Core & Main (CNM) risk factors, FY2026 10-K

Risks Related to Our Business

1. 01We have been, and may continue to be, adversely impacted by declines and volatility in the U.S. residential and non-residential construction markets, which may result in reduced net sales
2. 02Our business and the market for our products and services generally are subject to slowdowns in municipal infrastructure spending which may result in reduced net sales
3. 03We may lose business to competitors through the competitive bidding process
4. 04We are subject to price fluctuations in our product costs31% rewritten
5. 05We are subject to inventory management risks. Insufficient inventory may result in lost sales opportunities or delayed revenue, while excess inventory may negatively impact our gross margin
6. 06Acquisitions and other strategic transactions involve a number of inherent risks, any of which could result in the benefits anticipated not being realized
7. 07Our industry and the markets in which we operate are fragmented and highly competitive, and increased competitive pressures, including the pressure to consolidate, could adversely affect our business
8. 08The development of alternatives to distributors of our products in the supply chain could cause a decrease in our net sales and operating results and limit our ability to grow our business
9. 09We may be unable to hire, engage and retain key personnel, including sales representatives, qualified branch, district and regional managers and senior management26% rewritten
10. 10A change in supplier terms could adversely affect our income and margins
11. 11Our operating results are sensitive to the availability of freight
12. 12A significant amount of our net sales are credit sales, which are made primarily to customers whose ability to pay is dependent, in part, upon the economic strength of the industry and geographic areas in which they operate
13. 13We may not be able to identify new products and new product lines and integrate them into our distribution network, which could adversely affect our ability to compete
14. 14A public health crisis could have a material adverse effect on our business or financial condition
15. 15We could incur significant costs in complying with environmental, health and safety laws or permitting regimes or as a result of satisfying any liability or obligation imposed under such laws or permitting regimes
16. 16We are subject to regulation and regulatory change, and our costs of doing business could increase as a result of changes in federal, state or local regulations
17. 17Increasing scrutiny and changing stakeholder expectations and disclosures in respect of ESG and sustainability practices may adversely impact our business and our stock price and impose additional costs or expose us to new or additional risks32% rewritten
18. 18Due to the nature of our business, we may be subject to legal proceedings, regulatory disputes, and governmental inquiries that could cause us to incur significant expenses, divert our management’s attention, and materially harm our business, financial condition, and operating results
19. 19Failure to achieve and maintain a high level of product quality as a result of our suppliers’ or manufacturers’ mistakes or inefficiencies could damage our reputation and negatively impact our revenue and results of operations
20. 20Any difficulties with, or interruptions of, our fabrication services could delay our output of products and harm our relationships with our customers
21. 21We are subject to certain safety and labor risks associated with the distribution and fabrication of our products
22. 22Our competitive environment may be impacted by technological innovation and we may be required to invest in technology to maintain our position in the industryNew
23. 23An impairment of goodwill, intangible assets or other long-lived assets could have a material adverse effect on our financial position or results of operations20% rewritten
24. 24Our customer relationships are generally governed by purchase orders and job-specific customer agreements, as applicable, and not by long-term agreements, and, as a result, such customers have the right to change the terms under which they do business and/or terminate their relationship with us
25. 25We are subject to risks associated with operating internationally

Risks Related to Our Indebtedness

1. 26Our indebtedness may adversely affect our financial health and our ability to raise additional capital or obtain financing in the future
2. 27Despite our indebtedness levels, we and our subsidiaries may be able to incur substantially more indebtedness, which may increase the risks to our financial condition and results of operations created by our indebtedness
3. 28The agreements governing our indebtedness restrict our current and future operations and our ability, and the ability of our future subsidiaries, to engage in certain business and financial transactions, and as a result, may adversely affect our business or financial condition
4. 29The Amended and Restated Limited Partnership Agreement of Holdings and the Tax Receivable Agreements limit our ability to incur additional indebtedness or refinance our existing indebtedness on favorable terms
5. 30An increase in interest rates would increase the cost of servicing our indebtedness and could reduce our profitability, increase cash outflows, decrease our liquidity or impact our solvency
6. 31Changes in our credit ratings and outlook may reduce access to capital and increase borrowing costs
7. 32Our ability to generate the significant amount of cash needed to pay interest and principal on our indebtedness and our ability to refinance all or a portion of our indebtedness or obtain additional financing depends on many factors beyond our control

Risks Related to Our Organizational Structure

1. 33Our organizational structure, including the Tax Receivable Agreements, confers certain benefits that will not benefit Class A common shareholders to the same extent as it will benefit holders of the Tax Receivable Agreements
2. 34The Tax Receivable Agreements require us to make cash payments in respect of certain tax benefits to which we may become entitled, and we expect that the payments we will be required to make will be substantial
3. 35In certain cases, payments under the Tax Receivable Agreements may be accelerated or significantly exceed the actual benefits we realize in respect of the tax attributes subject to the Tax Receivable Agreements
4. 36We will not be reimbursed for any payments made under the Tax Receivable Agreements in the event that any tax benefits are disallowed

Risks Related to Our Class A Common Stock

1. 37The market price of our Class A common stock may be volatile and could decline
2. 38An active, liquid trading market for our Class A common stock may not be sustained
3. 39Future sales of shares by us or our existing shareholders could cause our stock price to decline
4. 40As of February 1, 2026, we had a total of 188,770,435 shares of Class A common stock outstanding and 6,611,263 of potential additional shares of Class A common stock issuable upon exchange of Partnership Interests (with automatic retirement of an equal number of shares of Class B common stock)
5. 41Anti-takeover provisions in our Certificate of Incorporation and our amended and restated by-laws (the “By-laws”) could discourage, delay or prevent a change of control of our Company and may affect the trading price of our Class A common stock
6. 42We currently do not have an approved plan to pay dividends on our Class A common stock and consequently, your ability to achieve a return on your investment depends on appreciation in the price of our Class A common stock
7. 43We could repurchase Class A common stock under the approved Repurchase Program however we are not obligated to repurchase shares under the plan