Innovative Solutions and Support Inc

Item 1A. Risk Factors

For information regarding the Companys risk factors, refer to the Risk Factors in Part I, Item 1A of the Companys Annual Report on Form 10-K for the year ended September 30, 2024, filed with the SEC on December 30, 2024 (the Form 10-K). Other than as set forth below, there have been no material changes in our risk factors as previously disclosed in Part I, Item 1A of the Companys Annual Report on Form 10-K for the fiscal year ended September 30, 2024 and Part II, Item 1A of the Companys Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2024.

Tariffs imposed by the United States government could have a material adverse effect on our results of operations.

TDuring Fiscal 2025, the U.S.nited States government has plaannounced tariffs on certain goods imported from China and other into the United States from numerous countries and may impose new . In response, multiple nations countered with reciprocal tariffs on goods imported from China and oand trade restrictions. In light of these events, there countries, including productsntinues to exist significant uncertainty about that we import. In retalie future relation, China ship between the U.S. and other countries with responded by imposing tariffs on a wiect to such trade range of products imported from the U.S. and by adjusting the value of its currencypolicies , treaties and tariffs. The U.S. government has recently imposstated or threatened to impose new tariffs on additionalthat it is willing to negotiate with other countries, inclu regarding Mexico and Canada. Such the tariffs could significantly increase the cost of the products that we source and may materially impact our cost of goods and business.

and trade restrictions. If renegotiations of existing tariffs are unsuccessful or additional tariffs or trade restrictions are implemented by the U.S.nited States or other countries in connection with a global trade war, the resulting escalation of trade tensions could have a material adverse effect on world trade and the global economy. The tariffs implemented by the United States and other countries along with any additional tariffs or trade restrictions implemented by such countries, may negatively impact demand and the Companys supply chain, resulting in an increase in some product costs. Even in the absence of further tariffs or trade restrictions, the related uncertainty and the market's fear of an economic slowdown could lead to a decrease in demand for our products and services, and we may experience lower net revenues than expected. Reduced revenues may result in reduced operating cash flows if we are not able to appropriately manage inventory levelwhich could have a material adverse impact on our business, financial condition and results or leverage expensesf operations.