Power Solutions International (PSIX) risk factors, FY2025 10-K

Other

1. 01Tariffs and changes in trade policy could materially increase our costs, disrupt our supply chain, and adversely affect our competitive position and results of operationsNew
2. 02Our liquidity could be adversely affected by volatility in demand, supply‑chain constraints, and significant capital investment requirements inherent in our engine manufacturing operationsNew
3. 03The Company’s existing debt or any potential new debt could adversely affect its business and growth prospects36% rewritten
4. 04The Company is subject to price increases in some of the key components in its power systems
5. 05Many of the Company’s power systems involve long and variable design and sales cycles
6. 06The Company could suffer warranty claims or be subject to product liability claims, both of which could materially adversely affect its business
7. 07The Company and its products are subject to numerous environmental and regulatory policies, including emission and fuel economy rules
8. 08The Company is dependent on certain key third-party suppliers, and the partial or complete loss of one of these key suppliers, or the failure to find replacement suppliers or manufacturers in a timely manner, could result in supply shortages
9. 09Disruptions arising from compliance with certain importation and trade laws and regulations, including those governing goods shipped from certain regions in China, have, and in the future may, cause supply chain interruptions and raw material shortages
10. 10The market for alternative-fueled, spark-ignited power systems may not continue to develop as expected
11. 11The Company may be impacted by volatility of oil and gas prices and/or fuel price differentials
12. 12The introduction of new products, including new engines that the Company develops, and the continued expansion of products may not succeed or achieve widespread acceptance
13. 13The Company’s OEM customers may not continue to outsource their power system needs
14. 14The failure to attract, retain and motivate a highly qualified workforce and high functioning management team could, in the future, affect the Company’s business results
15. 15A decrease in stock price may have an unfavorable impact on our status on the Nasdaq and liquidity
16. 16Ownership of the Company’s stock is concentrated with Weichai and therefore other stockholders’ ability to influence corporate matters is limited45% rewritten
17. 17Our relationship with Weichai, a Chinese state-owned entity, and heightened U.S.-China geopolitical tensions could subject us to increased regulatory scrutiny, reputational harm, and operational restrictionsNew
18. 18Weichai maintains certain rights through its Investor Rights Agreement with the Company
19. 19The Company is exposed to, and may be adversely affected by, potential security breaches or other disruptions to its information technology systems and data security
20. 20The increasing use of artificial intelligence technologies by our competitors, customers, and suppliers could impact our competitive positionNew
21. 21Adverse global and regional economic conditions may materially and adversely affect the Company’s business, results of operations and financial condition
22. 22The Company is exposed to political, economic and other risks, in addition to various laws and regulations that arise from operating a multinational business
23. 23Any of these factors could have a material adverse effect on the Company’s business and results of operations
24. 24Employee disputes or litigation and related unfavorable publicity may negatively affect our future business, financial condition, and operating results
25. 25If we fail to maintain an effective system of internal controls, we may not be able to accurately determine our financial results or prevent fraud. As a result, our stockholders could lose confidence in our financial results, which could materially and adversely affect us
26. 26The Company could incur restructuring and impairment charges as it continuously evaluates its portfolio of assets and identifies opportunities to restructure its business to optimize its cost structure
27. 27The Company currently faces, and will continue to face, significant competition
28. 28Failure to keep pace with technological developments may adversely affect the Company’s operations
29. 29The Company could fail to adequately protect its intellectual property rights or could face claims of intellectual property infringement by third parties
30. 30Limitations of the Company’s Directors’ and Officers’ liability insurance and potential indemnification obligations will have a material adverse effect on the Company’s financial condition, results of operations and cash flows
31. 31Unanticipated changes in our effective tax rate, the adoption of new tax legislation or exposure to additional income tax liabilities could adversely affect our profitability