Exponent (EXPO) risk factors, FY2025 10-K

Risks Related to Our Clients and Demand for Our Services

1. 01The unpredictable and reactive nature of our business can create uneven performance in any given quarter or year
2. 02Our financial results could suffer if our clients’ needs change more rapidly than we are able to secure the appropriate mix of trained, skilled and experienced personnel
3. 03We may not manage our growth effectively, and our profitability may suffer
4. 04The loss of a large client could adversely affect our business
5. 05Our clients may be unable to pay for our services
6. 06Our business is dependent on our professional reputation
7. 07Our business can be adversely impacted by regulatory uncertainty, deregulation or reduced regulatory enforcement
8. 08Tort reform can reduce demand for our services
9. 09Potential conflicts of interest may preclude us from accepting some engagements
10. 10Inherent risks related to government contracts may adversely affect our business
11. 11Clients may terminate, cancel, modify or curtail our contracts at any time prior to their completion
12. 12Artificial intelligence (AI) technologies may reduce demand for our services and change client expectationsNew

Risks Related to Our Operations

1. 13Failure to attract and retain key employees may adversely affect our business
2. 14Our engagements may result in professional or other liability
3. 15We are subject to unpredictable risks of litigation
4. 16We are subject to security breaches that may disrupt our operations and/or lead to the inability to protect confidential information
5. 17Laws regarding data protection continue to rapidly evolve, and failure to protect client and employee data may have an adverse effect on our business
6. 18Our adoption and use of artificial intelligence technologies may create operational, legal, and regulatory risksNew
7. 19Our international operations create special risks that could adversely affect our business
8. 20Employee or contractor misconduct, or our failure to comply with governmental, regulatory and legal requirements or with our company-wide Code of Business Conduct and Ethics and related policies could lead to governmental or legal proceedings that could expose us to significant liabilities and damage our reputation
9. 21Failure to comply with domestic and international export laws could adversely affect our business57% rewritten
10. 22encountered in implementing new or replacement systems could materially adversely affect our business and operations and harm our reputationNew
11. 23Increases in operating expenses may adversely affect our profitability and margins

General Risks

1. 24Competition could reduce our pricing and adversely affect our business
2. 25We hold substantial investments that could present liquidity risks
3. 26Impairment of goodwill may require us to record a significant charge to earnings
4. 27Impairment of long-lived assets or restructuring activities may require us to record a significant charge to earnings
5. 28Uncertainty about current and future economic conditions and other adverse changes in general political conditions in any of the countries in which we do business could adversely affect our operating results
6. 29Our quarterly results may vary
7. 30The market price of our common stock may be volatile
8. 31There can be no assurance that we will continue to declare cash dividends or repurchase our shares at all or in any particular amounts
9. 32Catastrophic events may disrupt our business
10. 33Unavailability or cancellation of third-party insurance coverage would increase our overall risk exposure as well as disrupt the management of our business operations
11. 34Climate change may disrupt our business62% rewritten