Company: BSAI
Filing Date: 2025-04-01
Form Type: 10-K
Source: 0001096906-25-000357
Chunk: 374

Company: BLUSKY AI INC.
Filing Date: 2025-04-01
Form: 10-K
Item: Item 1A
Chunk 374
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An investment in our securities involves a high degree of risk. You should consider carefully the following risks, along with all of the other information included in this report, before deciding to buy our common stock. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also impair our business operations. If we are unable to prevent events that have a negative effect from occurring, then our business may suffer.

RISKS RELATED TO OUR COMPANY

We rely on third parties and disruptions in the supply chain could cause significant delays.

One of the primary risks comes from its reliance on modular data center providers. Any disruptions in the supply chain, such as delays in manufacturing, installation, or shipping, could affect deployment schedules. Furthermore, standardization challenges across different jurisdictions may require design adjustments, increasing both costs and deployment times. The need for specialized equipment, such as liquid cooling systems for high-performance AI workloads, also introduces compatibility risks with various modular providers. Another significant risk revolves around the GPU supply chain and performance. GPUs are essential for BluSky AI's high-performance computing infrastructure, particularly for AI and machine learning workloads. However, the global semiconductor supply chain remains volatile, with shortages, geopolitical restrictions, and high demand from cloud and AI companies impacting availability and pricing. BluSky AI’s dependence on a few major GPU manufacturers, such as NVIDIA and AMD, increases procurement risks, as delays or price hikes from these suppliers can directly affect operational costs and scalability.

We rely on the existing U.S. energy grid

Additionally, there are risks related to the U.S. energy grid. The growing demand for data centers, combined with aging energy infrastructure in some regions, poses a risk to BluSky AI's ability to secure reliable power for its facilities. Regulatory restrictions on energy consumption and sustainability requirements may also affect site selection and operational costs. Power-intensive AI workloads require stable energy supplies, and any potential grid instabilities could necessitate costly backup solutions, such as on-site renewables or energy storage systems. For BluSky AI's government contracts, any portion of its business tied to these agreements may be subject to renegotiation of profits or termination at the government’s discretion. Changes in federal or state regulations, budget reallocations, or shifts in policy could impact existing agreements, and government contracts often include termination clauses, meaning the government can end agreements without cause, potentially leading to financial losses. Additionally, the company must comply with evolving security and data protection requirements in government contracts, which may require additional investment in infrastructure and regulatory compliance measures.

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