our business
19. 19The wars in Ukraine and the Middle East may impact the business of the Company, the markets in which it operates and the financial markets, in which the Company needs to raise capital
20. 20Interruptions, delays in service or defects in our systems could impair the delivery of our services and harm our business
21. 21Third parties could obtain access to our proprietary information or could independently develop similar technologies
22. 22Third parties may assert that we are infringing their intellectual property rights; IP litigation could require us to incur substantial costs even when our efforts are successful
23. 23Our officers, directors and holders of 5% of outstanding shares together beneficially own a significant portion of our Common Stock and, as a result, can exercise control over stockholder and corporate actions
24. 24Due to our ability to serve both identity verification and authentication needs, as well as the tendency for enterprises to acquire multiple digital identity solutions, we can and often do co-exist with competing products within our customer base
25. 25Government regulation, specifically that relating to data privacy protection could negatively impact the business
26. 26Our amended and restated bylaws designate certain courts as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees
27. 27There can be no assurance that we will be able to comply with the continued listing standards of the Nasdaq Capital Market. Our failure to meet the continued listing requirements of the Nasdaq Capital Market could result in a de-listing of our Common Stock
28. 28Sales of a substantial number of shares of our Common Stock in the public market by our existing stockholders could cause our share price to fall
29. 29We may be subject to securities litigation, which is expensive and could divert management attention
30. 30If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they adversely change their recommendations or publish negative reports regarding our business or our Common Stock, our stock price and trading volume could decline
31. 31The market price of our common stock has been volatile and your investment in our stock could suffer a decline in value
32. 32We do not anticipate paying any cash dividends in the foreseeable future