Angi (ANGI) risk factors, FY2024 10-K

Other

1. 01Cautionary Statement Regarding Forward-Looking Information

Risks Related to Our Business and Industry

1. 02Our success will depend, in substantial part, on the continued migration of the home services market online
2. 03Marketing efforts designed to drive traffic to our brands and businesses may not be successful or cost-effective
3. 04Our success depends on our ability to continue to balance our various offerings to service professionals across the Angi platforms
4. 05Our success depends, in substantial part, on our ability to establish and maintain relationships with quality and trustworthy professionals
5. 06Our success depends, in part, on our ability to continue to develop and monetize versions of our products and services for mobile and other digital devices
6. 07Our success depends, in part, on our ability to access, collect and use personal data about consumers
7. 08Our ability to communicate with consumers and professionals via email (or other sufficient means) is critical to our success
8. 09Changes to certain requirements applicable to certain communications with consumers may adversely impact our ability to generate leads for our professionals
9. 10There may be adverse tax, legal and other consequences if the contractor classification or employment status of the professionals who use our platform is challenged
10. 11Our brands and businesses operate in an especially competitive and evolving industry
11. 12Our brands and businesses are sensitive to general economic events and trends, particularly those that adversely impact consumer confidence and spending behavior, as well as general geopolitical risks
12. 13We own and operate two of the leading home services brands in the United States (Angi and HomeAdvisor), as well as leading brands in several foreign jurisdictions
13. 14We may not be able to protect our systems, technology and infrastructure from cyberattacks or cyberattacks experienced by third parties may adversely affect us
14. 15If personal, confidential or sensitive user information that we maintain and store is breached or otherwise accessed by unauthorized persons, it may be costly to mitigate and our reputation could be harmed
15. 16The processing, storage, use and disclosure of personal data could give rise to liabilities and increased costs
16. 17We accept payments (including recurring payments) from professionals and consumers, primarily through credit and debit card transactions. The ability to access payment information on a real-time basis without having to proactively reach out to professionals and consumers to process payments is critical to our success
17. 18could, new payment information for some may not be obtained and pending payments may not be processed, which could adversely affect our business, financial condition and results of operations
18. 19Our success depends, in part, on the integrity, quality, efficiency and scalability of our systems, technology and infrastructure, and those of third parties
19. 20We depend on our key personnel

Risks Related to Our Current Relationship with IAC

1. 21IAC controls our company and will have the ability to control the direction of our business
2. 22Our amended and restated certificate of incorporation could prevent us from benefiting from certain corporate opportunities
3. 23IAC’s interests may conflict with our interests and the interests of our other stockholders. Conflicts of interest between us and IAC could be resolved in a manner unfavorable to us and our other stockholders
4. 24We rely on exemptions from certain Nasdaq corporate governance requirements that provide protection to stockholders of other companies
5. 25Accordingly, for so long as we are a “controlled company” and avail ourselves of these exemptions, our stockholders will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the Marketplace Rules
6. 26Our agreements with IAC will require us to indemnify IAC for certain tax liabilities and may limit our ability to engage in desirable strategic or capital-raising transactions
7. 27Future sales or distributions of shares of our capital stock by IAC could depress the price of our Class A common stock
8. 28The services that IAC provides to us may not be sufficient to meet our needs

Risks Related to Our Indebtedness

1. 29We may not be able to generate sufficient cash to service our indebtedness
2. 30Our ability to satisfy our debt obligations will depend upon, among other things, our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory and other factors, many of which are beyond our control

Risks Related to Ownership of Our Class A Common Stock Before the Distribution

1. 31The multiclass structure of our capital stock has the effect of concentrating voting control with IAC and limiting the ability of holders of our Class A common stock to influence corporate matters
2. 32The difference in the voting rights of our Class B common stock and Class A common stock may harm the value and liquidity of our Class A common stock
3. 33The Delaware General Corporation Law and certain provisions in our amended and restated certificate of incorporation and bylaws may discourage, delay or prevent a change of control of our company and/or changes in our management
4. 34The choice of forum provision in our amended and restated bylaws could limit the ability of our stockholders to obtain the judicial forum of their choice for certain disputes

Risks Relating to the Distribution

1. 35Some or all of the expected benefits of the Distribution may not be achieved
2. 36If the Distribution were to fail to qualify as a transaction that is generally tax-free for U.S. federal income tax purposes, IAC, Angi and their respective stockholders could suffer material adverse consequences
3. 37We may not be able to engage in desirable capital-raising or strategic transactions following the Distribution
4. 38The Distribution may be abandoned by IAC at any time prior to completion, and is subject to certain closing conditions that, if not satisfied or waived, will result in the Distribution not being completed
5. 39After the Distribution, actual or potential conflicts of interest may develop between the management and directors of IAC, on the one hand, and Company management and directors, on the other hand
6. 40IAC or the Company may fail to perform under the agreements between them and the Company may be unable to replace some of these agreements
7. 41In connection with the Distribution, IAC will indemnify us for certain liabilities, and we will indemnify IAC for certain liabilities, in each case, pursuant to existing agreements between IAC and us. If we are required to pay under these indemnities to IAC, our financial results could be negatively impacted
8. 42The synergies that IAC achieves with all of its businesses under the same corporate structure, and the benefits of those synergies that the Company enjoys, will cease to exist with regard to our businesses following the Distribution
9. 43IAC will provide certain services to us pursuant to a services agreement following the Distribution. When such services terminate, we will be required to replace such services, and the economic terms of the new arrangements may be less favorable to us
10. 44The Distribution may result in litigation and/or regulatory inquiries and investigations, which would harm our business, financial condition and results of operations and could divert management attention

Risks Relating to Ownership of Our Class A Common Stock Following the Distribution

1. 45The value of the shares of Class A common stock that current holders of IAC capital stock receive in the Distribution might be less than the value of shares of Class A common stock prior to the Distribution
2. 46The market price and trading volume of our Class A common stock may be volatile and may face negative pressure
3. 47Substantial sales of our Class A common stock following the Distribution, or the perception that such sales might occur, could depress the market price of our Class A common stock
4. 48We do not expect to declare any regular cash dividends in the foreseeable future
5. 49Provisions in our certificate of incorporation and bylaws or Delaware law may discourage, delay or prevent a change of control, or changes in management and, therefore, depress the trading price of our Class A common stock
6. 50Our bylaws designate specified courts as the sole and exclusive forum for certain types of actions or proceedings that may be initiated by our stockholders, which could discourage lawsuits against the Company and its directors, officers and other employees
7. 51If securities or industry analysts do not publish research or publish unfavorable research about us, the price and trading volume of our Class A common stock could decline