Company: ARBB
Filing Date: 2025-10-31
Form Type: 20-F
Source: 0001213900-25-104705
Chunk: 15

Company: ARB IOT Group Ltd
Filing Date: 2025-10-31
Form: 20-F
Item: Item 3
Chunk 15
---
 our business partners
are not able to successfully manage these risks.

As a IoT solution service provider, the
success of our business model depends on our ability to recruit, deploy and manage outsourced contractors.

We currently rely extensively
on third-party contractors and outsourcing vendors for engineering, installation, field services, firmware customization, and ongoing
support. Our ability to recruit, vet, onboard, deploy, and manage these contractors at the speed and scale required by customer engagements
is critical to our operating performance. We may face shortages of qualified contractors, wage inflation, competition from other technology
and services firms, and variability in contractor availability by region and season. Inadequate staffing levels, delays in deployment,
or deficiencies in training and supervision could result in schedule slippage, cost overruns, safety incidents, rework, or quality issues
that adversely affect customer satisfaction and service-level compliance. Because contractors operate outside our direct employment, we
are exposed to risks related to inconsistent performance, misalignment with our policies and controls, and noncompliance with legal and
regulatory requirements, including labor, immigration, health and safety, and data security laws. We may also be subject to joint employer,
vicarious liability, or indemnity claims arising from contractor conduct. If we are unable to attract and retain qualified contractors,
efficiently allocate and manage them across projects, or enforce our standards and contractual protections, our ability to deliver projects
on time and within budget could be impaired, which could harm our reputation, customer relationships, revenue growth, margins, and cash
flows. In addition, disruptions at or the financial instability of our outsourcing vendors could interrupt service delivery, require us
to incur incremental costs to transition work, or necessitate internal hiring that may not be feasible on short notice, any of which could
materially and adversely affect our business.

Our AI partnerships,
regional expansion, and large server orders may not commercialize as expected and expose us to execution, supply chain, and working capital
risks.

Our recent AI initiatives
in relation to the AI data center server orders are subject to uncertainties in finalizing definitive agreements, coordinating joint go-to-market
efforts, and meeting customer schedules and performance criteria. We depend on constrained components (including GPUs, accelerators, memory,
and power and thermal systems), upstream vendor allocations, certification timelines, and the readiness of customer facilities (power
density, cooling, networking, and security). Any delays, redesigns, or cost inflation could compress margins, defer revenue recognition,
or trigger penalties