Dynatrace (DT) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01We have experienced rapid revenue growth in recent periods, which may not be indicative of our future growth
2. 02Our quarterly and annual operating results may be adversely affected due to a variety of factors, which could make our future results difficult to predict
3. 03Market adoption of the solutions that we offer may not grow as we expect, which may harm our business and prospects
4. 04Our business is dependent on overall demand for observability and related solutions and therefore reduced spending on those solutions or overall adverse economic conditions may negatively affect our business, operating results, and financial condition
5. 05If we fail to innovate and do not continue to develop and effectively market solutions that anticipate and respond to the needs of our customers, our business, operating results, and financial condition may suffer
6. 06To the extent that we are not able to continue to execute on our business model to timely and effectively develop or acquire and market applications to address these challenges and attain market acceptance, our business, operating results, and financial condition will be adversely affected
7. 07If our platform and solutions do not effectively interoperate with our customers’ existing or future IT infrastructures, installations of our solutions could be delayed or canceled, which would harm our business
8. 08If we are unable to acquire new customers or retain and expand our relationships with existing customers, our future revenues and operating results will be harmed
9. 09Failure to effectively expand our sales and marketing capabilities could harm our ability to execute on our business plan, increase our customer base, and achieve broader market acceptance of our applications
10. 10We face significant competition, which may adversely affect our ability to add new customers, retain existing customers, and grow our business
11. 11If the prices we charge for our solutions and services are unacceptable to our customers, our operating results will be harmed
12. 12We expect our billings and revenue mix to vary over time, which could harm our gross margin, cash flows, and operating results
13. 13If we are unable to maintain successful relationships with our partners, or if our partners fail to perform, our ability to market, sell, and distribute our applications and services will be limited, and our business, operating results, and financial condition could be harmed
14. 14We believe the Dynatrace brand is integral to our future success and if we fail to cost-effectively maintain and enhance awareness of our company, our business and competitive position may be harmed
15. 15Our sales cycles can be long, unpredictable and vary seasonally, which can cause significant variation in the number and size of transactions that close in a particular quarter
16. 16Our ability to succeed depends on the experience and expertise of our senior management team. If we are unable to attract, retain, and motivate our leadership team, our business, operating results, and prospects may be harmed
17. 17We rely on highly skilled personnel and if we are unable to attract, retain, or motivate substantial numbers of qualified personnel or expand and train our personnel, we may not be able to grow effectively
18. 18Any failure to offer high-quality customer support and professional services may adversely affect our relationships with our customers and our financial results
19. 19We believe that our corporate culture has contributed to our success, and if we cannot successfully maintain our culture as we grow, we could lose the innovation, creativity, and teamwork fostered by our culture
20. 20Our Credit Facility contains restrictions that impact our business and expose us to risks that could adversely affect our liquidity and financial condition

Risks Related to Information Technology, IP, and Data Security and Privacy

1. 21Security breaches, computer malware, computer hacking attacks, and other security incidents or compromises could harm our business, reputation, brand, and operating results
2. 22Interruptions or disruptions with the delivery of our SaaS solutions, or third-party cloud-based systems that we depend on in our operations, may adversely affect our business, operating results, and financial condition
3. 23Real or perceived errors, failures, defects, or vulnerabilities in our solutions could adversely affect our financial results and growth prospects
4. 24Assertions by third parties of infringement or other violations by us of their IP rights, or other lawsuits brought against us, could result in significant costs and substantially harm our business, operating results, and financial condition
5. 25Failure to protect and enforce our proprietary technology and IP rights could substantially harm our business, operating results, and financial condition
6. 26Our use of open source technology could impose limitations on our ability to commercialize our solutions and platform
7. 27Our participation in open source initiatives may limit our ability to enforce our IP rights in certain circumstances
8. 28Any actual or perceived failure by us to comply with stringent and evolving privacy laws or regulatory requirements in one or multiple jurisdictions, privacy, and information security policies and/or contractual obligations could result in proceedings, actions, or penalties against us

Risks Related to Legal, Regulatory, Accounting, and Tax Matters

1. 29Tax matters, including changes in tax laws, rules, regulations, and treaties, could impact our effective tax rate and our results of operations
2. 30We operate in over 35 countries around the world and, as a multinational corporation, we are subject to income and non-income taxes, including payroll, sales, use, value-added, net worth, property, and goods and services taxes, in both the United States and various non-U.S. jurisdictions
3. 31We are subject to a number of risks associated with global sales and operations
4. 32Continued uncertainty in the U.S. and global economies, particularly Europe, along with uncertain geopolitical conditions, could negatively affect sales of our offerings and services and could harm our operating results
5. 33Because we recognize revenue from our SaaS subscriptions and term licenses over the subscription or license term, downturns or upturns in new sales and renewals may not be immediately reflected in our operating results and may be difficult to discern
6. 34Our revenue recognition policy and other factors may distort our financial results in any given period and make them difficult to predict
7. 35Changes in existing financial accounting standards or practices may harm our operating results
8. 36We may face exposure to foreign currency exchange rate fluctuations
9. 37Our sales to government entities are subject to a number of challenges and risks
10. 38We may acquire other businesses, products, or technologies in the future which could require significant management attention, disrupt our business or result in operating difficulties, dilute stockholder value, and adversely affect our results of operations
11. 39Our business is subject to a wide range of laws and regulations and our failure to comply with those laws and regulations could harm our business, operating results, and financial condition
12. 40We are subject to governmental export, import, and sanctions controls that could impair our ability to compete in international markets and subject us to liability if we are not in compliance with applicable laws
13. 41Due to the global nature of our business, we could be adversely affected by violations of anti-bribery, anti-money laundering and similar laws in other jurisdictions in which we operate

Risks Related to Our Common Stock

1. 42The trading price of our common stock has been, and may continue to be, volatile and you could lose all or part of your investment
2. 43Sales of substantial amounts of our common stock in the public markets, or the perception that such sales could occur, could reduce the market price of our common stock
3. 44Our issuance of additional capital stock in connection with financings, acquisitions, investments, our stock incentive plans, or otherwise will dilute all other stockholders
4. 45We cannot guarantee that our share repurchase program will be fully consummated or will enhance long-term stockholder value, and share repurchases could increase the volatility of the trading price of our common stock and diminish our cash reserves
5. 46We do not intend to pay dividends on our common stock and, consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stock
6. 47Our charter and bylaws contain anti-takeover provisions that could delay or discourage takeover attempts that stockholders may consider favorable
7. 48We may issue preferred stock, the terms of which could adversely affect the voting power or value of our common stock
8. 49Our bylaws designate certain specified courts as the sole and exclusive forum for certain disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees
9. 50Catastrophic events could materially interrupt or disrupt our business and others with which we conduct business
10. 51Climate change may have a long-term negative impact on our business