Polaris (PII) risk factors, FY2024 10-K

Macroeconomic Risks

1. 01Our business may be sensitive to economic conditions, including those that impact our customers’ spending
2. 02Adverse changes in these factors has previously, and may in the future, lead to a decreased level of demand for our products, which could negatively impact our business, results of operations, financial condition and cash flows
3. 03Shortages or increases in the cost of raw materials, commodities, component parts, and transportation could negatively impact our business

Market and Competitive Risks

1. 04We face intense competition in all product lines. Failure to compete effectively against competitors could negatively impact our business and operating results
2. 05If we are unable to continue to enhance existing products and develop and market new or enhanced products that respond to customer needs and preferences, we may experience a decrease in demand for our products and our business and operating results could be negatively impacted
3. 06Our continued success is dependent on positive perceptions of our Polaris brands which, if weakened, could adversely affect our sales
4. 07Increased negative public perception of the social acceptability of our products or any increased restrictions on the access or the use of our products in certain locations could materially adversely affect our business or results of operations
5. 08From time to time, we manage our portfolio and grow our business through acquisitions, non-consolidated investments, alliances and new joint ventures and partnerships, which could be risky and could harm our business

Operational Risks

1. 09Disruption in our suppliers’ operations could disrupt our production schedule
2. 10We manufacture our products at, and distribute our products from, several locations in North America and internationally. An unforeseen change in the level of demand for our products or any disruption at any of these facilities or manufacturing delays could adversely affect our business and operating results
3. 11We depend on suppliers, financing sources and other strategic partners who may be sensitive to economic conditions that could affect their businesses in a manner that adversely affects their relationship with us
4. 12Failure to establish and maintain the appropriate level of dealer and distributor relationships or weak economic conditions impacting those relationships may negatively impact our business and operating results
5. 13Our operations require significant management attention and financial resources, expose us to difficulties presented by global economic, political, regulatory, accounting, and business factors, and may not be successful or produce desired levels of sales and profitability
6. 14Weather conditions may reduce demand and negatively impact net sales and production of certain of our products
7. 15A significant adverse determination in any material litigation claim against us could adversely affect our operating results or financial condition
8. 16Significant product repair and/or replacement costs due to product warranty claims or product recalls could have a material adverse impact on our results of operations

Regulatory, Intellectual Property, Cybersecurity and Privacy Risks

1. 17Our business, properties and products are subject to extensive United States federal and state and international safety, environmental, trade and other government regulation and any failure to comply with these regulations could harm our reputation, expose us to damages and otherwise adversely affect our business
2. 18Our reliance upon patents, trademark laws, and contractual provisions to protect our proprietary rights may not be sufficient to protect our intellectual property from others who may sell similar products and may lead to costly litigation
3. 19We may be subject to cybersecurity events and other disruptions to our information technology systems, data and connected products that could adversely affect our business
4. 20Our business, data, services and products are subject to United States federal and state and international data privacy laws and regulations and any failure to comply with these laws and regulations could harm our reputation, expose us to damages and otherwise adversely affect our business
5. 21Fluctuations in foreign currency exchange rates could result in declines in our reported sales and net earnings
6. 22Retail credit market deterioration and volatility may restrict the ability of our retail customers to finance the purchase of our products
7. 23We have outstanding debt and must comply with restrictive covenants in our debt agreements. Provisions in our debt agreements could adversely affect our operating flexibility, pose risks of default and reduce our flexibility to respond to an economic downturn

General Risks

1. 24Additional tax expense or tax exposure could impact our financial performance
2. 25An impairment in the carrying value of goodwill and trade names could negatively impact our consolidated results of operations and net worth
3. 26Expectations relating to environmental, social and governance considerations expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business