Aware (AWRE) risk factors, FY2025 10-K

Aware's FY2025 10-K, filed Mar 06, 2026, lists 28 risk factors. Against the prior year's 30: 2 dropped, 7 substantially reworded.

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Risk factors listed
280 groups
New this year
0vs 30 last year
Dropped
2since the prior 10-K
Substantially reworded
7of those kept
Section length
5k wordsItem 1A

What the changes say

  • The filing drops separate commercial biometrics-demand and stock-litigation risks while retaining related market-acceptance and volatility language.
  • Acquisition risk now acknowledges some past benefits did not exceed acquisition costs.
  • Accounting risk adds rapidly changing standards and the need to interpret new standards correctly.
  • Biometrics acceptance risk now expressly includes concerns about fairness, accuracy, and potential bias.

What changed since the prior 10-K

Dropped

  • Dropped

    solutions; ii) costs involved in adopting and integrating biometric solutions; iii) public concerns regarding privacy; and iv) potential privacy legislation

  • Dropped

    corporate actions we may initiate, such as acquisitions, stock sales or repurchases, dividend declarations, or corporate reorganizations

Reworded

  • 58% rewritten

    We must make judgments in the process of preparing our financial statements

    Accounting estimates are now discussed in MD&A, while rapidly changing standards and evolving interpretations create implementation risk.

  • 58% rewritten

    The market price of our common stock has been and may continue to be subject to wide fluctuations, and this may make it difficult for shareholders to resell the common stock when they want or at prices they find attractive

    Stock volatility language now adds acquisitions, stock sales or repurchases, dividends, reorganizations, and broader market trends as possible causes.

  • 46% rewritten

    We may not realize the anticipated benefits of our acquisitions or investments

    The company now says some past acquisition benefits did not exceed costs, in addition to warning that future benefits may not.

  • 35% rewritten

    A significant commercial market for biometrics technology may not develop, and, even if it does, there can be no assurance our biometrics technology will be successful

    The risk description ends after traditional security alternatives, omitting the prior discussion of performance, reliability, privacy, cost, and adoption factors.

  • 35% rewritten

    Our business may be affected by government laws and regulations

    No substantive change: privacy and biometric-data regulation risks remain tied to GDPR, CPRA, state, federal, and foreign requirements.

  • 31% rewritten

    We derive a significant portion of our revenue directly or indirectly from government customers, and our business may be adversely affected by changes in the contracting or fiscal policies of those governmental entities

    The current text retains government dependence, contracting-policy, and budget-constraint risks but omits the prior detailed examples shown.

  • 24% rewritten

    If the biometrics market does not experience significant growth or if our products do not achieve broad acceptance both domestically and internationally, we may not be able to grow our business

    Public concern language now specifically names intrusiveness, fairness, accuracy, and potential bias as factors affecting biometrics-market growth.

All 28 risk factors

Headings as the filing states them, in filing order.

Other

  1. 01Our operating results may fluctuate significantly from period-to-period and are difficult to predict
  2. 02We derive a significant portion of our revenue directly or indirectly from government customers, and our business may be adversely affected by changes in the contracting or fiscal policies of those governmental entities31% rewritten
  3. 03delays in the payment of our invoices by government payment offices
  4. 04We derive a significant portion of our revenue from third party channel partners
  5. 05A significant commercial market for biometrics technology may not develop, and, even if it does, there can be no assurance our biometrics technology will be successful35% rewritten
  6. 06If the biometrics market does not experience significant growth or if our products do not achieve broad acceptance both domestically and internationally, we may not be able to grow our business24% rewritten
  7. 07marketing efforts and publicity regarding biometrics solutions
  8. 08We face intense competition from other biometrics solutions providers
  9. 09Component providers that offer biometrics software and hardware components for fingerprint, facial, iris and voice biometric identification. This group of competitors includes companies such as FaceTec, iProov, and Innovatrics
  10. 10The biometrics industry is characterized by rapid technological change and evolving industry standards, which could render our existing products obsolete
  11. 11Our software products may have errors, defects or bugs, which could result in delayed or lost revenue, expensive correction, liability to our customers, and claims against us
  12. 12Our business may be adversely affected by our use of open-source software
  13. 13We rely on third-party software to develop and provide our solutions and significant defects in third-party software could harm our business
  14. 14We rely on third-party relationships
  15. 15Part of our future business is dependent on market demand for, and acceptance of, the cloud-based model for the use of software
  16. 16Our operational systems, networks and products are subject to continually evolving cybersecurity or other technological risks, which could result in the disclosure of our or our customers' confidential information, damage to our reputation, additional costs, regulatory penalties and financial losses
  17. 17Our intellectual property is subject to limited protection
  18. 18We may be sued by third parties for alleged infringement of their proprietary rights
  19. 19litigation based on allegations of patent infringement. Third parties have asserted against us in the past and may assert against us in the future patent, copyright and other intellectual property rights to technologies that are important to our business
  20. 20If we are unable to attract and retain key personnel, our business could be harmed
  21. 21Our business may be affected by government laws and regulations35% rewritten
  22. 22Adverse economic conditions could harm our business
  23. 23We may not realize the anticipated benefits of our acquisitions or investments46% rewritten
  24. 24We may have additional tax liabilities
  25. 25The market price of our common stock has been and may continue to be subject to wide fluctuations, and this may make it difficult for shareholders to resell the common stock when they want or at prices they find attractive58% rewritten
  26. 26If we are unable to maintain effective internal controls over financial reporting, investors could lose confidence in the reliability of our financial statements, which could result in a decline in the price of our common stock
  27. 27We must make judgments in the process of preparing our financial statements58% rewritten
  28. 28Our 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

Other Aware 10-Ks

  • FY2024 10-K risk factors
    30 risks

    Revenue depends heavily on unpredictable individual orders, government contracts, and third-party channel partners selling biometric software. Adoption of biometrics in commercial markets remains uncertain amid intense competition and rapid technological changes. Reliance on open-source code, third-party software, cloud models, and key personnel creates operational and intellectual property risks.

    Filed Mar 13, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.