What the changes say
- New risks emphasize rebuilding sales execution, commercializing AI, and keeping offerings competitive as technology changes.
- Operational exposure expands to supply-chain disruptions, international geopolitics, inflation, and limited ability to pass through costs.
- The section drops standalone risks on strategy execution, COVID-19, indebtedness, credit markets, hedging counterparties, and alliances.
- Revisions add third-party privacy failures, AI-related credit-rating pressure, OECD global minimum-tax uncertainty, and guidance-driven stock volatility.
What changed since the prior 10-K
New
- NewRisks Related to Our Business
If we do not effectively manage and improve our sales organization, we may have difficulty acquiring new customers or increasing sales to existing customers, and our business and results of operations may be adversely affected
Fragmented sales operations, weak pipeline visibility, and difficulty recruiting qualified salespeople could reduce win rates, productivity, and revenue growth.
- NewRisks Related to Our Business
We may fail to develop and expand our service offerings to address emerging business demands and technological trends and remain competitive
Rapid technological change and customer adoption of AI, automation, cloud, and other technologies could replace traditional services or compress margins.
- NewRisks Related to Our Business
Risks associated with artificial intelligence, including our adoption, deployment, and governance of AI technologies, could adversely affect our business, reputation, financial condition, and results of operations
AI offerings and internal tools may fail commercially or produce inaccurate, biased, or otherwise flawed outputs.
- NewRisks Related to Our Business
Systems failures, catastrophic events, and resulting interruptions in the availability of our products or services could harm our business, damage our reputation, and subject us to substantial liability
Failures, cyberattacks, disasters, geopolitical events, or other disruptions affecting DXC or third-party infrastructure could interrupt services and create liability.
- NewRisks Related to Our Business
We are exposed to risks inherent to our international operations, including fluctuations in exchange rates, and geopolitical conflicts and disruptions can adversely affect our sales and operations
Offshore operations expose DXC to skilled-labor shortages, wage increases, currency movements, political instability, and potential restrictions on offshore work.
- NewRisks Related to Our Business
Prolonged periods of inflation, wage increases, or other cost escalation may adversely affect general economic conditions, customer budgeting, and our profitability, particularly in customer contracts where our ability to pass through increased costs is limited
Inflation, wage increases, and other cost escalation may exceed contract adjustment mechanisms, especially where pricing protections are capped or absent.
- NewRisks Related to Our Business
We face aggressive competition and may fail to compete effectively in certain markets
Aggressive, specialized, or consolidated competitors may win customers or force DXC to accept lower profitability.
- NewRisks Related to Our Business
Disruption of our supply chain or increases in procurement costs could adversely impact our business
Component shortages, supplier failures, transportation delays, or geopolitical disruptions could increase procurement costs and delay hardware and service delivery.
Dropped
- DroppedRisks Related to Our Business
We may not succeed in our strategic objectives, which could adversely affect our business, financial condition, results of operations and cash flows
Failure to execute DXC’s strategic priorities, control costs, or maintain competitive offerings.
- DroppedRisks Related to Our Business
Product and service quality issues could impact our business, operating results and financial condition
- DroppedRisks Related to Our Business
potentially stronger competitors in the markets in which we operate. Additionally, competitors may affect our business by entering into exclusive arrangements with existing or potential customers or suppliers
- DroppedRisks Related to Our Business
Our ability to compete in certain markets we serve is dependent on our ability to continue to expand our capacity in certain offshore locations. However, as our presence in these locations increases, we are exposed to risks inherent to these locations which may adversely affect our revenue and profitability
- DroppedRisks Related to Our Business
If industry or equity research analysts have difficulty in understanding the changes to our business model, or we fail to meet our publicly announced financial guidance, our stock price and trading volume could decline
Errors, defects, vulnerabilities, or service disruptions affecting products, customers, reputation, and results.
- DroppedRisks Related to Our Business
Public health crises, such as the COVID-19 pandemic, have caused disruptions in global economies, financial and commodities markets and rapid shifts in governmental and public health policies
Complicated alliance relationships, competing partners, and exclusive arrangements could reduce business.
- DroppedRisks Related to Our Business
We have indebtedness, which could have a material adverse effect on our business, financial condition and results of operations
Dependence on expanding offshore capacity and related location-specific operating risks.
- DroppedRisks Related to Our Business
Performance under contracts, including those on which we have partnered with third parties, may be adversely affected if we or the third parties fail to deliver on commitments or otherwise breach obligations to our customers
- DroppedRisks Related to Our Business
Prolonged periods of inflation have an adverse effect on general economic conditions and consumer budgeting, which could impact our profitability and have a material adverse effect on our business and results of operations, especially for customer contracts where we do not have adequate inflation protections
Analyst misunderstanding of DXC’s business model or missed financial guidance could reduce stock price and trading volume.
- DroppedRisks Related to Our Business
Our international operations are exposed to risks, including fluctuations in exchange rates, which may be beyond our control
COVID-19 or other public-health crises could restrict employees, facilities, customers, subcontractors, and service delivery.
- DroppedRisks Related to Our Business
We may be adversely affected by disruptions in the credit markets, including disruptions that reduce our customers' access to credit and increase the costs to our customers of obtaining credit
Approximately $3.9 billion of debt and additional borrowing could constrain operations and liquidity.
- DroppedRisks Related to Our Business
Our hedging program is subject to counterparty default risk
- DroppedRisks Related to Our Business
We derive significant revenues and profit from contracts awarded through competitive bidding processes, which can impose substantial costs on us and we may not achieve revenue and profit objectives if we fail to bid on these projects effectively
- DroppedRisks Related to Our Business
If our customers experience financial difficulties, we may not be able to collect our receivables, which would materially and adversely affect our profitability and cash flows from operations
DXC or third-party partners could miss delivery commitments or breach customer-contract obligations.
- DroppedRisks Related to Our Business
If we are unable to maintain and grow our customer relationships over time, our operating results and cash flows will suffer. Failure to comply with customer contracts or government contracting regulations or requirements could adversely affect our business, results of operations and cash flows
- DroppedRisks Related to Our Business
Changes in U.S. tax legislation may materially affect our financial condition, results of operations and cash flows
Reworded
- 85% rewrittenRisks Related to Our Business
In addition, we could be unable to refinance our outstanding indebtedness on reasonable terms or at all
Adds that refinancing may be unavailable or unreasonable, while tying liquidity more explicitly to operating improvements, capital markets, and third-party funding.
- 85% rewrittenRisks Related to Our Business
Compliance with privacy and security laws, requirements and regulations may result in cost increases due to expanded compliance obligations, potential systems changes, the development of additional administrative processes and increased enforcement actions, litigation, fines and penalties
Shifts emphasis from customers imposing privacy terms and evolving regulation to third-party providers’ compliance failures causing enforcement, claims, or reputational harm.
- 78% rewrittenRisks Related to Our Business
Failure to maintain our credit rating, manage our indebtedness, and raise additional capital for future needs could adversely affect our liquidity, capital position, borrowing cost, and access to capital markets
Adds geopolitical changes and structural shifts such as AI as potential causes of negative credit outlooks or downgrades.
Was: Failure to maintain our credit rating and ability to manage working capital, refinance and raise additional capital for future needs could adversely affect our liquidity, capital position, borrowing cost, and access to capital markets
- 75% rewrittenRisks Related to Our Business
The price of our securities is subject to market and other conditions and may be volatile
Replaces the broader stock-price discussion with explicit risk that missing or reducing public revenue, earnings, margin, or cash-flow guidance hurts trading.
- 71% rewrittenRisks Related to Our Business
Changes in tax rates, tax laws and the timing and outcome of tax examinations could affect our future results
Adds OECD global minimum-tax rules, noting local adoption could increase tax uncertainty and income taxes.
- 65% rewrittenRisks Related to Our Business
Our inability to procure third-party licenses required for the operation of our products and service offerings may result in decreased revenue or increased costs
No substantive change; the risk continues to concern renewal, pricing, concentration, and loss of third-party software licenses.
- 59% rewrittenRisks Related to Our Business
If we are unable to accurately estimate the cost of services and the timeline for completion of contracts, or if we or third parties fail to deliver on commitments to our customers, the profitability of our contracts may be materially and adversely affected
Adds consumption-based or resource-unit pricing to the contract types, while removing the detailed discussion of geographically dispersed workforces and skill sets.
Was: If we are unable to accurately estimate the cost of services and the timeline for completion of contracts, the profitability of our contracts may be materially and adversely affected
- 42% rewrittenRisks Related to Our Business
Our Board may authorize share repurchases from time to time. However, we are not obligated to make any purchases of our shares, and our decision to repurchase our shares, as well as the timing of such repurchases, will depend on a variety of factors as determined by our management and Board
No substantive change; the passage continues to state that dividends remain suspended and repurchases are discretionary.
- 40% rewrittenRisks Related to Our Business
We may not achieve some or all of the expected benefits of our restructuring plans and our restructuring may adversely affect our business
- 26% rewrittenRisks Related to Our Business
We could be held liable for damages, our reputation could suffer, and our business may be materially impacted due to service interruptions from security breaches, cyber-attacks, other cybersecurity events or incidents or disclosure of confidential information or personal data
All 32 risk factors
Headings as the filing states them, in filing order.
Risks Related to Our Business
- 01If we do not effectively manage and improve our sales organization, we may have difficulty acquiring new customers or increasing sales to existing customers, and our business and results of operations may be adversely affectedNew
- 02We may fail to develop and expand our service offerings to address emerging business demands and technological trends and remain competitiveNew
- 03Our ability to provide customers with competitive services is dependent on our ability to attract and retain qualified personnel
- 04Additionally, the inability to adequately develop and train personnel and assimilate key new hires or promoted employees could have a material adverse effect on relationships with third parties, our financial condition and results of operations and cash flows
- 05Risks associated with artificial intelligence, including our adoption, deployment, and governance of AI technologies, could adversely affect our business, reputation, financial condition, and results of operationsNew
- 06If we are unable to accurately estimate the cost of services and the timeline for completion of contracts, or if we or third parties fail to deliver on commitments to our customers, the profitability of our contracts may be materially and adversely affected59% rewritten
- 07Systems failures, catastrophic events, and resulting interruptions in the availability of our products or services could harm our business, damage our reputation, and subject us to substantial liabilityNew
- 08We could be held liable for damages, our reputation could suffer, and our business may be materially impacted due to service interruptions from security breaches, cyber-attacks, other cybersecurity events or incidents or disclosure of confidential information or personal data26% rewritten
- 09Failure to comply with obligations arising under new or existing laws, regulations, and customer contracts relating to the privacy, security and handling of personal data could adversely affect our financial condition, results of operations and cash flows
- 10Compliance with privacy and security laws, requirements and regulations may result in cost increases due to expanded compliance obligations, potential systems changes, the development of additional administrative processes and increased enforcement actions, litigation, fines and penalties85% rewritten
- 11Failure to maintain our credit rating, manage our indebtedness, and raise additional capital for future needs could adversely affect our liquidity, capital position, borrowing cost, and access to capital markets78% rewritten
- 12In addition, we could be unable to refinance our outstanding indebtedness on reasonable terms or at all85% rewritten
- 13We are exposed to risks inherent to our international operations, including fluctuations in exchange rates, and geopolitical conflicts and disruptions can adversely affect our sales and operationsNew
- 14Prolonged periods of inflation, wage increases, or other cost escalation may adversely affect general economic conditions, customer budgeting, and our profitability, particularly in customer contracts where our ability to pass through increased costs is limitedNew
- 15We face aggressive competition and may fail to compete effectively in certain marketsNew
- 16Our strategic transactions may prove unsuccessful and our profitability may be materially and adversely affected
- 17In addition, we may fail to complete transactions. Closing transactions is subject to uncertainties and risks, including the risk that we may be unable to satisfy conditions to closing, such as regulatory and financing conditions and the absence of material adverse changes to our business
- 18The price of our securities is subject to market and other conditions and may be volatile75% rewritten
- 19Disruption of our supply chain or increases in procurement costs could adversely impact our businessNew
- 20We are subject to a series of risks relating to climate change and natural disasters, which may affect our worldwide business operations and financial results
- 21Increased scrutiny of, and evolving expectations for, sustainability and ESG initiatives could increase our costs, harm our reputation, or otherwise adversely impact our business
- 22We may inadvertently infringe on the intellectual property rights of others and be exposed to claims for damages, and our intellectual property rights may be infringed by third parties
- 23Our inability to procure third-party licenses required for the operation of our products and service offerings may result in decreased revenue or increased costs65% rewritten
- 24We may not achieve some or all of the expected benefits of our restructuring plans and our restructuring may adversely affect our business40% rewritten
- 25We may be exposed to negative publicity and other potential risks if we are unable to maintain effective disclosure controls and internal control over financial reporting
- 26We could suffer additional losses due to asset impairment charges
- 27Our Board may authorize share repurchases from time to time. However, we are not obligated to make any purchases of our shares, and our decision to repurchase our shares, as well as the timing of such repurchases, will depend on a variety of factors as determined by our management and Board42% rewritten
- 28We are defendants in pending litigation that may have a material and adverse impact on our profitability and liquidity
- 29Changes in tax rates, tax laws and the timing and outcome of tax examinations could affect our future results71% rewritten
Risks Related to our Completed Strategic Transactions
- 30We could have an indemnification obligation to HPE if the stock distribution in connection with the HPES business separation (the "Distribution") were determined not to qualify for tax-free treatment, which could materially adversely affect our financial condition
- 31If the HPES Merger does not qualify as a reorganization under Section 368(a) of the Code, CSC's former stockholders may incur significant tax liabilities
- 32The USPS Separation and Mergers and NPS Separation could result in substantial tax liability to DXC and our stockholders
Other DXC Technology 10-Ks
- FY2025 10-K risk factors40 risks
This initial risk disclosure emphasizes execution risks in strategic priorities and IT service delivery, potential liabilities from cybersecurity incidents and privacy compliance, and financial exposures tied to $3.9 billion in indebtedness.
Filed May 15, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.