Knightscope (KSCP) risk factors, FY2025 10-K

Risks Related to the Business and the Global Economy

1. 01We have not yet generated any profits and anticipate that we will incur continued losses for the foreseeable future and may never achieve profitability
2. 02The report of our independent registered public accounting firm expresses substantial doubt about our ability to continue as a going concern, and we may not be able to continue to operate the business if we are not successful in securing additional funding
3. 03We expect to experience future losses as we implement our business strategy and will need to generate significant revenues to achieve profitability, which may not occur
4. 04Investment in new products and services may not achieve expected returns and could disrupt our ongoing business, present risks not originally contemplated and materially adversely affect our business, reputation, results of operations and financial condition48% rewritten
5. 05We are subject to potential fluctuations in operating results due to our sales cycle
6. 06If we are unable to acquire new customers, our future revenues and operating results will be harmed. Likewise, potential customer turnover in the future, or costs we incur to retain our existing customers, could materially and adversely affect our financial performance32% rewritten
7. 07We are subject to the loss of contracts, due to terminations, non-renewals or competitive re-bids, which could adversely affect our results of operations and liquidity, including our ability to secure new contracts from other customers
8. 08The failure to identify, consummate, effectively integrate or realize the expected benefits from acquisitions could adversely affect our growth and our business, financial condition, and results of operationsNew
9. 09Our future operating results are difficult to predict and may be affected by a number of factors, many of which are outside of our control
10. 10Our financial results will fluctuate in the future, which makes them difficult to predict
11. 11The occurrence of any of the above and any unanticipated obstacles may hinder the execution of our business plan and adversely affect or materially adversely affect our operating results
12. 12Our business could be adversely affected by trade tariffs or other trade barriers
13. 13Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults or non-performance by financial institutions, could adversely affect our business, financial condition or results of operations
14. 14We have a limited number of deployments, and limited market acceptance of our products could harm our business
15. 15We cannot assure you that we will effectively manage our growth
16. 16Our costs may grow more quickly than our revenues, harming our business and profitability
17. 17The loss of one or more of our key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm our business21% rewritten
18. 18If we are unable to protect our intellectual property, the value of our brand and other intangible assets may be diminished and our business may be adversely affected25% rewritten
19. 19We may be subject to claims, disputes or legal proceedings in the ordinary course of our business. If the outcome of these proceedings is unfavorable to us, then our business, results of operations and financial condition could be adversely affected
20. 20We may face additional competition
21. 21Our business and operations may suffer in the event of information technology system failures, cyberattacks or deficiencies in our cybersecurity
22. 22We have limited experience in operating our ASRs in a variety of environments and increased interactions may lead to collisions, possible liability and negative publicity
23. 23Our brand, reputation and ability to attract, retain, and serve our customers are dependent in part upon the reliable performance of our products, infrastructure, and employees
24. 24The private security industry is undergoing structural changes in technology and services
25. 25We have a government customer and are seeking additional government customers, which would subject us to risks including early termination, audits, investigations, sanctions, or penalties
26. 26We are dependent on the global supply chain and have experienced supply chain constraints, as well as increased costs on components and shipping

Risks Related to Ownership of our Class A Common Stock

1. 27We may not be able to comply with all applicable listing requirements or standards of The Nasdaq Capital Market, and Nasdaq could delist our Class A Common Stock
2. 28We will need to seek additional funds in the future
3. 29Our stock price may be volatile
4. 30We have not paid cash dividends in the past and do not expect to pay dividends in the future. Any return on investment may be limited to the value of our Class A Common Stock
5. 31If financial securities industry analysts cease to publish reports on us or publish unfavorable reports on us, then the market price and market trading volume of our Class A Common Stock could be negatively affected
6. 32We are an emerging growth company, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Class A Common Stock less attractive to investors
7. 33We are subject to complex and changing laws and regulations, which expose us to potential liabilities, increased costs and other adverse effects on our business
8. 34Substantial future sales or issuances of our securities, or the perception in the public markets that these sales may occur, may depress our stock price
9. 35Increasing attention to, and evolving expectations for, ESG initiatives could increase our costs, harm our reputation, or otherwise adversely impact our business
10. 36Short sellers of our stock may be manipulative and may drive down the market price of our Class A Common Stock

Risks Related to the Event Risk Acquisition

1. 37The Event Risk Acquisition may not achieve its intended results New