Company: PFSA
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112723
Chunk: 262

Company: Profusa, Inc.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 2
Chunk 262
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 public company regulatory requirements and customary practices. We expect to incur additional annual expenses as a public company
for, among other things, directors’ and officers’ liability insurance, director fees, and additional internal and external accounting,
legal and administrative resources.

Recent Developments

Inflation, Monetary Response, and Economic Impacts

The world economy is experiencing stubbornly high inflation, a challenge
not faced for decades. Following the global financial crisis, with inflationary pressures muted, interest rates were extremely low for
years and investors became accustomed to low volatility. The resulting easing of financial conditions supported economic growth, but it
also contributed to a buildup of financial vulnerabilities. With inflation at multi-decade highs, monetary authorities in advanced economies
are accelerating the pace of policy normalization. Policymakers have continued to tighten policy against a backdrop of rising inflation
and currency pressures, albeit with notable differences across regions. Global financial conditions have tightened notably this year,
leading to capital outflows. Amid heightened economic and geopolitical uncertainties, investors have aggressively pulled back from risk-taking
and adjusted their investment preferences generally. Key gauges of systemic risk, such as higher dollar funding costs and counterparty
credit spreads, have risen. There is a risk of a disorderly tightening of financial conditions that may be amplified by vulnerabilities
built over the years.

In addition, our business, growth, financial condition or results of
operations could be materially adversely affected by instability or changes in a country’s or region’s economic conditions; inflation;
changes in laws or regulations or in the interpretation of existing laws or regulations, whether caused by a change in government or otherwise;
increased difficulty of conducting business in a country or region due to actual or potential political or military conflict; or action
by the U.S. or foreign governments that may restrict our ability to transact business in a foreign country or with certain foreign individuals
or entities. A possible slowdown in global trade caused by increasing tariffs or other restrictions could decrease consumer or corporate
confidence and reduce consumer, government and corporate spending in countries inside or outside the U.S., which could adversely affect
our operations. Climate-related events, including extreme weather events and natural disasters and their effect on critical infrastructure
in the U.S. or internationally, could have similar adverse effects on our operations, users, or third-party suppliers.

Principles of Accounting and Consolidation

The accompanying condensed consolidated financial statements have been
prepared in conformity with U.S. GAAP and pursuant to applicable rules and regulations of the SEC and include all adjustments necessary
for the