What changed in this filing

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Item 1A. Risk Factors

2025-04-25 compared with 2024-02-26 · 140 added, 129 removed, 344 unchanged (44% of the section changed)

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• 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, and transportation markets;

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

• the demand and cost of commodities;

• 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;

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• 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.

• uncertainty regarding social, political, 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 – such as through increased tariffs imposed on imports into the U.S.

and any resulting retaliatory actions taken by other countries – 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 or result in supply chain delays.

The heightened trade tensions and related imposition of tariffs between the U.S.

and its trading partners, the extent and duration of these tariffs, and their impact on global economic conditions remain uncertain and depend on various factors, including international negotiations, policy responses, potential exemptions, and shifts in global supply and demand.

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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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.

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.

The geopolitical conditions, such as the developments in the conflict between Russia and Ukraine and related events and their impact on our suppliers and on international trade in general, have previously 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 included extended delivery times for certain components of our hardware products and increased freight costs.

These disruptions 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, such as:

• inflationary cost increases;

• trade restrictions, tariffs, or duties;

• increases in wages that drive up prices of labor;

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• 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;

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• severe weather conditions or natural disasters;

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

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

• disruptions in utility and other services.

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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.

Because our operations are geographically diverse and 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.

The size, complexity, and diverse nature of our business and the expansion of our product lines and customer base have placed increased demands on our management and operations, and future growth may place additional strains on our resources in the future.

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• improving our information reporting systems and procedures.

We have increasingly diversified the nature of our businesses both organically and by acquisition.

We have increasingly diversified and modified the nature and mix of our businesses, both organically and by acquisitions and divestitures.

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 to achieve economies of scale, simplify our operations, and improve the customer experience.

Pursuant to our Connect & 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.

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Our customers have no obligation to renew their agreements for our software maintenance or subscription services after the expiration of their initial contract period, which typically ranges from one to three years.

This shift reflects both an increasing use of subscription models for new products, and a transition for some existing products from perpetual license sales and distribution in favor of SaaS or other subscription offerings.

This shift reflects an increasing use of subscription models for new products, and a transition for some existing products from perpetual license sales and distribution in favor of SaaS or other subscription offerings, as well as divestitures of some of our legacy businesses.

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, such as security, reliability, performance, concerns about data privacy, current subscription terms, customer preference, and industry adoption.

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, 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.

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

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

We had first identified material weaknesses in our 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, as included in the Annual Report on Form 10-K for the period ended December 29, 2023 (the “2023 Form 10-K”), we had identified a material weakness related to the accounting for the Company’s business combination of Transporeon, including lack of appropriate oversight of third-party valuation specialists and insufficient design and operating effectiveness of management review controls.

Subsequent to the filing of the 2023 Form 10-K with the SEC on February 26, 2024, management re-evaluated the effectiveness of our internal control over financial reporting.

Based on this re-evaluation, we had identified additional material weaknesses related to certain information technology general controls (“ITGCs”), undue reliance on controls over IT interfaces, and the evaluation of standalone selling prices utilized in the accounting for revenue, all of which support the Company’s financial reporting processes.

As previously disclosed, the Company had delayed the filing of its Quarterly Reports on Form 10-Q for the first, second, and third quarters of 2024 until the assessment of the impacts of the matters described above was complete.

As a result of the delayed filings, the Company had received notices from the Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Company was not in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Listing Rule”), which requires listed companies to timely file all required periodic financial reports with the SEC.

Subsequently, the Company had delayed the filing of this report for the fiscal year ended January 3, 2025 due to the time required to prepare and file the prior delayed reports.

After filing its Amendment No.

1 on Form 10-K/A to the 2023 Form 10-K and its Quarterly Reports on Form 10-Q for the first, second, and third quarters of 2024 with the SEC on January 16, 2025, and subsequently, this report for the fiscal year ended January 3, 2025 with the SEC, the Company has since regained compliance with the Listing Rule.

As a result of our previous failure to timely meet our SEC reporting obligations, we are unable to use Form S-3 for the twelve months after that date.

This could make accessing the capital markets during this period more costly or less efficient.

Additionally, our management, under the oversight of the Audit Committee, has been taking actions to address the material weaknesses in our internal control over financial reporting for the fiscal year ended January 3, 2025 and implement our remediation plan, in each case, as described more fully in Part II, Item 9A, “Controls and Procedures” of this report.

Unless otherwise described herein, the material weaknesses 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.

If we are not able to successfully remediate these material weaknesses, there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be presented or detected on a timely basis.

Moreover, if we uncover additional material weaknesses, our financial statements may be inaccurate, and we may be unable to comply with our SEC filing obligations, which could prevent us from using Form S-3 or result in a Nasdaq delisting.

In addition, we may be unable to access the capital markets or repurchase our stock if we are not current with our SEC filing obligations.

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

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

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

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

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

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

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.

As market conditions and our business strategies evolve, we must also evolve our distribution and go to market strategies.

Our efforts to further develop and expand dealer networks may not be successful, and could cause conflict in our channels or disrupt dealer coverage within specific geographic or end-user markets, which 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 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.

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.

From time to time, we have divested businesses, including the sale of our agricultural business to a joint venture with AGCO and the sale of our Mobility business.

We expect to undertake more divestitures in the future.

Any such divestiture may result in:

• a disruption of our business;

• reduced synergies, including the loss of scale or key employees;

• impairment of customer relationships;

• reductions in the breadth of our product offerings.

Divestitures may adversely impact our results if we are unable to offset the dilutive impacts from the loss of revenue associated with the divested products or businesses, or mitigate overhead costs allocated to those businesses.

We could also experience higher than expected transaction costs and business sale losses, or post-closing disputes with buyers of our divested businesses, which may adversely affect our business, financial condition, and results of operations.

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

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

In some cases, we have retained an equity position in the entities to which we divest our business units.

We have limited control over such entities, and the value of such equity stake could decline over time.

We have acquired a number of businesses, and we intend to continue to acquire other businesses.

Acquisitions entail numerous risks, including:

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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.

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

Any such divestiture may result in:

• a disruption of our business;

• reduced synergies, including the loss of scale or key employees;

• impairment of customer relationships;

• reductions in the breadth of our product offerings.

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 .

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.

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.

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.

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 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.

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.

The contribution of Ag to a newly formed joint venture (JV), and the sale of a majority interest in the JV, are subject to substantial risks, including failure to realize the intended benefits, unanticipated challenges, and other uncertainties

In April 2024, we contributed our Ag business, excluding certain GNSS and guidance technologies, to a JV with AGCO, of which we retained a 15% stake.

The risks and uncertainties associated with the new JV include that (i) we may fail to realize the anticipated benefits of our non-controlling stake in the JV, (ii) the benefits from the various agreements entered into concurrently with forming the JV (specifically, a long-term supply agreement, a technology transfer and license agreement, a trademark license agreement, and a transition services agreement) will be dependent upon the JV’s ability to successfully develop and market products, (iii) unanticipated factors may arise that affect the cost of operating the JV as a standalone business, (iv) we may be unable to successfully integrate AGCO’s JCA Technologies business into the JV, and (v) the development of technology synergies will depend on the level of research and development spending and the success of future innovation.

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

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Within each of our markets, we encounter direct competition from other GNSS, software, optical, and laser suppliers, and competition may intensify from various larger U.S.

competitors and new market entrants, particularly from markets such as China.

competitors and new market entrants.

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.

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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, 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.

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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.

In addition, to increase revenues, we will be required to increase the size and productivity of our sales and channel management groups.

In addition, to increase

revenues, we will be required to increase the size and productivity of our sales and channel management groups.

Competition for qualified employees in our major locations is intense.

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If we fail to grant equity competitively, we may have difficulty attracting and retaining critical employees.

In addition, because of our sales structure, cash, and equity incentive compensation plans, we may be at increased risk of losing employees at certain times.

For example, the retention value of our compensation plans decreases after the payment of periodic bonuses or the vesting of equity awards.

Risks related to our technology and products

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Computer hackers, foreign governments, cybercriminals, or cyber terrorists may attempt to or succeed in penetrating our network security and our website.

Additionally, due to geopolitical tensions, such as the ongoing military conflict between Russia and Ukraine, we and our third-party vendors may be vulnerable to a heightened risk of cybersecurity attacks, phishing attacks, viruses, malware, ransomware, hacking or similar breaches and incidents from nation-state actors or affiliated actors, including attacks that could materially disrupt our systems and operations, supply chain, and ability to produce, sell, and distribute our products and services.

The availability and use of AI-enabled technologies also increase the sophistication and threat posed by such actors.

Additionally, due to geopolitical tensions, such as the developments in the conflict between Russia and Ukraine and other geopolitical tensions, we and our third-party vendors may be vulnerable to a heightened risk of cybersecurity attacks, phishing attacks, viruses, malware, ransomware, hacking, or similar breaches and incidents from nation-state actors or affiliated actors, including attacks that could materially disrupt our systems and operations, supply chain, and ability to produce, sell, and distribute our products and services.

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.

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We may be unable to anticipate or counter these techniques.

It is also possible that unauthorized access to customer data or confidential information may be obtained through inadequate use of security controls by customers, vendors, or business partners.

It is also possible that unauthorized access to customer data or confidential information may be obtained through inadequate use of security controls

by customers, vendors, or business partners.

Efforts to prevent hackers from disrupting our service or otherwise accessing our systems are expensive to develop, implement, and maintain.

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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.

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

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.

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

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Our development-stage products may not be successfully completed or, if developed, may not achieve significant customer acceptance.

Development and manufacturing schedules for technology products are difficult to predict, and we might not achieve our goals as to the timing of introducing new technology products or could encounter increased costs.

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 was negatively impacted, for example, by the global supply chain shortage in 2021 and 2022.

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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Lifecycles of software products can be short, and this can exacerbate the risks associated with developing new products.

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 could be adversely affected, harming our business, financial condition, and results of operations.

The introduction of third-party solutions embodying new, disruptive technologies, the potentially transformative impact of AI, 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, including AI, 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.

Our use of artificial intelligence, or AI, and generative AI tools presents risks and challenges that could adversely affect our business and require that we incur substantial costs

We use AI and generative AI tools in certain of our products, services, and operations, including customer service, data analytics, product development, and code creation.

AI is a rapidly evolving and disruptive technology, and the long-term implications of its use are still uncertain.

We expect that the increasing adoption and use of AI technologies will continue to accelerate and have significant impacts on our business and the industries we serve.

Although we continue to invest in AI, there can be no assurance that our investments will be beneficial to our business.

Our competitors may incorporate AI more quickly or successfully, and our solutions could become less competitive as a result.

AI-related laws and regulations in the U.S.

and other countries are rapidly evolving and are subject to significant uncertainty, and could impose significant compliance costs, restrict certain AI applications, or require us to alter our AI-related practices.

AI may also produce erroneous or misleading content, and outputs that infringe on the IP or data privacy rights of others.

Although we take measures to address the accuracy and appropriate use of generative AI content, including through internal AI policies and training, these efforts may not always be successful.

Any failure by our personnel, contractors, or partners to adhere to our AI policies, or otherwise use AI in an inappropriate manner, could result in violations of confidentiality obligations and laws or regulations, jeopardize our IP rights, or expose our products or business systems to defects and malware, any of which could damage our business and result in reputational, technical, or competitive harm.

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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Many of our products use other radio frequency bands, such as the public land mobile radio bands, together with the GNSS signal, to provide enhanced GNSS capabilities, such as real-time kinematics precision.

The continuing availability of these non-GNSS radio frequencies is essential to provide enhanced GNSS products to our precision survey, agriculture, and construction machine controls markets.

The continuing availability of these non-GNSS radio frequencies is essential to provide enhanced GNSS products to our precision survey, and construction machine controls markets.

In addition, transmissions and emissions from other services and equipment operating in adjacent frequency bands or in-band may impair the utility and reliability of our products.

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GNSS technology, GPS satellites, and their ground support systems are complex electronic systems subject to electronic and mechanical failures and possible intentional disruption.

Many of the GPS satellites currently in orbit were originally designed to have lives of 7.5 years and are subject to damage by the hostile space environment in which they operate.

However, of the current deployment of operational satellites in orbit, some have been in operation for much longer.

Many of the GPS satellites currently in orbit have outlived their expected lifespans and are subject to damage by the hostile space environment in which they operate.

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.

In addition, software updates to GPS satellites and ground control segments, and infrequent known events such as GPS week number rollover, may adversely affect our products and customers.

In addition, natural phenomena such as solar storms, software updates to GPS satellites and ground control segments, and infrequent known constellation-related events, such as GPS week number rollover, may adversely affect our products and customers.

We depend on public access to open technical specifications in advance of system updates to mitigate these problems, which may not be available or complete.

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National or European authorities may provide preferential access to signals to companies associated with their markets, including our competitors, which could harm our competitive position.

Geopolitical tensions between the United States and Russia and China could also result in the restriction of our usage of such satellite signals.

Geopolitical tensions could also result in the restriction of our usage of such satellite signals.

Use of non-U.S.

GNSS signals are also subject to FCC waiver requirements and to restrictions based upon international trade or geopolitical considerations.

If we are unable to develop timely and competitive commercial products using these systems, or obtain timely and equal access to service signals, this could result in lost revenue.

GNSS signals are also subject to FCC regulation and to restrictions based upon international trade or geopolitical considerations.

Certain government officials and other interested parties have questioned whether continued use of the Russian GLONASS and Chinese BeiDou GNSS signals violates FCC rules and policies.

If use of these signals was restricted by the U.S.

Government, we would be unable to develop and offer timely and competitive commercial products using these systems, or obtain timely and equal access to service signals, this could impact the performance of our products, harm our competitive position, and result in lost revenue.

Regulatory risks

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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.

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

Foreign Corrupt Practices Act (“FCPA”), the U.K.

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Our success depends, in part, on our ability to anticipate these risks and manage these difficulties.

We are subject to evolving and potentially conflicting privacy laws in the United States and other jurisdictions, which could adversely impact our business and require that we incur substantial costs

Existing privacy-related laws and regulations in the United States and other countries are evolving and are subject to unclear or potentially differing interpretations, and various U.S.

federal and state or other international legislative and regulatory bodies may expand or enact laws regarding privacy and data security-related matters.

In Europe, conflicting privacy policies are being pursued by the Commission, legislators and enforcement agencies.

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.

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.

We are subject to evolving and potentially conflicting data privacy and data security laws in the United States and other jurisdictions, which could adversely impact our business and require that we incur substantial costs

We are subject to a complex and evolving patchwork of data privacy and data security laws and regulations in the United States and other jurisdictions in which we operate.

These laws and regulations impose numerous obligations on our business, including those relating to the collection, use, disclosure, transfer, destruction, and security of personal information.

The requirements under these laws are often complex, vary by jurisdiction, and can be subject to unclear or conflicting interpretations.

These laws may also carry significant penalties for non-compliance, including substantial fines and private litigation.

Despite our efforts to comply with these obligations, our products, services, and operations may not fully comply with all applicable laws and regulations at all times.

Data privacy and data security laws and regulations may lack clarity and depend on regulators implementing further rules and guidance, which are often significantly delayed.

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.

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

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.

In addition, the California Consumer Privacy Rights Act, as amended, gives 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.

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We market many products that are subject to governmental regulations and certifications before they can be sold.

The European Union increasingly regulates the use of our products on agriculture, construction, and other types of machinery.

As we develop and enhance features which support automated and autonomous operation of our products, we are increasingly subject to functional safety regulation.

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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.

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.

An inability to obtain required certifications in a timely manner could adversely affect our ability to bring our products to market and harm our customer relationships.

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Our debt could adversely affect our cash flow and prevent us from fulfilling our financial obligations

At the end of 2023, our total debt was $3.1 billion, of which $1.8 billion was senior notes.

At the end of 2024, our total debt, comprised of senior notes, was $1.4 billion.

When our senior notes mature, we will have to utilize significant resources to repay these senior notes or seek to refinance them.

If we decide to refinance the senior notes, we may be required to do so on different or less favorable terms, or we may be unable to refinance the senior notes at all, both of which may adversely affect our business, financial condition, and results of operation.

If we decide to refinance the senior notes, we may be required to do so on different or less favorable terms, which may adversely affect our results of operation.

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.

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• limiting our flexibility in planning for, or reacting to changes and opportunities in our industry, which may place us at a competitive disadvantage.

There are various financial covenants and other restrictions in our debt instruments.

There are various financial covenants and other restrictions in our debt instruments, including a requirement to timely file our SEC reports.

If we fail to comply with any of these requirements, the related indebtedness (and other unrelated indebtedness) could become due and payable prior to its stated maturity, and we may not be able to repay the indebtedness that becomes due.

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.

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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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 and impact our financial results.

For example, the Tax Cuts and Jobs Act of 2017 is set to expire in 2025.

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.

We will continue to monitor and assess how this may impact our financial results when implemented.

We are currently in various stages of multiple year examinations by state and foreign taxing authorities.

During 2024, certain member countries have implemented the framework, and while the impact to our 2024 financial results was minimal, we will continue to monitor and evaluate the implications.

We are currently in various stages of multiple year examinations by U.S.

federal, state, and foreign taxing authorities.

If taxing authorities of any jurisdiction were to successfully challenge a material tax position, we could become subject to higher taxes and our earnings could be adversely affected.

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., and we are potentially exposed to adverse as well as beneficial movements in currency exchange rates.

Approximately 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.

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

• announcements and reports of developments related to our business, our major customers and partners, and the industries in which we compete, or the industries in which our customers compete;

• announcements and reports of developments related to our business, financial statements and performance, our major customers and partners, and the industries in which we compete, or the industries in which our customers compete;

• delays in filing our SEC reports;

• security breaches;

• acquisition announcements;

• acquisition, divestiture, and joint venture announcements;

• new products or product enhancements announced or introduced by us or our competitors;

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• the imposition of tariffs or other trade barriers;

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

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

• general conditions in the worldwide economy;

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• changes in the U.S.

or foreign policies on taxes, trade, or spending;

or foreign policies on taxes, trade, tariffs, or spending;

• regional responses and restrictions related to global pandemics;

• the number of weeks in a fiscal period, which may differ period over period;

• other risks, including those described below.

Seasonal variations in demand for our products may also affect our quarterly results.

Construction equipment revenue has historically been the highest in early spring.

Our agricultural equipment revenue has historically been the highest in the first quarter, followed by the second quarter, reflecting buying in anticipation of the spring planting season in the Northern hemisphere.

For instance, construction equipment revenue has historically been the highest in early spring.

If we do not accurately forecast seasonal demand, we may be left with unsold inventory or have a shortage of inventory, which could adversely impact our business, financial conditions, and results of operations.

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The threat of terrorism and war and heightened security and military activity in response to this threat, or any future acts of terrorism or hostilities, may involve a redeployment of the satellites used in GNSS or interruptions of the system.

Civil unrest, local conflicts, or other

political instability may adversely impact regional economies, cause work stoppages, or result in limitations on business transactions with the affected jurisdictions.

Civil unrest, local conflicts, or other political instability may adversely impact regional economies, cause work stoppages, or result in limitations on business transactions with the affected jurisdictions.

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.

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.

The uncertain nature, magnitude, and duration of hostilities stemming from the developments in the 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 renew the prior supply chain challenges that we had 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.

The sanctions have contributed to supply chain disruptions, higher commodity prices, higher oil and natural gas price, and a slowdown in global economic growth.

It is not possible to predict the broader consequences of the conflict, which could include further sanctions;

Further sanctions;

regional instability;

geopolitical shifts and adverse effects on macroeconomic conditions;

the availability and cost of raw materials, supplies, freight, and labor;

currency exchange rates;

our suppliers, customers, and potential consumer demand for our products;

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

geopolitical shifts, and adverse effects on macroeconomic conditions could lead to the unavailability and increased cost of raw materials, supplies, freight, and labor, and negatively impact currency exchange rates and our suppliers, customers, and potential consumer demand for our products, all of which could impact 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.

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

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Our disclosures on these matters, and standards we set for ourselves or a failure to meet these standards, may influence our reputation and the value of our brand.

For example, we have elected to share publicly our commitments and ongoing efforts in our Sustainability Report, where we address the importance of ESG matters to our stakeholders and our Company.

For example, we have elected to share publicly our commitments and ongoing efforts in our Sustainability Report, where we address the importance of sustainability matters to our stakeholders and our Company.

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.

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and international regulators, investors, and other stakeholders are increasingly focused on ESG matters.

New domestic and international laws and regulations relating to ESG matters, including human capital, diversity, sustainability, climate change, and cybersecurity are under consideration or being adopted, which may include specific, target-driven disclosure requirements or obligations.

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.

New domestic and international laws and regulations relating to ESG matters, including human capital, climate change, and cybersecurity are under consideration or being adopted, which may include specific, target-driven disclosure requirements or obligations.

We communicate certain sustainability-related initiatives, goals, and/or 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 the goal to engage 70% of our suppliers in setting their own science-based targets.

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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.

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