Cisco Systems (CSCO) risk factors, FY2025 10-K

Risks Related to our Business and Industry

1. 01Our operations can be difficult to predict because our operating results may fluctuate in future periods
2. 02Our operating results may be negatively impacted by unfavorable economic and market conditions and the uncertain geopolitical environment
3. 03Our revenue for a particular period is difficult to predict, and a shortfall in revenue may harm our operating results
4. 04We expect gross margin to vary over time, and our level of product gross margin may not be sustainable
5. 05Sales to the service provider and cloud market are especially volatile, and weakness in orders from this industry may harm our operating results and financial condition
6. 06Disruption of or changes in our distribution model could harm our sales and margins
7. 07The markets in which we compete are intensely competitive, which could negatively impact our achievement of revenue growth
8. 08Inventory management relating to our sales to our two-tier distribution channel is complex, and excess inventory may harm our gross margins
9. 09Issues related to the development and use of artificial intelligence (AI) could give rise to legal and/or regulatory action, damage our reputation or otherwise materially harm our business
10. 10We depend upon the development of new products and services, and enhancements to existing products and services, and if we fail to predict and respond to emerging technological trends and customers’ changing needs, our operating results and market share may suffer
11. 11Changes in industry structure and market conditions could lead to charges related to discontinuances of certain of our products or businesses, asset impairments and workforce reductions or restructurings
12. 12Over the long term we intend to invest in engineering, sales, service and marketing activities, and in key priority areas, and these investments may achieve delayed, or lower than expected, benefits which could harm our operating results
13. 13We have made and expect to continue to make acquisitions that could disrupt our operations and harm our operating results
14. 14Entrance into new or developing markets exposes us to additional competition and will likely increase demands on our service and support operations
15. 15If we do not successfully manage our strategic alliances, we may not realize the expected benefits from such alliances, and we may experience increased competition or delays in product development
16. 16Product quality problems could lead to reduced revenue, gross margins, and net income
17. 17Due to the global nature of our operations, political or economic changes or other factors in a specific country or region could harm our operating results and financial condition
18. 18We are exposed to the credit risk of some of our customers and to credit exposures in weakened markets, which could result in material losses
19. 19We are exposed to fluctuations in the market values of our portfolio investments and in interest rates; impairment of our investments could harm our earnings
20. 20We are exposed to fluctuations in currency exchange rates that could negatively impact our financial results and cash flows
21. 21Failure to retain and recruit key personnel would harm our ability to meet key objectives
22. 22Adverse resolution of claims, litigation or governmental investigations may harm our operating results or financial condition
23. 23Our operating results may be negatively impacted and damage to our reputation may occur due to the production and sale of counterfeit versions of our products
24. 24Changes in our provision for income taxes or adverse outcomes resulting from examination of our income tax returns could negatively impact our results
25. 25Our business and operations are especially subject to the risks of earthquakes, floods, and other natural catastrophic events (including as a result of global climate change)
26. 26Terrorism, war, and other events may harm our business, operating results and financial condition
27. 27There can be no assurance that our operating results and financial condition will not be negatively impacted by our incurrence of debt
28. 28Our reputation and/or business could be negatively impacted by matters relating to environmental, social, and governance and/or our reporting of such matters

Risks Related to Intellectual Property

1. 29Our proprietary rights may prove difficult to enforce
2. 30We may be found to infringe on intellectual property rights of others
3. 31We rely on the availability of third-party licenses

Risks Related to Cybersecurity, Privacy, and Regulatory Requirements

1. 32Our actual or perceived failure to adequately protect and appropriately use data could result in claims of legal and/or regulatory action against us, damage our reputation, or otherwise materially harm our business
2. 33Our business, operating results, and financial condition could be materially harmed by evolving regulatory uncertainty or obligations applicable to our products and services

Risks Related to Ownership of Our Stock

1. 34Our stock price may be volatile