Cycurion, Inc. 10-Q

Item 1A. Risk Factors In connection with information set forth in this Form 10-Q, the factors discussed below and under “Risk Factors” in our Form 10-K for fiscal year ended December 31, 2024, should be considered. The risks included below and in the Form 10-K could materially and adversely affect our business, financial condition and results of operations. Other than as set forth below, there have been no material changes to the factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the Securities and Exchange Commission on April 17, 2025. Our business could be adversely affected by legislative or government budgetary and spending changes. The market for our services depends largely on domestic and international legislative programs and the budgetary capability to support programs, including the continuance of existing programs. Many of our contracts are not fully funded at inception and rely upon future appropriations of funds. Accordingly, a failure to receive additional anticipated funding may result in early termination of a contract. In addition, many of our contracts include clauses that allow clients to unilaterally modify or terminate contracts with little or no recompense. Decreases in funding for, or delays in contract awards and in government spending on the types of programs that we support, and terminations or price reductions on government contracts on which we are currently performing could adversely affect our future revenues and profitability. Changes in state or federal government initiatives or in the level of government spending due to budgetary or deficit considerations may have a significant impact on our future financial performance. In recent quarters, the U.S. Federal Government has placed a significant focus on efficiency, including with respect to contracting with private companies. These efforts have and may continue to have effects on our business, including, but not limited to: ● Changes in priorities may result in procurement changes, delays or cancellations, as well as changes in scope, pricing, or outright cancellations of existing contracts. ● Changes in priorities may also affect the level of demand or funding for our state programs in the United States, which are typically mandated and fully or partially funded from the U.S. Federal Government. ● Changes to procurement rules may result in additional competition, scrutiny and costs of compliance. ● Changes in federal regulations, such as those related to the elimination of diversity, equity and inclusion initiatives, or return to office mandates may require us to change our existing business practices, may be disruptive to our business, may create a level of uncertainty within our workforce and may conflict with local laws and regulations. ● The U.S. Government may seek to lower barriers to entry to allow greater involvement by the private sector. While this may provide additional opportunities for us, it may also expose us to greater levels of competition. 43