Market Competition and Pricing Pressure: The networking and telecommunications equipment market is highly competitive, and Actelis faces strong competition from larger, more established companies with greater resources, which could lead to pricing pressure and loss of market share.

Dependence on Key Customers and Large Projects: A significant portion of Actelis's revenue may be derived from a limited number of customers or specific, large-scale projects, making its financial results susceptible to the loss of such customers or the delayed/cancelled execution of major contracts.

Technological Obsolescence and R&D Investment: The rapid pace of technological change in the networking industry requires continuous and substantial investment in research and development to remain competitive, and failure to innovate or adapt quickly could render its products obsolete.