What changed in this filing

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Item 1A. Risk Factors

2026-05-14 compared with 2025-11-12 · 25 added, 99 removed, 109 unchanged (53% of the section changed)

7 unchanged sentences

We might not be able to continue as a going concern.

Our consolidated financial

statements as of September 30, 2025 have been prepared under the assumption that we will continue as a going concern for the next twelve

As of September 30, 2025, we had cash and cash equivalents of $1.9 million and an accumulated deficit of $180.6 million.

that our existing cash and cash equivalents as of September 30, 2025 and expected receipts associated with forecasted product sales will

enable us to meet our capital needs into the first quarter of 2026.

Our condensed consolidated financial statements as of March 31, 2026

have been prepared under the assumption that we will continue as a going concern for the next twelve months.

As of March 31, 2026, we

had cash and cash equivalents of $2.7 million and an accumulated deficit of $184.4 million.

We believe that our existing cash and cash

equivalents as of March 31, 2026 and expected receipts associated with forecasted product sales will enable us to meet our capital needs

into the fourth quarter of 2026.

Our ability to continue as

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could seriously harm our business.

We have a history of losses, and we will

need to raise additional capital.

We incurred net losses of approximately

$2.5 million for the three months ended March 31, 2026 and $4.8 million for the year ended December 31, 2025, and we had an accumulated

deficit of approximately $184.4 million as of March 31, 2026.

These and prior-year losses have resulted in significant negative cash

To remain competitive and expand our product offerings to customers, we will need to increase revenues substantially beyond levels

that we have attained in the past in order to generate sustainable operating profit and sufficient cash flows to continue doing business

without raising additional capital from time to time.

Given our history of fluctuating revenues and operating losses, and the challenges

we face in securing customers for our products, we cannot be certain that we will be able to achieve and maintain profitability on either

a quarterly or annual basis in the future.

As a result, we may need to raise additional capital in the future, which may or may not be

available to us at all or only on unfavorable terms.

Our evaluation of strategic alternatives,

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As a result, we commenced an end-of-life (“EOL”) of our memory products in 2023.

In March 2025,

we fulfilled all outstanding EOL orders for our memory IC products.

We do not expect any further shipments or to generate any meaningful

revenue from shipments of our memory IC products after March 2025 with the exception of two purchase orders received in September 2025.

For the nine months ended September 30, 2025 and 2024, our memory IC products represented approximately 25% and 87% of our revenues, respectively.

The discontinuation of the production and sale of our memory IC products will negatively impact our future revenues, results of operations

and cash flows.

We have a history of losses, and we will

need to raise additional capital.

We incurred net losses of approximately

$3.5 million for the nine months ended September 30, 2025 and $10.7 million for the year ended December 31, 2024, and we had an accumulated

deficit of approximately $180.6 million as of September 30, 2025.

These and prior-year losses have resulted in significant negative

To remain competitive and expand our product offerings to customers, we will need to increase revenues substantially beyond

levels that we have attained in the past in order to generate sustainable operating profit and sufficient cash flows to continue doing

business without raising additional capital from time to time.

Given our history of fluctuating revenues and operating losses, and the

challenges we face in securing customers for our products, we cannot be certain that we will be able to achieve and maintain profitability

on either a quarterly or annual basis in the future.

As a result, we may need to raise additional capital in the future, which may or

may not be available to us at all or only on unfavorable terms.

Our 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.

In November 2023, we implemented

an employee lay-off and terminated certain consulting positions (the “Reductions”) to reduce operating expenses and cash burn,

as we prioritized business activities and projects that we believe will have a higher return on investment.

As part of the Reductions,

we implemented a temporary lay-off that impacted 16 employees (the “Employees”) of Peraso Tech.

During the six months ended

June 30, 2024, we determined that we would not recall any of the 11 Employees that remained on our payroll and commenced notifying the

remaining Employees that their employment would be terminated.

The remaining severance liabilities as of June 30, 2025 were paid in July

As a result of the decision

to not recall the Employees, we determined that it was probable that a number of our non-cancelable licenses for computer-aided design

software would not be utilized during the remaining license terms.

During the six months ended June 30, 2024, we expensed the value of

the remaining contractual liabilities and recorded liabilities of approximately $1.6 million.

During the three months ended June 30, 2025,

a licensor terminated one of the license agreements and initiated a refund of approximately $56,300 for amounts previously paid by us.

As a result, we reversed approximately $222,600 of expense and approximately $166,300 of the related contractual liabilities for this

licensor during the three months ended June 30, 2025.

As of September 30, 2025, the remaining contractual liabilities of approximately

$0.2 million are expected to be paid by December 31, 2025.

In addition to the costs associated

with the non-cancelable license commitments for computer-aided design software, the Reductions may result in other unintended consequences

and costs, such as the loss of institutional knowledge and expertise, attrition beyond the intended number of employees, decreased morale

among our remaining employees, and the risk that we may not achieve the anticipated benefits of the Reductions.

In addition, while positions

have been eliminated certain functions necessary to our operations remain, and we may be unsuccessful in distributing the duties and obligations

of departed employees among our remaining employees.

We may also be unsuccessful in negotiating any desired strategic alternative or partnership

relating to such functions on a timely basis, on acceptable terms, or at all.

The Reductions could also make it difficult for us to pursue,

or prevent us from pursuing, new opportunities and initiatives due to insufficient personnel, or require us to incur additional and unanticipated

costs to hire new personnel to pursue such opportunities or initiatives.

Further, inflationary pressure may increase our costs, including

employee compensation costs, or result in employee attrition to the extent our compensation does not keep up with inflation, particularly

if our competitors’ compensation does.

If we are unable to realize the anticipated benefits from the Reductions, if we experience

significant adverse consequences from the reduction in force, or if we are otherwise unable to retain our employees, our business, financial

condition, and results of operations may be materially adversely affected.

International trade policies, including

protectionist trade policies, such as tariffs and sanctions, could adversely affect our business, results of operations and financial

Due to the interconnectedness

of the global economy, policy changes in one area of the world can have an immediate and material adverse impact on markets around the

Changes in international trade policies, including:

(i) changes to existing trade agreements;

(ii) greater restrictions on free

trade generally;

and (iii) significant increases in customs duties and tariffs on goods imported into the United States and reciprocal

actions by other countries, could adversely affect our business, results of operations and financial condition.

Current or future tariffs

or other restrictive trade measures may raise the costs of raw materials, components or finished goods, which may adversely impact both

our product offerings and our operational expenses.

Such cost increases may reduce our margins and require us to increase prices, which

could harm our competitive position, reduce customer demand and damage customer relationships.

Trade disputes, trade restrictions,

tariffs and other political tensions between the U.S.

and other countries may also exacerbate unfavorable macroeconomic conditions including

inflationary pressures, foreign exchange volatility, financial market instability, and economic recessions or downturns, which may also

negatively impact customer demand for our products or services, delay purchases or renewals, limit expansion opportunities with customers,

limit our access to capital, or otherwise negatively impact our business and operations.

Ongoing tariff, trade restrictions and macroeconomic

uncertainty has and may continue to contribute to volatility in the price of our common stock.

Ongoing uncertainty regarding

trade policies may also complicate our short- and long-term strategic planning, and that of our partners and customers, including decisions

regarding hiring, product strategy, capital investment, supply chain design and geographic expansion.

While we continue to monitor

trade developments, the ultimate impact of these risks remains uncertain and any prolonged economic downturn, escalation in trade tensions,

or deterioration in international perception of U.S.-based companies could materially and adversely affect our supply chain, as well as

our business, results of operations and financial condition.

In addition, tariffs and other trade developments have and may continue to

heighten the risks related to the other risk factors described elsewhere in this “ Risk Factors ” section and in Part

I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024.

We expect revenues

from sales of our memory IC products to be minimal during 2026.

The discontinuation of the production and sale of our memory IC products

will negatively impact our future revenues, results of operations and cash flows.

Unregistered Sales of Equity Securities

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors