Peraso (PRSO) risk factors, FY2024 10-K

Risks Related to Our Business, Operations and Industry

1. 01We might not be able to continue as a going concern
2. 02We discontinued the production of our memory products
3. 03Our gross profit may fluctuate due to a variety of factors, which could negatively impact our results of operations and our financial condition
4. 04We have a history of losses, and we will need to raise additional capital
5. 05Our failure to generate the significant capital necessary or raise additional capital to expand our operations and invest in new products could reduce our ability to compete and could harm our business
6. 06Our reduction in force undertaken to significantly reduce our ongoing operating expenses may not result in our intended outcomes and may yield unintended consequences and additional costs
7. 07Failure to comply with laws relating to employment could subject us to penalties and other adverse consequences
8. 08Our failure to successfully market our products could seriously harm our ability to execute our business strategy and may force us to curtail our research and development plans or existing operations
9. 09The design-win process for our products is generally lengthy, expensive and competitive, with no guarantee of revenue, and, if we fail to generate sufficient revenue to offset our expenses, our business and operating results would suffer
10. 10If our foundries do not achieve satisfactory yields or quality, our cost of net revenue will increase, our operating margins will decline and our reputation and customer relationships could be harmed
11. 11We may experience difficulties in transitioning to new wafer fabrication process technologies or in achieving higher levels of design integration, which may result in reduced manufacturing yields, delays in product deliveries and increased costs
12. 12To date, we have not achieved the anticipated benefits of a fabless semiconductor company
13. 13Our main objective is the development and sale of our technologies to OEMs, service providers and other equipment manufacturers and their subsystem and component vendors and, if demand for these products does not grow, we may not achieve revenue growth and our strategic objectives
14. 14Our failure to continue to develop new products and enhance our products on a timely basis could diminish our ability to attract and retain customers
15. 15Our products have a lengthy sales cycle, which makes it difficult to predict success in this market and the timing of future revenue
16. 16The semiconductor industry is cyclical in nature and subject to periodic downturns, which can negatively affect our revenue
17. 17Our revenue has been highly concentrated among a small number of customers, and our results of operations could be harmed if we lose a key revenue source and fail to replace it
18. 18Our revenue concentration may also pose credit risks which could negatively affect our cash flow and financial condition
19. 19Our products must meet exact specifications and defects and failures may occur, which may cause customers to return or stop buying our products
20. 20Because we sell our products on a purchase order basis and rely on estimated forecasts of our customers’ needs, inaccurate forecasts could adversely affect our business
21. 21Disruptions in our supply chain due to shortages in the global semiconductor supply chain could cause delays for customers and impact revenue
22. 22Price increases from our supply chain can adversely impact revenue or reduce margins
23. 23The discovery of defects in our technology and products could expose us to liability for damages
24. 24We might not be able to protect and enforce our IP rights, which could impair our ability to compete and reduce the value of our technology
25. 25Our existing patents might not provide us with sufficient protection of our IP, and our patent applications might not result in the issuance of patents, either of which could reduce the value of our core technology and harm our business
26. 26If we fail to retain key personnel, our business and growth could be negatively affected
27. 27We currently maintain and may expand operations outside of the United States, which exposes us to significant risks
28. 28International trade policies, including protectionist trade policies, such as tariffs and sanctions, could adversely affect our business, results of operations and financial condition
29. 29Our ability to utilize our net operating loss carryforwards is limited as a result of an “ownership change,” as defined in Section 382 of the Internal Revenue Code of 1986, as amended
30. 30Third parties might attempt to gain unauthorized access to our network or seek to compromise our products and services
31. 31Acquisitions or other business combinations that we pursue in the future, whether or not consummated, could result in other operating and financial difficulties
32. 32War, terrorism, other acts of violence, natural disasters and global pandemics, such as the COVID-19 pandemic and associated macroeconomic pressures in the markets in could adversely impact our business
33. 33Sustained inflation could have a material adverse effect on our business, financial condition, results of operations and liquidity

Risks Related to Our Securities

1. 34There may be future sales of our common stock, which could adversely affect the market price of our common stock and dilute a stockholder’s ownership of common stock
2. 35Potential volatility of the price of our common stock could negatively affect your investment
3. 36The effective increase in the number of shares of our common stock available for issuance as a result of our reverse stock split could result in further dilution to our existing stockholders and have antitakeover implications
4. 37Provisions of our certificate of incorporation and bylaws or Delaware law might delay or prevent a change-of-control transaction and depress the market price of our stock
5. 38Certain of our common stock warrants outstanding at December 31, 2024 are accounted for as liabilities and recorded at fair value with changes in fair value each period reported in earnings, which may have an adverse effect on the market price of our common stock
6. 39If we are unable to satisfy the continued listing requirements of the Nasdaq, our common stock could be delisted and the price and liquidity of our common stock may be adversely affected
7. 40We are a “smaller reporting company” and, as a result of the reduced disclosure and governance requirements applicable to smaller reporting companies, our common stock may be less attractive to investors
8. 41Holders of exchangeable shares are expected to experience a delay in receiving shares of our common stock from the date they request an exchange, which may affect the value of the shares the holder receives in an exchange