Mitek Systems (MITK) risk factors, FY2025 10-K

Other

1. 01Risks Associated With Our Business and Operations
2. 02We currently derive substantially all of our revenue from a few types of technologies. If these technologies and the related products do not achieve or continue to achieve market acceptance, our business, financial condition, and results of operations would be adversely affected
3. 03Our solutions depend on compatibility with third-party mobile operating systems and hardware. Changes in such systems could disrupt our businessNew
4. 04We cannot predict the impact that the decline of the use of checks, changes in consumer behavior facilitated by advances in technologies, and the development of check alternatives, or the plateau of the penetration of active mobile banking users may have on our business57% rewritten
5. 05If the patents we own or license, or our other intellectual property rights, do not adequately protect our technologies, brands or other intellectual property, we may lose market share to our competitors and be unable to operate our business profitably
6. 06We face competition from several companies that may have greater resources than we do, which could result in price reductions, reduced margins, or loss of market share
7. 07We must continue to engage in extensive research and development in order to remain competitive41% rewritten
8. 08Defects or malfunctions in our products could hurt our reputation, sales and profitability
9. 09Our lengthy sales cycles and the difficulty in predicting timing of sales or delays may impair our operating results
10. 10Our historical order flow patterns, which we expect to continue, have caused forecasting difficulties for us. If we do not meet our forecasts or analysts’ forecasts for us, the price of our common stock may decline
11. 11Entry into new lines of business, and our offering of new products and services may result in exposure to new risks
12. 12Adverse economic conditions or reduced spending on information technology solutions may adversely impact our revenue and profitability
13. 13We may be exposed to tariff policy changes that could negatively impact our financial resultsNew
14. 14We may need to raise additional capital to fund continuing operations and an inability to raise the necessary capital or the inability to do so on acceptable terms could threaten the success of our business
15. 15Our annual and quarterly results have fluctuated greatly in the past and will likely continue to do so, which may cause substantial fluctuations in our common stock price21% rewritten
16. 16Due to our operations in non-U.S. markets, we are subject to certain risks that could adversely affect our business, results of operations or financial condition
17. 17Our international operations may increase our exposure to potential liability under anti-corruption, trade protection, tax, and other laws and regulations22% rewritten
18. 18Fluctuations in foreign currency exchange and interest rates could adversely affect our results of operations
19. 19An “ownership change” could limit our ability to utilize our net operating loss and tax credit carryforwards, which could result in our payment of income taxes earlier than if we were able to fully utilize our net operating loss and tax credit carryforwards
20. 20Our cash and cash equivalents could be adversely affected if the financial institutions at which we hold our cash and cash equivalents fail
21. 21Our business could be adversely affected in the event we default under our debt agreements
22. 22Our revenues are dependent on our ability to maintain and expand existing customer relationships and our ability to attract new customers
23. 23The loss of one or more of our key customers could slow our revenue growth or cause our revenues to decline
24. 24We may incur goodwill and intangible asset impairment charges that adversely affect our operating resultsNew

Risks Related to Privacy, Artificial Intelligence, and Cybersecurity

1. 25Evolving domestic and international data privacy and AI laws and regulations may restrict our ability, and that of our customers, to solicit, collect, process, transfer, disclose and use personal information or may increase the costs of doing so, which could harm our business65% rewritten
2. 26Our ability to adopt and deploy AI and other new technologies may impact demand for our products and services and impact our internal operationsNew
3. 27Fraudsters’ use of generative AI could create new attack vectors that we may be unable to effectively detect or preventNew
4. 28Our business and operations are subject to a variety of regulatory requirements in the countries in which we operate or in which we offer our solutions, including, among other things, with respect to AI and ML technologies that may be difficult and expensive to comply with and that could negatively impact our businessNew
5. 29technologies may reveal other personal or sensitive information generated by the model. Use of third‑party models may also trigger additional contractual obligations, intellectual property risks, and export control considerationsNew
6. 30Security breaches or cyberattacks could expose us to significant liability, cause our business and reputation to suffer and harm our competitive position29% rewritten

Risks Related to Investing in Our Common Stock

1. 31A potential proxy contest for the election of directors at our annual meeting could result in potential operational disruption, divert our resources, and could potentially result in adverse consequences under certain of our agreements

Risks Related to Regulation and Compliance

1. 32If we are unable to retain and recruit qualified personnel, or if any of our key executives or key employees discontinues his or her employment with us, it may have a material adverse effect on our business
2. 33Legislation and governmental regulations enacted in the U.S. and other countries that apply to us or to our customers may require us to change our current products and services and/or result in additional expenses, which could adversely affect our business and results of operations
3. 34Natural disasters or other catastrophic events may disrupt our business