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The following are certain risks that could affect our business, financial position and results of operations.
−Removed: These risks should be considered in connection with evaluating an investment in our company and, in particular, the forward-looking statements contained in this Report because these risks could cause the actual results to differ materially from those suggested by the forward-looking statements.
+Added: These risks should be considered in connection with evaluating an investment in our company and, in particular, together with the forward-looking statements contained in this Report because these risks could cause the actual results to differ materially from those suggested by the forward-looking statements.
These factors are neither presented in order of importance nor weighted.
Additionally, there are other risks which could impact us that we may not describe, because we currently do not perceive them to be material or because they are presently unknown.
−Removed: If any of these risks develops into actual events, our business, financial condition and
−Removed: Index to Financial Statements
−Removed: results of operations could be negatively affected, the market price of our common stock could decline and you may lose all or part of your investment in our common stock.
+Added: If any of these risks develops into actual events, our business, financial condition and results of operations could be negatively affected, the market price of our common stock could decline and you may lose all or part of your investment in our common stock.
We expressly disclaim any obligation to update or revise any risk factors, whether as a result of new information, future events or otherwise, except as required by law.
Risk Factors Related to our Operations
−Removed: People - If we cannot continue to hire and retain high quality employees, our business and financial results may be negatively affected.
−Removed: Our operating results could be adversely affected by increased competition for employees, difficulty in recruiting employees, higher employee turnover or increased compensation and benefit costs.
−Removed: Our employees are important to our success and we are dependent in part on our ability to retain the services of our employees in key roles.
−Removed: We have built our business on a set of core values, and we attempt to hire and retain employees who are committed to these values and our culture of providing exceptional service to our customers and suppliers.
−Removed: In order to compete and to continue to grow, we must attract, retain and motivate employees, including those in executive, senior management, sales, marketing, logistics, technical support and other operating positions.
−Removed: Many of our employees work in small teams to provide specific services to customers and suppliers.
−Removed: They are trained to develop their knowledge of products, services, programs and practices and customer business needs, as well as to enhance the skills required to provide exceptional service and to manage our business.
−Removed: As they gain experience and develop their knowledge and skills, our employees become highly desired by other businesses.
−Removed: Therefore, to retain our employees and attract new ones, we have to provide a satisfying work environment and competitive compensation and benefits.
Acquisitions - Our growth strategy includes acquisitions of companies that complement or expand our existing business.
Acquisitions involve unique risks and uncertainties, including difficulty in identifying and completing potential acquisitions.
+Added: Index to Financial Statements
We have acquired, and may continue to acquire, companies that complement or expand our existing business in the United States and internationally, and some of these acquisitions may be in business lines where we have little, if any, experience.
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In addition, increases in the size and complexity of our business may place a significant strain on our management, operations, technical performance, financial resources and internal financial control and reporting functions, and there are no assurances that we will be able to manage the acquisition process or newly acquired companies effectively.
−Removed: Our personnel, systems, procedures and controls may not be adequate to effectively manage our future operations, especially as we employ personnel in multiple domestic and international locations.
+Added: Our personnel, systems, procedures and controls may not be adequate to effectively manage our future operations, especially as we employ personnel in multiple domestic and some international locations.
We may not be able to hire, train, retain and manage the personnel required to address our growth.
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Furthermore, even if we complete such transactions and effectively integrate the newly acquired business or strategic alliance into our existing operations, we may fail to realize the anticipated returns and/or fail to capture the expected benefits, such as strategic or operational synergies or cost savings.
+Added: People - If we cannot continue to hire and retain high quality employees, our business and financial results may be negatively affected.
+Added: Our operating results could be adversely affected by increased competition for employees, difficulty in recruiting employees, higher employee turnover or increased compensation and benefit costs.
+Added: Our employees are important to our success and we are dependent in part on our ability to retain the services of our employees in key roles.
+Added: We have built our business on a set of core values, and we attempt to hire and retain employees who are committed to these values and our culture of providing exceptional service to our customers and suppliers.
+Added: In order to compete and to continue to grow, we must attract, retain and motivate employees, including those in executive, senior management, sales, marketing, logistics, technical support and other operating positions.
+Added: Many of our employees work in small teams to provide specific services to customers and suppliers.
+Added: They are trained to develop their knowledge of products, services, programs and practices and customer business needs, as well as to enhance the skills required to provide exceptional service and to manage our business.
+Added: As they gain experience and develop their knowledge and skills, our employees become highly desired by other businesses.
+Added: Therefore, to retain our employees and attract new ones, we have to provide a satisfying work environment and competitive compensation and benefits.
IT Systems - Our ability to manage our business and monitor results is highly dependent upon information and communication systems.
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Failure to properly or adequately address these issues could impact our ability to perform necessary business operations, which could adversely affect our reputation, competitive position, business, financial condition and results of operations.
−Removed: Index to Financial Statements
In addition, the information systems of companies we acquire may not meet our standards or we may not be able to successfully convert them to provide acceptable information on a timely and cost-effective basis.
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Our customers rely on our electronic ordering, information systems and website for product information, including availability, pricing and placing orders.
−Removed: Our systems were disrupted during our recent ransomware incident, and there can be no assurance that our systems will not fail or experience disruptions again in the future, and any significant failure or disruption of these systems could prevent us from making sales, ordering and delivering products and otherwise conducting our business.
+Added: A ransomware incident in 2023 disrupted our systems, and there can be no assurance that our
+Added: Index to Financial Statements
+Added: systems will not fail or experience disruptions again in the future.
+Added: Any significant failure or disruption of these systems could prevent us from making sales, ordering and delivering products and otherwise conducting our business.
+Added: Organic growth strategies - If we fail to effectively manage and implement our operating strategies, we may experience a negative effect on our business and financial results.
+Added: A significant component of our growth strategy is to expand our channels and expand our existing products and services in our existing channels and entry into new channels.
+Added: These efforts may divert our resources and systems, require additional resources that might not be available (or available on acceptable terms), result in new or more intense competition, require longer implementation times or greater expenditures than anticipated and otherwise fail to achieve timely desired results, if at all.
+Added: If we are unable to increase our sales and earnings by expanding our product and service offerings in a cost-effective manner, our results may suffer.
+Added: Our ability to successfully manage our organic growth will require continued enhancement of our operational, managerial and financial resources, controls, and models.
+Added: Our failure to effectively manage our organic growth could have an adverse effect on our business, financial condition and results of operations.
Supply Chain issues, include a shortage of products, may increase our costs or cause a delay in fulfilling customer orders, completing services or purchasing products and services needed to support our internal operations, resulting in an adverse impact on our financial results.
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Supply chain issues, including a shortage of technology products and available services, may increase our costs or cause a delay in purchasing technology products needed to support our internal systems and infrastructure or operations, resulting in an impact on our operations and availability of our systems, which could result in a materially adverse effect on our operations and financial results.
−Removed: Organic growth strategies - If we fail to effectively manage and implement our operating strategies, we may experience a negative effect on our business and financial results.
−Removed: A significant component of our growth strategy is to expand our channels and expand our existing products and services in our existing channels and entry into new channels.
−Removed: These efforts may divert our resources and systems, require additional resources that might not be available (or available on acceptable terms), result in new or more intense competition, require longer implementation times or greater expenditures than anticipated and otherwise fail to achieve timely desired results, if at all.
−Removed: If we are unable to increase our sales and earnings by expanding our product and service offerings in a cost-effective manner, our results may suffer.
−Removed: Our ability to successfully manage our organic growth will require continued enhancement of our operational, managerial and financial resources, controls, and models.
−Removed: Our failure to effectively manage our organic growth could have an adverse effect on our business, financial condition and results of operations.
Credit exposure - We have credit exposure to our customers.
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We also provide financing to some Intelisys customers based on their future commission flows.
−Removed: As we grow and compete for business, our typical payment terms tend to be longer, and therefore may increase our credit risk.
−Removed: Index to Financial Statements
+Added: As we grow and compete for business, our typical payment terms tend to get longer, increasing our credit risk.
While we evaluate our customers' qualifications for credit and monitor our extensions of credit, these efforts cannot prevent all credit losses and any credit losses negatively impact our performance.
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If there is deterioration in the collectability of our receivables, or if we fail to take other actions to adequately mitigate such credit risk, our earnings, cash flows and our ability to utilize receivable-based financing could deteriorate.
+Added: Index to Financial Statements
In addition, extending credit to international customers involves additional risks.
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We work closely with our third-party logistics and warehousing providers to anticipate issues, and also review public information regarding their financial health.
−Removed: However, issues may not be identified quickly, which may lead to lack of or poor execution of services, loss or litigation.
+Added: However, issues may not be timely identified, which may lead to lack of or poor execution of services, loss or litigation.
Additionally, deterioration of the financial condition of our logistical and warehousing providers could result in delayed responsiveness or delivery failure, which would ultimately affect our responsiveness to our customers and thus may adversely affect our business, financial condition and results of operations.
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In addition, these protections are not always reflected in supplier agreements and their application in a particular situation is dependent upon negotiations with our suppliers.
−Removed: As a result, occasionally we are required to write down the value of excess and obsolete inventory, and should any of these write-downs occur at a significant level, they could have an adverse effect on our business, financial condition and results of operations.
+Added: As a result, we are required to write down the value of excess and obsolete inventory, and should any of these write-downs occur at a significant level, they could have an adverse effect on our business, financial condition and results of operations.
Suppliers - Changes to supply agreement terms or lack of product availability from our suppliers could adversely affect our operating margins, revenue or the level of capital required to fund our operations.
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As a result of such concentration risk, terminations of supply or services agreements or a change in terms or conditions of sale from one or more of our key suppliers could adversely affect our operating margins, revenue or the level of capital required to fund our operations.
−Removed: Our suppliers have the ability to make adverse changes in their sales terms and conditions, such as reducing the level of purchase discounts and
−Removed: Index to Financial Statements
−Removed: rebates they make available to us.
+Added: Our suppliers have the ability to make adverse changes in their sales terms and conditions, such as reducing the level of purchase discounts and rebates they make available to us.
In addition, our supplier agreements typically are short-term and may be terminated without cause on short notice.
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Our inability to pass through to our customers the impact of these changes, as well as if we fail to develop or maintain systems to manage ongoing supplier programs, could cause us to record inventory write-downs or other losses and could have significant negative impact on our gross margins.
+Added: Index to Financial Statements
We receive purchase discounts and rebates from some suppliers based on various factors, including goals for quantitative and qualitative sales or purchase volume and customer related metrics.
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In addition, the cost of borrowings under our existing sources of capital and any potential new sources of capital as a result of variable interest rates may increase, which could have an adverse effect on our financial condition.
−Removed: Changes in how lenders rate our credit worthiness, as well as macroeconomic factors such as an economic downturn, inflation, rising interest rates and
−Removed: Index to Financial Statements
−Removed: global economic instability may restrict our ability to raise capital in adequate amounts or on terms acceptable to us, and the failure to do so could harm our ability to operate our business.
+Added: Changes in how lenders rate our credit worthiness, as well as macroeconomic factors such as an economic downturn, inflation, rising interest rates and global economic instability may restrict our ability to raise capital in adequate amounts or on terms acceptable to us, and the failure to do so could harm our ability to operate our business.
In addition, our cash and cash equivalents are deposited with various financial institutions located in the various countries in which we operate.
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however, we are exposed to risk of loss on such funds or we may experience significant disruptions in our liquidity needs if one or more of these financial institutions were to fail or suffer bankruptcy or similar restructuring.
+Added: Index to Financial Statements
Customers - We operate in a highly competitive environment and good customer relations are critical to our success.
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Therefore, our customers can choose to purchase from other sources.
−Removed: From time to time, we experience shortages in availability of some products from suppliers, and this impacts customers' decisions regarding whether to make purchases from us.
+Added: From time to time, we experience shortages in availability of some products from suppliers, and this impacts customer decisions regarding whether to make purchases from us.
Anything that negatively influences customer relations can also negatively impact our operating results.
+Added: As a distributor in a channel business model our offerings can create channel conflict.
+Added: These perceived channel conflicts can impact or customer relationships and negatively impact our operating results and our ability to retain those customers.
Customer consolidation also may lead to changes in the nature and terms of relationships with our customers.
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Testing goodwill and other intangibles for impairment requires the use of significant estimates and other inputs outside of our control.
−Removed: If the carrying value of goodwill in any of our goodwill reporting units or other intangible assets is determined to exceed their respective fair values, we may be required to record significant impairment charges.
+Added: If the carryi ng value of goodwill in any of our goodwill reporting units or other intangible assets is determined to exceed their respective fair values, we may be required to record significant impairment charges.
In addition, our decision to dispose of certain of our operations has in the past and may in the future require us to recognize an impairment to the carrying value of goodwill and other intangible assets attendant to those operations.
−Removed: As of June 30, 2023, the Specialty Technology Solutions and Modern Communications & Cloud reporting units' goodwill balances are $16.4 million and $200.3 million, respectively.
+Added: As of June 30, 2024, the Specialty Technology Solutions and Modern Communications & Cloud reporting units' goodwill balances are $16.4 million and $189.9 million, resp ectively.
The fair value of the reporting units exceeded its carrying value by 11% and 33% , respectively, as of the annual goodwill impairment testing date.
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Impairment charges would also reduce our consolidated shareholders' equity and increase our debt-to-total-capitalization ratio, which could negatively impact our credit rating and access to the public debt and equity markets.
−Removed: Index to Financial Statements
International operations - Our international operations expose us to risks that are different from, and possibly greater than, the risks we are exposed to domestically.
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These risks include:
−Removed: • Fluctuations of foreign currency and exchange rates, which can impact sales, costs of the goods we sell and the reporting of our results and assets on our financial statements;
+Added: Index to Financial Statements
+Added: • Fluctuations of foreign currency and exchange rates, which can impact sales, costs of goods sold and the reporting of our results from operations and financial conditions, including the value of certain assets on our financial statements;
• Changes in international trade laws, trade agreements, or trading relationships affecting our import and export activities, including export license requirements, restrictions on the export of certain technology and tariff changes, or the imposition of new or increased trade sanctions;
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• Difficulties in staffing and managing operations in foreign countries;
−Removed: • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), and laws related to data privacy such as GDPR and other similar privacy laws that impact our IT systems and processes;
+Added: • Changes in the interpretation and enforcement of laws (in particular related to items such as duty and taxation), and laws related to data privacy and other similar privacy laws that impact our IT systems and processes;
• Global economic and financial market instability;
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• Compliance with foreign and domestic import and export regulations and anti-corruption laws, including the Iran Threat Reduction and Syria Human Rights Act of 2012, U.S.
−Removed: Foreign Corrupt Practices Act, UK Bribery Act, and similar laws of other jurisdictions, governing our business activities outside the United States, the violation of which could result in severe penalties, including monetary fines, criminal proceedings and suspension of export or import privileges;
+Added: Foreign Corrupt Practices Act and similar laws of other jurisdictions, governing our business activities outside the United States, the violation of which could result in severe penalties, including monetary fines, criminal proceedings and suspension of export or import privileges;
• Terrorist or military actions that result in destruction or seizure of our assets or suspension or disruption of our operations or those of our customers, suppliers or service providers.
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Furthermore, in developing markets it may be common for others to engage in business practices prohibited by laws and regulations applicable to us, such as the U.S.
−Removed: Foreign Corrupt Practices Act, UK Bribery Act, or similar local anti-bribery laws.
+Added: Foreign Corrupt Practices Act or similar local anti-bribery laws.
Our commitment to legal compliance could put us at a competitive disadvantage, and any lapses in our compliance could subject us to civil and criminal penalties that could materially and adversely affect our financial condition and results of operations.
In addition, competition in developing markets is increasing.
−Removed: If we cannot successfully increase our business, our product sales, financial condition and results of operations could be adversely affected.
−Removed: Quarterly fluctuations - Our net sales and operating results are dependent on a number of factors.
+Added: If we cannot successfully increase our business, our product sales, our financial condition and results of operations could be adversely affected.
+Added: Quarterly fluctuations - Our net sales and operating results are dependent on several factors.
Our net sales will fluctuate from quarter to quarter, and these fluctuations may cause volatility in our stock price.
−Removed: Our net sales and operating results may fluctuate quarterly and, as a result our performance in one period may vary significantly from our performance in the preceding quarter, and may differ significantly from our forecast of performance from quarter to quarter.
+Added: Our net sales and operating results may fluctuate quarterly and, as a result, our performance in one period may vary significantly from our performance in the preceding quarter, and may differ significantly from our performance forecast from quarter to quarter.
The impact of these variances may cause volatility in our stock price.
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The results of any quarterly period are not indicative of results to be expected for a full fiscal year.
−Removed: Index to Financial Statements
−Removed: Centralized functions - We have centralized a number of functions to provide efficient support to our business.
−Removed: As a result, a loss or reduction of use of one of our locations would have an adverse effect on our business operations and financial results.
+Added: Centralized functions - We have centralized several functions to provide efficient support to our business.
+Added: As a result, a loss or reduction of use of one of our locations could have an adverse effect on our business operations and financial results.
In order to be as efficient as possible, we centralize a number of critical functions.
For instance, we currently distribute products to the majority of North America from a single warehouse.
−Removed: Similarly, for the primary business operations, we utilize a single information system based in the United States for the majority of our North American operations, while our Brazilian and UK operations have separate systems.
−Removed: While we have backup systems and business continuity plans, any significant or lengthy interruption of our ability to provide these centralized functions as a result of natural disasters, prolonged inclement weather, security breaches or otherwise would significantly impair our ability to continue normal business operations.
−Removed: In addition, the centralization of these functions increases our exposure to local risks, such as the availability of qualified employees and the lessening of competition for critical services, such as freight and communications.
+Added: Similarly, for our primary business operations, we utilize a single information system based in the United States for the majority of our North American operations, while our Brazilian operations utilize a separate system.
+Added: While we have backup systems and business continuity plans, any significant or lengthy interruption of our ability to provide these centralized functions as a result of natural disasters, prolonged inclement weather, security breaches (including cyberattacks) or otherwise would significantly impair our ability to continue normal business operations.
+Added: In addition, the centralization of these functions increases our exposure to local risks, such as the availability of qualified employees and increased competition for, or lack of access to, critical services, such as freight and communications.
+Added: Index to Financial Statements
Risk Factors Related to our Industry
−Removed: Competition - We experience intense competition in all of our markets.
+Added: Competition - We experience intense competition in all our markets.
This competition could result in reduced margins and loss of our market share.
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As a result of intense price competition in our industry, our gross margins and our operating profit margins historically have been narrow, and we expect them to continue to be narrow in the future.
−Removed: To remain competitive, we may be forced to offer more credit or extended payment terms to our customers.
−Removed: This could result in an increase in our need for capital, increase our financing costs, increase our bad debt expenses and have an adverse impact on our results of operations.
+Added: To remain competitive, we may be forced to offer more credit or extend payment terms to our customers.
+Added: This could result in an increase in our need for capital, increase our financing costs, increase our bad debt expenses and have an adverse impact on our financial condition and results of operations.
We may lose market share, reduce our prices in response to actions of our competitors, or withdraw from geographical markets where we do not believe we can earn appropriate margins.
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Disruptive technology - We may not be able to respond and adapt to rapid technological changes, evolving industry standards or changing customer needs or requirements, and thus may become less competitive.
−Removed: The market for some of our products and services is subject to rapid technological change, evolving industry standards and changes in customer demand, which can contribute to the decline in value or obsolescence of inventory.
−Removed: Although some of our suppliers provide us with certain protections from the loss in value of inventory (such as price protection and certain return rights), we cannot be sure that such protections will fully compensate for any loss in value, or that the suppliers will choose to, or be able to, honor such agreements.
−Removed: Our ability and our supplier's ability to anticipate and react quickly to new technology trends and customer requirements is crucial to our overall success, financial condition and results of operations.
−Removed: If our suppliers fail to evolve their product and service offerings, or if we fail to evolve our product and service offerings or engage with desirable suppliers in time to respond to, and remain ahead of, new technological developments, it would adversely affect our ability to retain or increase market share and revenue.
−Removed: New technologies may emerge that quickly surpass the capabilities of the products we currently hold in inventory or have access to sell through our existing supplier network, and our customers may no longer view our product offerings as desirable or necessary, which could result in a reduction in our market share and ability to obtain sufficient profit margins.
−Removed: Some of our competitors and our suppliers’ competitors may be better at adapting to disruptive technology or entering
−Removed: Index to Financial Statements
+Added: The market for some of our products and services is subject to rapid technological change, evolving industry standards and changes in customer demand, which can contribute to a decline in value or obsolescence of inventory.
+Added: Although some of our suppliers provide us with certain protections from a loss in value of inventory (such as price protection and certain return rights), we cannot be sure that such protections will fully compensate for any loss in value, or that such suppliers will choose to, or be able to, honor such agreements.
+Added: Our ability and our suppliers’ ability to anticipate and react quickly to new technology trends and customer requirements is crucial to our overall success, financial condition and results of operations.
+Added: If our suppliers fail to evolve their product and service offerings, or if we fail to evolve our product and service offerings or to engage with desirable suppliers in time to respond to, and remain ahead of, new technological developments, our ability to retain or increase market share, profit margins and revenue could be adversely affected.
+Added: Some of our competitors and our suppliers’ competitors may be better at adapting to disruptive technology or entering new markets.
Our future success depends, in part, on our ability to adapt and manage our product and service offerings to meet customer needs at prices that our customers are willing to pay.
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Cybersecurity risk - If we are the subject of a ransomware or other cyberattack, we could lose valuable financial and operational data, we could be prevented from processing customer orders, ordering and tracking inventory, and efficiently operating our business, and we could lose revenue and profits and incur significant costs.
−Removed: In addition, we could be subject to legal claims in the event of the loss, disclosure or misappropriation of, or access to, our customer's or business partners' or our own information.
+Added: In addition, we could be subject to legal claims in the event of loss, disclosure or misappropriation of, or loss of access to, our customers’, business partners’ or our own information.
We make extensive use of online services and integrated information systems, including through third-party service providers.
The secure maintenance and transmission of customer information is a critical element of our operations.
−Removed: Our information technology and other systems that maintain and transmit customer or employee information or those of service providers or business partners may be compromised by a malicious third-party penetration of our network security, or that of a third-party service provider or business partner, or impacted by advertent or inadvertent actions or inactions by our employees, or those of a third-party service provider or business partner.
−Removed: With constant changes in the security landscape, experienced computer programmers and hackers may be able to penetrate our network security, or that of our third-party service providers, and misappropriate or compromise our confidential information, create system disruptions, or cause shutdowns.
+Added: Our information technology and other systems that maintain and transmit customer or employee information or those of our service providers or business partners may be compromised by a malicious third-party penetration of network security or impacted by the advertent or inadvertent actions or inactions of our employees, third-party service providers or business partners.
+Added: With constant changes
+Added: Index to Financial Statements
+Added: in the security landscape, experienced computer programmers and hackers may be able to penetrate our network security, or that of our third-party service providers and business partners, and misappropriate or compromise confidential information, create system disruptions or cause shutdowns.
As a result, our customers’ information may be lost, disclosed, accessed or taken without our customers’ consent.
We are subject to laws and regulations relating to customer privacy and the protection of personal information.
−Removed: Any such loss, disclosure or misappropriation of, or access to, customers' or business partners' information or our information or other breach of such information security can result in legal claims or legal proceedings, including regulatory investigations and actions, and may have a serious impact on our reputation and may adversely affect our businesses, operating results and financial condition.
+Added: Any such loss, disclosure or misappropriation of, or access to, our customers’ or business partners’ information or our information or other data breach affecting such information can result in legal claims or legal proceedings, including regulatory investigations and actions, and may have a serious impact on our reputation and may adversely affect our businesses, operating results and financial condition.
In May 2023, we learned that we had been the subject of a ransomware attack.
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This attack interrupted our ability to accept and process orders for approximately nine business days and resulted in the disclosure on the “dark web” of various information from our systems.
−Removed: Although substantially all of the restoration is complete, there can be no assurance that we will not be a victim of a ransomware or other cyberattack again in the future.
+Added: Upon detection, we took immediate steps to address the incident, engaged third-party experts, and notified law enforcement.
+Added: We have taken steps to strengthen our existing IT security infrastructure and continue to implement additional measures to prevent unauthorized access to, or manipulation of, our systems and data.
+Added: Although restoration is complete, there can be no assurance that we will not be a victim of a ransomware or other cyberattack again in the future.
+Added: Although we have insurance to offset financial losses incurred for events such as the ransomware attack we experienced in May 2023, there can be no guarantee that we will recover all insurance proceeds claimed.
+Added: Any insurance proceeds received related to the cybersecurity incident will be recorded in selling, general and administrative expenses of the consolidated income statement for the relevant period.
Increased government regulation - We may be subject to additional costs and subject to fines and penalties because certain governmental entities are end-customers of products that we sell.
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We also may be subject to increased scrutiny and investigation into our business practices, which may increase operating costs and increase legal liability, as well as expose us to additional reputational risk.
−Removed: Volatility of Stock Price - The trading price of our common stock fluctuates.
−Removed: The stock market as a whole and the trading prices of companies with smaller capitalization have been volatile.
−Removed: This volatility could significantly reduce the price of our common stock at any time, without regard to our own operating performance.
−Removed: This volatility may affect the price at which you could sell your common stock.
−Removed: Our stock price is likely to continue to be volatile in response to market and other factors;
−Removed: variations in our quarterly operating results from our expectations or those of securities analysts or investors;
−Removed: downward revisions in securities analysts’ estimates;
−Removed: and announcement by us or our competitors of significant acquisitions, transactions, partnerships, joint ventures or capital commitments.
−Removed: A material decline in the price of our common stock may result in the assertion of certain claims against us, and/or the commencement of inquiries and/or investigations against us.
−Removed: A prolonged decline in the price of our common stock could result in a reduction in the liquidity of our common stock and a reduction in our ability to raise capital, if needed, and the inability for you to obtain a favorable price at which you could sell your shares.
−Removed: Index to Financial Statements
Foreign currency - Our international operations expose us to fluctuations in foreign currency exchange rates that could adversely affect our results of operations.
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dollar and other currencies we transact in may positively or negatively affect our results of operations.
−Removed: In addition, unexpected and dramatic changes in foreign currency exchange rates may negatively affect our earnings from those markets.
−Removed: Economic weakness - Economic weakness, including recession and inflation, and geopolitical uncertainty could adversely affect our results and prospects.
+Added: In addition, unexpected and dramatic changes in foreign currency exchange rates may negatively affect our earnings from foreign markets.
+Added: Economic weakness - Economic weakness and uncertainty, including the possibility of recession and heightened levels of inflation, and geopolitical uncertainty could adversely affect our results and prospects.
Our financial results, operations and prospects depend significantly on worldwide economic and geopolitical conditions, the demand for our products and services, and the financial condition of our customers and suppliers.
Economic weakness and geopolitical uncertainty have in the past resulted, and may result in the future, in reduced demand for products resulting in decreased sales, margins and earnings.
−Removed: Economic weakness and geopolitical uncertainty may also lead us to impair assets, including goodwill, intangible assets and other long-lived assets, take restructuring actions or adjust our operating strategy and reduce expenses in response to decreased sales or margins.
+Added: Economic weakness and geopolitical uncertainty may also lead us to impair assets, including goodwill, intangible assets and other long-lived assets, take restructuring actions or adjust our operating strategy and
+Added: Index to Financial Statements
+Added: reduce expenses in response to decreased sales or margins.
We may not be able to adequately adjust our cost structure in a timely fashion, which may adversely impact our profitability.
−Removed: Uncertainty about economic conditions may increase foreign currency volatility in markets in which we transact business, which may negatively impact our results.
+Added: Uncertainty about economic conditions also may increase foreign currency volatility in such markets, which may negatively impact our results.
Economic weakness and geopolitical uncertainty also make it more difficult for us to manage inventory levels and/or collect customer receivables, which may result in provisions to create reserves, write-offs, reduced access to liquidity and higher financing costs.
−Removed: Unresolved Staff Comments.
−Removed: Not applicable.
+Added: Although U.S.
+Added: inflation rates have shown signs of moderating, periods of elevated inflation contribute to increased costs for labor, materials and services.
+Added: The re-emergence of high levels of inflation could further increase our costs and otherwise adversely impact our results of operations and financial condition.
+Added: Although we monitor changes to the macroeconomic environment, we cannot predict any future trends in the rate of inflation or the general state of the economy.
+Added: Volatility of Stock Price - The trading price of our common stock fluctuates.
+Added: The market price of our common stock could be subject to wide fluctuations.
+Added: This volatility could significantly reduce the price of our common stock at any time, without regard to our own operating performance, particularly because we are designated as a small cap stock that is thinly traded.
+Added: Our stock price can be affected by numerous factors such as variations in our quarterly operating results or expectations with regard thereto;
+Added: revisions in securities analysts’ estimates;
+Added: announcements by us or our competitors of significant acquisitions, transactions, partnerships, joint ventures or capital commitments;
+Added: interest rates;
+Added: business conditions in our industry or the general state of the securities markets and the economy.
+Added: A material decline in the price of our common stock may result in the assertion of certain claims against us, and/or the commencement of inquiries and/or investigations against us.
+Added: A prolonged decline in the price of our common stock could result in a reduction in the liquidity of our common stock and a reduction in our ability to raise capital, if needed, and the inability for you to obtain a favorable price at which you could sell your shares.
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.