Samsara (IOT) risk factors, 2025 10-K

Risks Related to Our Business, Industry, and Operations

1. 01Our rapid growth makes it difficult to evaluate our future prospects and increases the risk that we will not continue to grow at or near historical rates
2. 02We have a history of losses and may not be able to achieve our profitability targets in the future
3. 03We face risks associated with the growth of our business in new use cases
4. 04If we are unable to attract new customers, our future revenue and results of operations will be harmed
5. 05If we are unable to retain and expand our relationships with existing customers, our financial position and results of operations will be harmed
6. 06We rely heavily on direct sales to sell subscriptions to access our Connected Operations Platform
7. 07The length of our sales cycle can be unpredictable, particularly with respect to sales to larger customers, and our sales efforts may require considerable time and expense
8. 08Our ability to achieve customer renewals and increase sales of subscriptions to our solution is dependent on the quality of our customer outcomes team, and our failure to offer high quality support would have an adverse effect on our business, reputation, and results of operations
9. 09If we fail to effectively manage our growth, our business, financial condition, and results of operations could be harmed
10. 10We face intense and increasing competition, and we may not be able to compete effectively, which could reduce demand for our solution and adversely affect our business, revenue growth, and market share
11. 11Our dependence on a limited number of joint design manufacturers and suppliers of manufacturing services and critical components within our supply chain for our IoT devices may adversely affect our ability to sell subscriptions to our Connected Operations Platform, our margins, and our results of operations
12. 12Managing the supply of our IoT devices is complex. Insufficient supply and inventory may result in lost sales opportunities or delayed revenue, while excess inventory may harm our results of operations
13. 13We may not be able to successfully execute our strategic initiatives or meet our long-term financial goals
14. 14If we are not able to develop and timely introduce new technologies for our Connected Operations Platform that achieve market acceptance, keep pace with technological developments, and meet existing and emerging regulatory requirements, our business, financial condition, and results of operations would be harmed
15. 15Abuse or misuse of our internal platform controls and system tools could cause significant harm to our business and reputation
16. 16Business disruptions or performance problems associated with our technology and infrastructure, including interruptions, delays, or failures in service from our third-party data center hosting facilities and other third-party services, could adversely affect our business, financial condition, and results of operations
17. 17We rely on third-party software for certain essential financial and operational services, and a failure or disruption in these services could materially and adversely affect our ability to manage our business effectively
18. 18If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, or changing customer needs, requirements or preferences, our Connected Operations Platform may become less competitive
19. 19Our Connected Operations Platform relies on cellular and satellite networks and any disruption, failure, or increase in costs of these networks could adversely affect the functionality of our solution, impede our profitability, and harm our results of operations
20. 20If we do not develop IoT devices that are compatible with third-party hardware, software, and infrastructure, including the many evolving wireless industry standards, our ability to introduce and sell new subscriptions to access our Connected Operations Platform, or to renew existing subscriptions, could suffer
21. 21Our ability to grow our business is dependent in part on strategic relationships we develop and maintain with third parties
22. 22We may not be able to maintain and expand our business if we are not able to hire, retain, and manage qualified personnel, and in particular, our key personnel
23. 23If we cannot maintain our company culture, our success and our business and competitive position may be harmed, and our attempts to operate under a flexible work model may not be successful and may adversely impact our business
24. 24If we are not able to maintain, enhance, and protect our brand, our business, financial condition, and results of operations may be harmed
25. 25Issues and uncertainty in the development, deployment, and use of AI in our solution, organization, and by our customers may subject us to liability and may harm our reputation and operating results
26. 26Some AI scenarios may also present ethical issues. If we enable or offer AI features that are controversial because of their perceived or real impact on human rights, privacy, employment, or other social issues, we may experience brand or reputational harm
27. 27A real or perceived defect, security vulnerability, error, or performance failure in our Connected Operations Platform could cause us to lose revenue, damage our reputation, and expose us to liability, and our product liability insurance may not adequately protect us
28. 28Challenges in implementation or incorrect use of, or failure to update, our solution could result in customer dissatisfaction and negatively affect our business and growth prospects
29. 29We may be subject to product liability, warranty, and recall claims that may increase the costs of doing business and adversely affect our business, financial condition, and results of operations
30. 30Our current operations are international in scope, and we plan further geographic expansion, creating a variety of operational challenges

Risks Related to Our Intellectual Property

1. 31Failure to identify and protect our proprietary technology and intellectual property rights could substantially harm our business and results of operations
2. 32There can be no assurance that our patents are enforceable or otherwise will be upheld as valid, or that our patent applications will be granted
3. 33Confidentiality agreements with employees and others may not adequately protect our intellectual property rights and proprietary technology or prevent the disclosure of trade secrets
4. 34We may become subject to additional intellectual property disputes, which are costly and may subject us to significant liability and increased costs of doing business
5. 35Our exposure to risks associated with the use of intellectual property may be increased as a result of any future acquisitions we may complete
6. 36Our use of open source software could negatively affect our ability to sell subscriptions to our Connected Operations Platform and subject us to possible litigation
7. 37Indemnity provisions in various agreements potentially expose us to substantial liability for intellectual property infringement, misappropriation, violation, and other losses
8. 38We rely on the availability of licenses to third-party technology that may be difficult to replace or that may cause errors or delay implementation of our solution should we not be able to continue or obtain a commercially reasonable license to such technology

Risks Related to Government Regulation

1. 39Federal and other governments and independent standards organizations have implemented and may implement in the future significant regulations or standards that could adversely affect our ability to produce, market, or sell subscriptions to our solution
2. 40Reductions in regulation of our customers’ physical operations may adversely impact demand for our solution by reducing the necessity for, or desirability of, certain of our Applications
3. 41Failure to comply with laws, regulations, executive orders, and directives applicable to our business could subject us to fines and penalties and could also cause us to lose customers or otherwise harm our business, financial condition, and results of operations
4. 42We are subject to stringent and changing laws, regulations, standards, and contractual obligations related to privacy, data protection, and cybersecurity. Any actual or perceived failure to comply with such obligations could harm our business
5. 43Failure to comply with anti-corruption and anti-money laundering laws, including the FCPA and similar laws associated with our activities outside of the United States, could subject us to penalties and other adverse consequences
6. 44A portion of our revenue is generated by sales to government entities, which are subject to a number of challenges and risks
7. 45Failure to comply with laws, regulations, policies, or contractual provisions applicable to our business could cause us to lose government customers or our ability to contract with the U.S. and other governments
8. 46We are required to comply with governmental export control, economic sanctions, and import laws and regulations. Our failure to comply with these laws and regulations could have an adverse effect on our business, financial condition, and results of operations
9. 47Our failure to comply with the requirements of applicable environmental legislation and regulation could have a material adverse effect on our revenue and profitability
10. 48Regulations related to conflict minerals may cause us to incur additional expenses and could limit the supply and increase the costs of certain metals used in the manufacturing of our products
11. 49We may face fines, penalties, or other costs, either directly or vicariously, if any of our partners, resellers, contractors, vendors, or other third parties fail to adhere to their compliance obligations under our policies and applicable law

Risks Related to Finance, Accounting, and Tax Matters

1. 50Our results of operations and our business metrics have fluctuated and are likely to fluctuate significantly in future periods and may not fully reflect the underlying performance of our business, which makes our future results difficult to predict and could cause our results of operations to fall below expectations
2. 51Seasonality may cause fluctuations in our results of operations and financial position
3. 52If we are unable to achieve and sustain a level of liquidity sufficient to support our operations and fulfill our obligations, our business, financial condition, and results of operations could be adversely affected
4. 53We may require additional capital to fund our business and support our growth, and any inability to generate or obtain such capital may adversely affect our business and financial condition
5. 54Our business is exposed to risks related to third-party financing of our customers’ subscriptions to our Connected Operations Platform
6. 55Changes in our subscription or pricing models could adversely affect our business, financial condition, and results of operations
7. 56We recognize certain revenue streams over the term of our subscription contracts. Consequently, downturns in new sales may not be immediately reflected in our results of operations and may be difficult to discern
8. 57Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could expose us to greater than anticipated tax liabilities
9. 58Our international operations may subject us to potential adverse tax consequences
10. 59If currency exchange rates fluctuate substantially in the future, the results of our operations, which are reported in U.S. dollars, could be adversely affected
11. 60Our marketable debt securities portfolio is subject to credit, liquidity, market, and interest rate risks that could cause its value to decline and materially adversely affect our business, financial condition, results of operations, and prospects
12. 61We could be required to collect additional sales, use, value added, digital services, or other similar taxes or be subject to other liabilities that may increase the costs our customers would have to pay for our Applications and adversely affect our results of operations
13. 62Our ability to use our net operating loss carryforwards to offset future taxable income may be subject to certain limitations
14. 63If our judgments or estimates relating to our critical accounting policies are based on assumptions that change or prove to be incorrect, our results of operations could fall below expectations of securities analysts and investors, resulting in a decline in our stock price

Risks Related to the Ownership of Our Class A Common Stock

1. 64Sales or distributions of substantial amounts of our Class A common stock in the public markets, or the perception that they might occur, could cause the market price of our Class A common stock to decline
2. 65Our stock price may be volatile and may decline significantly and rapidly regardless of our operating performance, resulting in substantial losses for investors
3. 66The multi-class structure of our common stock has the effect of concentrating voting control with those stockholders who held our capital stock prior to the completion of our initial public offering
4. 67Our multi-class structure may negatively affect the decision by certain institutional investors to purchase or hold shares of our Class A common stock
5. 68An active and liquid market for our Class A common stock may not be sustained, which may make it difficult for investors to sell the Class A common stock they purchase
6. 69Our issuance of additional capital stock in connection with financings, acquisitions, investments, our equity incentive plans, or otherwise will dilute all other stockholders
7. 70If securities or industry analysts do not publish research or reports about our business, or publish negative reports about our business, our share price and trading volume could decline
8. 71We do not intend to pay dividends for the foreseeable future
9. 72The requirements of being a public company may strain our resources, divert management’s attention, and affect our ability to attract and retain executive management and qualified board members
10. 73As a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, and the rules and regulations of the applicable listing standards of the New York Stock Exchange
11. 74Provisions in our corporate charter documents and under Delaware law may prevent or frustrate attempts by our stockholders to change our management or hinder efforts to acquire a controlling interest in us, and the market price of our Class A common stock may be lower as a result
12. 75Our business could be impacted as a result of actions by activist shareholders or others
13. 76Our business may be materially and adversely impacted by U.S. and global market, political, and economic conditions, including elevated inflation rates
14. 77Our estimates of market opportunity and market share, and our forecasts of market growth may prove to be inaccurate
15. 78Fluctuating expectations and attitudes towards environmental, social, and governance issues by shareholders, customers, regulators, and other stakeholders may impose additional risks and costs on our business
16. 79Acquisitions, strategic investments, partnerships, or alliances could be difficult to identify, pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value, and adversely affect our business, financial condition, and results of operations
17. 80Litigation could have a material adverse impact on our results of operations and financial condition
18. 81We may be adversely affected by natural disasters and other catastrophic events, and by man-made problems such as terrorism, that could disrupt our business and adversely affect results of operations, and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster