Company: NEOV
Filing Date: 2025-09-29
Form Type: 10-K
Source: 0001683168-25-007304
Chunk: 14

Company: NeoVolta Inc.
Filing Date: 2025-09-29
Form: 10-K
Item: Item 1
Chunk 14
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 supply, of materials used;

·disruption in the supply of cells due to quality issues or recalls by manufacturers;

·tariffs on the materials we source in China, which make up a significant amount of the materials we require;

·fluctuations in the value of the Chinese Renminbi against the U.S. dollar as our purchases for energy
storage products are denominated in Chinese Renminbi.; and

·potential increases in global shipping costs.

Our business is dependent
on the continued supply of inverters and battery cells for the battery packs used in our energy storage products. Any disruption in the
supply of inverters or battery cells could disrupt production of our battery packs we require for our energy storage product. Substantial
increases in the prices for our materials or prices charged to us would increase our operating costs, and could reduce our margins if
we cannot recoup the increased costs through increased prices. Any attempts to increase prices in response to increased material costs
could result in cancellations of energy storage orders and therefore materially and adversely affect our brand, image, business, prospects
and operating results.

Continued high mortgage interest rates may
result in a decrease in demand by homeowners for our residential energy storage systems.

Sales volume in our homeowner
channel is partially dependent on the construction of new homes and the sale of existing homes in our residential markets. Many customers
of our installation partners rely on mortgage loans from banks and other lenders in order to finance a substantial portion of the purchase
price for their home, including any related improvements. Increased mortgage interest rates may lead to lower demand for new homes and
a reduced number of homes available for solar origination through our homeowner channel. Additionally, increased interest rates may result
in fewer secondary home sales, a reduction in the number of customers refinancing their mortgages and uncertainty about the economy.

 12 

We are currently operating in a period of
economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing
military conflicts between Russia and Ukraine and between Gaza and Israel. Our business, financial condition and results of operations
may be materially and adversely affected by any negative impact on the global economy and capital markets resulting from these conflicts
or any other geopolitical tensions.

U.S. and global markets are
experiencing volatility and disruption following the escalation of geopolitical tensions and the military conflicts between Russia and
Ukraine, which began in February 2022, and between Gaza and Israel, which began in October 2023. Although the length