Nixxy (NIXX) FY2025 10-K Risk Factors: 23 New, 24 Dropped

What the changes say

Nixxy transitioned from staffing to telecommunications and AI services, updating its risk profile for network costs and compliance.

What changed since the prior 10-K

New

New
We will need to raise additional funds in the near future in order to execute our business plan and these funds may not be available to us when we need them. If we cannot raise additional funds when we need them, our business, prospects, financial condition and operating results could be negatively affected
We need additional capital to fund our growth and support telecommunications working capital, and raising funds may dilute shareholders.
New
If we fail to meet the continued listing standards of NASDAQ, our common stock may be delisted, which could have a material adverse effect on the liquidity and market price of our common stock and expose the Company to litigation
Our common stock received a Nasdaq notice on February 20, 2026, for closing below the $1.00 minimum bid price requirement.
New
The telecommunications industry is characterized by intense price competition, which has resulted in declines in both our average per-minute price realizations and our average per-minute termination costs
Intense price competition in telecommunications and the growth of free Over-The-Top calling services like WhatsApp may reduce our revenues.
New
Our products face intense competitive challenges, including rapid technological changes and pricing pressure from competitors, which could adversely affect our business
Our product lines face intense competition, rapid technological changes, and pricing pressures that could cause protracted losses.
New
Our operating results may fluctuate, which could have a negative impact on our ability to grow our client base, establish sustainable revenues and succeed overall
Our operating results may fluctuate due to factors like economic conditions, seasonality, and telecommunications regulations, risking our business.
New
The termination of our carrier agreements or our inability to enter into new carrier agreements in the future could materially and adversely affect our ability to compete, which could reduce our revenues and profits
We rely on finite-term carrier agreements with third parties to originate and terminate traffic, and their loss would reduce revenues.
New
Our customers could experience financial difficulties, which could adversely affect our revenues and profitability if we experience difficulties in collecting our receivables
We depend on collecting receivables from smaller, less financially stable long-distance providers in the wholesale telecommunications market.
New
We may fail to successfully integrate our acquisitions or otherwise be unable to benefit from pursuing acquisitions
Future acquisitions of complementary businesses may involve material transaction costs, integration difficulties, and potentially dilutive equity issuances.
New
We may seek business combination opportunities in industries or sectors that are outside of our management’s area of expertise
We may seek business combinations outside management's expertise, limiting our ability to evaluate risks and make effective decisions.
New
We may attempt to complete a business combination with a private target company about which little information is available, and such target entity may not generate revenue as expected or otherwise be compatible with us as expected
We may acquire private target companies with limited available public information, leading to potential operational or revenue shortfalls.
New
Any business we acquire will likely lack diversity of operations or geographical reach, and in such case we will be subject to risks associated with dependence on a single industry or region
Acquired businesses may lack geographic or industry diversification, increasing our vulnerability to localized risks or single-industry downturns.
New
Our AI systems may not perform as intended
Our AI-driven routing and analytics tools may produce inaccurate results leading to billing errors or contractual disputes.
New
Natural disasters, terrorist acts, acts of war, pandemics, cyber-attacks or other breaches of network or information technology security may cause equipment failures or disrupt our operations
New
If we are unable to successfully manage growth, our operations could be adversely affected
New
If we are unable to respond to technological advancements and other changes in our industry by developing and releasing new services, or improving our existing services, in a timely and cost-effective manner or at all, our business could be materially and adversely affected
New
The loss of key personnel could disrupt the management and operations of our business
NewRisks Related to Legal Uncertainty
We may be subject to securities litigation, which is expensive and could divert management attention
NewRisks Related to Legal Uncertainty
We may be subject to tax and regulatory audits which could subject us to liabilities
NewRisks Related to Legal Uncertainty
Changes in regulations or user concerns regarding privacy and protection of user data, or any failure to comply with such laws, could adversely affect our business
NewRisks Related to Legal Uncertainty
Security breaches, denial of service attacks, or other hacking and phishing attacks on our systems or other security breaches, including internal security failures, could harm our reputation or subject us to significant liability, and adversely affect our business and financial results
NewRisks Related to Our Common Stock
Due to factors beyond our control, our stock price may be volatile
NewRisks Related to Our Common Stock
Future issuance of our Common Stock could dilute the interests of our existing shareholders, particularly in connection with an acquisition and any resulting financing
NewRisks Related to Our Common Stock
We do not currently intend to pay dividends on our common stock in the foreseeable future, and consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stock

Dropped

DroppedRisks Related to Our Business and Industry
We may incur potential liability to employees and clients
Potential liability to employees and clients.
DroppedRisks Related to Our Business and Industry
Because we have historically had arrangements with related parties affecting a significant part of our operations, such arrangements may not reflect terms that would otherwise be available from unaffiliated third parties
Related party arrangements and customer concentration.
DroppedRisks Related to Our Business and Industry
There is substantial doubt regarding our ability to continue as a going concern absent obtaining adequate new debt or equity financing and achieving sufficient sales levels
Substantial doubt regarding going concern.
DroppedRisks Related to Our Business and Industry
Our business depends on a strong reputation and anything that harms our reputation will likely harm our results
Staffing solutions reputation and name recognition.
DroppedRisks Related to Our Business and Industry
We utilize AI, which could expose us to liability or adversely affect our business
Generative AI utilization and competition.
DroppedRisks Related to Our Business and Industry
We may not be able to maintain our compliance with Nasdaq
Nasdaq stockholders' equity compliance extension.
DroppedRisks Related to Our Business and Industry
We may be unable to find sufficient candidates for our staffing business
Candidate supply for staffing services.
DroppedRisks Related to Our Business and Industry
We may require additional capital to fund our business and support our growth, and our inability to generate and obtain such capital on acceptable terms, or at all, could harm our business, operating results, financial condition, and prospects
Capital requirements for staffing growth.
DroppedRisks Related to Our Business and Industry
If we experience errors, defects, or disruptions on the Platform it could damage our reputation, which could in turn materially and adversely impact our operating results and growth prospects
DroppedRisks Related to Our Business and Industry
We rely on third parties to host our Platform, and any disruption of service from such third parties or material change to, or termination of, our arrangement with them could adversely affect our business
Platform errors, defects, and disruptions.
DroppedRisks Related to Our Business and Industry
Our Platform contains open-source software components, and failure to comply with the terms of the underlying licenses could restrict our ability to market or operate our Platform
Third-party hosting and cloud infrastructure reliance.
DroppedRisks Related to Our Business and Industry
Our future growth depends in part on our ability to form new and maintain existing strategic partnerships with third party solution providers and continued performance of such solution providers under the terms of our strategic partnerships with them
Open-source software components and license compliance.
DroppedRisks Related to Our Business and Industry
We rely in part on certain software that we license from related and third parties as part of our service offerings, and if we were to lose the ability to use such software our business and operating results would be materially and adversely affected
Strategic partnerships with third-party solution providers.
DroppedRisks Related to Our Business and Industry
For the year ended December 31, 2024, two customers accounted for more than 10% of total revenue, at 40%. For the year ended December 31, 2023, one customer accounted for more than 10% of total revenue, at 57%
DroppedRisks Related to Our Business and Industry
Failure to protect our intellectual property could adversely affect our business
DroppedRisks Related to Our Business and Industry
Our future success depends on our ability to retain and attract high-quality personnel, and the efforts, abilities and continued service of our senior management, and unsuccessful succession planning could adversely affect our business
DroppedRisks Related to Our Business and Industry
If we sustain an impairment in the carrying value of long-lived assets and goodwill, it will negatively affect our operating results
DroppedRisks Related to Our Business and Industry
If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired
DroppedRisks Related to Our Business and Industry
Our strategic transactions may not be integrated into our business successfully
DroppedRisks Related to Regulation
If recruiters on the Platform were classified as employees instead of independent contractors, our business would be materially and adversely affected
DroppedRisks Related to Regulation
The regulatory framework for privacy and data protection is complex and evolving, and changes in laws or regulations relating to privacy or the protection or transfer of personal data, or any actual or perceived failure by us to comply with such laws and regulations, could adversely affect our business
DroppedRisks Related to Regulation
Unfavorable global economic and geopolitical conditions could adversely affect our business, financial condition, stock price, and results of operations
DroppedRisks Related to the Telecommunications Industry
Increasing competition could materially adversely affect our operating results
DroppedRisks Relating to Investments in Our Common Stock
Because we may issue preferred stock without the approval of our stockholders and a concentrated group of stockholders own a significant percentage of our Common Stock, it may be more difficult for a third party to acquire us and could depress our stock price

Reworded

82% rewritten
Because we have a history of net losses, we may never achieve or sustain profitability or positive cash flow from operations
Updated net loss figures for the fiscal year ended December 31, 2025, showing $15.0 million in losses and an accumulated deficit of $113.8 million.

All 25 risk factors

Headings as the filing states them, in filing order.

Other

01Because we have a history of net losses, we may never achieve or sustain profitability or positive cash flow from operations 82% rewritten
02We will need to raise additional funds in the near future in order to execute our business plan and these funds may not be available to us when we need them. If we cannot raise additional funds when we need them, our business, prospects, financial condition and operating results could be negatively affectedNew
03If we fail to meet the continued listing standards of NASDAQ, our common stock may be delisted, which could have a material adverse effect on the liquidity and market price of our common stock and expose the Company to litigationNew
04The telecommunications industry is characterized by intense price competition, which has resulted in declines in both our average per-minute price realizations and our average per-minute termination costsNew
05Our products face intense competitive challenges, including rapid technological changes and pricing pressure from competitors, which could adversely affect our businessNew
06Our operating results may fluctuate, which could have a negative impact on our ability to grow our client base, establish sustainable revenues and succeed overallNew
07The termination of our carrier agreements or our inability to enter into new carrier agreements in the future could materially and adversely affect our ability to compete, which could reduce our revenues and profitsNew
08Our customers could experience financial difficulties, which could adversely affect our revenues and profitability if we experience difficulties in collecting our receivablesNew
09We may fail to successfully integrate our acquisitions or otherwise be unable to benefit from pursuing acquisitionsNew
10We may seek business combination opportunities in industries or sectors that are outside of our management’s area of expertiseNew
11Changes to federal, state and foreign government regulations and decisions in regulatory proceedings, as well as private litigation, could further increase our operating costs and/or alter customer perceptions of our operations, which could materially adversely affect us
12We may attempt to complete a business combination with a private target company about which little information is available, and such target entity may not generate revenue as expected or otherwise be compatible with us as expectedNew
13Any business we acquire will likely lack diversity of operations or geographical reach, and in such case we will be subject to risks associated with dependence on a single industry or regionNew
14Our AI systems may not perform as intendedNew
15Natural disasters, terrorist acts, acts of war, pandemics, cyber-attacks or other breaches of network or information technology security may cause equipment failures or disrupt our operationsNew
16If we are unable to successfully manage growth, our operations could be adversely affectedNew
17If we are unable to respond to technological advancements and other changes in our industry by developing and releasing new services, or improving our existing services, in a timely and cost-effective manner or at all, our business could be materially and adversely affected New
18The loss of key personnel could disrupt the management and operations of our businessNew

Risks Related to Legal Uncertainty

19We may be subject to securities litigation, which is expensive and could divert management attentionNew
20We may be subject to tax and regulatory audits which could subject us to liabilitiesNew
21Changes in regulations or user concerns regarding privacy and protection of user data, or any failure to comply with such laws, could adversely affect our businessNew
22Security breaches, denial of service attacks, or other hacking and phishing attacks on our systems or other security breaches, including internal security failures, could harm our reputation or subject us to significant liability, and adversely affect our business and financial resultsNew

Risks Related to Our Common Stock

23Due to factors beyond our control, our stock price may be volatileNew
24Future issuance of our Common Stock could dilute the interests of our existing shareholders, particularly in connection with an acquisition and any resulting financingNew
25We do not currently intend to pay dividends on our common stock in the foreseeable future, and consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stockNew

Other Nixxy 10-Ks

FY2024 10-K risk factors
26 risks
Nixxy faces a going concern doubt, significant accumulated deficits, and customer concentration risks in its staffing and platform business.
Filed Mar 31, 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.