What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2025-08-22 compared with 2024-08-23 · 114 added, 100 removed, 723 unchanged (23% of the section changed)

6 unchanged sentences

• volatility and competition in the markets we serve or our inability to compete effectively with our competitors;

• our reliance on a limited number of distributors for our products and the inability of our distributors to manage inventory of our products effectively, timely sell our products or estimate future demand for our products;

• our inventory decisions, including, without limitation, for new product introductions, are based on assumptions and forecasts, which, if inaccurate, may result in write-downs of inventory or components and increases of vendor deposits;

• our inability to keep pace with rapid technological and market changes or to maintain competitive prices for products;

1 unchanged sentence

• our inability to anticipate or mitigate cyberattacks, security vulnerabilities or other fraudulent or illegal activity;

• our inability to manage our growth and expand our operations;

• our inability to maintain or enhance the strength of our brand;

• our inability to manage our growth and expand our operations;

• our reliance on a limited number of contract manufacturers to manufacture our products, and potential quality or product supply problems for our products if we are unable to secure sufficient components for our products or there is a shortage of manufacturing capacity;

2 unchanged sentences

• a global economic downturn;

• changes or uncertainty in tariffs and global trade policies;

• lower than expected returns and exposure to increased operational risks from our investments in business lines, products, services, technologies, joint ventures and other strategic transactions;

• the ineffective management of product introductions, product transitions and marketing or our inability to remain competitive and stimulate customer demand for our products;

• our inability to anticipate consumer preferences and develop desirable products and solutions, or to execute our strategy for our products or develop our sales channels;

• our inability to anticipate customer preferences and develop desirable products and solutions, or to execute our strategy for our products or develop our sales channels;

• general credit, liquidity, market, and interest rate risks to our investment securities;

8 unchanged sentences

• the risks of using open source software in our products;

• our use of artificial intelligence technologies which may present business, compliance, and reputational risks:

• our use of artificial intelligence (“AI”) technologies which may present business, compliance, and reputational risks;

• our reliance on our founder and chief executive officer, who owns a majority of our common stock;

• our debt levels and the impact our debt levels may have on our ability to raise capital or otherwise finance our business;

1 unchanged sentence

• our reliance on third-party software and services for certain aspects of our operations, including, without limitation, our financial reporting functions;

• our reliance on our founder and chief executive officer, who owns a majority of our common stock;

• volatility in the price of our common stock due to volatility in our results of operations or our failure to pay cash dividends or to repurchase shares of our common stock;

94 unchanged sentences

Some of our products and services also involve the storage and transmission of users’ and customers’ proprietary information which may be the target of cyber-attacks.

Hardware and software that we produce or procure from third parties also may contain defects in manufacture or design, including bugs and other problems, which could compromise their ability to withstand cyber-attacks.

Hardware and software that we produce or procure from third parties also may contain manufacturing or design defects, including bugs and other problems, which could compromise their ability to withstand cyber-attacks.

In addition, customers not deploying security updates in a timely manner or deciding not to upgrade products, services or solutions could result in claims of liability against us, damage our reputation or otherwise materially harm our business.

Even when we prioritize a security vulnerability, it could take time for us to develop a remedy and the remedy may ultimately be insufficient to fully fix the issue.

Security vulnerabilities can persist even after we have issued security updates if we have not identified and addressed the root cause of a particular vulnerability, if customers have not installed the most recent updates, if the attackers exploited the vulnerabilities before a security update is applied to install additional malware to further compromise customers’ systems, or if a previously patched vulnerability is inadvertently reintroduced during future development.

Furthermore, the emergence and maturation of AI capabilities designed to circumvent controls, avoid detection and remove or obfuscate forensic evidence, and the utilization of these techniques by attackers, has led to new and more effective methods of cyber-attacks.

Additionally, our sales to end customers through our webstores have increased, which may expose us to liabilities associated with the online collection of customer data, including credit card information, and the costs we may incur to mitigate such risks.

5 unchanged sentences

In addition, state and federal laws and regulations are increasingly enacted to protect consumers against identity theft.

regulations, we could be subject to potential claims for damages and other remedies, which could adversely affect our business and results of operations.

These laws and regulations will likely increase the costs of doing business and if we or our service providers fail to implement appropriate security measures, or to detect and provide prompt notice of unauthorized access as required by some of these laws and regulations, we could be subject to potential claims for damages and other remedies, which could adversely affect our business and results of operations.

For additional information regarding the impact of privacy regulations applicable to our business, see “—Risks Related to Regulatory, Legal and Tax Matters — Our failure to comply with U.S.

6 unchanged sentences

Any such breach or unauthorized access could result in significant legal and financial exposure, costly and time-intensive notice requirements or other remediation efforts, damage to our reputation, and a loss of confidence in the security of our products and services.

Any such breach or unauthorized access could also lead to customers stop using our products and services, deter new customers from using our products and services, and otherwise negatively impact our ability to grow and operate our business.

Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, and often are not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures.

7 unchanged sentences

We may be unable to anticipate or fail to adequately mitigate against increasingly sophisticated methods to engage in illegal or fraudulent activities against us.

Despite any defensive measures we take to manage threats to our business, our risk and exposure to these matters remain heightened because of, among other things, the evolving nature of such threats in light of advances in computer capabilities and artificial intelligence, new discoveries in the field of cryptography, new and sophisticated methods used by criminals including phishing, social engineering or other illicit acts, the increasing use of our webstores by customers, or other events or developments that we may be unable to anticipate or fail to adequately mitigate.

Despite any defensive measures we take to manage threats to our business, our risk and exposure to these matters remain heightened because of, among other things, the evolving nature of such threats in light of advances in computer capabilities and AI, new discoveries in the field of cryptography, new and sophisticated methods used by criminals including phishing, social engineering or other illicit acts, the increasing use of our webstores by customers, or other events or developments that we may be unable to anticipate or fail to adequately mitigate.

In June 2015, we determined that we were the victim of criminal fraud known to law enforcement authorities as business e-mail compromise fraud which involved employee impersonation and fraudulent requests targeting our finance department.

40 unchanged sentences

We believe that our orders may not represent a material portion of our contract manufacturers’ total orders and, as a result, fulfilling our orders may not be a priority in the event our contract manufacturers are constrained in their capacity.

If any of our contract

manufacturers experiences problems in its manufacturing operations, or if we have to change or add additional contract manufacturers, our ability to ship products to our customers would be impaired.

If any of our contract manufacturers experiences problems in its manufacturing operations, or if we have to change or add additional contract manufacturers, our ability to ship products to our customers would be impaired.

Additionally, any or all of the following could either limit supply or increase costs, directly or indirectly, to us or our contract manufacturers:

• changes or uncertainty in tariffs, economic sanctions, and other trade barriers;

• labor strikes or shortages;

1 unchanged sentence

• reservation of manufacturing capacity at our contract manufactures by other companies, inside or outside of our industry;

• changes or uncertainty in tariffs, economic sanctions, and other trade barriers;

• industry consolidation occurring within one or more component supplier markets, such as the semiconductor market.

9 unchanged sentences

We purchase components, directly or through our contract manufacturers, from third parties that are necessary for the manufacture of our products.

Shortages in the supply of components or other supply disruptions, including, without limitation, due to increasing demand for electronics and reductions in supply as a result of unforeseen events such as health crises or pandemics, geopolitical conditions (including China-Taiwan relations) or commercial disputes with the suppliers, may not be predicted in time to design-in different components or qualify other suppliers.

Shortages in the supply of components or other supply disruptions, including, without limitation, due to increasing demand for electronics and reductions in supply as a result of unforeseen events such as health crises or pandemics, tariffs and other trade barriers, economic sanctions, geopolitical conditions (including China-Taiwan relations) or commercial disputes with the suppliers, may not be predicted in time to design-in different components or qualify other suppliers.

Shortages or supply disruptions may also increase the prices of components due to market conditions and reduce our gross margin and profitability if we are unable to pass these price increases through to our customers.

11 unchanged sentences

The manufacturing or shipping of our products at one or more facilities may be disrupted because our manufacturing and logistics contractors are primarily located in Vietnam and China.

Our principal executive offices are located in New York, New York and we

have operations in Ukraine, Taiwan and their surrounding countries.

Our principal executive offices are located in New York, New York and we have operations in Ukraine, Taiwan and their surrounding countries.

The risks of earthquakes, extreme storms and other natural disasters (including as a result of climate change), military conflicts or geopolitical tensions in these geographic areas are significant.

11 unchanged sentences

The continuation of these remote working measures also introduces additional operational risk, including increased cybersecurity risk.

These cybersecurity risks include greater phishing, social engineering, malware, and other cybersecurity attacks, greater risk of a security breach resulting in the unauthorized release, destruction or misuse of valuable information, and potential impairment of our ability to perform critical functions, all of which could expose us to risks of data or financial loss, litigation and liability and could seriously disrupt our operations, which could materially and adversely affect our business, financial condition or results of operations.

These cybersecurity risks include greater phishing, social engineering, malware, ransomware and other cybersecurity attacks, greater risk of a security breach resulting in the unauthorized release, destruction or misuse of valuable information, and potential impairment of our ability to perform critical functions, all of which could expose us to risks of data or financial loss, litigation and liability and could seriously disrupt our operations, which could materially and adversely affect our business, financial condition or results of operations.

Public health problems may expose us to unanticipated liability or require us to change our business practices in a manner materially adverse to our business, results of operations and financial condition.

7 unchanged sentences

General global economic downturns and macroeconomic trends, including inflation or slowed economic growth, may negatively affect our customers and their ability to purchase our products.

A downturn or such other trends may decrease our revenues and increase our costs and may increase credit risk with our customers and impact our ability to collect account receivable and recognize revenue.

The global macroeconomic environment has been challenging and inconsistent caused by inflation, instability in the global credit markets, the impact of uncertainty regarding global central bank monetary policy, and the instability in the geopolitical environment in many parts of the world.

A downturn or such other trends may decrease our revenues and

increase our costs and may increase credit risk with our customers and impact our ability to collect account receivable and recognize revenue.

The global macroeconomic environment has been challenging and inconsistent caused by inflation, instability in the global credit markets, the impact of uncertainty regarding global central bank monetary policy and global trade policies, and the instability in the geopolitical environment in many parts of the world.

Inflation in the United States and the other countries that we operate has decreased from its previous elevated level, however, it is uncertain whether inflation will continue to decrease or whether it may rise again.

Rising inflation could have an adverse impact on our expenses.

Our costs are subject to fluctuations, including due to the costs of raw materials, labor, transportation and energy.

Therefore, our business results depend, in part, on our continued ability to manage these fluctuations through pricing actions, cost

saving projects and sourcing decisions, while maintaining and improving margins and market share.

Our costs are subject to fluctuations, including due to the costs of raw materials, labor, tariffs, transportation and energy.

Therefore, our business results depend, in part, on our continued ability to manage these fluctuations through pricing actions, cost saving projects and sourcing decisions, while maintaining and improving margins and market share.

Failure to manage these fluctuations could adversely impact our results of operations or financial conditions.

Unfavorable macroeconomic conditions, such as a recession or continued slowed economic growth, may negatively affect demand for our products and exacerbate some of the other risks that affect our business, results of operations and financial condition.

These risks may be exacerbated by changes in global tariff policies and escalating global trade tensions, which pose uncertainties for supply chains, material costs and consumer demand.

Unfavorable macroeconomic conditions, such as a recession, increasing tariffs, uncertainty over global trade policies, or continued slowed economic growth, may negatively affect demand for our products and exacerbate some of the other risks that affect our business, results of operations and financial condition.

Factors affecting the level of consumer spending include general market conditions, macroeconomic conditions, fluctuations in foreign exchange rates and interest rates, and other factors such as consumer confidence, the availability and cost of consumer credit, levels of unemployment and tax rates.

21 unchanged sentences

With some of our products, we depend on third party retailers to provide adequate and attractive placement for our products in their stores, both physical and online.

We further depend on these retailers to employ, educate and motivate their sales personnel to

effectively sell our products.

We further depend on these retailers to employ, educate and motivate their sales personnel to effectively sell our products.

If our retailers do not adequately display our products, choose to reduce the space for our products in their stores or locate them in less than premium positioning, choose not to carry some or all of our products or promote competitors’ products over ours, or do not effectively explain to customers the advantages of our products, our sales could decrease and our business could be harmed.

25 unchanged sentences

There is an increasing focus from regulators, certain investors, and other stakeholders concerning environmental, social, and governance (ESG) matters, both in the United States and internationally.

ESG-related initiatives, goals, and/or commitments such as those regarding environmental matters, diversity, responsible sourcing and social investments, and other matters, could be difficult to achieve and costly to implement.

The achievement of any goals that we may announce may rely on the accuracy of our estimates and assumptions supporting those goals.

We could fail to achieve, or be perceived to fail to achieve, ESG-related initiatives, goals or commitments that we might set, and the timing, scope or nature of these initiatives, goals, or commitments, or for any revisions to them may not be acceptable to the Securities and Exchange Commission or other regulators or stakeholders, including our shareholders.

ESG-related initiatives, goals, and/or commitments such as those regarding environmental matters, responsible sourcing and social investments, and other matters, could be difficult to achieve and costly to implement.

The achievement of any goals that we may announce may rely on the accuracy of our estimates and

assumptions supporting those goals.

We could fail to achieve, or be perceived to fail to achieve, ESG-related initiatives, goals or commitments that we might set, and the timing, scope or nature of these initiatives, goals, or commitments, or for any revisions to them may not be acceptable to the regulators or stakeholders, including our shareholders.

Our actual or perceived failure to adopt or achieve any ESG-related initiatives, goals, or commitments that we make could negatively impact our reputation or otherwise materially harm our business.

At the same time, “anti-ESG” sentiment has recently gained momentum with a number of stakeholders, government entities, regulators and lawmakers.

The proposal or enactment of anti-ESG legislation, regulation, policies and enforcement priorities may result in increased scrutiny, reputational risk, lawsuits or market access restrictions.

If we are unable to anticipate customer preferences and successfully develop desirable products and solutions, we might not be able to maintain or increase revenue and profitability.

2 unchanged sentences

If we are unable to introduce appealing new consumer products or novel technologies in a timely manner, or our new products or technologies are not accepted or adopted by customers, our competitors may increase their market share, which could hurt our competitive position.

It is also possible that competitors could introduce new products and services that negatively impact

customer preference in the type of products that we supply, which could result in decreased sales of our product and a loss in market share.

It is also possible that competitors could introduce new products and services that negatively impact customer preference in the type of products that we supply, which could result in decreased sales of our product and a loss in market share.

We may not be able to achieve an acceptable return, if any, on our research and development efforts, and our business, results of operations, liquidity and financial condition may be adversely affected.

1 unchanged sentence

We might not be able to, or determine that it is not in our interests to, raise prices to compensate for any additional costs.

We are incorporating artificial intelligence technologies into our products, services and processes.

These technologies may present business, compliance, and reputational risks.

Recent technological advances in AI and machine-learning technology both present opportunities and pose risks to us.

If we fail to keep pace with rapidly evolving technological developments in AI, our competitive position and business results may suffer.

At the same time, use of AI has recently become the source of significant media attention and political debate.

The introduction of these technologies, particularly generative AI, into internal processes, and new and existing offerings may result in new or expanded risks and liabilities, including due to enhanced governmental or regulatory scrutiny, litigation, compliance issues, ethical concerns, confidentiality or security risks, as well as other factors that could adversely affect our business, reputation, and financial results.

In addition, our personnel could, unbeknownst to us, improperly utilize AI and machine learning-technology while carrying out their responsibilities.

The use of AI can lead to unintended consequences, including generating content that appears correct but is factually inaccurate, misleading or otherwise flawed, or that results in unintended biases and discriminatory outcomes, which could harm our reputation and business and expose us to risks related to inaccuracies or errors in the output of such technologies.

We also face risks of competitive disadvantage if our competitors more effectively use AI to create new or enhanced products or services that we are unable to compete against.

As we increase our investment in technology, software and systems to adopt AI into our internal processes, products and services, such investments may not increase productivity, result in more efficient operations or deliver better products, services and customer experiences.

Risks Related to Our International Operations

7 unchanged sentences

• impact of inflation on local economies;

• import and export license requirements, tariffs, economic sanctions, contractual limitations and other trade barriers;

• import and export license requirements, economic sanctions, contractual limitations and other trade barriers;

• tariffs, the threat of new or increased tariffs, and escalating trade tensions;

• changes in local tax and customs duty laws or changes in the enforcement, application or interpretation of such laws (including potential responses to the higher U.S.

tariffs on certain imported products implemented by the U.S.);

• increasing labor costs, especially in Vietnam and China;

10 unchanged sentences

We cannot be certain that the investment and additional resources required to establish, acquire or integrate operations in other countries will produce anticipated levels of revenues or profitability.

Our business may be negatively affected by geopolitical events and foreign policy responses.

Geopolitical uncertainties and events could cause damage or disruption to international commerce and the global economy, and thus could have a material adverse effect on us, our suppliers, logistics providers, manufacturing vendors and customers, including our distributors and other channel partners.

For example, escalating tensions between the U.S., China and other countries may result in changes in laws or regulations that will affect our ability and/or increase our costs to manufacture and sell our products.

Recently, the U.S.

government has altered its approach to international trade policy and in some case renegotiated, or potentially terminated, certain existing bilateral or multi-lateral trade agreements and treaties with foreign countries.

The current U.S.

administration has imposed significant increases to tariffs on goods imported into the U.S., including from China and Vietnam, and has raised the possibility of imposing significant, additional tariff increases or expanding the tariffs to capture additional countries and types of goods.

Some foreign governments, including China, have instituted retaliatory tariffs on certain U.S.

While the U.S.

administration has negotiated tariff rates with several countries, the negotiation with many countries is ongoing.

Due to the numerous executive orders, the overall determination of duties on imports has become complex.

The tariffs and related policy changes have significantly affected our business, financial condition and results of operations, and we may not be able to plan for alternative sources for our supply chain and manufacturing operations or effectively mitigate the adverse impacts from such measures.

Additional trade restrictions could be adopted with little to no advance notice, which could further increase the cost of our products, disrupt our supply chain, reduce the demand for our products, and impair our ability to effectively operate and compete in the countries where we do business.

We are closely monitoring this evolving situation but there can be no assurance that we will be able to mitigate the impacts of any trade measures, which could be material to our operating results or harm our competitive position.

The imposition of tariffs is dependent upon the classification of items under the Harmonized Tariff System (“HTS”), the value determination of the item and the country of origin of the item.

Determination of the HTS, the value and the origin of the item is a technical matter that can be subjective in nature.

Accordingly, although we believe our valuation determinations and classifications of HTS and origin are appropriate, there is no certainty that government agencies will agree with us.

If these agencies do not agree with our determinations, we could be subject to investigation and could be required to pay additional amounts, including potential penalties which could have a material adverse effect on our business, results of operations and financial condition.

We also face uncertainty in the interpretation of new tariffs and their applicability, including with respect to customs valuation, product classification and country-of-origin determinations.

Although we seek to comply with applicable customs laws and regulations, the application of rules regarding new tariffs can be subject to varying interpretations or future re-interpretations.

Customs and Border Protection is currently challenging, and may continue to challenge, the valuation, rules of origin and classification methods that we apply to certain products imported into the U.S.

Any such disagreement could result in the retroactive assessment of additional duties with interest, the imposition of penalties, or other enforcement actions without the ability to mitigate such penalties, thereby adversely affecting our operations and financial results.

The progress and continuation of trade negotiations between the U.S., China, Vietnam and other countries continues to be uncertain.

A further escalation of the trade tensions remains a possibility, which could reduce trade volume, investment, technological exchange, and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets, which could in turn have a material adverse impact on our business, financial condition and the results of operations.

We can provide no assurance regarding the magnitude, scope or duration of the imposed tariffs and trade restrictions or the magnitude, scope or duration from any relief in increases to such tariffs, as well as the potential for

additional tariffs, quotas, duties, taxes or trade barriers by the U.S., China, Vietnam or other countries, nor that any strategies we may implement to mitigate the impact of such tariffs or other trade actions will be successful.

Changes in U.S.

social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently develop and sell products, and any negative sentiments towards the U.S.

as a result of such changes, could also adversely affect our business.

For example, negative sentiments towards the U.S.

among non-U.S.

customers and among non-U.S.

employees or prospective employees could adversely affect sales or hiring and retention, respectively.

The foreign policies of governments may be volatile and may result in rapid changes to import and export requirements, customs classifications, tariffs, trade sanctions and embargoes or other retaliatory trade measures that may cause us to raise prices, prevent us from offering products or providing services to particular entities or markets, may cause us to make changes to our operations, or create delays and inefficiencies in our supply chain.

For example, political unrest, conflicts and uncertainties in the Middle East, Eastern Europe and Asia Pacific, including the military conflict between Russia and Ukraine and the escalating tensions between China and Taiwan, may lead to disruptions in commerce in those regions, which would in turn impact our sales to those regions.

Furthermore, if the U.S.

government imposes new sanctions against certain countries or entities, such sanctions could sufficiently restrict our ability to market and sell our products and may materially adversely affect our results of operations.

In addition, reports of certain intelligence gathering methods of the U.S.

government could affect customers’ perception of the products of companies based in the United States.

Trust and confidence in us as an equipment supplier is critical to the development and growth of our markets.

Impairment of that trust, or foreign regulatory actions taken in response to reports of certain intelligence gathering methods of the U.S.

government, could affect the demand for our products from customers outside of the United States and could have an adverse effect on our results of operations.

Our third-party logistics and warehousing providers in Vietnam and China and elsewhere may fail to safeguard and accurately manage and report our inventory.

7 unchanged sentences

Relations between mainland China and Taiwan and other factors affecting military, political or economic conditions in mainland China and Taiwan, including responses by governments worldwide to the geopolitical tension or conflict between mainland China and Taiwan, could materially and adversely affect our business, financial condition and results of operations.

In addition, both China and

Taiwan are leading manufacturers of the world’s semiconductor supply.

In addition, both China and Taiwan are leading manufacturers of the world’s semiconductor supply.

Conflict between China and Taiwan might lead to trade sanctions, technology disputes, or supply chain disruptions, which could, in particular, affect the semiconductor industry, which might result in reduced availability of components used to manufacture our products, especially chipsets, which may impact our ability and costs to manufacture our products.

9 unchanged sentences

• our limited experience in operating manufacturing facilities.

Since these activities are currently conducted in Vietnam, Taiwan and China and could be expanded to other foreign countries, some of these risks may be more significant due to the less predictable legal and political environment.

Since these activities are currently conducted in Taiwan and could be expanded to other foreign countries, some of these risks may be more significant due to the less predictable legal and political environment.

Additionally, changes in the local political, social and economic environment could adversely affect our ability and plans to develop our own manufacturing capacity.

Our business may be negatively affected by political events and foreign policy responses.

Changes in commodity prices may also cause political uncertainty and increase currency volatility that can affect economic activity.

For example, escalating tensions between the U.S., China and other countries may result in changes in laws or regulations that will affect our ability to manufacture and sell our products.

The vast majority of our products that are imported into the U.S.

from China are currently subject to tariffs that range between 7.5% and 25%.

These tariffs have affected our operating results and margins.

Additionally, the imposition of tariffs is dependent upon the classification of items under the Harmonized Tariff System (“HTS”), the value determination of the item and the country of origin of the item.

Determination of the HTS, the value and the origin of the item is a technical matter that can be subjective in nature.

Accordingly, although we believe our valuation determinations and classifications of HTS and origin are appropriate, there is no certainty that government agencies will agree with us.

The progress and continuation of trade negotiations between the U.S.

and China continues to be uncertain and a further escalation of the trade war remains a possibility.

These tariffs have, and will continue to have, an adverse effect on our results of operations and margins.

We can provide no assurance regarding the magnitude, scope or duration of the imposed tariffs or the magnitude, scope or duration from any relief in increases to such tariffs, as well as the potential for additional tariffs or trade barriers by the U.S., China or other countries, nor that any strategies we may implement to mitigate the impact of such tariffs or other trade actions will be successful.

Changes in U.S.

as a result of such changes, could also adversely affect our business.

For example, if the U.S.

government withdraws or materially modifies existing or proposed trade agreements, places greater restriction on free trade generally or imposes increases on tariffs on goods imported into the U.S., particularly from China, our business, financial condition and results of operations could be adversely affected.

In addition, negative sentiments towards the U.S.

among non-U.S.

customers and among non-U.S.

employees or prospective employees could adversely affect sales or hiring and retention, respectively.

For example, political unrest and uncertainties in the Middle East, Eastern Europe and Asia Pacific, including the military conflict between Russia and Ukraine and the escalating tensions between China and Taiwan,

may lead to disruptions in commerce in those regions, which would in turn impact our sales to those regions.

Furthermore, if the U.S.

In addition, reports of certain intelligence gathering methods of the U.S.

government could affect customers’ perception of the products of companies based in the United States.

Trust and confidence in us as an equipment supplier is critical to the development and growth of our markets.

Impairment of that trust, or foreign regulatory actions taken in response to reports of certain intelligence gathering methods of the U.S.

government, could affect the demand for our products from customers outside of the United States and could have an adverse effect on our results of operations.

Our ability to introduce new products and support our existing products depends on our ability to manage geographically dispersed research and development teams.

32 unchanged sentences

Our inability or failure to effectively protect our intellectual property could reduce the value of our technology and could impair our ability to compete.

Any inability or failure by us to

meaningfully protect our intellectual property could result in competitors offering products that incorporate our most technologically advanced features.

Any inability or failure by us to meaningfully protect our intellectual property could result in competitors offering products that incorporate our most technologically advanced features.

We have initiated and may continue to initiate legal proceedings to enforce our intellectual property rights.

59 unchanged sentences

That could significantly diminish the value of some of our products and negatively affect our business.

We are incorporating artificial intelligence technologies into our products, services and processes.

These technologies may present business, compliance, and reputational risks.

Recent technological advances in artificial intelligence (AI) and machine-learning technology both present opportunities and pose risks to us.

If we fail to keep pace with rapidly evolving technological developments in AI, our competitive position and business results may suffer.

At the same time, use of AI has recently become the source of significant media attention and political debate.

The introduction of these technologies, particularly generative AI, into internal processes, new and existing offerings may result in new or expanded risks and liabilities, including due to enhanced governmental or regulatory scrutiny, litigation, compliance issues, ethical concerns, confidentiality or security risks, as well as other factors that could adversely affect our business, reputation, and financial results.

In addition, our personnel could, unbeknownst to us, improperly utilize AI and machine learning-technology while carrying out their responsibilities.

The use of artificial intelligence can lead to unintended consequences, including generating content that appears correct but is factually inaccurate, misleading or otherwise flawed, or that results in unintended biases and discriminatory outcomes, which could harm our reputation and business and expose us to risks related to inaccuracies or errors in the output of such

technologies.

We also face risks of competitive disadvantage if our competitors more effectively use AI to create new or enhanced products or services that we are unable to compete against.

Risks Related to Our Management and Structure

20 unchanged sentences

Our profitability may decline as we expand into new product areas.

We receive a substantial majority of our revenues from the sale of outdoor wireless networking equipment and enterprise WLAN.

We receive a substantial majority of our revenues from the sale of enterprise WLAN and outdoor wireless networking equipment.

As we expand into other products and services, such as video surveillance equipment, voice communication equipment, security access equipment, wireless backhaul, consumer electronics, and Software-as-a-Services, we may not be able to compete effectively with existing market participants and may not be able to realize a positive return on the investment we have made in these products or services.

15 unchanged sentences

The availability of this service is essential to the management of our business.

As we expand our operations, we expect to utilize additional systems

and service providers that may also be essential to managing our business.

As we expand our operations, we expect to utilize additional systems and service providers that may also be essential to managing our business.

Although the systems and services that we require are typically available from a number of providers, it is time consuming and costly to qualify and implement these relationships.

2 unchanged sentences

If our existing cloud service providers experience interruptions in service regularly or for a prolonged basis, or other similar issues, our business would be seriously harmed.

Our reliance on such third parties exposes us to cybersecurity risks and vulnerabilities if such third parties or their partners are targeted by cyber-attack or other sources of compromise.

Additionally, our existing cloud service providers have broad discretion to change and interpret its terms of service and other policies with respect to us, and they may take actions beyond our control that could harm our business.

2 unchanged sentences

Our debt levels could adversely affect our ability to raise additional capital to pay dividends, repurchase our shares of common stock and fund our operations or limit our ability to react to changes in our industry or the economy.

As of June 30, 2024, our balance outstanding under the Amended Credit Agreement for our Term Facilities and Revolving Facility (each as defined herein), was $533.1 million and $175.0 million, respectively.

As of June 30, 2025, our balance outstanding under the Amended Credit Agreement for our Term Facilities (as defined herein), was $250.0 million.

There was no outstanding balance on the Revolving Facility (as defined herein) as of June 30, 2025.

The Facilities mature in March 2026.

In the future we may need to raise additional capital to finance our payment of dividends or repurchase shares of our common stock and fund our growth and operational goals.

61 unchanged sentences

If the Company fails to meet expectations related to dividends, its stock price may decline, which could have a material adverse impact on investor confidence and employee retention.

These and other factors may also

affect our ability to repurchase shares of our common stock.

These and other factors may also affect the continuation of, or activity under, our previously announced stock repurchase program.

Failure to pay cash dividends could cause the market price of our common stock to decline.

Failure to repurchase shares of our common stock could also result in a lower market price of our common stock.

The discontinuance of, or lack of activity under, our previously announced stock repurchase program could also result in a lower market price of our common stock.

Fluctuations in our results of operations could cause the market price of our common stock to decline.

37 unchanged sentences

sanctions, our products, including our firmware updates, could be provided by our distributors, resellers and/or end users despite such precautions.

Any such provision could

have negative consequences, including government investigations, penalties and reputational harm.

Any such provision could have negative consequences, including government investigations, penalties and reputational harm.

Our failure or inability to obtain required import or export approval for our products could harm our international and domestic sales and adversely affect our revenue.

31 unchanged sentences

The GDPR includes operational requirements for companies that receive or process personal data of residents of the European Union that are different than those previously in place in the European Union, and that include significant penalties for non-compliance.

Another example, in November 2016, the Standing Committee of

China’s National People’s Congress passed China’s first Cybersecurity Law (“CSL”), which took effect in June 2017.

Another example, in November 2016, the Standing Committee of China’s National People’s Congress passed China’s first Cybersecurity Law (“CSL”), which took effect in June 2017.

The CSL is the first Chinese law that systematically lays out the regulatory requirements on cybersecurity and data protection, subjecting many previously under-regulated or unregulated activities in cyberspace to government scrutiny.

4 unchanged sentences

The CCPA was significantly expanded on January 1, 2023, when the California Privacy Rights Act (“CPRA”) became effective.

The CPRA amendments, among other things, give California residents the ability to limit use of certain sensitive personal information, further restrict the use of cross-contextual advertising, establish restrictions on the retention of personal information, expand the types of data breaches subject to the CCPA’s private right of action, provide for increased penalties for CCPA violations concerning California residents under the age of 16, and establish a new California Privacy Protection Agency to implement and enforce the new law.

CCPA’s private right of action, provide for increased penalties for CCPA violations concerning California residents under the age of 16, and establish a new California Privacy Protection Agency to implement and enforce the new law.

In addition, data privacy and security laws have been proposed at the federal, state, and local levels in recent years, which could further complicate compliance efforts.

For example, states such as Colorado, Connecticut, Delaware, Indiana, Iowa, Kentucky, Maryland, Minnesota, Montana, Nebraska, New Hampshire, New Jersey, Oregon, Tennessee, Texas, Virginia, and Utah have enacted their own data privacy laws.

For example, states such as Colorado, Connecticut, Delaware, Florida, Indiana, Iowa, Kentucky, Maryland, Minnesota, Montana, Nebraska, New Hampshire, New Jersey, Oregon, Rhode Island, Tennessee, Texas, Virginia, and Utah have enacted their own data privacy laws.

Given the recent implementation of these regulations, we cannot yet predict the impact of these regulations on our business or operations.

1 unchanged sentence

However, given that the scope, interpretation, and application of these laws and regulations are often uncertain and may be conflicting, it is possible that these obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or our practices.

Any failure or perceived failure by us or third-party service-providers to comply with our privacy or security policies or privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of personally identifiable information or other user data, may result in governmental enforcement actions, litigation, additional reporting requirements and/or oversight, bans or restrictions on processing personal data, orders to destroy or not use personal data, loss of customers, interruptions or stoppages in our business operations, inability to process personal data or operate in certain jurisdictions, limited ability to develop or commercialize our products and services, expenditure of time and resources to defend against claims or inquiries, changes to our business model or operation, or negative publicity, and could have an adverse effect on our brand, results of operations and financial condition.

Governments are continuing to focus on privacy, cybersecurity, data protection and data security and it is possible that new privacy or data security laws will be passed or existing laws will be amended in a way that is material to our business.

15 unchanged sentences

For example, to provide products for network operators and service providers who utilize unlicensed RF spectrum, we may be required to limit their ability to use our products in licensed RF spectrum.

The operation of our products by network operators

or service providers in the United States or elsewhere in a manner not in compliance with local law could result in fines, operational disruption, or harm to our reputation.

The operation of our products by network operators or service providers in the United States or elsewhere in a manner not in compliance with local law could result in fines, operational disruption, or harm to our reputation.

In addition, if new spectrums, either licensed or unlicensed, are made available by government regulatory agencies for broadband wireless communication that may disrupt the competitive landscape of our industry and impact our business.

2 unchanged sentences

It can be difficult or impossible to predict the outcome of legal proceedings with any degree of certainty, particularly given that laws may be ambiguous and factual findings can often be the result of incomplete evidence, opinions, varying standards or proof, and extraneous factors.

Any such proceedings or matters may adversely affect how we operate the business, divert the attention of management from the operation of the business, have an adverse effect on our reputation, result in additional costs and adversely affect our results of operations.

such proceedings or matters may adversely affect how we operate the business, divert the attention of management from the operation of the business, have an adverse effect on our reputation, result in additional costs and adversely affect our results of operations.

If one or more of the legal proceedings to which we may be or become a party are resolved against us, our results of operations and financial condition could be adversely affected.

25 unchanged sentences

As described in more detail in the Annual Report on Form 10-K for the fiscal year ended June 30, 2017, under Item 9A.

“Controls and Procedures”, the Company completed the remediation efforts of such material weakness, completed testing of the controls to address such material weaknesses and concluded that the previously reported material weaknesses in internal controls over financial reporting have been satisfactorily remediated as of

June 30, 2017.

Any such failure (including any failure to implement new or improved controls, difficulties in the execution of such implementation or deterioration of our current control practices) may result in an inability to prevent fraud, or cause us to fail to meet our reporting obligations.

18 unchanged sentences

The legislative bodies in many jurisdictions regularly consider proposed legislation that, if adopted, could affect our tax rate in such jurisdictions, and the carrying value of our deferred tax assets or our tax liabilities.

Multi-jurisdictional changes enacted in response to the guidelines provided by the Organization for Economic Cooperation and Development (“OECD”) to address base erosion and profit shifting (“BEPS”), including a Pillar Two framework that imposes a minimum tax rate of 15% in each taxing jurisdiction for multinational enterprises, and additional amendments or guidance regarding comprehensive U.S.

tax reform, among other things, may change certain U.S.

16 unchanged sentences

Further , in 2022, the U.S.

government enacted the Inflation Reduction Act, which made a number of changes, including adding a 1% excise tax on stock buybacks by publicly-traded corporations and a 15% corporate minimum tax for companies with higher than $1 billion of certain adjusted financial statement income.

government enacted the Inflation Reduction Act, which made a number of changes, including adding a 1% excise tax on stock buybacks by publicly-traded corporations and a 15% corporate minimum tax for companies with higher th an $1 billion of certain adjusted financial statement income.

As a result of the 1% excise tax, the cost to us of making repurchases will increase.

In July 2025, the U.S.

government enacted the One Big Beautiful Bill Act (the “OBBBA”).

The OBBBA extended or made permanent many of the corporate tax changes arising under the Tax Cuts and Jobs Act.

Changes in tax laws and regulations and interpretations of such laws and regulations, including taxation of earnings outside of the U.S., may materially and adversely affect our business, results of operations and financial condition.

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