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Any of these factors, many of which are beyond our control, could materially adversely affect our business, financial condition, operating results, cash flow and stock price.
−Removed: Business or economic disruptions or global health concerns could seriously harm our business.
−Removed: Broad-based business, economic disruptions or global health concerns could adversely affect our business and the sale of our products.
−Removed: For example, in December 2019 an outbreak of a novel strain of the coronavirus disease (COVID-19) originated in Wuhan, China, and has since spread to a number of other countries, including the United States.
−Removed: Initially, this outbreak resulted in extended shutdowns of certain businesses in the Wuhan region and had ripple effects to businesses around the world.
−Removed: While the impact of this pandemic has largely subsided, a resurgence of this virus or another could have an impact on our business.
−Removed: Although the Company has remained open throughout the COVID-19 pandemic, complete or partial government shutdowns of many businesses, schools, bars and restaurants have occurred.
−Removed: The Russian invasion of Ukraine and the conflict in Israel and Gaza could also adversely affect our business in spite of the immaterial amount of direct business we have done in this region in the past.
−Removed: We cannot presently predict the scope and severity of any future business shutdowns or disruptions to us, but if we or any of the third parties with whom we engage, including our customers, suppliers and other third parties, were to experience extended shutdowns or other business disruptions, our ability to conduct our business could be materially and negatively impacted, and could have a material adverse effect on our business and our results of operation and financial condition.
−Removed: A pandemic, epidemic or outbreak of an infectious disease in the United States or worldwide may adversely affect our business.
−Removed: Our operations expose us to risks associated with pandemics, epidemics or other public health emergencies, such as the outbreak of coronavirus disease (COVID-19) that subsequently spread around the world.
−Removed: Outbreaks such as these have resulted, and can continue to result, in governments around the world implementing increasingly stringent measures to help control the spread, including quarantines, "shelter in place" and "stay at home" orders, travel restrictions, business curtailments, school closures, and other measures.
−Removed: Government imposed requirements regarding vaccines, testing etc., could negatively impact the Company’s ability to hire or retain certain employees who are important to our business operations.
−Removed: These actions with respect to the COVID-19 outbreak have negatively impacted, and could continue to have negative impacts on, our operations, supply chain, transportation networks, customers and employees.
−Removed: Any continuing economic downturn as a result of this pandemic could adversely affect, demand for our products, and negatively impact our business or results of operations through the temporary closure of our operating locations or those of our customers or suppliers.
−Removed: The extent to which a COVID-19 resurgence may adversely impact our business depends on future developments, which are highly uncertain and unpredictable, including new information concerning the severity of an outbreak and the effectiveness of actions globally to contain or mitigate its effects, including the deployment and efficacy of vaccines.
We have a highly concentrated customer base so that changes in ordering patterns, delays or order cancellations could have a material adverse effect on our business and results of operations.
Three customers accounted for 58% of revenue in 2024 and 60% of revenue in 2023.
−Removed: We believe that our relationships with these customers are positive and may provide us with ongoing continuous sustainability for years to come, however a large customer, if lost, would be difficult to be replace, and our inability to do so may have a material adverse effect on our business and financial condition.
+Added: We believe that our relationships with these customers are positive and may provide us with ongoing continuous sustainability for years to come.
+Added: However, a large customer, if lost, would be difficult to replace, and our inability to do so may have a material adverse effect on our business and financial condition.
We expect that orders from a relatively limited number of customers will continue to account for a substantial portion of our business.
The mix and type of customers, and sales to any single customer, may vary significantly from quarter to quarter and from year to year.
−Removed: If any of our significant customers do not place orders, or they substantially reduce, delay or cancel orders, we may not be able to replace the business in a timely manner or at all, which can and has had a material adverse effect on our results of operations and financial condition.
+Added: If any of our significant customers do not place orders, or they substantially reduce, delay or cancel orders, we may not be able to replace the business in a timely manner or at all, which can have a material adverse effect on our results of operations and financial condition.
Major customers may also seek, and on occasion receive, pricing, payment or other commercial terms that are less favorable to us and can hurt our competitive position.
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The sales cycle for our products is often lengthy, ranging from several months to several years.
−Removed: In many cases potential customers must evaluate the properties of our product against their current solution, which may not be as robust as the CPS solution, but is often less expensive.
+Added: In many cases potential customers must evaluate the properties of our product against their current solution.
In many cases potential customers must redesign other components of the end product they are making to realize the full benefits of using our products.
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The length of the sales cycle depends on the size and complexity of the project, and the depth of the evaluation of our products conducted by the customers.
−Removed: Because a significant portion of our operating expenses is fixed, we have and may continue to incur substantial expense before we earn associated revenue.
+Added: Because a significant portion of our operating expenses is fixed, we may incur substantial expense before we earn associated revenue.
If customer cancellations occur, they could result in the loss of anticipated sales without allowing us sufficient time to reduce our operating expenses.
+Added: Fluctuations in foreign exchange rates can negatively impact our ability to compete against foreign based competitors.
+Added: Several of our major competitors are located outside of the United States.
+Added: The relative strength of the U.S.
+Added: dollar compared to such competitors’ respective local currencies makes our products more expensive to our customers relative to our competitors’ prices.
+Added: Such circumstances could result in a reduction in product pricing (and profitability) in order to maintain or grow our current levels of business.
+Added: If we are unable or unwilling to reduce pricing of our products to the level necessary to maintain current business levels, we could see an overall reduction in revenue.
+Added: Our dependence on outside vendors to perform particular steps in our manufacturing process could negatively impact us should those vendors be unable or unwilling to provide such service at a reasonable cost.
+Added: Several of our major customers require that we use only vendors approved by them for certain steps, typically plating, of our manufacturing process before the finished product can be shipped to the customer and recognized as revenue.
+Added: In some cases these vendors are sole sourced, i.e., one vendor is the only vendor approved for that process.
+Added: If that vendor raises their price to us, we may not be able to pass that increase on to our customer, eroding our margins.
+Added: If we are able to pass along these increases, that could negatively impact our sales volumes if our customer shifts some of their purchases to a lower priced competitor.
+Added: If a sole sourced vendor is unable to process our product fast enough to meet our customer’s demand, or if they do not process our product at all, our expected revenue could be negatively affected despite our ability to produce enough to meet that demand.
Our success is highly dependent on managerial contributions of key individuals and we may be unable to retain these individuals or recruit others.
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The integration of any new personnel could disrupt our ongoing operations.
+Added: Business or economic disruptions or global health concerns could seriously harm our business.
+Added: Broad-based business, economic disruptions or global health concerns could adversely affect our business and the sale of our products.
+Added: For example, in December 2019 an outbreak of a novel strain of the coronavirus disease (COVID-19) originated in Wuhan, China, and spread to a number of other countries, including the United States.
+Added: Initially, this outbreak resulted in extended shutdowns of certain businesses in the Wuhan region and had ripple effects to businesses around the world.
+Added: While the impact of this pandemic has largely subsided, a resurgence of this virus or another could have an impact on our business.
+Added: Although the Company remained open throughout the COVID-19 pandemic, complete or partial government shutdowns of many businesses, schools, bars and restaurants did occur.
+Added: The Russian invasion of Ukraine and the conflict in Israel and Gaza could also adversely affect our business in spite of the immaterial amount of direct business we have done in these regions in the past.
+Added: We cannot presently predict the scope and severity of any future business shutdowns or disruptions to us, but if we or any of the third parties with whom we engage, including our customers, suppliers and other third parties, were to experience extended shutdowns or other business disruptions, our ability to conduct our business could be materially and negatively impacted, and could have a material adverse effect on our business and our results of operation and financial condition.
+Added: Changes in trade policy could seriously impact our business.
+Added: Most of our raw materials are domestically sourced by CPS.
+Added: However, some of those raw materials may originate in countries other than the United States.
+Added: Should tariffs be imposed on any of these countries of origin, our vendors would likely increase their price to us to cover the cost of these tariffs.
+Added: We may not be able to pass these cost increases on to our customers in a timely manner, therefore eroding our margins.
+Added: A significant portion of our business is exported to customers outside the United States.
+Added: Should their countries impose tariffs on US goods, including ours, we could find ourselves at a competitive disadvantage in relation to our competitors, some of whom are located outside the United States.
Acquisitions can result in an increase in our operating costs, divert management ’ s attention away from other operational matters and expose us to other associated risks.
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If we fail to respond to these cyclical changes, our business could be seriously harmed.
−Removed: We do not have long-term volume production contracts with our customers, and we do not control the timing or volume of orders placed by our customers.
+Added: We do not typically have long-term volume production contracts with our customers, and we do not control the timing or volume of orders placed by our customers.
Whether and to what extent our customers place orders for any specific products, and the mix and quantities of products included in those orders are factors beyond our control.
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We may experience increasing price pressure.
−Removed: Our historical business strategy for many of our products has focused on product performance and customer service rather than on price.
+Added: Our historical business strategy for many of our products has focused on product performance and customer service rather than on offering the lowest price.
As a result of budgetary constraints, many of our customers are extremely price sensitive when purchasing our products.
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The costs of such a move or expansion could be significant to our profitability.
−Removed: Our ability to meet our customer’s needs including the on-time shipment of products, is paramount to our success.
+Added: Our ability to meet our customers’ needs including the on-time shipment of products, is paramount to our success.
Our current facility may not be able to adequately handle future growth and our ability to meet the needs of our customers.
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We believe that while patents can be useful and may be utilized by us in the future, they are not always necessary or feasible to protect our intellectual property.
−Removed: The process of seeking patent protection is lengthy and expensive, and we cannot be certain that applications will actually result in issued patents or that issued patents will be of sufficient scope or strength to provide meaningful protection or commercial advantage to us.
+Added: The process of seeking patent protection is lengthy and expensive, and we cannot be certain that applications will result in issued patents or that issued patents will be of sufficient scope or strength to provide meaningful protection or commercial advantage to us.
In addition to patent protection, we have also historically protected our proprietary information and intellectual property such as design specifications, blueprints, technical processes and employee know-how, by limiting access to this confidential information and trade secrets and through the use of non-disclosure agreements.
Other companies and individuals, including our competitors, may develop technologies that are similar or superior to our technology, or design around the intellectual property that we own or license.
−Removed: Our failure to adequately protect our intellectual property, could result in the reduction or extinguishment of our rights to such intellectual property.
+Added: Our failure to adequately protect our intellectual property could result in the reduction or elimination of our rights to such intellectual property.
We also assert rights to certain trademarks relating to certain of our products and product lines.
−Removed: While patent, copyright and trademark protection for our intellectual property may be important, we believe our future success in highly dynamic markets is most dependent upon the technical competence and creative skills of our personnel.
We attempt to protect our trade secrets and other proprietary information through confidentiality agreements with our customers, suppliers, employees and consultants, and through other internal security measures.
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The stock market has at times over the last 15 years experienced periods of high and extreme volatility.
−Removed: If these market fluctuations continue, the trading price of our common shares could decline significantly independent of the overall market, and stockholders could lose all or a substantial part of their investment.
+Added: If these market fluctuations continue or for other factors, including those listed below, the trading price of our common shares could decline significantly independent of the overall market, and stockholders could lose all or a substantial part of their investment.
The market price of our common shares could fluctuate significantly in response to several factors, including, among others:
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the occurrence of major catastrophic events, including the effects of a possible resurgence of the novel coronavirus (COVID-19).
−Removed: Significant price and value fluctuations have occurred with respect to our publicly traded securities.
+Added: Significant price fluctuations have occurred with respect to our publicly traded securities.
The price of our common shares is likely to be volatile in the future.
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Computer programmers and hackers also may be able to develop and deploy viruses, worms, and other malicious software programs that attack our systems or our products, or that otherwise exploit any security vulnerabilities.
−Removed: The costs to address the foregoing security problems and security vulnerabilities before or after a cyber-incident could be significant.
+Added: The costs of addressing the foregoing security problems and security vulnerabilities before or after a cyber-incident could be significant.
Our remediation efforts may not be successful and could result in interruptions, delays, or cessation of service, and loss of existing or potential customers, impeding our sales, manufacturing, distribution, or other critical functions.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.