Paymentus Holdings (PAY) FY2025 10-K Risk Factors: 49 New, 40 Dropped

What the changes say

Growth in payment volumes and biller adoption may not match historical rates or support market expectations.
Strategic partnerships with JPMorgan Chase, U.S. Bank, and PayPal are critical for expanding electronic bill payment transaction volume.
Heavy investments in sales, technology infrastructure, and AI features may not yield anticipated cost offsets and profitability.

What changed since the prior 10-K

New

NewRisks Related to Our Business, Industry and Growth
Our historical growth rate, including in payment volumes, may not be sustainable or indicative of our future growth. We cannot guarantee that we will be able to attract new billers, financial institutions and end-users, retain existing ones or maintain similar growth, despite solid growth in recent years
Future growth in payment volumes and biller adoption may slow, risking our stock price if key performance metrics are missed.
NewRisks Related to Our Business, Industry and Growth
We rely on partnerships for a portion of our revenue; if we fail to establish, grow or maintain them, our ability to compete and our operating results will be impaired
Our transaction volume depends heavily on maintaining integrations and strategic partnerships with firms like JPMorgan Chase, U.S. Bank, PayPal, and Walmart.
NewRisks Related to Our Business, Industry and Growth
Our ability to maintain profitability is uncertain due to expected increases in costs that may not be offset by revenue growth or expected benefits from investments
Substantial investments in sales expansion, AI platform development, and international markets may fail to generate expected profitability.
NewRisks Related to Our Business, Industry and Growth
Our sales efforts to large enterprises are complex, costly and unpredictable, which could cause our results to fluctuate
Selling our platform to large enterprise billers involves long, unpredictable sales cycles and complex approval processes that cause financial fluctuations.
NewRisks Related to Our Business, Industry and Growth
Economic risks and inflationary pressures could negatively affect our financial performance, and we may not be able to adjust our pricing accordingly
Economic uncertainty, inflation, or interest rate hikes could reduce consumer spending and lower the volume and value of electronic bill payments processed.
NewRisks Related to Our Business, Industry and Growth
The market in which we operate is competitive, and if we cannot compete effectively, our business, operating results and financial condition could be harmed
Intense competition from legacy payment providers, financial institutions, and bundled software solutions could harm our financial results.
NewRisks Related to Our Business, Industry and Growth
Fluctuations in our operating results and shifts in payment mix make forecasting difficult; inability to accurately meet our forecasts could cause our stock price to decline
Shifts in payment methods and fluctuating demand make operating results difficult to forecast accurately.
NewRisks Related to Our Business, Industry and Growth
Variations across biller industries, affecting payment methods and average payment amounts, and thus revenue and gross margin, particularly due to interchange fees
Variations across biller industries and changing consumer preferences for cloud security or payment methods can impact revenue and gross margins.
NewRisks Related to Our Business, Industry and Growth
Our use of artificial intelligence (AI) and machine learning (ML) presents specific risks that could harm our business and reputation
Growing use of AI and machine learning introduces risks of algorithmic flaws, data bias, regulatory inquiries, and increased cybersecurity vulnerabilities.
NewRisks Related to Our Business, Industry and Growth
We operate in an innovative and evolving market, and slow or unexpected development could negatively impact our revenue
Slow market adoption of cloud-based platforms over traditional paper bills, checks, and internal bank systems could stunt revenue growth.
NewRisks Related to Our Business, Industry and Growth
The success of competing solutions, including those that may offer superior, more efficient or secure solutions at lower prices
Failure to adapt to technological changes and lower-priced competing solutions could render our electronic bill payment products less competitive.
NewRisks Related to Our Business, Industry and Growth
Our risk management efforts may be ineffective against fraudulent activities, exposing us to material financial losses, liability and reputational harm
Automated platform processes and identity verification may fail to catch sophisticated fraud schemes, leading to material financial losses.
NewRisks Related to Our Business, Industry and Growth
Failure to provide high-quality customer support could damage our reputation and business, or negatively impact our profitability
NewRisks Related to Our Business, Industry and Growth
If our transaction fees are unacceptable to clients or consumers, our financial condition and growth could be harmed
NewRisks Related to Our Business, Industry and Growth
Failure to meet our service level commitments could lead to credits, refunds or contract terminations, adversely affecting our revenue and financial condition
NewRisks Related to Our Business, Industry and Growth
International expansion exposes us to a variety of operational, regulatory and financial risks
NewRisks Related to Our Business, Industry and Growth
Failure to maintain and enhance our brand could adversely affect our business and financial condition
NewRisks Related to Our Business, Industry and Growth
Successfully differentiating our products from competitors
NewRisks Related to Our Business, Industry and Growth
Widespread health issues or pandemics, natural disasters or man-made problems could materially harm our business operations
NewRisks Related to Our Business, Industry and Growth
Future litigation, investigations or similar matters could adversely affect our business and result in substantial costs
NewRisks Related to Regulation
Failure to comply with extensive and evolving financial services, anti-corruption and other laws could materially harm our business
NewRisks Related to Regulation
Actual or perceived failure to comply with data privacy, data protection and information security laws could result in litigation, fines and reputational harm
NewRisks Related to Regulation
Federal Trade Commission and state attorneys general interpretations of consumer protection laws
NewRisks Related to Regulation
Self-regulatory standards imposed by privacy advocates and industry groups
NewRisks Related to Regulation
Our and our clients' communications with consumers are subject to laws regulating telephone and email marketing, and non-compliance could lead to significant penalties
NewRisks Related to Regulation
messages, requiring opt-out mechanisms. These and other communications laws are subject to varying, subjective interpretations, making compliance challenging
NewRisks Related to Regulation
Although remediated, we have previously identified material weaknesses in internal control over financial reporting; any future failure to maintain effective controls could harm our business and stock price
NewRisks Related to Regulation
Limitations or adverse findings regarding our ability to do business in some jurisdictions
NewRisks Related to Our Technology and Intellectual Property
If our platform fails to interoperate with third-party software and technologies, or if those systems have performance issues, our solutions will be less effective and our business could be harmed
NewRisks Related to Our Technology and Intellectual Property
information systems, some of which are also competitors that seek to limit our access to our customers’ user data or acquire their payments business
NewRisks Related to Our Technology and Intellectual Property
Interruptions or delays in services provided by third-party cloud-based data centers or internet service providers could impair platform delivery, damage our reputation and expose us to liability
NewRisks Related to Our Technology and Intellectual Property
Our insurance policies may not adequately compensate us for losses. Third-party providers' failure to timely notify us of security breaches or data disclosures may cause us to incur significant costs
NewRisks Related to Our Technology and Intellectual Property
Software defects, undetected errors or performance problems in our technology, including open source software, could damage client relations, harm our reputation and expose us to liability
NewRisks Related to Our Technology and Intellectual Property
Result in liability, lost business, increased insurance costs, difficulty collecting accounts receivable, costly litigation or regulatory actions
NewRisks Related to Our Technology and Intellectual Property
Re-engineer our platform, which is costly and time-consuming
NewRisks Related to Our Technology and Intellectual Property
Failure to obtain, maintain, protect or enforce our intellectual property rights could impair our competitive position and harm our business
NewRisks Related to Our Technology and Intellectual Property
Although we carry insurance, our insurance may not cover potential claims of this type or may not be adequate to indemnify us for all liability that may be imposed
NewRisks Related to Our Technology and Intellectual Property
Our platform depends on intellectual property and technology licensed from or made available by third parties in some cases, and the loss of access to such intellectual property and technology or the inability to obtain acceptable license terms could harm our business
NewRisks Related to Our Technology and Intellectual Property
Future licenses or rights may not be available on acceptable terms, or at all, which could prevent our platform from remaining competitive. Our inability to obtain licenses on favorable terms could materially and adversely affect our business and results of operations
NewRisks Related to Our Technology and Intellectual Property
Any real or perceived improper or unauthorized use, disclosure or access to the sensitive and personal data we process could harm our reputation and materially adversely affect our business and financial condition
NewRisks Related to Our Technology and Intellectual Property
Liability and financial loss in the form of lost business, increased insurance costs, litigation or adverse publicity
NewRisks Related to Our Technology and Intellectual Property
Expose us to legal risk, potential liability resulting from governmental or regulatory investigations, class action litigation or indemnity obligations, and financial penalties
NewRisks Related to Our Class A Common Stock
The market price of our Class A common stock has and may continue to fluctuate or decline significantly in response to factors described in this “Risk Factors” section or otherwise, many of which are beyond our control. These fluctuations could cause you to lose all or part of your investment
NewRisks Related to Our Class A Common Stock
Other events such as war or terrorism
NewRisks Related to Our Class A Common Stock
Sales of a substantial number of shares of our Class A common stock, particularly by directors, executive officers and principal stockholders, or the perception that such sales may occur, could cause the market price of our Class A common stock to fall
NewRisks Related to Our Class A Common Stock
Our certificate of incorporation and bylaws contain anti-takeover provisions that could discourage, delay or prevent a change of control or changes in management
NewRisks Related to Our Class A Common Stock
The forum for certain litigation against us is restricted to Delaware
NewRisks Related to Our Class A Common Stock
Our bylaws designate exclusive forums for certain legal disputes, which could limit a stockholder's choice of judicial forum
NewRisks Related to Our Class A Common Stock
This provision does not apply to any action to enforce a duty or liability created by the Exchange Act

Dropped

DroppedRisks Related to Our Business and Industry
our ability to expand internationally; and
DroppedRisks Related to Our Business and Industry
If we are unsuccessful in establishing, growing or maintaining partnerships, our ability to compete could be impaired, and our operating results may suffer
International expansion efforts and prioritization of long-term strategic value over short-term revenue.
DroppedRisks Related to Our Business and Industry
Our sales efforts to large enterprises involve considerable time and expense with long and unpredictable sales cycles
DroppedRisks Related to Our Business and Industry
The markets in which we participate are competitive, and if we do not compete effectively, our business, operating results and financial condition could be harmed
Risks related to establishing and maintaining third-party software and referral partnerships.
DroppedRisks Related to Our Business and Industry
relationships that would enable them to expand their product offerings to compete with our platform, provide more comprehensive offerings than they individually had offered or achieve greater economies of scale than us
DroppedRisks Related to Our Business and Industry
Our revenue is sensitive to shifts in payment mix
Time and expense required for enterprise sales cycles.
DroppedRisks Related to Our Business and Industry
We expect fluctuations in our operating results, which will make it difficult to project future results and may cause the market price of our Class A common stock to decline
Competition from legacy providers and financial institutions with internal solutions.
DroppedRisks Related to Our Business and Industry
awareness of our brand and our reputation in our target markets
Competitor bundling and zero-cost pricing strategies for bill payment offerings.
DroppedRisks Related to Our Business and Industry
We operate in an emerging and evolving market, which may develop more slowly or differently than we expect. If our market does not grow as we expect, or if we cannot expand our platform to meet the demands of this market, our revenue may decline or fail to grow
Revenue sensitivity to payment mix shifts between card and ACH transactions.
DroppedRisks Related to Our Business and Industry
Our risk management efforts may not be effective to prevent fraudulent activities, which could expose us to material financial losses and liability and otherwise harm our business
Operating results fluctuations making financial projections difficult.
DroppedRisks Related to Our Business and Industry
Failure to attract and retain additional qualified personnel and any restrictions on the movement of personnel could prevent us from executing our business strategy and growth plans
Brand awareness, public company costs, and unmet revenue assumptions.
DroppedRisks Related to Our Business and Industry
If we fail to offer high-quality customer support, if we experience complaints regarding our customer support or if our support is more expensive than anticipated, our business and reputation could suffer
DroppedRisks Related to Our Business and Industry
If the fees we charge are unacceptable to our billers, financial institutions or their consumers, our business, operating results and financial condition could be harmed
Emerging market risks and competition against legacy bill payment processes.
DroppedRisks Related to Our Business and Industry
If we fail to meet our service level commitments, we could be obligated to provide credits or refunds or face contract terminations, which could adversely affect our business, operating results and financial condition
Risk management and fraud prevention effectiveness.
DroppedRisks Related to Our Business and Industry
If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations and changing business needs, requirements or preferences, our products may become less competitive and our growth rate could decline
DroppedRisks Related to Our Business and Industry
Growing use of artificial intelligence in our business has challenges that, if not properly managed could result in harm to our brand, reputation, business or customers, and adversely affect our results of operations
Difficulty attracting and retaining qualified personnel in competitive job markets.
DroppedRisks Related to Our Business and Industry
Failure to effectively develop and expand our sales and marketing capabilities could harm our ability to increase our biller and financial institution base and achieve broader market acceptance of our products
Customer support quality, complaints, and operational expenses.
DroppedRisks Related to Our Business and Industry
If we fail to maintain and enhance our brand, our ability to expand our business, operating results and financial condition could be adversely affected
DroppedRisks Related to Our Business and Industry
Natural catastrophic events and man-made problems such as power disruptions, computer viruses, security breaches and incidents and terrorism may disrupt our business
DroppedRisks Related to Our Business and Industry
Any future litigation, investigations or similar matters, or adverse facts and developments related thereto, could adversely affect our business, operating results and financial condition
DroppedRisks Related to Regulation
Payments and other financial services-related regulations and oversight are material to our business and any failure by us to comply could materially harm our business
DroppedRisks Related to Regulation
the growth of our business. Furthermore, any costs incurred as a result of this potential liability could harm our operating results
DroppedRisks Related to Regulation
If we fail to comply with extensive, complex, overlapping and frequently changing rules, regulations, standards and legal interpretations, our business could be materially harmed
DroppedRisks Related to Regulation
force us to change our business practices or compliance program, make product or operational changes or delay planned product launches or improvements
DroppedRisks Related to Regulation
We are subject to anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business
DroppedRisks Related to Regulation
Any of these developments could adversely affect our operating results
DroppedRisks Related to Our Technology and Intellectual Property
costs to address the situation. Additionally, our billers, financial institutions and partners may terminate their relationship with us and we may lose access to large numbers of consumers and biller and financial institution referrals as a result
DroppedRisks Related to Our Technology and Intellectual Property
If we fail to adequately obtain, maintain, protect or enforce our intellectual property and proprietary rights, our competitive position could be impaired, our reputation could be harmed and we may lose valuable assets, generate less revenue and incur costly litigation to protect our rights
DroppedRisks Related to Our Technology and Intellectual Property
third parties to copy our products and use information that we regard as proprietary to create products and services that compete with ours
DroppedRisks Related to Our Technology and Intellectual Property
Our business and platform depend in part on intellectual property and proprietary rights and technology licensed from or otherwise made available to us by third parties
DroppedRisks Related to Our Class A Common Stock
other events or factors, including those resulting from war or incidents of terrorism, or responses to these events
DroppedRisks Related to Our Class A Common Stock
A common stock to fall or make it more difficult for you to sell your Class A common stock at a time and price that you deem appropriate
DroppedRisks Related to Our Class A Common Stock
Furthermore, up to 1,193,880 shares of Class A common stock may be issuable pursuant to warrant agreements with JPMC Strategic Investments I Corporation. These shares will become eligible for sale in the public market to the extent permitted by the vesting terms of the warrant, and Rule 144
DroppedRisks Related to Our Class A Common Stock
We are an emerging growth company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our Class A common stock less attractive to investors
DroppedRisks Related to Our Class A Common Stock
exemption from the requirement to hold non-binding advisory votes on executive compensation or golden parachute arrangements
DroppedRisks Related to Our Class A Common Stock
Future securities issuances could result in significant dilution to our stockholders and impair the market price of our Class A common stock
DroppedRisks Related to Our Class A Common Stock
Anti-takeover provisions in our charter documents or applicable state law could make an acquisition of us difficult, limit attempts by our stockholders to replace or remove our current management and depress the market price of our Class A common stock
DroppedRisks Related to Our Class A Common Stock
stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner, and also meet specific requirements as to the form and content of a stockholder’s notice
DroppedRisks Related to Our Class A Common Stock
In addition, certain state laws may discourage, delay or prevent a change of control of our company or changes in our management that the stockholders of our company may deem advantageous
DroppedRisks Related to Our Class A Common Stock
exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act, each of which could limit our stockholders’ ability to choose the judicial forum for disputes with us or our directors, officers, stockholders or employees

Reworded

100% rewrittenRisks Related to Our Business, Industry and Growth
Our historical growth rate may not be sustainable or indicative of our future growth, and a failure to attract and retain billers and financial institutions could materially harm our business
Removed commentary comparing the high cost of acquiring new customers versus retaining existing billers and financial institutions.
Was: Our historical growth rate may not be sustainable or indicative of our future growth
100% rewrittenRisks Related to Our Business, Industry and Growth
The impact of widespread health issues, such as pandemics, on our operating results, liquidity, financial condition and key stakeholders
Replaced pandemic-specific remote work risks with expanded discussions on public company expenses, stock price volatility, and credit card payment mix.
Was: Widespread health issues or pandemics could have a material adverse impact on our employees, billers, financial institutions, partners, consumers and other key stakeholders, which could materially and adversely impact our business, operating results and financial condition
100% rewrittenRisks Related to Our Class A Common Stock
The market price of our Class A common stock may be volatile, or decline steeply, and we may not be able to meet investor or analyst expectations
Streamlined stock price volatility factors to focus directly on operating results, analyst expectations, and general market disruption.
Was: The market price of our Class A common stock may be volatile or may decline steeply or suddenly regardless of our operating performance, and we may not be able to meet investor or analyst expectations
98% rewrittenRisks Related to Our Technology and Intellectual Property
We may become involved in costly and time-consuming intellectual property disputes, which could subject us to significant liability
Added specific intellectual property risks stemming from the increased use of AI, particularly generative AI, and potential litigation outcomes.
Was: We may in the future become subject to or initiate intellectual property disputes, which are costly and time-consuming to defend against or pursue, and may subject us to significant liability and increased costs of doing business
97% rewrittenRisks Related to Regulation
We are required to comply with payment network operating rules, and changes to these rules or associated fees could harm our business
Updated payment network compliance rules to explicitly cite NACHA requirements for enhanced fraud detection and risk management.
Was: We are required to comply with payment network operating rules, and changes to such rules or payment network fees could harm our business
94% rewrittenRisks Related to Our Business, Industry and Growth
If we cannot manage our infrastructure to support future growth and effectively manage our expanding operations, our business and reputation could be harmed
Expanded infrastructure scaling risks to include specific resource allocation for customer support, cybersecurity, data protection, and compliance operations.
Was: Our business could be harmed if we fail to manage our infrastructure to support future growth
94% rewrittenRisks Related to Our Class A Common Stock
Amending certain provisions of our certificate of incorporation and bylaws will be subject to super-majority voting thresholds
Clarified state law anti-takeover provisions and change-of-control protections regarding stockholder premium opportunities.
93% rewrittenRisks Related to Our Class A Common Stock
Future issuances or sales of a substantial number of shares, or the perception that they could occur, could cause our stock price to decline
Added dilution risks from future equity issuances, acquisitions, and senior convertible securities.
Was: Future sales of shares, or the perception that such sales could occur, could cause our stock price to decline
93% rewrittenRisks Related to Regulation
We are subject to laws regarding anti-money laundering, counter-terror financing, anti-corruption, export control and trade sanctions, and non-compliance could result in civil or criminal liability
Was: We are subject to laws and regulations regarding export control, import, economic and trade sanctions, anti-money laundering and counter-terror financing that could impair our ability to compete in international markets or subject us to criminal or civil liability if we violate them
92% rewrittenRisks Related to Our Technology and Intellectual Property
Develops or favors its own competitive offerings over our platform or products
Was: develops or otherwise favors its own competitive offerings over our platform or products
92% rewrittenRisks Related to Our Business, Industry and Growth
If we lose our founder and chief executive officer or other key management, or cannot attract and retain qualified executives and employees, our business may be harmed
Was: If we lose our founder and chief executive officer or other key members of our management team, or if we are unable to attract and retain executives and employees we need to support our operations and growth, our business may be harmed
92% rewrittenRisks Related to Our Business, Industry and Growth
General administration, including increased legal and accounting expenses as a public company
Was: general administration, including increased legal and accounting expenses associated with being a public company
92% rewrittenRisks Related to Regulation
The requirements of being a public company may strain our resources, result in more litigation, and divert management's attention
90% rewrittenRisks Related to Our Business, Industry and Growth
Identifying and assuming liabilities from the acquired business's pre-acquisition activities, such as legal violations, intellectual property issues and taxes
Was: identifying and assuming liabilities related to the activities of the acquired business before the acquisition, including liabilities for violations of laws and regulations, intellectual property issues, commercial disputes, taxes and other matters
90% rewrittenRisks Related to Our Class A Common Stock
If securities or industry analysts publish inaccurate or unfavorable research about us or change their recommendations regarding our Class A common stock, or if we fail to meet or exceed our earnings guidance, the market price or trading volume of our Class A common stock could decline
Was: If securities or industry analysts publish inaccurate or unfavorable research about us, our business or our market, or if they adversely change their recommendations regarding our Class A common stock, the market price or trading volume of our Class A common stock could decline
89% rewrittenRisks Related to Regulation
Changes in our effective tax rate or tax liability may adversely affect our operating results
89% rewrittenRisks Related to Our Business, Industry and Growth
We depend on third-party payment processors, sponsor banks, and printers; service interruptions from these providers could harm our business
Was: We depend on third-party payment processors, sponsor banks and third-party printers to process bill payments made on our platform, and our business, operating results and reputation could be harmed if we experience service interruptions related to these processors
85% rewrittenRisks Related to Our Class A Common Stock
We may elect to take advantage of the "controlled company" exemption to the corporate governance rules for New York Stock Exchange-listed companies, which could make our Class A common stock less attractive to some investors or otherwise harm our stock price
82% rewrittenRisks Related to Our Business, Industry and Growth
Adverse developments in the financial services industry, including events involving liquidity, defaults or non-performance, could adversely affect our business
Was: Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults or non-performance by customers, financial institutions or transactional counterparties, could adversely affect our business, financial condition or results of operations
81% rewrittenRisks Related to Our Business, Industry and Growth
We may require additional capital to support growth, and it may not be available on favorable terms, if at all
Was: We may require additional capital to support the growth of our business, and this capital might not be available on acceptable terms, if at all
71% rewrittenRisks Related to Our Business, Industry and Growth
Acquisitions and strategic investments could be difficult to identify and integrate, divert management, disrupt our business and dilute stockholder value
Was: Acquisitions and strategic investments could be difficult to identify and integrate, divert the attention of management, disrupt our business, dilute stockholder value and adversely affect our business, operating results and financial condition

All 71 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Business, Industry and Growth

01Our historical growth rate may not be sustainable or indicative of our future growth, and a failure to attract and retain billers and financial institutions could materially harm our business100% rewritten
02Our historical growth rate, including in payment volumes, may not be sustainable or indicative of our future growth. We cannot guarantee that we will be able to attract new billers, financial institutions and end-users, retain existing ones or maintain similar growth, despite solid growth in recent yearsNew
03We rely on partnerships for a portion of our revenue; if we fail to establish, grow or maintain them, our ability to compete and our operating results will be impairedNew
04If we cannot manage our infrastructure to support future growth and effectively manage our expanding operations, our business and reputation could be harmed94% rewritten
05Our ability to maintain profitability is uncertain due to expected increases in costs that may not be offset by revenue growth or expected benefits from investmentsNew
06General administration, including increased legal and accounting expenses as a public company92% rewritten
07Our sales efforts to large enterprises are complex, costly and unpredictable, which could cause our results to fluctuateNew
08Economic risks and inflationary pressures could negatively affect our financial performance, and we may not be able to adjust our pricing accordinglyNew
09The market in which we operate is competitive, and if we cannot compete effectively, our business, operating results and financial condition could be harmedNew
10Fluctuations in our operating results and shifts in payment mix make forecasting difficult; inability to accurately meet our forecasts could cause our stock price to declineNew
11Variations across biller industries, affecting payment methods and average payment amounts, and thus revenue and gross margin, particularly due to interchange feesNew
12The impact of widespread health issues, such as pandemics, on our operating results, liquidity, financial condition and key stakeholders100% rewritten
13We depend on third-party payment processors, sponsor banks, and printers; service interruptions from these providers could harm our business89% rewritten
14Our use of artificial intelligence (AI) and machine learning (ML) presents specific risks that could harm our business and reputationNew
15We operate in an innovative and evolving market, and slow or unexpected development could negatively impact our revenueNew
16The success of competing solutions, including those that may offer superior, more efficient or secure solutions at lower pricesNew
17Our risk management efforts may be ineffective against fraudulent activities, exposing us to material financial losses, liability and reputational harmNew
18If we lose our founder and chief executive officer or other key management, or cannot attract and retain qualified executives and employees, our business may be harmed92% rewritten
19Failure to provide high-quality customer support could damage our reputation and business, or negatively impact our profitabilityNew
20If our transaction fees are unacceptable to clients or consumers, our financial condition and growth could be harmedNew
21Failure to meet our service level commitments could lead to credits, refunds or contract terminations, adversely affecting our revenue and financial conditionNew
22International expansion exposes us to a variety of operational, regulatory and financial risksNew
23Acquisitions and strategic investments could be difficult to identify and integrate, divert management, disrupt our business and dilute stockholder value71% rewritten
24Identifying and assuming liabilities from the acquired business's pre-acquisition activities, such as legal violations, intellectual property issues and taxes90% rewritten
25Failure to maintain and enhance our brand could adversely affect our business and financial conditionNew
26Successfully differentiating our products from competitorsNew
27We may require additional capital to support growth, and it may not be available on favorable terms, if at all81% rewritten
28Adverse developments in the financial services industry, including events involving liquidity, defaults or non-performance, could adversely affect our business82% rewritten
29Widespread health issues or pandemics, natural disasters or man-made problems could materially harm our business operationsNew
30Future litigation, investigations or similar matters could adversely affect our business and result in substantial costsNew

Risks Related to Regulation

31Failure to comply with extensive and evolving financial services, anti-corruption and other laws could materially harm our businessNew
32We are required to comply with payment network operating rules, and changes to these rules or associated fees could harm our business97% rewritten
33Actual or perceived failure to comply with data privacy, data protection and information security laws could result in litigation, fines and reputational harmNew
34Federal Trade Commission and state attorneys general interpretations of consumer protection lawsNew
35Self-regulatory standards imposed by privacy advocates and industry groupsNew
36Our and our clients' communications with consumers are subject to laws regulating telephone and email marketing, and non-compliance could lead to significant penaltiesNew
37messages, requiring opt-out mechanisms. These and other communications laws are subject to varying, subjective interpretations, making compliance challengingNew
38We are subject to laws regarding anti-money laundering, counter-terror financing, anti-corruption, export control and trade sanctions, and non-compliance could result in civil or criminal liability93% rewritten
39The requirements of being a public company may strain our resources, result in more litigation, and divert management's attention92% rewritten
40Although remediated, we have previously identified material weaknesses in internal control over financial reporting; any future failure to maintain effective controls could harm our business and stock priceNew
41Changes in our effective tax rate or tax liability may adversely affect our operating results89% rewritten
42Limitations or adverse findings regarding our ability to do business in some jurisdictionsNew

Risks Related to Our Technology and Intellectual Property

43If our platform fails to interoperate with third-party software and technologies, or if those systems have performance issues, our solutions will be less effective and our business could be harmedNew
44information systems, some of which are also competitors that seek to limit our access to our customers’ user data or acquire their payments businessNew
45Develops or favors its own competitive offerings over our platform or products92% rewritten
46Interruptions or delays in services provided by third-party cloud-based data centers or internet service providers could impair platform delivery, damage our reputation and expose us to liabilityNew
47Our insurance policies may not adequately compensate us for losses. Third-party providers' failure to timely notify us of security breaches or data disclosures may cause us to incur significant costsNew
48Software defects, undetected errors or performance problems in our technology, including open source software, could damage client relations, harm our reputation and expose us to liabilityNew
49Result in liability, lost business, increased insurance costs, difficulty collecting accounts receivable, costly litigation or regulatory actionsNew
50Re-engineer our platform, which is costly and time-consumingNew
51Failure to obtain, maintain, protect or enforce our intellectual property rights could impair our competitive position and harm our businessNew
52We may become involved in costly and time-consuming intellectual property disputes, which could subject us to significant liability98% rewritten
53Although we carry insurance, our insurance may not cover potential claims of this type or may not be adequate to indemnify us for all liability that may be imposedNew
54Our platform depends on intellectual property and technology licensed from or made available by third parties in some cases, and the loss of access to such intellectual property and technology or the inability to obtain acceptable license terms could harm our businessNew
55Future licenses or rights may not be available on acceptable terms, or at all, which could prevent our platform from remaining competitive. Our inability to obtain licenses on favorable terms could materially and adversely affect our business and results of operationsNew
56Any real or perceived improper or unauthorized use, disclosure or access to the sensitive and personal data we process could harm our reputation and materially adversely affect our business and financial conditionNew
57Liability and financial loss in the form of lost business, increased insurance costs, litigation or adverse publicityNew
58Expose us to legal risk, potential liability resulting from governmental or regulatory investigations, class action litigation or indemnity obligations, and financial penaltiesNew

Risks Related to Our Class A Common Stock

59The market price of our Class A common stock may be volatile, or decline steeply, and we may not be able to meet investor or analyst expectations100% rewritten
60The market price of our Class A common stock has and may continue to fluctuate or decline significantly in response to factors described in this “Risk Factors” section or otherwise, many of which are beyond our control. These fluctuations could cause you to lose all or part of your investmentNew
61Other events such as war or terrorismNew
62Future issuances or sales of a substantial number of shares, or the perception that they could occur, could cause our stock price to decline93% rewritten
63Sales of a substantial number of shares of our Class A common stock, particularly by directors, executive officers and principal stockholders, or the perception that such sales may occur, could cause the market price of our Class A common stock to fallNew
64AKKR controls us, and its interests may conflict with ours or yours in the future
65If securities or industry analysts publish inaccurate or unfavorable research about us or change their recommendations regarding our Class A common stock, or if we fail to meet or exceed our earnings guidance, the market price or trading volume of our Class A common stock could decline90% rewritten
66We may elect to take advantage of the "controlled company" exemption to the corporate governance rules for New York Stock Exchange-listed companies, which could make our Class A common stock less attractive to some investors or otherwise harm our stock price85% rewritten
67Our certificate of incorporation and bylaws contain anti-takeover provisions that could discourage, delay or prevent a change of control or changes in managementNew
68The forum for certain litigation against us is restricted to DelawareNew
69Amending certain provisions of our certificate of incorporation and bylaws will be subject to super-majority voting thresholds94% rewritten
70Our bylaws designate exclusive forums for certain legal disputes, which could limit a stockholder's choice of judicial forumNew
71This provision does not apply to any action to enforce a duty or liability created by the Exchange ActNew

Other Paymentus Holdings 10-Ks

FY2024 10-K risk factors
62 risks
Paymentus operates in an evolving bill payment market facing intense competition from legacy financial institutions and tech providers.
Filed Mar 11, 2025

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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.