AIRG

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How AIRG rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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The principal risks and uncertainties affecting our business include, but are not limited to the following: • The markets for our wireless systems solutions, embedded and external antennas, and loT solutions are developing and may not develop as we expect; • Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or our guidance; • If we are unable to manage our growth and expand our operations successfully, or navigate the transition to integrated system solutions, including increased business complexity and execution risk, our business and operating results will be harmed, and our reputation may be damaged; • Our transition to integrated system solutions increases business complexity and execution risk; • Our wireless connectivity solutions and components are subject to intense competition, including competition from our suppliers and the customers to whom we sell; • Our future success depends on our ability to develop new products and successfully introduce new and enhanced products and services for the wireless market that meet the needs of our customers; • Any delays in our sales cycles could result in customers canceling purchases of our products; • We have a history of losses, including an accumulated deficit of $93.6 million at December 31, 2025, and we may not be profitable in the future; • We sell to customers who are price conscious, and to a limited number of customers, who represent a significant portion of our sales.
If we were to lose any of these customers or devices, our sales could decrease significantly; • We rely significantly on channel partners to sell and support our products, and the failure of this channel to be effective could materially reduce our sales; • We rely on a limited number of CMs and ODMs to produce and ship our products, and the failure to manage our relationships with these parties successfully could adversely affect our ability to market and sell our products; • Our CMs purchase some components, subassemblies and products from a single or limited number of suppliers.
The loss of any of these suppliers may substantially disrupt our ability to obtain orders and fulfill sales as we design in and qualify new components. • We are developing a number of our wireless connectivity solutions and new products in partnership with or under strategic alliances with other companies.
If any of these companies were to fail to perform, or our partnerships or strategic alliances were to be unsuccessful, we may experience delays in new product development or may not be able to bring our solutions to market successfully or on a timely basis; • Emerging satellite-to-device connectivity technologies may reduce demand for certain terrestrial wireless solutions or require significant engineering investment to address hybrid connectivity requirements; • The loss of key personnel or an inability to attract, retain and motivate qualified personnel may impair our ability to expand our business; • Our inability to raise additional capital on acceptable terms in the future may limit our ability to develop and commercialize new solutions and technologies and expand our operations; • Our acquisitions expose us to risks that could adversely affect our business and adversely affect our operating results, financial condition, and cash flows; • If we are unable to protect our intellectual property rights, our competitive position could be harmed, or we could be required to incur significant expenses to enforce our rights; • Our international sales and operations subject us to additional risks that can adversely affect our operating results and financial condition; • We are subject to governmental export and import controls and supply chain-related regulations that could impair our ability to compete in international markets due to licensing requirements, result in the disruption of our supply chains and/or subject us to liability and reputational harm if we are not in compliance with applicable laws; and • Changes to United States tax, tariffs, Department of Defense’s Section 1260H List, and import/export regulations may have a negative effect on global economic conditions, financial markets and our business.
The wireless industry is characterized by rapidly evolving technologies, and the markets for our wireless connectivity solutions, embedded and external antennas, and IoT solutions may not develop as we expect.
Moving forward, our goal is to drive growth in complex system solutions in the enterprise and automotive markets, including Lighthouse and AC-Fleet.
For example, AC-Fleet and Lighthouse solutions are dependent on the carriers’ networks that they operate on and require widespread commitments across multiple customer markets and budgets.
The growth potential for these solutions may be limited, and we will need to introduce new products in the AirgainConnect and Lighthouse platforms in order to continue to grow.
If our wireless solutions do not achieve widespread adoption, if there is a slower rollout than we expect in certain markets, or if there is a reduction in demand for our wireless connectivity solutions or components including AC-Fleet and Lighthouse, caused by a lack of customer acceptance, technological challenges, competing technologies and products, decreases in corporate spending, weakening economic conditions, or otherwise, it could result in reduced customer orders and decreased sales, which would adversely affect our business, operating results, and financial condition.
Our net loss was $6.4 million in the year ended December 31, 2025, and the net loss or income will fluctuate in the future.
Prior to 2025, our net losses were $8.7 million, $12.4 million and $8.7 million for the years ended December 31, 2024, 2023 and 2022, respectively.
Our operating results may also fluctuate due to a variety of other factors, many of which are outside of our control, including any change or volatility in U.S., Asian, European and global economic environments, and any of which may cause our stock price to fluctuate.
Besides the other risks in this “Risk Factors” section, factors that may affect our operating results include: • fluctuations in demand for our products and services; • excess inventory held by customer; • the inherent complexity, length and associated unpredictability of product development windows and product lifecycles; • the timing and extent of investment in our targeted growth markets and the timing and amount of sales in such markets; • our ability to develop, introduce and ship in a timely manner new products and product enhancements and anticipate future market demands that meet our customers’ requirements, and provide adequate customer support for those products; • changes in customers’ budgets for technology purchases and delays in their purchasing cycles; • global supply shortage including, but not limited to semiconductors and modules, supply constraints relating to other materials and potential increasing shipping costs and related limitations on our ability to acquire mission critical components and our CM’s abilities to obtain sufficient human resources to meet our global demand; • inflation and other increases in the cost of components, consumables, labor and other manufacturing costs; • changing market and economic conditions and financial institution instability; • any significant changes in the competitive dynamics of our markets, including new entrants, or further consolidation, and the timing of product releases or upgrades by us or by our competitors; • uncertainty surrounding the type, scope, and implementation of tariffs, trade policies, and other governmental action by the United States and other countries and the effect therefrom on international relations, sanctions, tariffs, and supply chains; • government approval delays; • terrorism, political instability or war, and the imposition of sanctions or countermeasures by the United States and other countries in relation to such conflicts; • public health crises regionally and globally, including pandemics and epidemics; and • facility shutdowns related to local holidays in China and southeast Asia, affecting how customers make purchasing decisions.
Our transition to integrated system solutions increases business complexity and execution risk.
As we expand beyond component manufacturing into complete wireless systems incorporating hardware, embedded software, cloud platforms, and subscription services, we face increased operational complexity and execution challenges.
Successfully delivering integrated solutions requires capabilities in project management, software development, cloud infrastructure, cybersecurity, ongoing customer support, and carrier relationship management—areas where we have less extensive operating history than in RF hardware design.
System-level products also typically have longer sales cycles, more complex customer requirements, and heightened expectations for reliability and support compared to component sales.
Software and cloud services create ongoing obligations for security updates, feature development, data privacy, and uptime commitments that extend well beyond initial hardware delivery.
Additionally, the recurring revenue model from subscriptions requires different sales approaches, pricing strategies, and customer success functions than our historical transaction-based business.
If we fail to successfully execute this transition—whether due to product quality issues, software vulnerabilities, inadequate support infrastructure, or inability to scale our organization—we may damage customer relationships, fail to achieve projected revenue growth, and face increased warranty and support costs.
The higher average selling prices of system solutions may also attract more aggressive competition and increase the likelihood of customers developing competing solutions internally.
As our solutions begin to contain more system components and commensurate with higher average selling prices, the resulting product categories may attract additional competitors, or our customers may be more likely to begin to develop competing products.
As we transition into a wireless systems solutions provider, our investment in research and development will be required to grow to stay on the leading edge of next generation development and to align ourselves with the rapidly evolving technology needs of the industry.
We cannot assure you that our new wireless solutions will meet customer expectations or that our wireless solutions will be competitive in the market.
The introduction of the next generation AirgainConnect and Lighthouse platforms, and the transition to a more expansive level of advanced solutions, require coordination of efforts and increased time and resources.
As we rollout follow-on products and accessories for the AC-Fleet and Lighthouse solutions, we may not be able to successfully develop to conform to carrier approvals, PTCRB certifications, and specific country and regulatory certifications and approvals of such products.
Our products must meet stringent equipment authorization and carrier certification requirements (such as carrier, PTCRB, FCC, and industry-specific and regional standards).
Furthermore, the stringent customer demands for these advanced solutions require substantial ongoing effort and investment for solution maintenance, support, and evolution.
Sales cycles for some of our products can be lengthy, generally ranging between three and twelve months for our components, and six to twenty-four months and sometimes longer for our wireless systems solutions due to a lengthy customer evaluation, trial and approval process.
Sales cycles can be lengthy for several reasons, including: • our OEM customers and carriers usually complete a lengthy technical evaluation of our products, over which we have no control, before placing a purchase order; • the commercial introduction of our products by OEM customers and carriers is typically limited during the initial release to evaluate product performance; • the development and commercial introduction of products incorporating new technologies frequently are delayed; and • customers of integrated wireless solutions require successful field trials before committing to purchase our solutions, which could delay the customer decision making process.
The length of this process can be affected by factors over which we have little or no control, including the customer’s budgetary constraints and procurement cycles.
As a result, sales cycles for customer orders vary substantially among different customers.
A significant portion of our operating expenses is relatively fixed and is based in large part on our forecasts of volume and timing of orders.
In addition, we may incur substantial expenses and devote significant effort to develop potential relationships that do not result in agreements or revenues.
A write-off of the inventory, or a reduction in inventory value due to a sales price reduction, could have an adverse effect on our financial condition and operating results.
As a result, we had an accumulated deficit of $93.6 million on December 31, 2025.
Customers that accounted for 10% or more of our total revenue provided approximately 54% of sales in the aggregate for the year ended December 31, 2025.
Moving forward, as we transition to a wireless systems solutions provider, we expect a shift toward external wireless solutions in the automotive and enterprise markets that may result in a corresponding shift in the customer mix.
We outsource the manufacturing, assembly, and some of the testing of our products to CMs, and we also engage with ODMs to substantially contribute to the development of certain products in addition to production and shipping.
We make all of our purchases from our CMs and ODMs on a purchase order basis.

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Gone since FY2024

The principal risks and uncertainties affecting our business include, but are not limited to the following: • The markets for our antenna and wireless systems solutions are developing and may not develop as we expect; • Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or our guidance; • If we are unable to manage our growth and expand our operations successfully, our business and operating results will be harmed, and our reputation may be damaged; • Our wireless connectivity solutions and components are subject to intense competition, including competition from our suppliers and the customers to whom we sell; • Our future success depends on our ability to develop new products and successfully introduce new and enhanced products and services for the wireless market that meet the needs of our customers; • Any delays in our sales cycles could result in customers canceling purchases of our products; • We have a history of losses, including an accumulated deficit of $87.2 million at December 31, 2024, and we may not be profitable in the future; • We sell to customers who are price conscious, and to a limited number of customers, who represent a significant portion of our sales.
If we were to lose any of these customers or devices, our sales could decrease significantly; • We rely on a limited number of CMs and ODMs to produce and ship our products, and the failure to manage our relationships with these parties successfully could adversely affect our ability to market and sell our products; • Our CMs purchase some components, subassemblies and products from a single or limited number of suppliers.
The loss of any of these suppliers may substantially disrupt our ability to obtain orders and fulfill sales as we design in and qualify new components. • We are developing a number of our new products and wireless connectivity solutions in partnership with other companies.
If any of these companies were to fail to perform, or our partnerships were to be unsuccessful, we may not be able to bring our solutions to market successfully or on a timely basis; • If we are unable to protect our intellectual property rights, our competitive position could be harmed, or we could be required to incur significant expenses to enforce our rights; • Our international sales and operations subject us to additional risks that can adversely affect our operating results and financial condition; • We are subject to governmental export and import controls and supply chain-related regulations that could impair our ability to compete in international markets due to licensing requirements, result in the disruption of our supply chains and/or subject us to liability and reputational harm if we are not in compliance with applicable laws; and • Changes to United States tax, tariffs, Department of Defense’s Section 1260H List, and import/export regulations may have a negative effect on global economic conditions, financial markets and our business.
China’s 2024 export ban on critical minerals such as gallium, germanium, and antimony has disrupted and may continue to disrupt global supply chains, driving up costs for semiconductors, sensors, and LEDs.
The wireless industry is characterized by rapidly evolving technologies, and the markets for our wireless connectivity solutions, embedded and external antennas, and IoT products may not develop as we expect.
Moving forward, our goal is to drive growth in complex system solutions in the enterprise and automotive markets, including AC-Fleet, Lighthouse, Lantern, and asset tracking solutions.
For example, AC-Fleet, Lighthouse, Lantern, and asset tracking solutions are dependent on the carriers’ networks that they operate on and require widespread commitments across multiple customer markets and budgets.
The growth potential for these solutions may be limited, and we will need to introduce new products in the AirgainConnect, Lighthouse, Lantern, and asset tracking platforms in order to continue to grow.
If our wireless solutions do not achieve widespread adoption, if there is a slower rollout than we expect in certain markets, or if there is a reduction in demand for our wireless connectivity solutions or components including AC-Fleet, Lighthouse, Lantern, and asset trackers, caused by a lack of customer acceptance, technological challenges, competing technologies and products, decreases in corporate spending, weakening economic conditions, or otherwise, it could result in reduced customer orders and decreased sales, which would adversely affect our business, operating results, and financial condition.
Our net loss decreased from $12.4 million in the year ended December 31, 2023 to $8.7 million in the year ended December 31, 2024, and the net loss or income will fluctuate in the future.
Prior to 2024, our net losses were $12.2 million, $8.7 million and $10.1 million for the years ended December 31, 2023, 2022 and 2021, respectively.
Our operating results may also fluctuate due to a variety of other factors, many of which are outside of our control, including any change or volatility in U.S., European, Asian and global economic environments, and any of which may cause our stock price to fluctuate.
Besides the other risks in this “Risk Factors” section, factors that may affect our operating results include: • fluctuations in demand for our products and services; • excess inventory held by customer; • the inherent complexity, length and associated unpredictability of product development windows and product lifecycles; • the timing and extent of investment in our targeted growth markets and the timing and amount of sales in such markets; • our ability to develop, introduce and ship in a timely manner new products and product enhancements and anticipate future market demands that meet our customers’ requirements, and provide adequate customer support for those products; • changes in customers’ budgets for technology purchases and delays in their purchasing cycles; • global supply shortage including, but not limited to chips and modules, supply constraints relating to other materials and potential increasing shipping costs and related limitations on our ability to acquire mission critical components and our CM’s abilities to obtain sufficient human resources to meet our global demand; • inflation and other increases in the cost of components, consumables, labor and other manufacturing costs; • changing market and economic conditions and, financial institution instability. • any significant changes in the competitive dynamics of our markets, including new entrants, or further consolidation, and the timing of product releases or upgrades by us or by our competitors; • uncertainty surrounding the type, scope, and implementation of tariffs, trade policies, and other governmental action by the United States and other countries and the effect therefrom on international relations, sanctions, tariffs, and supply chains; • govenment approval delays • terrorism, political instability or war, and the imposition of sanctions or countermeasures by the United States and other countries in relation to such conflicts; • public health crises regionally and globally, including pandemics and epidemics; and • facility shutdowns related to local holidays in China and southeast Asia, affecting how customers make purchasing decisions.
As our solutions begin to contain more system components and commensurate higher average selling prices, the resulting product categories may attract additional competitors, or our customers may be more likely to begin to develop competing products.
As we complete our transition into a wireless systems solutions provider, our investment in research and development will grow to stay on the leading edge of next generation development and to align ourselves with the rapidly evolving technology needs of the industry.
We cannot assure that our new wireless solutions will meet customer expectations or that our wireless solutions will be competitive in the market.
The introduction of the next generation AirgainConnect, Lighthouse, Lantern and asset tracking platforms, and the transition to a more expansive level of advanced solutions, requires coordination of efforts and increased time and resources.
As we rollout follow-on products and accessories for the AC-Fleet, Lighthouse, Lantern and asset tracker solutions, we may not be able to successfully develop to conform to carrier PTCRB certifications, and specific country and regulatory certifications and approvals of such products.
Our products must meet stringent equipment authorization and carrier certification requirements (such as PTCRB, FCC, and industry-specific and regional standards).
Furthermore, the stringent customer demands for these advanced solutions requires substantial ongoing effort and investment for solution maintenance, support, and evolution.
Sales cycles for some of our products can be lengthy, often lasting several months to a year or longer.
Sales cycles can be lengthy for several reasons, including: • our OEM customers and carriers usually complete a lengthy technical evaluation of our products, over which we have no control, before placing a purchase order; • the commercial introduction of our products by OEM customers and carriers is typically limited during the initial release to evaluate product performance; • the development and commercial introduction of products incorporating new technologies frequently are delayed; and • certain customers of advanced antenna systems and integrated wireless solutions require successful field trials before committing to purchase our solutions, which could delay the customer decision making process.
A significant portion of our operating expense is relatively fixed and is based in large part on our forecasts of volume and timing of orders.
A write off of the inventory, or a reduction in the inventory value due to a sales price reduction, could have an adverse effect on our financial condition and operating results.
As a result, we had an accumulated deficit of $87.2 million on December 31, 2024.
Customers that accounted for 10% or more of our total revenue provided approximately 54% of sales in the aggregate for the year ended December 31, 2024.
Moving forward, as we transition to a wireless systems solutions provider, we expect a shift toward external wireless solutions and antenna technologies in the automotive and enterprise markets that may result in a corresponding shift in the customer mix.
We outsource the manufacturing, assembly and some of the testing of our products to CMs, and also engage with ODMs to substantially contribute to the development of certain of our products in addition to production and shipping.
We make substantially all of our purchases from our CMs and ODMs on a purchase order basis.
We may experience delays in obtaining product from manufacturers and may not be a high priority for our manufacturers.
Additionally, any or all of the following could either limit supply or increase costs, directly or indirectly, to us or our CMs: • financial problems of either CMs or component suppliers; • reservation of manufacturing capacity at our contract manufactures by other companies, inside or outside of our industry; • changes or uncertainty in U.S and non-U.S. tariffs and trade policy, economic sanctions, and other trade barriers, political unrest, or military conflict in regions where manufacturers are located; and potential conflicts involving other countries; • industry consolidation occurring within one or more component supplier markets, such as the semiconductor market; and • labor strikes or shortages, or restrictions imposed to limit pandemic or epidemics.
We cannot predict with certainty in the future whether a pandemic or epidemic will cause delays or disrupt our product shipments or impact manufacturing.
We rely on third-party components and technology companies to provide contents of our bills of material to that ultimately configure the devices that are deployed in our integrate solutions.
In 2024 we experienced continued relief from the shortages in supply of components that we experienced from 2021 to 2022, but we expect that we will experience shortages, constraints, hoarding, and higher prices due to export controls on critical minerals for semiconductors and tariffs in 2025.
In 2023 we saw relief on supply disruptions due to over correction.
A return to such shortages or other supply disruptions are possible, as well as inflation of prices of certain components, and our ability to predict the availability and pricing of such components is limited.
Over the past four years, there have been and continue to exist fluctuations between shortages of certain electronic components used in our industry and a surplus that have led to ongoing uncertainty regarding lead times for the manufacture of certain components in some of our products.
If shortages return or occur in the future, as, our business, operating results and financial condition would be materially adversely affected.
Unpredictable price increases of such components due to market demand may occur as well.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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