What changed in this filing

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Item 1A. Risk Factors

2024-02-26 compared with 2023-02-17 · 126 added, 130 removed, 347 unchanged (42% of the section changed)

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Risks related to our business

We operate globally and are subject to significant risks in many jurisdictions, and our business, financial condition, and results of operations have been and may continue to be impacted by adverse global and regional economic conditions

We operate globally and are subject to significant risks in many jurisdictions, including risks related to adverse economic, political, regulatory, and other global and regional conditions

We have operations in many countries, and a significant portion of our revenue is derived from countries outside of the United States.

As a result, our business, financial condition, and results of operations, including our ability to design, develop, or sell products, may be adversely affected by a number of factors outside of our control, including:

As a result, our business, financial condition, and results of operations, including our ability to design, develop, or sell products, has been and may continue to be adversely affected by a number of factors outside of our control, including:

• global and local economic conditions, such as inflation and recession;

• the demand and cost of commodities, such as corn and oil;

• the strength of the agricultural, engineering, and construction markets;

• the strength of the agricultural, engineering and construction, and transportation markets;

• inadequate infrastructure and other disruptions, such as supply chain interruptions and large-scale outages or unreliable provision of services from utilities, transportation, data hosting, or telecommunications providers;

• government restrictions on our operations in any country, or restrictions on our ability to repatriate earnings from a particular country;

• differing employment practices and labor issues;

• formal or informal imposition of new or revised export and/or import and doing-business regulations, including trade sanctions, tariffs, and import or export licensing requirements, which could be changed without notice;

• ineffective legal protection of our IP rights in certain countries;

• uncertain economic and political conditions in countries where we do business;

• local business and cultural factors that differ from our normal standards and practices;

• differing regional responses and restrictions related to global pandemics, like the COVID-19 pandemic;

• uncertainty regarding social, political, immigration, and trade policies in the U.S.

There is an inherent risk that political, diplomatic, or military events could result in trade disruptions, including tariffs, trade embargoes, export restrictions, and other trade barriers.

• differing employment practices and labor issues and the challenges and costs of staffing and managing a global workforce;

• imposition of new and changing trade barriers, including trade sanctions, duties, tariffs, and import or export licensing requirements or restrictions;

• compliance with differing local laws and regulations, including those relating to privacy, labor, and local content;

• ineffective legal protection of our IP rights in certain countries or difficulties procuring or enforcing our IP rights;

• volatile geopolitical conditions, including significant regional military conflicts and political and economic instability, in countries where we do business;

• local business and cultural factors that differ from our normal standards and practices, which can include longer payment cycles and difficulties in enforcing agreements and collecting receivables in certain foreign jurisdictions;

• fluctuations in currency rates;

• uncertainty regarding social, political, including elections, immigration, tax, and trade policies in the U.S.

A significant trade disruption or the establishment or increase of any trade barrier in any area where we do business could increase the cost of our products, which could adversely impact the margin that we earn on sales, make our products more expensive for customers or create uncertainty around demand for certain types of products, which could make our products less competitive and reduce customer demand.

Given the geopolitical climate, there is uncertainty about the trade policies, treaties, government regulations, and tariffs that could apply to trade.

If ther e were to be a deterioration in the global economy, the economies of the countries or regions where our customers are located or do business, or the industries that we or our customers serve, the demand for our products and services would likely decrease.

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Changes in economic conditions and political uncertainty surrounding international trade also make it difficult to make financial forecasts.

Risks associated with engaging in international business include:

• longer payment cycles and difficulties in enforcing agreements and collecting receivables through certain foreign legal systems;

• difficulties and costs of staffing and managing international operations;

• differing local customer product preferences and requirements than our U.S.

• difficulties protecting or procuring intellectual property rights;

• compliance with changes in local laws, including those relating to privacy, labor and local content.

These factors or any combination of these factors could adversely affect our business, financial condition, and results of operations.

We have experienced disruption in our supply chain including the effects of COVID-19 and related events, and are subject to ongoing supply chain risks, which could adversely affect our revenue and results of operations

Any of the foregoing factors could adversely affect our business, financial condition, and results of operations.

We have experienced disruption in our supply chain and related events, and are subject to ongoing supply chain risks

We are dependent upon a limited number of contract manufacturers for the manufacture, testing, and assembly of certain products and specific suppliers for a number of our critical components.

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Our current reliance on a limited group of contract manufacturers and suppliers involves risks, including the potential inability to obtain products or components to meet customers’ delivery requirements, reduced control over pricing and delivery schedules and discontinuation of or increased prices for certain components.

In the first half of 2022, we have

experienced disruption in our supply chain as a result of the effects of COVID-19 and the geopolitical conditions such as the ongoing military conflict between Russia and Ukraine and related events and their impact on our suppliers and on international trade in general, leading to shortfalls in available components we need to make products as well as increased costs to obtain components, to make products, and to transport components and products.

The geopolitical conditions such as the ongoing military conflict in the Middle East and between Russia and Ukraine and related events and their impact on our suppliers and on international trade in general, have led to shortfalls in available components we need to make products as well as increased costs to obtain components, to make products, and to transport components and products.

The disruptions include extended delivery times for certain components of our hardware products and increased freight costs.

These disruptions have had an adverse effect on our ability to meet customer demand and have resulted in delays in shipping products to customers and dealers.

Future disruptions could occur as a result of any number of events, including, but not limited to, inflationary cost increases, increases in wages that drive up prices or labor, the imposition of new regulations, quotas or embargoes on components, a scarcity of, or significant increase in the price of, required components for our products, trade restrictions, tariffs or duties, fluctuations in currency exchange rates, transportation failures affecting the supply chain and shipment of materials and finished goods, third party interference in the integrity of the products sourced through the supply chain, the unavailability of raw materials, severe weather conditions, natural disasters, civil unrest, military conflicts, geopolitical developments, war or terrorism, and disruptions in utility and other services.

Future disruptions could occur as a result of any number of events, such as:

• inflationary cost increases,

• increases in wages that drive up prices of labor,

• the imposition of new regulations, quotas or embargoes on components,

• a scarcity of, or significant increase in the price of, raw materials or required components for our products,

• trade restrictions, tariffs, or duties,

• fluctuations in currency exchange rates,

• transportation failures affecting the supply chain and shipment of materials and finished goods,

• third party interference in the integrity of the products sourced through the supply chain,

• severe weather conditions or natural disasters,

• civil unrest, military conflicts, geopolitical developments, war or terrorism, and

• disruptions in utility and other services.

Any other circumstance that would require us to seek alternative sources of supply or to manufacture, assemble, and test such components internally could significantly delay our ability to ship our products, which could damage relationships with current and prospective customers and could harm our reputation and brand as well as our results of operations.

Lastly, due to supply chain issues, we may accumulate excess inventories if we inaccurately forecast demand for our products.

If we are unable to effectively integrate, streamline and manage our increasingly diverse and complex businesses and operations, our ability to generate growth and revenue from new or existing customers may be adversely affected

Lastly, due to supply chain issues, we have in the past and may in the future accumulate excess inventories if we inaccurately forecast demand for our products, or if dealers are unable to work through their excess inventory.

If we are unable to effectively integrate, streamline and manage our diverse and complex businesses and operations, our ability to generate growth and revenue from new or existing customers may be adversely affected

Because our operations are geographically diverse and increasingly complex, our personnel resources and infrastructure could become strained, and our reputation in the market and our ability to successfully manage and grow our business may be adversely affected.

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As a result, an increasing amount of our business involves business models that require managerial techniques and skill sets that are different from those required to manage our historical core businesses.

Pursuant to our Connect and Scale strategy, we are investing substantial resources in integrating our product offerings and transitioning our businesses to common core services and systems in order to achieve economies of scale, simplify our operations, and improve the customer experience.

Pursuant to our Connect and Scale strategy, we are investing substantial resources in integrating our product offerings and transitioning our businesses to common core services and systems to achieve economies of scale, simplify our operations, and improve the customer experience.

These efforts may result in disruptions to our operations, which could have an adverse effect on our customers, may cost more than we anticipate increasing our expenses, and take longer than planned.

These factors or a combination of these factors could have an adverse impact on our business, financial condition, and results of operations.

Changes in our software and subscription businesses may adversely impact our business, financial condition and results of operations

These factors could have an adverse impact on our business, financial condition, and results of operations.

Changes in our software and subscription businesses may adversely affect our revenue

An increasing portion of our revenue is generated through software maintenance and subscription revenue, which includes “Software as a Service” (“ SaaS”) and new subscription services for integrated solutions.

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Our customer acquisition and renewal rates may decline or fluctuate as a result of a number of factors, including overall economic conditions, the health of their businesses, competitive offerings, and customer dissatisfaction with our services.

Customer satisfaction with our services is affected by a variety of factors, including but not limited to security, reliability, performance, concerns about data privacy, current subscription terms, customer preference, and industry adoption.

do not renew their contracts for our products, our maintenance and subscription revenue will decline, and our financial results will suffer.

Customer satisfaction with our services is affected by a variety of factors, such as security, reliability, performance, concerns about data privacy, current subscription terms, customer preference, and industry adoption.

If customers do not renew their contracts for our products, our maintenance and subscription revenue will decline, and our financial results will suffer.

Our subscription models provide our customers the right to access certain of our software in a hosted environment or use downloaded software for a specified subscription period.

Market acceptance of such offerings is affected by a variety of factors, including but not limited to security, reliability, performance, current license terms, customer preference and industry adoption, social/community engagement, customer concerns with entrusting a third party to store and manage their data, public concerns regarding privacy and the enactment of restrictive laws or regulations.

Market acceptance of such offerings is affected by a variety of factors, such as security, reliability, performance, current license terms, customer preference and industry adoption, social/community engagement, customer concerns with entrusting a third party to store and manage their data, public concerns

regarding privacy and the enactment of restrictive laws or regulations.

If we are unable to successfully market and support our subscription offerings, our business, financial condition, and results of operations could be adversely impacted.

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Changes to our licensing programs and subscription programs, including the introduction of new subscription services for integrated solutions that include hardware, the timing of the release of enhancements, upgrades, maintenance releases, the term of the contract, discounts, and promotions, could impact the timing of the recognition of revenue for our products, and adversely affect our cash flow, business, financial condition, and results of operations.

We may not be able to enter into or maintain important alliances and distribution relationships

We believe that in certain business opportunities, our success will depend on our ability to form and maintain alliances with industry participants.

Our failure to form and maintain such alliances, or the preemption or disruption of such alliances by actions of competitors, could adversely affect our ability to sell our products to customers.

Our relationships with substantial industry participants such as Caterpillar, Nikon, and Hilti are complex and multifaceted and are likely to evolve over time based upon the changing business needs and objectives of the parties.

To develop and expand our distribution channels, we must continue to expand and improve our processes and procedures that support our distribution channels, including our investment in systems and training, and those processes and procedures may become increasingly complex and difficult to manage.

The time and expense required for sales and marketing organizations of our channel partners to become familiar with our product offerings, including our new product developments, and newer types of offering, such as subscription programs for integrated solutions that include hardware, software maintenance, and other recurring services, may make it more difficult to introduce those products to end users and delay end-user adoption, which could result in lower revenue.

Disruption of dealer coverage within specific geographic or end-user markets could cause difficulties in marketing, selling, or servicing our products and have an adverse effect on our business, financial condition, and results of operations.

We utilize dealer networks, including those affiliated with Caterpillar and CNH to market, sell, and service many of our products.

Dealers who carry products that compete with our products may focus their inventory purchases and sales efforts on goods provided by competitors due to industry demand or profitability.

Such sourcing decisions can adversely impact our business, financial condition, an d results of operations.

A significant portion of our aftermarket sales have historically been generated through CNH, which resells our aftermarket products through its dealer network.

Moving forward, as part of our Connect and Scale strategy, we will directly manage, and further build out, our independent dealer network to ensure better access, service, and support for our customers.

Our aftermarket solutions address both new equipment as well as equipment already in the field, and we will reach customers through these independent dealer partners, who are focused on selling the full portfolio of Trimble-branded precision agriculture solutions.

Aligned with this strategy, in February 2023, we gave CNH a 12-month notification that we will no longer be supplying aftermarket precision agriculture products to CNH for resale through the CNH dealer network.

We will continue to supply hardware to CNH for their factory installations.

While we do not expect this action to have a material effect on our revenues in 2023, there c an be no assurance that our revenue from our independent dealer network will offset the reduction in revenue resulting from our discontinuance of sales of aftermarket products to CNH.

Evolution of our respective business strategies and diversification of product portfolios may lead to increased competition with our other strategic allies, placing additional pressure on these relationships.

Since these strategic relationships contribute to significant ongoing business in certain o f our important markets, changes in these relationships could adversely affect our sales.

Investing in and integrating new acquisitions or divesting businesses could be costly, place a significant strain on our management systems and resources, or fail to deliver expected outcomes, which could adversely impact our business, financial conditions, and results of operations

Investing in and integrating new acquisitions or divesting businesses could be costly, place a significant strain on our management systems and resources, or fail to deliver expected outcomes

We typically acquire a number of businesses each year and we intend to continue to acquire other businesses.

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In addition, changes in the operating results or the valuation of companies in which we have investments may have a direct impact on our financial statements or could result in our having to write down the value of such investment.

Even if successfully negotiated and closed, acquisitions may not yield expected synergies, may not advance our business strategy as expected, may fall short of expected return-on-investment targets, or may not prove successful or effective for our business.

Acquisitions may not yield expected synergies, may not grow, scale, or advance our business strategy as expected, may fall short of expected return-on-investment targets, or may not prove successful or effective for our business.

Companies that we acquire may operate with different cost and margin structures, which could further cause fluctuations in our operating results and adversely affect our business, financial condition, and results of operations.

In December 2022, we signed a definitive agreement to acquire Transporeon, a leading European cloud-based transportation management software platform.

The acquisition is expected to close in the first half of 2023.

We may not complete the acquisition of Transporeon within the time frame we anticipate or at all.

The completion of the acquisition of Transporeon is subject to certain closing conditions, including the receipt of merger control clearances in Austria, Germany, and Poland.

The failure to satisfy all the required conditions could delay or even prevent the acquisition from occurring at all.

If we consummate the acquisition of Transporeon, there is a risk that the desired benefits of the acquisition may not be fully realized or that we may fail to integrate the acquired assets as expected, which may negatively impact our business, financial condition, and results of operations.

From time to time we have divested businesses, and we expect to do so in the future.

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We could also experience higher than expected transaction costs and business sale losses, which may adversely affect our business, financial condition, and results of operations .

We face substantial competition in our markets, which could decrease our revenue and growth rates or impair our business, financial condition, and results of operations

Additionally, we typically agree to provide certain transitional services and support when we divest a business, and we may face significant, unanticipated costs in providing such services.

For significant divestitures, these transitional services can take up considerable corporate resources and attention, which may then adversely affect our other businesses, operations, and results.

We have identified a material weakness in our internal control over financial reporting, and if our remediation of such material weakness is not effective, it could impact our ability to produce timely and accurate financial statements or comply with applicable laws and regulations.

As more fully disclosed in Part II, Item 9A, “Controls and Procedures,” we identified a material weakness in internal control over financial reporting for the fiscal year ended December 29, 2023.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

In the course of preparing our consolidated financial statements as of and for the fiscal year ended December 29, 2023, we identified a material weakness related to the accounting for the Company’s business combination of Transporeon.

This included lack of appropriate oversight of third-party valuation specialists and insufficient design and operating effectiveness of management review controls, including controls over the completeness and accuracy of certain assumptions used in the valuation of acquired intangible assets.

Furthermore, there is a possibility that material misstatements to our future annual or interim financial statements will not be prevented or detected in a timely basis as a result of the identified material weakness.

Our management, under the oversight of the Audit Committee, is taking actions to implement our remediation plan as described more fully in Part II, Item 9A, “Controls and Procedures”.

Unless otherwise described herein, the material weakness will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded through testing that these controls are operating effectively.

We can give no assurance that additional material weaknesses will not arise in the future.

Any failure to remediate the material weakness, or the development of new material weaknesses in our internal control over financial reporting, could result in material misstatements in our financial statements and cause us to fail to meet our reporting and financial obligations, which in turn could have a negative impact on our financial condition, results of operations or cash flows, restrict our ability to access the capital markets, require significant resources to correct the material weaknesses or deficiencies, subject us to fines, penalties or judgments, harm our reputation or otherwise cause a decline in investor confidence and cause a decline in the market price of our stock.

The announced contribution of Trimble Ag to a newly formed JV, and the sale of a majority interest in the JV, are subject to substantial risks , including the possible inability to complete the transaction, failure to realize the intended benefits, unanticipated challenges, and other uncertainties.

In September 2023, we signed a definitive agreement to contribute our Trimble Ag business, excluding certain GNSS and guidance technologies, to a JV with AGCO, of which we will retain a 15% stake (the “Trimble Ag JV Transaction”).

The proposed transaction is expected to close in the first half of 2024.

The pending transaction may not be completed in accordance with announced plans, on the currently expected timeline, or at all, and the pending sale may be disruptive to our business operations and adversely affect our profitability.

In addition, the risks and uncertainties associated with the new JV include that (i) we may fail to realize the anticipated benefits of our noncontrolling stake in the JV, (ii) the closing of the proposed transaction is subject to conditions that may not be satisfied or may take longer to be satisfied than expected, (iii) the benefits from the long-term Supply Agreement, the Technology Transfer and License Agreement, the Trademark License Agreement, and the Transition Services Agreement with the JV will be dependent upon the JV’s ability to successfully develop and market products, (iv) unanticipated difficulties may arise in separating the precision agriculture business, (v) unanticipated factors may arise affecting the cost of operating the JV as a standalone business, (vi) we may be unable to successfully integrate AGCO's JCA Technologies business into the JV, (vii) the use of proceeds may be affected by market conditions and alternative uses that become more attractive over time, (viii) the development of technology synergies will depend on the level of research and development spending and the success of future innovation, and (ix) we may fail to obtain governmental or regulatory approval that may be required for the proposed transaction, or that, if such approval is obtained, the approval may be obtained subject to unexpected conditions.

We may not be able to continue to enter into or maintain important alliances and distribution relationships

We believe that in certain business opportunities, our success will depend on our ability to form and maintain alliances with industry participants.

Our failure to form and maintain such alliances, or the preemption or disruption of such alliances by actions of competitors, could adversely affect our ability to sell our products to customers.

We utilize dealer networks, including dealers associated with Caterpillar to market, sell, and service many of our products.

Dealers who carry products that compete with our products may focus their inventory purchases and sales efforts on goods provided by competitors due to industry demand or profitability.

Such sourcing decisions can adversely impact our business, financial condition, an d results of operations.

A significant portion of our agriculture aftermarket sales have historically been generated through CNH, which resells our aftermarket products through its dealer network.

In February 2023, we gave CNH a 12-month notification that we would no longer be supplying aftermarket precision agriculture products to CNH for resale through the CNH dealer network.

In December 2023, we notified CNH that our OEM agreement to supply CNH with products for factory installation would terminate in 2024.

Upon the closing of the proposed Trimble Ag JV Transaction, the JV will directly manage the independent dealer network to ensure access, service, and support for the agriculture customers.

O ur revenue from the independent dealer network, whether owned by us or the JV, might not offset the reduction in revenue resulting from our discontinuance of sales of aftermarket products to CNH.

Since these strategic relationships contribute to significant ongoing business in certain o f our important markets, changes in these relationships could adversely affect our sales.

We face substantial competition in our markets, which could decrease our revenue and growth rates

Our markets are highly competitive, and we expect that both direct and indirect competition will increase in the future.

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Our products, which commonly use GNSS for basic location information, may be subject to competition from alternative location technologies such as simultaneous location and mapping technology.

In our software and subscription services businesses, we face competition from a group of large, well-established companies, particularly in the areas of design, enterprise resource planning (“ERP”), and collaboration and project management solutions.

In our software and subscription services businesses, we face competition from a group of large, well-established companies, particularly in the areas of design software, enterprise resource planning (“ERP”) solutions, and collaboration and project management offerings.

Our integrated hardware and software products may be subject to increasing competition from mass market devices such as smartphones and tablets used in conjunction with relatively inexpensive applications, which have not been heavily used for commercial applications in the past.

These competitive developments may require us to rapidly adapt to technological and customer preference changes that we have not previously been exposed to, including those related to cloud computing, mobile devices, and new computing platforms.

Such competition has in the past resulted, and in the future may result, in price reductions, reduced margins, or loss of market share, any of which could decrease our revenue and growth rates or impair our operating results and financial condition.

These competitive developments may require us to rapidly adapt to technological and customer preference changes, including those related to cloud computing, mobile devices, and new computing platforms.

Such competition has in the past resulted, and in the future may result, in price reductions, reduced margins, or loss of market share, any of which could decrease our revenue and growth rates.

We believe that our ability to compete successfully in the future against existing and additional competitors will depend largely on our ability to execute our strategy to provide products with significantly differentiated features compared to currently available products.

We may not be able to implement this strategy successfully, and our products may not be competitive with other technologies or products that may be developed by our competitors, many of whom have significantly greater financial, technical, manufacturing, marketing, sales, and other resources than we do.

If we are unable to attract and retain qualified personnel, our business, financial condition, and results of operations could be harmed

Our continued success depends, in part, on our ability to hire and retain qualified personnel and to advance our corporate strategy, and preserve the key aspects of our corporate culture.

If we are unable to attract and retain qualified personnel, our business could be harmed

Our continued success depends, in part, on our ability to hire and retain qualified personnel, advance our corporate strategy, and preserve the key aspects of our corporate culture.

Because our future success is dependent on our ability to continue to enhance and introduce new products, we are particularly dependent on our ability to hire and retain qualified engineers, including in areas of technology such as GNSS, software programming, information systems, and data analytics.

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Competition for qualified employees in our major locations is intense.

The COVID-19 pandemic has also heavily impacted the environment for attracting and managing employees, and our failure to successfully manage these changes and navigate transitions such as return to office could harm our ability to attract and retain the best talent.

Our inability to hire and retain qualified management and skilled personnel, particularly engineers, salespeople, and key executive management, could disrupt our development efforts, sales results, business relationships, and our ability to execute our business plan and strategy on a timely basis and could materially and adversely affect our business, financial condition, and results of operations.

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Risks related to our technology and products

Our products are highly technical and may contain undetected errors, product defects, security vulnerabilities, or software errors

Our products are highly technical and may contain undetected errors, product defects, or security vulnerabilities

Our products, including our software products, are highly technical and complex and, when deployed, may contain errors, defects, or security vulnerabilities.

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Errors, viruses, or bugs may be present in software or hardware that we acquire or license from third parties and incorporate into our products or in third-party software or hardware that our customers use in conjunction with our products.

Our customers’ proprietary software and network firewall protections may corrupt data from our products and create difficulties in implementing our solutions.

Our customers’ proprietary software and network firewall protections may corrupt data from our products or create difficulties in implementing our solutions.

Changes to third-party software or hardware that our customers use in conjunction with our software could also render our applications inoperable.

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Undiscovered vulnerabilities in our products alone or in combination with third-party hardware or software could expose them to hackers or other unscrupulous third parties who develop and deploy viruses and other malicious software programs that could attack our products.

Actual or perceived security vulnerabilities in our products could harm our reputation and lead some customers to return products, to reduce or delay future purchases, or use competitive products.

Actual or perceived security vulnerabilities in our products could harm our reputation and lead some customers to return products, reduce or delay future purchases, or use competitive products.

Our internal and customer-facing systems, and systems of third parties we rely upon, may be subject to cybersecurity breaches, disruptions, or delays

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Unauthorized access to our proprietary business information or customer data may be obtained through break-ins, sabotage, breach of our secure network by an unauthorized party, computer viruses, computer denial-of-service attacks, employee theft or misuse, breach of the security of the networks of our third-party providers, or other misconduct.

Additionally, outside parties may attempt to fraudulently induce employees or users to disclose sensitive or confidential information in order to gain access to data.

Additionally, outside parties may attempt to fraudulently induce employees or users to disclose sensitive or confidential information to gain access to data.

We have experienced security breaches in the past, and despite our efforts to maintain the security and integrity of our systems, it is impossible to eliminate this risk.

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We also may be required to notify regulators about any actual or perceived personal data breach (including the EU Lead Data Protection Authority) as well as the individuals who are affected by the incident within strict time periods.

The systems we rely upon also remain vulnerable to damage or interruption from a number of other factors, including access to the internet, the failure of our network or software systems, or significant variability in visitor traffic on our product websites, earthquakes, floods, fires, power loss, telecommunication failures, computer viruses, human error, and similar events or disruptions.

earthquakes, floods, fires, power loss, telecommunication failures, computer viruses, human error, and similar events or disruptions.

Some of our systems are not fully redundant, and our disaster recovery planning is not sufficient for all eventualities.

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Our future revenue stream depends to a large degree on our ability to bring new products and services to market on a timely basis.

We must continue to make significant investments in research and development in order to continue to develop new products and services, enhance existing products, and achieve market acceptance of such products and services.

We must continue to make significant investments in research and development to continue to develop new products and services, enhance existing products, and achieve market acceptance of such products and services.

We may encounter problems in the future in innovating and introducing new products and services.

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The timely availability and cost-effective production of these products in volume and their acceptance by customers are important to our future success.

This has been and may

continue to be negatively impacted by the global supply chain shortage.

This has been and may continue to be negatively impacted by the global supply chain shortage.

If we are unable to introduce new products and services, if other companies develop competing technology products and services, or if we do not develop compelling new products and services, our number of customers may not grow as anticipated, or may decline, which could harm our operating results.

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The introduction of third party solutions embodying new, disruptive technologies and the emergence of new industry standards could make our existing and future software solutions and other products obsolete or non-competitive.

If we are not able to develop software and other solutions that address the increasingly sophisticated needs of our customers, or if we are unable to adapt to new platforms, technologies, or new industry standards that impact our markets, our ability to retain or increase market share, business, financial condition, and results of operations could be adversely affected.

If we are not able to develop software and other solutions that address the increasingly sophisticated needs of our customers, or if we are unable to adapt to new platforms, technologies, or new industry standards that impact our markets, our ability to retain or increase market share could be adversely affected, harming our business, financial condition, and results of operations.

Some of our products rely on third-party technologies including open-source software, which could result in product incompatibilities or harm availability of our products and services

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The loss of licenses to, or inability to support, maintain, and enhance, any such third-party software or technology could result in increased costs, or delays in software releases or updates, until such issues have been resolved.

This could have an adverse effect on our business, financial condition, and results of operations.

We also incorporate open-source software into our products.

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We are dependent on proprietary technology, which could result in litigation that could divert significant valuable resources

Our future success and competitive position is dependent upon our proprietary technology, and we rely on patent, trade secret, trademark, and copyright laws to protect our intellectual property.

Our future success and competitive position are dependent upon our proprietary technology, and we rely on patent, trade secret, trademark, and copyright laws to protect our intellectual property.

The patents owned or licensed by us may be invalidated, circumvented, infringed, or challenged.

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International allocations of radio frequency are made by the International Telecommunications Union (“ITU”), a specialized technical agency of the United Nations.

These allocations are further governed by radio regulations that have treaty status and which

may be subject to modification every two to three years by the World Radio Communication Conference.

These allocations are further governed by radio regulations that have treaty status and which may be subject to modification every two to three years by the World Radio Communication Conference.

Each country also has regulatory authority over how each band is used in the country.

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Repair of damaged or malfunctioning satellites is currently not economically feasible.

If a significant number of satellites were to become inoperable, there could be a substantial delay before they are replaced with new satellites.

If a significant number of satellites were to become inoperable,

there could be a substantial delay before they are replaced with new satellites.

A reduction in the number of operating satellites below the 24-satellite standard established for GPS may impair the utility of the GPS system and the growth of current and additional market opportunities.

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Regulatory risks

We face risks inherent in conducting business internationally, including compliance with international and U.S.

laws and regulations that apply to our international operations

Compliance with international and U.S.

laws and regulations that apply to our international operations can be complex, and exposes us to various risks related to potential non-compliance

These laws and regulations include data privacy requirements, labor relations laws, tax laws, anti-competition regulations, import and trade restrictions, export control laws, and laws that prohibit corrupt payments to governmental officials or certain payments or remunerations to customers, including the U.S.

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New privacy laws may lack clarity and depend on regulators implementing further rules and guidance, which are often significantly delayed, such as in Brazil, China and the European Union.

Some countries are considering or have passed legislation that requires local storage and processing of data, including geospatial data, which could impact our ability to deliver cloud-based solutions in an efficient manner.

and European Union continue to pursue agreement on the governing basis for data transfers from the EU to the U.S.

but have not yet adopted the EU-U.S.

Data Privacy Framework.

Some countries are considering or have passed legislation that requires local storage and processing of data,

including geospatial data, which could impact our ability to deliver cloud-based solutions in an efficient manner.

In 2023, the U.S.

and European Union agreed on a new EU-U.S.

Data Privacy Framework to provide a mechanism for data transfers from the EU to the U.S.

as a replacement for the invalided Privacy Shield program, but legal challenges to the Framework are currently pending.

International transfers of personal data present ongoing compliance challenges and complicate our business transactions and operations.

In addition, the California Consumer Privacy Act (the “CCPA”), which took effect in January 2020, was amended by the California Privacy Rights Act (“the “CPRA”) and took full effect in January 2023, with enforcement to begin on July 1, 2023.

The CCPA and CPRA, among other things, give California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used.

In addition, the California Privacy Rights Act (“the “CPRA”) amendments to the California Consumer Privacy Act (the “CCPA”) took full effect in January 2023, with enforcement to begin in March 2024.

The CCPA, as amended by the CPRA, among other things give California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used.

states and the U.S.

Congress have introduced, and some states like Virginia, Colorado, Connecticut and Utah have enacted, data privacy legislation, which may impact our business.

Congress have introduced, and a number of states have enacted, data privacy legislation, which may impact our business.

Such legislation, amendments and revisions to existing data privacy legislation, and other developments impacting data privacy and data protection may contain unclear and conflicting requirements, and may require us to modify our data processing practices and policies, increase the complexity of providing our products and services, and cause us to incur substantial costs in an effort to comply.

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Governmental authorities may also propose other forms of GPS receiver performance standards, which may limit design alternatives, hamper product innovation, or impose additional costs.

Some of our products that use integrated radio communication technology require product type certification and some products require an end user to obtain licensing from the

FCC and other national authorities for frequency-band usage.

Some of our products that use integrated radio communication technology require product type certification and some products require an end user to obtain licensing from the FCC and other national authorities for frequency-band usage.

Compliance with evolving product regulations in our major markets could require that we redesign our products, cease selling products in certain markets, and increase our costs of product development.

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Any downgrade by credit rating agencies could adversely affect our cost of borrowing, limit our access to the capital markets, or result in more restrictive covenants in future debt agreements.

In December 2022, in connection with our pending acquisition of Transporeon, we arranged to incur substantial new debt obligations including those arising under the following:

• a term loan credit agreement providing for an unsecured delayed draw term loan facility in the aggregate principal amount of $1.0 billion, comprised of commitments for a 3-year tranche in the amount of $500.0 million and a 5-year tranche in the amount of $500.0 million, and

• an amendment to our 2022 Credit Facility that made $600.0 million of the existing commitments under the Facility available for the pending acquisition of Transporeon and that increases our maximum permitted leverage ratio following the closing of the acquisition.

Prior to arranging the above two transactions, we had entered into a 364-day bridge facility commitment letter (the “Bridge Facility”) that provided for up to €1.88 billion of commitments for term loans to fund our acquisition of Transporeon.

The Bridge Facility was subsequently reduced to €500 million by the term loan credit agreement and the amended 2022 Credit Facility.

Because of the additional outstanding indebtedness we have and expect to incur, we have temporarily discontinued share repurchases.

Our outstanding indebtedness, including the substantial indebtedness we plan to incur in connection with the pending acquisition of Transporeon, could have other important consequences, such as:

Our outstanding indebtedness could have other important consequences, such as:

• decreasing our business flexibility, limiting access to capital, and/or increasing our borrowing costs;

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A default under our debt instruments may also significantly affect our ability to obtain additional or alternative financing.

Our ability to make scheduled payments or to refinance our obligations with respect to indebtedness will depend on our operating and financial performance, which in turn, is subject to prevailing economic conditions and to financial, business, and other factors beyond our control.

other factors beyond our control.

A portion of our outstanding debt has interest rates that float based on prevailing interest rates, and we may incur additional variable-rate debt in the future.

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• changes in generally accepted accounting principles.

Tax laws are dynamic and subject to change as new laws are passed and new interpretations of the law are issued or applied, and governmental tax authorities are increasingly scrutinizing the tax positions of companies.

The jurisdictions where we do business may change tax laws, regulations, and interpretations on a prospective or retroactive basis and these potential changes could adversely affect our effective tax rates.

As these and other tax laws and related regulations change, our financial results could be materially impacted.

Given the unpredictability of these possible changes and their potential interdependency, it is very difficult to assess whether the overall effect of such potential tax changes would be cumulatively positive or negative for our earnings and cash flow, but such changes could impact our financial results.

The Organization of Economic Cooperation and Development (“OECD”) introduced, and member countries agreed to, a framework that imposes a minimum tax of 15% to certain multinational enterprises.

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We may be affected by fluctuations in currency exchange rates

Over half of our revenue is derived from sales to customers outside of the U.S.

We are potentially exposed to adverse as well as beneficial movements in currency exchange rates.

Over half of our revenue is derived from sales to customers outside of the U.S., and we are potentially exposed to adverse as well as beneficial movements in currency exchange rates.

Historically, the majority of our revenue contracts are denominated in U.S.

Dollars, with the most significant exception being Europe, where we invoice primarily in Euro.

Additionally, a portion of our expenses, primarily the cost to manufacture, cost of personnel to deliver technical support on our products and professional services, sales and sales support, and research and development, are denominated in foreign currencies, primarily the Euro.

Additionally, a portion of our expenses, such as the cost to manufacture and costs of personnel, are denominated in foreign currencies, primarily the Euro.

An increase in the value of the dollar could increase the real cost to our customers of our products in those markets outside the U.S.

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Risks related to ownership of our stock

The volatility of our stock price could adversely affect an investment in our common stock

Our stock price is volatile

The market price of our common stock has been, and may continue to be, highly volatile.

During 2023, our stock price ranged from $39.57 to $62.01.

We believe that a variety of factors could cause the price of our common stock to fluctuate, perhaps substantially, including:

• general conditions in the worldwide economy;

A variety of factors can cause the price of our common stock to fluctuate, perhaps substantially, including:

• quarterly fluctuations in our actual or anticipated operating results and order levels;

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• the imposition of tariffs or other trade barriers;

• political, economic, or social uncertainty, such as the ongoing military conflict between Russia and Ukraine;

• global pandemics, like the COVID-19 pandemic;

• political, economic, or social uncertainty, such as the conflicts in the Middle East and between Russian and Ukraine;

• general conditions in the worldwide economy;

• catastrophic or geopolitical events, including global pandemics;

• acts of terrorism.

In addition, the stock market in general and the markets for shares of “high-tech” companies in particular have frequently experienced extreme price fluctuations, which have often been unrelated to the operating performance of affected companies.

Any such fluctuations could adversely affect the market price of our common stock.

Our annual and quarterly performance may fluctuate, which could adversely impact our financial condition, results of operations, and stock price

Our annual and quarterly performance fluctuates, which can adversely impact our stock price

Our operating results have fluctuated and can be expected to continue to fluctuate in the future on a quarterly and annual basis as a result of a number of factors, many of which are beyond our control.

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• pricing of products;

• execution of objectives and key results;

• changes in the U.S.

or foreign policies on taxes, trade, or spending;

• regional responses and restrictions related to global pandemics, like the COVID-19 pandemic;

• regional responses and restrictions related to global pandemics;

• other risks, including those described below.

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To the extent that such interruptions result in delays or the cancellation of orders, disruption of the manufacturing or shipment of our products, or reduced demand for our products, these interruptions could have a material adverse effect on our business, financial condition, and results of operations.

Geopolitical risks, resulting from the Russia and Ukraine conflict, could result in increased market volatility and uncertainty, which could negatively impact our business, financial condition, and results of operations

The uncertain nature, magnitude, and duration of hostilities stemming from the ongoing military conflict between Russia and Ukraine, including effects of sanctions on the world economy and markets, possible retaliatory cyber-attacks, and supply chain disruptions, have contributed to increased market volatility and uncertainty, and could have an adverse impact on our business and could amplify the existing supply chain challenges we faced.

The uncertain nature, magnitude, and duration of hostilities stemming from the ongoing military conflict in the Middle East and between Russia and Ukraine, including effects of sanctions on the world economy and markets, possible retaliatory cyber-attacks, and supply chain disruptions, have contributed to increased market volatility and uncertainty, and could have an adverse impact on our business and could amplify the existing supply chain challenges we faced.

As a result of the ongoing military conflict in Ukraine, the United States, the United Kingdom, and the European Union governments, among others, implemented a series of sanctions packages against Russia.

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and financial markets, all of which could impact our business, financial condition, and results of operations.

In December 2022, we entered a definitive agreement to acquire Transporeon, a leading cloud-based transportation management software platform that is headquartered in Germany and has operations in Russia and Ukraine.

If the acquisition closes as expected, it is possible that the ongoing military conflict in Ukraine or related sanctions may limit the usage of Transporeon products, disrupt our employees (both within and outside of Ukraine, including nearby regions such as Poland), negatively impact the productivity of affected employees, or lead to claims against us for failure to fulfill our contractual obligations.

Future public health crises and epidemics could impact our international operations and sales

Our results of operations could be adversely affected to the extent that future pandemics, similar to COVID-19 or any other epidemic, harm any significant market where we do business.

Contagious disease epidemics or global pandemics could also significantly impact our international supply chain and result in component and product shortages and general disruptions to the economy.

Such outbreaks could also result in mass quarantines, business closures, and significantly impact our suppliers, customers, and commercial partners in affected areas, which may materially and adversely affect our business, financial condition, and results of operations.

Additionally, we rely on our Americas Regional Fulfillment Center (“ARFC”) in Dayton, Ohio to support our hardware product sales in the U.S.

and internationally, and we typically maintain a significant concentration of inventory at this location.

Any disruption or damage to our facility, operations, or inventory at our ARFC, whether as a result of a natural disaster or other catastrophic event, could significantly impair our ability to fulfill orders for our hardware products, including into Europe, which would negatively affect our results of operations.

Damage to our reputation could significantly harm our businesses, competitive position, and prospects for growth

Our ability to attract and retain investors, customers, and employees could be adversely affected by damage to our reputation resulting from various sources, including environmental, social, and governance (“ESG”) related issues;

Our ability to attract and retain investors, customers, and employees could be adversely affected by damage to our reputation resulting from various events, including environmental, social, and governance (“ESG”) related issues;

employee misconduct, litigation, or regulatory outcomes;

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Our business may face increased scrutiny related to these activities, including from the investment community, and our failure to achieve progress in these areas on a timely basis, or at all, could adversely affect our reputation, growth, business, financial condition, and results of operations.

Climate change may have an impact on our business

Climate change could disrupt or harm our business

While we seek to mitigate our business risks associated with climate change by establishing robust environmental programs and partnering with organizations who are also focused on mitigating their own climate-related risks, we recognize that there are inherent climate-related risks wherever business is conducted.

Any of our primary locations may be vulnerable to the adverse effects of climate change.

The 2021 wildfires in Colorado occurred in close proximity to our headquarters in Westminster, Colorado.

Our California office has historically experienced, and is projected to continue to experience, climate-related events at an increasing frequency including drought, heat waves, wildfires including resultant air quality impacts, flooding, and power shutoffs associated with wildfire prevention and flooding.

Furthermore, it is more difficult to mitigate the impact of these events on our employees while they work from home.

Changing market dynamics, global policy developments, and the increasing frequency and impact of extreme weather events on critical infrastructure in the U.S.

and elsewhere have the

potential to disrupt our business, the business of our third-party suppliers, and the business of our customers, and may cause us to experience higher attrition, losses, and additional costs to maintain or resume operations.

and elsewhere, each have the potential to disrupt our business, the business of our third-party suppliers, and the business of our customers, and may cause us to experience higher attrition, losses, and additional costs to maintain or resume operations.

Environmental, social, and governance matters and related reporting obligations may cause us to incur additional expenses or adversely impact our business or reputation

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We communicate certain ESG-related initiatives, goals, and/or and other matters in our annual Sustainability Report, on our website, in our filings with the SEC, and elsewhere.

For example, in 2022, we established science-based targets for Scope 1, 2, and 3 greenhouse gas emissions, certain commitments on sourcing renewable energy, and certain commitments to partner with suppliers that have announced their own science-based targets.

For example, in 2022, we established science-based targets for Scope 1, 2, and 3 greenhouse gas emissions, certain commitments on sourcing renewable energy, and the goal to engage 70% of our suppliers in setting their own science-based targets.

Implementation of our goals and targets may require capital improvements.

Our ability to achieve any stated commitment, goal, target, or objective is subject to many factors and conditions, some of which are outside of our control, including the pace of changes in technology and the cooperation and/or availability of suppliers that can meet our sustainability standards.

If we fail to achieve, are perceived to have failed or been delayed in achieving, or improperly report our progress toward achieving our publicly stated goals and commitments or compliance with U.S.

If we fail to achieve, are perceived to have failed or been delayed in achieving, or improperly report our progress toward achieving our publicly stated goals and

commitments or compliance with U.S.

and international ESG laws and regulations, our business reputation and our financial condition, and results of operations may be negatively impacted.

Unresolved Staff Comments

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.

What changed 10-K

Item 1A. Risk Factors