SES AI (SES) FY2025 10-K Risk Factors: 13 New, 10 Dropped

What the changes say

SES expanded its risk disclosures following the September 2025 acquisition of UZ Energy and entry into ESS and drone cell markets.

What changed since the prior 10-K

New

NewRisks Relating to Our Business and Technology
We may not be able to successfully integrate UZ Energy’s operations with our business
We may struggle to successfully integrate UZ Energy’s operations and retain key employees following our September 2025 acquisition.
NewRisks Relating to Our Business and Technology
We may face challenges in developing NDAA-compliant manufacturing capacity for drone cells, and even if we develop the manufacturing capacity, demand for NDAA-compliant drone cells may not develop
Developing NDAA-compliant drone cell manufacturing capacity involves high capital costs, and expected market demand may not materialize.
NewRisks Relating to Our Business and Technology
We have entered into strategic alliances and may in the future enter into additional strategic alliances
Strategic alliances with battery manufacturers and OEMs expose us to partner non-performance, shared proprietary info, and potential reputational harm.
NewRisks Relating to Our Business and Technology
in crashes resulting in death or personal injury. Additionally, product liability claims that affect our competitors may cause indirect adverse publicity for us and our products
Product liability claims resulting in death or injury could cause substantial monetary damages and severe negative publicity.
NewRisks Relating to Our Business and Technology
We may not be able to develop and commercialize newly discovered materials
Novel electrolyte materials discovered through Molecular Universe may fail real-world performance tests or customer validation standards.
NewRisks Relating to Our Business and Technology
due to the uncertainty that a license may not be granted and the candidate would be unemployable in the role envisioned. If we fail to attract new personnel, or fail to retain and motivate our current personnel, our business and growth prospects could be harmed
Losing CEO Dr. Qichao Hu or key technical personnel could harm our growth prospects and innovation culture.
NewRisks Relating to the ESS Industry
The economic benefit of our ESS products to our customers depends on the cost of electricity available from alternative sources, including local electric utility companies, which cost structure is subject to change
Changes in local utility electricity rates could undermine the economic benefits and customer demand for our ESS products.
NewRisks Relating to the ESS Industry
Our ESS products performance may not meet customers’ expectations or needs
ESS products, including those from UZ Energy, may experience operational failures or output interruptions that hurt customer demand.
NewRisks Relating to the ESS Industry
We depend upon component and product manufacturing and logistical services provided by third parties, many of whom are located outside of the U.S
We rely heavily on third-party manufacturers outside the U.S. for ESS components, reducing our direct control over quality and production.
NewRisks Relating to Our Intellectual Property
other jurisdictions, as well as license agreements and other contractual protections, to establish, maintain and enforce rights in our proprietary technologies
Unpatented proprietary technology and trade secrets may be inadequately protected by nondisclosure agreements or become independently developed by competitors.
NewRisks Relating to Regulations and Our Compliance With Such Regulations
Changes in U.S. and foreign government policy, including the imposition of or increases in tariffs and changes to existing trade agreements, could have a material adverse effect on global economic conditions and our business, results of operations, prospects and financial condition
New global trade tariffs imposed in fiscal 2025 on imports from China and other countries could increase our cost of sales and lower gross margins.
NewRisks Relating to Regulations and Our Compliance With Such Regulations
Our operations in the United States, China, and South Korea may be subject to environmental laws and regulations, including laws and regulations relating to water, discharges, emissions, chemicals, hazardous materials, natural resources, remediation and contamination
Our global operations in the U.S., China, and South Korea face complex and costly environmental regulations regarding battery life cycle management and emissions.
NewRisks Relating to Our Common Stock and Warrants
We have a history of material weaknesses in our internal control over financial reporting. Our identification of any new material weakness could have an adverse impact on the value of our Class A common stock

Dropped

DroppedRisks Relating to Our Business and Technology
We face significant challenges in developing a Li-Metal battery that can be commercialized for use in EVs and other applications, and the pace of development is often unpredictable and subject to delays
Challenges and delays in commercializing Li-Metal batteries for EVs and UAM.
DroppedRisks Relating to Our Business and Technology
Our Li-Metal technology is untested in actual EVs and may ultimately prove unworkable
DroppedRisks Relating to Our Business and Technology
We are unable to predict user behavior when driving EVs with Li-Metal technology
DroppedRisks Relating to Our Business and Technology
Delays in the pre-manufacturing development of our battery cells could adversely affect our business and prospects
Untested nature of Li-Metal technology in actual EVs.
DroppedRisks Relating to Our Business and Technology
If we are unable to integrate our products into EVs manufactured by OEM customers, our results of operations could be impaired
DroppedRisks Relating to Our Business and Technology
temporarily disrupt future research and development activities or production of our batteries until an alternative supplier is able to meet our requirements
DroppedRisks Relating to Our Business and Technology
We have pursued and may continue to pursue JDAs, service contracts and other strategic alliances, which could have an adverse impact on our business if they are unsuccessful or if we are unable to enter into new strategic alliances
Unpredictable user behavior when driving EVs with Li-Metal batteries.
DroppedRisks Relating to Our Business and Technology
We may not be able to estimate accurately the future supply and demand for our batteries, which could result in a variety of inefficiencies in our business and hinder our ability to generate revenue. If we fail to predict accurately our manufacturing requirements, we could incur additional costs or experience delays
Pre-manufacturing development delays in battery cells.
DroppedRisks Relating to the EV Industry
Our future growth and success depend on the willingness of vehicle operators and consumers to adopt EVs
DroppedRisks Relating to the EV Industry
Our ability to successfully market our products will depend on the establishment of charging station networks meeting the needs of EVs using our products. If any of the charging station networks are not compatible with such products and technologies, our sales could be adversely affected
Risks of failing to integrate products into custom OEM vehicle configurations.

Reworded

92% rewrittenRisks Relating to Regulations and Our Compliance With Such Regulations
Our operations expose us to litigation, environmental and other legal compliance risks. Compliance with laws and regulations can be expensive, and our failure to comply with these laws and regulations may result in monetary damages and fines, adverse publicity and a material adverse effect on our business
Added specific references to environmental laws and regulations in the United States, China, and South Korea.
89% rewrittenRisks Relating to Our Intellectual Property
We rely heavily on our intellectual property portfolio, including unpatented proprietary technology. If we are unable to protect our intellectual property rights from unauthorized use, our business and competitive position would be harmed
Shortened intellectual property protection descriptions by dropping specific mentions of trademark and trade secret laws.
68% rewrittenRisks Relating to Our Business and Technology
We may not be able to engage target OEM customers successfully and to convert such contacts into meaningful orders in the future
Renumbered and updated heading to focus on engaging target OEM customers and converting contacts into orders.
67% rewrittenRisks Relating to Our Business and Technology
If our batteries are installed in EVs that do not meet certain motor vehicle standards, our business, operating results and prospects could be adversely affected
Updated to address risks if EV manufacturing customers fail to meet motor vehicle standards.
Was: If the EVs in which our batteries are installed do not meet certain motor vehicle standards, our business, operating results and prospects could be adversely affected
65% rewrittenRisks Relating to Our Common Stock and Warrants
We are a “smaller reporting company” and the reduced reporting requirements applicable to such companies may make our securities less attractive to investors
Retained smaller reporting company disclosure requirements with no substantive textual changes.
63% rewrittenRisks Relating to Our Business and Technology
The unavailability, reduction or elimination of, or uncertainty regarding, government and economic incentives or subsidies available to us, end-users or OEMs could have a material adverse effect on our business, financial condition, operating results and prospects
Added specific historical examples of Shanghai and Seoul rent subsidies and warned that incentives can be clawed back.
48% rewrittenRisks Relating to Our Business and Technology
The battery market continues to evolve and is highly competitive, and certain other battery manufacturers have significantly greater resources than we do
Broadened market description from just EV batteries to the broader renewable energy sector.
Was: The EV battery market continues to evolve and is highly competitive, and certain other battery manufacturers have significantly greater resources than we do
43% rewrittenRisks Relating to Our Business and Technology
Our business depends substantially on the continuing efforts of our senior executives and other key personnel as well as the ability to attract, train and retain highly skilled employees and key personnel
Removed mention of the FTC's Non-Compete Clause Rule litigation and added artificial intelligence and machine learning talent needs.
41% rewrittenRisks Relating to Our Business and Technology
The market for UAM, and for use of our battery technology in UAM and other applications, is still emerging, and may not achieve the growth potential we expect
Was: The market for UAM, and for use of Li-Metal technology in UAM applications, is still emerging, and may not achieve the growth potential we expect
40% rewrittenRisks Relating to Our Business and Technology
We expect to continue to incur losses for the foreseeable future. While we expect to become profitable eventually, our projections are based on internal assumptions that may prove incorrect, and we may never achieve or maintain profitability
35% rewrittenRisks Relating to Artificial Intelligence
The use of AI in our products and services may result in reputational harm and competitive harm
34% rewrittenRisks Relating to Our Business and Technology
Because we expect to rely heavily on complex machinery, well-trained personnel and a well-managed supply chain for our operations, our internal and outsourced production will involve a significant degree of uncertainty and risk in terms of operational capacity performance and costs
33% rewrittenRisks Relating to Our Business and Technology
If our batteries fail to perform as expected, our ability to develop, market and sell our batteries could be harmed
32% rewrittenRisks Relating to Our Common Stock and Warrants
Our public warrants may never be in the money, and they may expire worthless
27% rewrittenRisks Relating to Our Common Stock and Warrants
Our failure to satisfy certain NYSE listing requirements may result in our Class A common stock being delisted from the NYSE, which could eliminate or adversely affect the trading market for our Class A common stock
26% rewrittenRisks Relating to Our Business and Technology
Certain components of our batteries pose safety risks that may cause accidents. We may be subject to financial and reputational risks due to product recalls and product liability claims, and we could face substantial liabilities that exceed our resources
24% rewrittenRisks Relating to Our Business and Technology
We will need substantial additional capital in the future to fund our business and may be unable to meet our future capital requirements, impairing our financial position and results of operations
24% rewrittenRisks Relating to Artificial Intelligence
The market for our AI for Science services such as Molecular Universe is still emerging, and our Molecular Universe programs may not achieve the growth potential we expect
Was: The market for our AI-based services is still emerging, and our AI programs may not achieve the growth potential we expect
21% rewrittenRisks Relating to Our Common Stock and Warrants
Our CEO and certain entities affiliated with the CEO (the “SES Founder Group”) is a large and significant stockholder and, as a result, we are a “controlled company,” which exempts us from certain obligations to comply with certain corporate governance requirements
21% rewrittenRisks Relating to Our Common Stock and Warrants
If the price of our Class A common stock increases, warrants to purchase SES common stock could increase the number of shares eligible for future resale in the public market and result in dilution to stockholders

All 54 risk factors

Headings as the filing states them, in filing order.

Risks Relating to Our Business and Technology

01We expect to continue to incur losses for the foreseeable future. While we expect to become profitable eventually, our projections are based on internal assumptions that may prove incorrect, and we may never achieve or maintain profitability40% rewritten
02We will need substantial additional capital in the future to fund our business and may be unable to meet our future capital requirements, impairing our financial position and results of operations24% rewritten
03We may not be able to successfully integrate UZ Energy’s operations with our businessNew
04The market for UAM, and for use of our battery technology in UAM and other applications, is still emerging, and may not achieve the growth potential we expect41% rewritten
05We may face challenges in developing NDAA-compliant manufacturing capacity for drone cells, and even if we develop the manufacturing capacity, demand for NDAA-compliant drone cells may not developNew
06If our batteries fail to perform as expected, our ability to develop, market and sell our batteries could be harmed33% rewritten
07We may not be able to engage target OEM customers successfully and to convert such contacts into meaningful orders in the future68% rewritten
08Because we expect to rely heavily on complex machinery, well-trained personnel and a well-managed supply chain for our operations, our internal and outsourced production will involve a significant degree of uncertainty and risk in terms of operational capacity performance and costs34% rewritten
09We have entered into strategic alliances and may in the future enter into additional strategic alliancesNew
10The battery market continues to evolve and is highly competitive, and certain other battery manufacturers have significantly greater resources than we do48% rewritten
11Certain components of our batteries pose safety risks that may cause accidents. We may be subject to financial and reputational risks due to product recalls and product liability claims, and we could face substantial liabilities that exceed our resources26% rewritten
12in crashes resulting in death or personal injury. Additionally, product liability claims that affect our competitors may cause indirect adverse publicity for us and our productsNew
13We may not be able to develop and commercialize newly discovered materialsNew
14We may incur significant costs based on the warranties we may supply in our products and services
15Our business depends substantially on the continuing efforts of our senior executives and other key personnel as well as the ability to attract, train and retain highly skilled employees and key personnel43% rewritten
16due to the uncertainty that a license may not be granted and the candidate would be unemployable in the role envisioned. If we fail to attract new personnel, or fail to retain and motivate our current personnel, our business and growth prospects could be harmedNew
17Our insurance coverage may not be adequate to protect us from all business risks
18The unavailability, reduction or elimination of, or uncertainty regarding, government and economic incentives or subsidies available to us, end-users or OEMs could have a material adverse effect on our business, financial condition, operating results and prospects63% rewritten
19Developments in alternative technology or other fossil fuel alternatives may adversely affect the demand for our battery products
20If our batteries are installed in EVs that do not meet certain motor vehicle standards, our business, operating results and prospects could be adversely affected67% rewritten

Risks Relating to Artificial Intelligence

21The use of AI in our products and services may result in reputational harm and competitive harm35% rewritten
22Our use of artificial intelligence and machine learning may result in legal and regulatory risks
23The market for our AI for Science services such as Molecular Universe is still emerging, and our Molecular Universe programs may not achieve the growth potential we expect24% rewritten

Risks Relating to the ESS Industry

24The economic benefit of our ESS products to our customers depends on the cost of electricity available from alternative sources, including local electric utility companies, which cost structure is subject to changeNew
25Our ESS products performance may not meet customers’ expectations or needsNew
26We depend upon component and product manufacturing and logistical services provided by third parties, many of whom are located outside of the U.SNew

Risks Relating to Our Intellectual Property

27Our patent applications may not result in issued patents or our patent rights may be challenged, invalidated or limited in scope, any of which could have a material adverse effect on our ability to prevent others from competing or interfering with the commercialization of our products
28We rely heavily on our intellectual property portfolio, including unpatented proprietary technology. If we are unable to protect our intellectual property rights from unauthorized use, our business and competitive position would be harmed89% rewritten
29other jurisdictions, as well as license agreements and other contractual protections, to establish, maintain and enforce rights in our proprietary technologiesNew
30We may need to defend ourselves against intellectual property infringement claims, which may be time-consuming and could cause us to incur substantial costs
31We may face risks relating to protecting our intellectual property in various countries

Risks Relating to our International Operations

32The international nature of our business exposes us to business, regulatory, political, operational, financial and economic risks associated with doing business outside of the United States
33We could experience losses associated with our intellectual property in relation to our operations in China
34Implementation of labor laws and regulations in China may adversely affect our business and results of operations
35Our incentives from various governments are conditional upon achieving or maintaining certain performance obligations and are subject to reduction, termination, or clawback

Risks Relating to Regulations and Our Compliance With Such Regulations

36Changes in U.S. and foreign government policy, including the imposition of or increases in tariffs and changes to existing trade agreements, could have a material adverse effect on global economic conditions and our business, results of operations, prospects and financial conditionNew
37Our operations expose us to litigation, environmental and other legal compliance risks. Compliance with laws and regulations can be expensive, and our failure to comply with these laws and regulations may result in monetary damages and fines, adverse publicity and a material adverse effect on our business92% rewritten
38Our operations in the United States, China, and South Korea may be subject to environmental laws and regulations, including laws and regulations relating to water, discharges, emissions, chemicals, hazardous materials, natural resources, remediation and contaminationNew
39Failure to comply with certain health and production safety laws and regulations governing hazardous materials could materially adversely affect our business and results of operations
40Governmental trade controls, including export and import controls, sanctions, customs requirements and related regimes, could subject us to liability or loss of contracting privileges, limit our ability to transfer technology or compete in certain markets and affect our ability to hire qualified personnel
41Changes in U.S. and foreign tax laws could have a material adverse effect on our business, cash flow, results of operations or financial conditions
42Certain U.S. state tax authorities may assert that we have a state nexus and seek to impose state and local income taxes which could harm our results of operations

Risks Relating to Privacy and Security

43If we experience a significant cybersecurity breach or disruption in our information systems or any of our partners’ information systems, our business could be adversely affected

Risks Relating to Our Common Stock and Warrants

44Our failure to satisfy certain NYSE listing requirements may result in our Class A common stock being delisted from the NYSE, which could eliminate or adversely affect the trading market for our Class A common stock27% rewritten
45Our CEO and certain entities affiliated with the CEO (the “SES Founder Group”) is a large and significant stockholder and, as a result, we are a “controlled company,” which exempts us from certain obligations to comply with certain corporate governance requirements21% rewritten
46We are controlled or substantially influenced by the SES Founder Group, whose interests may conflict with other stockholders. The concentrated ownership of our dual class common stock could prevent stockholders from influencing significant decisions
47Provisions in our Certificate of Incorporation (the “Charter”) and Delaware law may inhibit a takeover attempt which could limit the price investors might be willing to pay in the future for our common stock and could entrench management
48The price of our common stock has been and may continue to be volatile
49Our public warrants may never be in the money, and they may expire worthless32% rewritten
50We may redeem unexpired public warrants prior to their exercise at a time that is disadvantageous to the warrant holders, thereby making the warrants worthless
51If the price of our Class A common stock increases, warrants to purchase SES common stock could increase the number of shares eligible for future resale in the public market and result in dilution to stockholders21% rewritten
52We may be subject to securities litigation, which is expensive and could divert management’s attention
53We are a “smaller reporting company” and the reduced reporting requirements applicable to such companies may make our securities less attractive to investors65% rewritten
54We have a history of material weaknesses in our internal control over financial reporting. Our identification of any new material weakness could have an adverse impact on the value of our Class A common stockNew

Other SES AI 10-Ks

FY2024 10-K risk factors
51 risks
Undeveloped Li-Metal battery technology with no prior commercial vehicle use creates massive uncertainty.
Filed Feb 28, 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.