RingCentral (RNG) risk factors, FY2025 10-K

Risks Related to Our Business and Our Industry

1. 01We have in the past incurred significant losses and negative cash flows prior to achieving profitability, and we may not be able to maintain profitability in the future26% rewritten
2. 02Our quarterly and annual results of operations have fluctuated in the past and may continue to do so in the future. As a result, we may fail to meet or to exceed the expectations of research analysts or investors, which could cause our stock price to fluctuate
3. 03If we are unable to develop, license, or acquire new services or applications on a timely and cost-effective basis, our business, financial condition, and results of operations may be materially and adversely affected29% rewritten
4. 04If we are unable to attract new customers to our subscriptions or upsell to those customers on a cost-effective basis, our business will be materially and adversely affected
5. 05We rely and may in the future rely significantly on our channel partners and global service providers to market and sell our subscriptions; our failure to effectively develop, manage, and maintain our indirect sales channels could materially and adversely affect our revenues
6. 06Increased customer turnover, or costs we incur to retain, grow, and upsell our customers, could materially and adversely affect our financial performance81% rewritten
7. 07shorter contract lengths, or for a less expensive subscription plan or edition. We cannot predict the renewal rates or types for customers that have entered into subscription contracts with usNew
8. 08Economic and political conditions may harm our industry, business and results of operations
9. 09We face intense competition in our markets and may lack sufficient financial or other resources to compete successfully
10. 10We face significant risks in our efforts to sell and market to medium-sized and larger businesses for sales of our subscriptions and, if we do not manage these efforts effectively, our business and results of operations could be materially and adversely affected
11. 11If we fail to continue to develop our brand or our reputation is harmed, our business may suffer25% rewritten
12. 12We depend largely on the continued services of our senior management and other highly-skilled employees, and if we are unable to hire, retain, manage and motivate our employees, we may not be able to grow effectively and our business, results of operations and financial condition could be adversely affected
13. 13We may expand through acquisitions of and investments in other companies, each of which may divert our management’s attention, result in additional dilution to our stockholders, increase expenses, disrupt our operations, and harm our results of operations
14. 14Interruptions or delays in service whether caused by our third-party data center hosting facilities, other third-party providers, internal process failures, human errors, internal bugs or otherwise could impair the delivery of our subscriptions, require us to issue credits or pay penalties and harm our business
15. 15A security incident, such as a cyber-attack, information security breach, or denial of service event, could delay or interrupt service to our customers, harm our reputation or business, impact our subscriptions, and subject us to significant liability
16. 16The AI technology and features we develop and/or incorporate into our solutions include new and evolving technologies that may present both legal and business risks39% rewritten
17. 17The use of AI technologies in our business may not produce the desired benefits, and may result in increased liability, reputational harm, or other adverse consequencesNew
18. 18We rely on third-party competitors to deliver contact center, SMS, and other services to customers, and changes in these relationships could have a material adverse effect on our business, results of operations and financial condition48% rewritten
19. 19Our international operations and customer base may expose us to significant risks
20. 20If we are unable to effectively process local number and toll-free number portability provisioning, and/or our customers are unable to register with TCR in a timely manner, our growth may be negatively affected
21. 21Our business could suffer if we cannot obtain or retain direct inward dialing numbers or are prohibited from obtaining local or toll-free numbers or if we are limited to distributing local or toll-free numbers to only certain customers
22. 22If we experience excessive fraudulent activity or cannot meet evolving credit card association merchant standards, we could incur substantial costs and lose the right to accept credit cards for payment, which could cause our customer base, new sales, and revenues to decline significantly
23. 23Failures in Internet infrastructure or interference with broadband access could cause current or potential users to believe that our systems are unreliable, possibly leading our customers to switch to our competitors or to avoid using our subscriptions
24. 24Interruptions in our services caused by undetected errors, failures, or bugs in our services and/or human error could harm our reputation, result in significant costs to us, and impair our ability to sell our subscriptions
25. 25Potential problems with our information systems could interfere with our business and operations
26. 26Growth may place significant demands on our management and our infrastructure
27. 27Support for smartphones and tablets is an integral part of our solutions. If we are unable to develop robust mobile applications that operate on the mobile platforms that our customers use, our business and results of operations could be materially and adversely affected72% rewritten
28. 28addition, if we experience difficulties in the future integrating our mobile applications into smart devices or if problems arise with our relationships with providers of mobile operating systems, such as those of Apple Inc. or Alphabet Inc., our future growth and our results of operations could sufferNew
29. 29The occurrence of a catastrophic disaster could damage our facilities or the facilities of our contractors, which could cause us to curtail our operations

Risks Related to Our Reliance on Third Parties

1. 30We rely on third parties, including third parties in countries outside the U.S., for a significant portion of our software development and design, quality assurance, operations, and customer support
2. 31To deliver our subscriptions, we rely on third parties for our network connectivity and for certain of the features in our subscriptions
3. 32We rely on third-party software that may be difficult to replace or which could cause errors or failures of our subscriptions
4. 33We rely on third parties to fulfill various aspects of our E-911 service. If these third parties do not provide our customers with reliable, high-quality service, our reputation will be harmed, and we may lose customers
5. 34We currently depend on a limited number of phone device suppliers and fulfillment agents to configure and deliver the phones that we sell46% rewritten

Risks Related to Intellectual Property

1. 35Accusations of infringement of third-party intellectual property rights could materially and adversely affect our business
2. 36Our limited ability to protect our intellectual property rights could materially and adversely affect our business80% rewritten
3. 37vendors to the public or others who could make use of the trade secret information would likely preclude that information from being protected as a trade secretNew
4. 38Our use of open source technology could impose limitations on our ability to commercialize our subscriptions

Risks Related to Our Indebtedness

1. 39We may require additional capital or need to restructure our existing debt to pursue our business objectives and to respond to business opportunities, challenges or unforeseen circumstances. If capital is not available to us, our business, results of operations, and financial condition may be adversely affected74% rewritten
2. 40Our Credit Agreement imposes operating and financial restrictions on us39% rewritten

Risks Related to Our Class A Common Stock and Our Charter Provisions

1. 41The market price of our Class A Common Stock is likely to be volatile and could decline
2. 42The holders of Series A Convertible Preferred Stock are generally entitled to vote with the holders of our Class A Common Stock, which reduces the relative voting power of holders of our Class A Common Stock, and the holders of Series A Convertible Preferred Stock have certain separate consent rights
3. 43Our Series A Convertible Preferred Stock has certain rights that are preferential to the rights of our common stock, which could adversely affect our liquidity and financial condition
4. 44We cannot guarantee that share repurchases or dividend payments will enhance long-term stockholder value. Share repurchases and dividend payments could also increase volatility of the trading price of our stock and will diminish our cash reservesNew
5. 45There can be no assurance that we will continue to declare cash dividendsNew
6. 46Anti-takeover provisions in our certificate of incorporation and bylaws and under Delaware corporate law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our Class A Common Stock
7. 47If research analysts do not publish research or reports about our business, or if they issue unfavorable commentary or downgrade our Class A Common Stock, our stock price and trading volume may decline

Risks Related to Taxation and Accounting Matters

1. 48Changes in our effective tax rates, or adverse outcomes resulting from examination of our income or other tax returns, could adversely affect our results of operations and financial condition
2. 49Changes in U.S. and foreign tax laws could have a material adverse effect on our business, cash flow, results of operations or financial conditions77% rewritten
3. 50We may be subject to liabilities on past sales for taxes, surcharges, and fees and our operating results may be harmed if we are required to collect such amounts in jurisdictions where we have not historically done so
4. 51We may be unable to use some or all of our net operating loss and research credit carryforwards, which could materially and adversely affect our reported financial condition and results of operations30% rewritten
5. 52If our internal control over financial reporting is not effective, it may adversely affect investor confidence in our company
6. 53Our estimates or judgments relating to our critical accounting policies may be based on assumptions that change or prove to be incorrect, which could cause our results of operations to fall below expectations of securities analysts and investors, resulting in a decline in the market price of our Class A common stock