Note 2. Going Concern and Liquidity

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of June 30, 2024, the Company had cash and cash equivalents of $24.4 million and working capital deficit of $46.3 million. In the absence of additional liquidity, the Company anticipates that its existing cash resources, with a continued focus on cash conservation, is sufficient to fund its operations into the third quarter of fiscal 2025. There is no assurance that the Company’s projections and estimates are accurate. On May 17, 2024, after a trial in the U.S. District Court for the District of Delaware in the matter of Qorvo Inc. vs. Akoustis Technologies, Inc. DE Case 1:21-cv-01417-JPM (the “Qorvo Litigation”), the jury in the Qorvo Litigation awarded Qorvo approximately $38.6 million in damages. On September 9 and 10, 2024, the District Court issued orders awarding Qorvo an aggregate of approximately $19.0 in attorneys’ fees and pre- and post-judgment interest. Although, as of the date of this Report, the District Court has not entered a final judgment in respect of the jury verdict in the Qorvo Litigation, and Akoustis may elect to appeal such final judgment and portions of the awards of attorneys’ fees and pre- and post-judgment interest, these matters raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date of this filing. Our ability to continue as a going concern is dependent upon our ability to obtain additional equity financing or other capital or to timely appeal the District Court’s judgment and awards. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern. If we elect not to appeal an adverse final judgment or the awards of attorneys’ fees and pre- and post-judgment interest, or if we are unable to post an undertaking (such as an appeal bond) to enable us to do so, we will likely be forced to pursue a reorganization proceeding under Chapter 11 of the U.S. Bankruptcy Code.