Phinia (PHIN) risk factors, 2025 10-K

Risks Related to Our Industry and Strategy

1. 01Adverse changes in general business and economic conditions, including recessions, adverse market conditions or downturns impacting the vehicle and industrial equipment industries, have in the past and may in the future adversely affect our business, financial condition, and results of operations
2. 02If we do not deliver new products, services and technologies in response to changing consumer preferences and increased regulation of greenhouse gas emissions, or if the market for electric vehicles grows faster than expected, our business, financial condition, and results of operations could be adversely impacted
3. 03We face strong competition
4. 04The failure to identify, consummate, effectively integrate or realize the expected benefits from acquisitions or partnerships could adversely affect our growth and our business, financial condition, and results of operations

Risks Related to Our Business and Operations

1. 05We are under substantial pressure from OEMs to reduce the prices of our products
2. 06We continue to face volatile costs of commodities used in the production of our products and elevated levels of inflation
3. 07Changes in U.S. and foreign administrative policy, including changes to existing trade agreements and any resulting changes in international trade relations, may adversely affect our business, financial condition and results of operations
4. 08If we are unable to protect our intellectual property or if a third party makes assertions against us or our customers relating to intellectual property rights, our business, financial condition and results of operations could be adversely affected
5. 09A failure of or disruption in our information technology infrastructure, including a disruption related to cybersecurity, could adversely impact our business, financial condition and results of operations
6. 10Our inability to identify, attract, retain and develop a qualified global workforce could adversely impact our business, financial condition and results of operations and impair our ability to meet our strategic objectives and the needs of our customers
7. 11Our profitability and results of operations may be adversely affected by program launch difficulties
8. 12We could incur restructuring charges as we execute restructuring and other actions in an effort to improve future profitability and competitiveness and to optimize our product portfolio, and we may not achieve the anticipated savings and benefits from these actions
9. 13We are subject to risks related to our international operations
10. 14Our business in China is subject to aggressive competition and is sensitive to economic, political, social and market conditions

Risks Related to Our Customers and Suppliers

1. 15We face credit, operational and sales concentration risks related to our customers
2. 16Disruptions in our supply chain have in the past and could in the future adversely affect our business, financial condition, and results of operations
3. 17Work stoppages, production shutdowns and similar events or conditions could significantly disrupt and adversely impact our business, financial condition and results of operations

Risks Related to Regulatory, Legal, and Similar Matters

1. 18We are, and in the future may be, subject to governmental investigations and related proceedings regarding vehicle emissions standards
2. 19We are subject to extensive environmental, health and safety, human rights and other laws and regulations that are subject to change and may involve significant risks
3. 20The impacts of climate change, regulations related to climate change and various stakeholders’ emphasis on climate change and other related matters may adversely impact our business, financial condition and results of operations
4. 21Compliance with and changes in other laws and regulations impacting our operations could be costly and could affect our business, financial condition and results of operations
5. 22We have liabilities related to product warranties, litigation and other claims
6. 23Changes in tax laws or tax rates taken by taxing authorities and tax audits or similar processes could adversely affect our business, financial condition and results of operations

Risks Related to Credit and Our Financials

1. 24Goodwill, indefinite-lived intangible assets and long-lived assets, which are subject to periodic impairment evaluations, represent a significant portion of our total assets. An impairment charge on these assets could have an adverse impact on our business, financial condition and results of operations
2. 25Changes in interest rates and asset returns could increase our pension funding obligations, which could reduce our profitability and cash flow and adversely impact our business, financial condition and results of operations
3. 26We are subject to a number of restrictive covenants and requirements under our indebtedness, which could limit our financial and operating flexibility and subject us to other risks

Risks Related to the Spin-Off

1. 27We may be unable to achieve some or all of the benefits that we expect to achieve from the Spin-Off
2. 28If the Spin-Off were determined not to qualify as tax-free for U.S. federal income tax purposes, we could have an indemnification obligation to the Former Parent, which could adversely affect our business, financial condition and results of operations
3. 29We or the Former Parent may fail to perform under, or additional disputes may arise between the parties relating to, various transaction agreements that have been executed in connection with the separation
4. 30We have only operated as an independent, publicly traded company since July 3, 2023, and our historical combined financial information is not necessarily representative of the results we would have achieved as an independent, publicly traded company and may not be a reliable indicator of our future results