Natural Alternatives International (NAII) risk factors, FY2026 10-K

Natural Alternatives International's FY2026 10-K, filed Sep 28, 2026, lists 22 risk factors in 8 groups. Against the prior year's 19: 3 new, 4 substantially reworded.

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Risk factors listed
228 groups
New this year
3vs 19 last year
Dropped
0since the prior 10-K
Substantially reworded
4of those kept
Section length
8k wordsItem 1A

What the changes say

  • Three years of losses and negative cash flow now create substantial doubt about NAII’s ability to continue as a going concern.
  • A major customer cut projected fiscal 2027 orders, threatening revenue and the domestic credit facility’s fixed-charge coverage covenant.
  • Customer concentration increased: the two largest customers represented 52% of fiscal 2026 consolidated sales.
  • Employment litigation includes a proposed settlement requiring up to $1.25 million.

What changed since the prior 10-K

New

  • NewRisks Related to the Company’s Business and Industry

    We have experienced multiple years of operating losses, negative operating cash flows, increased dependence on our credit facilities, and there is substantial doubt about our ability to continue as a going concern

    Multiple years of losses, negative operating cash flow, heavier credit-facility dependence, and substantial doubt now threaten continued operations.

  • NewRisks Related to the Company’s Business and Industry

    As of June 30, 2026, we had $7.5 million in cash, cash equivalents and restricted cash of which $6.3 million was held by NAIE. On October 15, 2025, NAIE paid a dividend of $3.1 million to NAI which was subject to a 5% Swiss withholding tax

    NAII may breach its domestic lender’s fixed-charge coverage covenant after a major customer cut fiscal 2027 orders; $7.5 million of cash was held, including $6.3 million at NAIE.

  • NewRisks Related to Litigation

    We could be exposed to employment litigation matters such as but not limited to wage and hour claims, which may be costly and could materially adversely affect our operations

    U.S. and Swiss employment claims, including putative class and PAGA actions, could require significant resources; a tentative settlement allows up to $1.25 million.

Reworded

  • 53% rewrittenGeneral Risk Factors

    We expect our operating results will vary. Fluctuations in our operating results may adversely affect the share price of our common stock

    The risk now reports three consecutive fiscal-year losses, negative operating cash flow in fiscal 2026 and 2024, and expected fiscal 2027 losses.

  • 41% rewrittenGeneral Risk Factors

    We may not be able to raise additional capital or obtain additional financing if needed

    The risk now includes Swiss credit lines and replaces the domestic facility’s December 2026 termination with a May 18, 2029 termination.

  • 37% rewrittenRisks Related to Customer Concentration

    Because we derive a significant portion of our revenues from a limited number of customers, our revenues would be adversely affected by the loss of a major customer or a significant change in their business, personnel or the timing or amount of their sales to their customers and their orders from us

    Customer concentration shifted from three customers at 59% of fiscal 2025 sales to two customers at 52% in fiscal 2026, with a new fiscal 2027 order reduction.

  • 34% rewrittenRisks Related to Customer Concentration

    Our future growth and stability depends, in part, on our ability to diversify our sales. Our efforts to establish new sales from both existing customers and new customers could require significant initial investments, which may or may not result in higher overall sales and improved financial results

    No material substantive change; the risk continues to cover upfront investments and delays in developing products and customers.

All 22 risk factors

Headings as the filing states them, in filing order.

Risks Related to the Company’s Business and Industry

  1. 01We have experienced multiple years of operating losses, negative operating cash flows, increased dependence on our credit facilities, and there is substantial doubt about our ability to continue as a going concernNew
  2. 02As of June 30, 2026, we had $7.5 million in cash, cash equivalents and restricted cash of which $6.3 million was held by NAIE. On October 15, 2025, NAIE paid a dividend of $3.1 million to NAI which was subject to a 5% Swiss withholding taxNew
  3. 03A significant or prolonged economic downturn could have a material adverse effect on our results of operations
  4. 04Risks related to global economic instability, including global supply chain issues, inflation and fuel and energy costs may affect the Company's business
  5. 05Our industry is highly competitive, and we may be unable to continue to compete effectively. Increased competition could adversely affect our financial condition
  6. 06Our business is subject to the effects of adverse publicity, which could negatively affect our sales and revenues

Risks Related to Operations, Manufacturing, and Technology

  1. 07If we are unable to attract and retain qualified management personnel, and key manufacturing personnel, our business may suffer
  2. 08Our manufacturing and third party fulfillment activities are subject to certain risks
  3. 09The failure of our suppliers to supply quality materials in sufficient quantities, at a favorable price, and in a timely fashion could adversely affect the results of our operations

Risks Related to Customer Concentration

  1. 10Because we derive a significant portion of our revenues from a limited number of customers, our revenues would be adversely affected by the loss of a major customer or a significant change in their business, personnel or the timing or amount of their sales to their customers and their orders from us37% rewritten
  2. 11Our future growth and stability depends, in part, on our ability to diversify our sales. Our efforts to establish new sales from both existing customers and new customers could require significant initial investments, which may or may not result in higher overall sales and improved financial results34% rewritten

Risks Related to Regulations

  1. 12Our products and manufacturing activities are subject to extensive government regulation, which could limit or prevent the sale of our products in some markets and could increase our costs
  2. 13Tariffs on imported goods from China and elsewhere could adversely affect our business operations

Risks Related to Litigation

  1. 14We could be exposed to employment litigation matters such as but not limited to wage and hour claims, which may be costly and could materially adversely affect our operationsNew
  2. 15We could be exposed to product liability claims or other litigation, which may be costly and could materially adversely affect our operations
  3. 16We may continue to incur significant costs in the course of creating and defending our intellectual property. We may be unable to protect our intellectual property rights or may inadvertently infringe on the intellectual property rights of others

Risks Related to Insider Ownership and Corporate Structure

  1. 17If certain provisions of our Certificate of Incorporation, Bylaws and Delaware law are triggered, the market for our shares may decrease
  2. 18Collectively, our officers and directors own a significant amount of our common stock, giving them influence over corporate transactions and other matters and potentially limiting the influence of other stockholders on important policy and management issues

Risks Related to Future Acquisitions

  1. 19We may pursue acquisitions of other companies that, if not successful, could adversely affect our business, financial condition and results of operations

General Risk Factors

  1. 20We expect our operating results will vary. Fluctuations in our operating results may adversely affect the share price of our common stock53% rewritten
  2. 21Our stock price could fluctuate significantly
  3. 22We may not be able to raise additional capital or obtain additional financing if needed41% rewritten

Other Natural Alternatives International 10-Ks

  • FY2025 10-K risk factors
    22 risks3 reworded

    Operating loss increased in fiscal 2025 despite higher net sales. The company shifted its fiscal 2026 profit outlook, expecting a first-half loss and second-half net income. Geopolitical risk disclosures now explicitly include the Middle East alongside Ukraine.

    Filed Sep 23, 2025
  • FY2024 10-K risk factors
    22 risks

    Concentrated customer base creates extreme dependency risk, with three customers accounting for 68% of consolidated net sales. Single-source supply chain vulnerability exists for beta-alanine used in CarnoSyn products. Extensive government regulations govern nutritional supplement manufacturing, packaging, and labeling across global markets.

    Filed Sep 27, 2024

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.