Insperity (NSP) risk factors, FY2025 10-K

Insperity's FY2025 10-K, filed Feb 11, 2026, lists 29 risk factors in 2 groups. Against the prior year's 28: 2 new, 1 dropped, 14 substantially reworded.

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Risk factors listed
292 groups
New this year
2vs 28 last year
Dropped
1since the prior 10-K
Substantially reworded
14of those kept
Section length
10k wordsItem 1A

What the changes say

  • Insperity added risks regarding COVID employee retention tax credit deadlines and insurance carrier failures.
  • The new HRScale joint solution with Workday is highlighted for larger clients exceeding 1,000 WSEEs.
  • Client contract cancellations and potential co-employer liabilities remain key ongoing business vulnerabilities.

What changed since the prior 10-K

New

  • New

    If the claims that we made for employee retention tax credits under COVID relief programs are disallowed, our business, financial condition, and results of operations could be materially adversely affected

    If our employee retention tax credit claims for PEO clients are disallowed or face retroactive deadlines under the OBBB, our operations could be harmed.

  • New

    Our loss of insurance coverage, the failure of our insurance carriers or increased insurance costs or deductibles could have a material adverse effect on us

    Loss of insurance coverage, carrier failures, or increased costs for workers' compensation and commercial policies could expose us to uninsured risks.

Dropped

  • Dropped

    If we are unable to comply with or meet client expectations regarding certain COVID-19 relief programs, our business, financial condition, and results of operations could be materially adversely affected

Reworded

  • 61% rewritten

    Many of our contracts for our PEO HR Solutions may be canceled on short notice. Our inability to renew client contracts or attract new clients could materially and adversely affect our financial condition or results of operations

    Added the new HRScale solution targeting larger clients and updated the percentage of paid WSEEs exceeding 1,000 WSEEs from 3% in 2024 to 2% in 2025.

    Was: Many of our contracts for our PEO HR Outsourcing Solutions may be canceled on short notice. Our inability to renew client contracts or attract new clients could materially and adversely affect our financial condition or results of operations

  • 51% rewritten

    We may be subject to liabilities for client and employee actions

    Added a note that we maintain an employment practices liability insurance policy for our clients in co-employment relationships.

  • 50% rewritten

    Inflation may reduce our profitability

    Added a cross-reference warning about potential increases in health insurance costs or inability to secure replacement coverage.

  • 45% rewrittenOther Operational Risks

    We may not fully realize the anticipated benefits of our strategic partnership and joint solution with Workday, which could have a material adverse impact on our financial condition or results of operations

    Named the Workday partnership joint solution as Insperity HRScale and noted client agreements entered in 2025 commencing in Q1 2026.

    Was: We may not fully realize the anticipated benefits of our strategic partnership and plans to develop a joint solution with Workday, which could have a material adverse impact on our financial condition or results of operations

  • 41% rewrittenTechnology Risks

    Evolving regulations, market trends and client expectations require us to constantly enhance and expand our service and technology offerings

    Added artificial intelligence (AI) and the OBBB law as factors driving rapid technological advances and evolving regulatory compliance requirements.

  • 37% rewritten

    Labor shortages, increasing competition for highly skilled workers, and evolving employee expectations regarding the workplace could have a material adverse effect on our business, financial condition or results of operations

    Updated the tight labor market and macroeconomic conditions reference timeframe to reflect 2021 through 2023.

  • 37% rewritten

    Adverse economic conditions or changes in the employment levels could negatively affect our industry, business, and results of operations

    Added the caveat regarding difficulty obtaining credit at favorable rates or at all during weak economic conditions.

    Was: Adverse economic conditions could negatively affect our industry, business, and results of operations

  • 34% rewrittenTechnology Risks

    Failure to comply with privacy, data protection, biometric, AI, and cybersecurity laws and regulations could have a material adverse effect on our reputation, results of operations or financial condition, or have other adverse consequences

    Added biometric and AI laws to the scope of privacy, data protection, and cybersecurity regulations.

    Was: Failure to comply with privacy, data protection and cybersecurity laws and regulations could have a material adverse effect on our reputation, results of operations or financial condition, or have other adverse consequences

  • 33% rewritten

    Competition and other developments in the HR services industry, including the impact of AI, may impact our growth and/or profitability

    Was: Competition and other developments in the HR services industry may impact our growth and/or profitability

  • 30% rewritten

    Geographic market concentration makes our results of operations vulnerable to regional economic factors

  • 29% rewrittenTechnology Risks

    The failure of third-party providers, such as financial institutions, data centers, or cloud-service providers, could have a material adverse effect on us

  • 29% rewrittenTechnology Risks

    Disruptions of our information technology systems could damage our reputation and materially disrupt our business operations

  • 28% rewrittenTechnology Risks

    We could be subject to reduced revenues, increased costs, liability claims, or harm to our competitive position as a result of data theft, cyberattacks or other security vulnerabilities

  • 24% rewritten

    Increases in health insurance costs or our inability to secure replacement health insurance coverage on competitive terms could have a material adverse effect on our business, financial condition or results of operations

All 29 risk factors

Headings as the filing states them, in filing order.

Other

  1. 01Adverse economic conditions or changes in the employment levels could negatively affect our industry, business, and results of operations37% rewritten
  2. 02If the claims that we made for employee retention tax credits under COVID relief programs are disallowed, our business, financial condition, and results of operations could be materially adversely affectedNew
  3. 03Bank failures or other events affecting financial institutions could have a material adverse effect on our business, results of operations or financial condition, or have other adverse consequences
  4. 04Labor shortages, increasing competition for highly skilled workers, and evolving employee expectations regarding the workplace could have a material adverse effect on our business, financial condition or results of operations37% rewritten
  5. 05Inflation may reduce our profitability50% rewritten
  6. 06Geographic market concentration makes our results of operations vulnerable to regional economic factors30% rewritten
  7. 07We are subject to covenants under our credit facility that may restrict our business and financing activities. Our failure to comply with these covenants may result in an acceleration of our indebtedness, which could have a material adverse effect on our business, financial condition or results of operations
  8. 08In addition, we are required to maintain certain financial covenants. Our ability to comply with the financial covenants may be affected by financial, business, economic, regulatory and other factors beyond our control
  9. 09A future outbreak of highly infectious or contagious diseases could have a material and adverse impact on our business, results of operations, financial condition and cash flows
  10. 10We assume liability for WSEE payroll, payroll taxes, benefits costs and workers’ compensation costs and are responsible for their payment regardless of the amount billed to or paid by our clients
  11. 11Increases in health insurance costs or our inability to secure replacement health insurance coverage on competitive terms could have a material adverse effect on our business, financial condition or results of operations24% rewritten
  12. 12Health care reform could affect our health insurance plan and could lead to a significant disruption in our business
  13. 13A determination that we are not the employer of our WSEEs and an inability to offer alternate benefit plans could have a material adverse effect on our business
  14. 14Increases in workers’ compensation costs or our inability to secure replacement coverage on competitive terms could lead to a significant disruption and harm to our business
  15. 15Our ability to adjust and collect service fees for increases in unemployment or other tax rates may be limited
  16. 16Many of our contracts for our PEO HR Solutions may be canceled on short notice. Our inability to renew client contracts or attract new clients could materially and adversely affect our financial condition or results of operations61% rewritten
  17. 17Our loss of insurance coverage, the failure of our insurance carriers or increased insurance costs or deductibles could have a material adverse effect on usNew
  18. 18A determination that a client is liable for employment taxes not paid by a PEO may discourage clients from contracting with us in the future
  19. 19New and higher federal, state and local taxes could have a material adverse impact on our financial condition and results of operations
  20. 20We may be subject to liabilities for client and employee actions51% rewritten
  21. 21Changes in federal, state and local regulation or our inability to obtain licenses under new regulatory frameworks could have a material adverse effect on our results of operations or financial condition
  22. 22Competition and other developments in the HR services industry, including the impact of AI, may impact our growth and/or profitability33% rewritten

Technology Risks

  1. 23Evolving regulations, market trends and client expectations require us to constantly enhance and expand our service and technology offerings41% rewritten
  2. 24Disruptions of our information technology systems could damage our reputation and materially disrupt our business operations29% rewritten
  3. 25We could be subject to reduced revenues, increased costs, liability claims, or harm to our competitive position as a result of data theft, cyberattacks or other security vulnerabilities28% rewritten
  4. 26Failure to comply with privacy, data protection, biometric, AI, and cybersecurity laws and regulations could have a material adverse effect on our reputation, results of operations or financial condition, or have other adverse consequences34% rewritten
  5. 27The failure of third-party providers, such as financial institutions, data centers, or cloud-service providers, could have a material adverse effect on us29% rewritten

Other Operational Risks

  1. 28We may not fully realize the anticipated benefits of our strategic partnership and joint solution with Workday, which could have a material adverse impact on our financial condition or results of operations45% rewritten
  2. 29Failure to integrate or realize the expected return on future product offerings, including through acquisitions, strategic partnerships, and investments, could have a material adverse impact on our financial condition or results of operations

Other Insperity 10-Ks

  • FY2024 10-K risk factors
    28 risks

    Insperity relies heavily on G-SIB bank deposits exceeding FDIC limits, major markets in New York, California, and Texas, and long-term partnerships like Workday.

    Filed Feb 11, 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.