RXO (RXO) risk factors, FY2025 10-K

Risks Related to Industry Dynamics

1. 01We operate in a highly competitive industry and, if we are unable to adequately address factors that may adversely affect our revenue and costs, our business could suffer
2. 02Economic recessions and other factors that reduce economic activity could have a material adverse impact on our business
3. 03We are subject to risks associated with the availability and price of fuel, all of which are subject to political, economic and market factors that are outside of our control
4. 04Higher carrier prices may result in decreased income from operations and increases in working capital usage
5. 05Extreme or unusual weather conditions can disrupt our operations, impact freight volumes, and increase our costs, all of which could have a material adverse effect on our business results
6. 06Our operations may be subject to seasonal fluctuations, and our inability to manage these fluctuations could negatively affect our business and our results of operations

Risks Related to Third-Party Relationships

1. 07We depend on third parties in the operation of our business
2. 08Our business relies on third-party carriers to conduct its operations, and the status of these parties as independent contractors, rather than employees, is being challenged
3. 09Our business may be materially adversely affected by labor disputes or organizing efforts
4. 10Labor disputes involving our customers could affect our operations. If our customers experience plant slowdowns or closures because they are unable to negotiate labor contracts, our revenue and profitability could be negatively impacted

Risks Related to Our Use of Technology

1. 11Our business will be seriously harmed if we fail to develop, implement, maintain, upgrade, enhance, protect and integrate our information technology systems, including those systems of any businesses that we acquire
2. 12We could be affected by cyberattacks or breaches of our information systems, any of which could have a material adverse effect on our business
3. 13A failure of our information technology infrastructure, information systems, networks or processes may materially adversely affect our business
4. 14Issues related to the intellectual property rights on which our business depends, whether related to our failure to enforce our own rights or infringement claims brought by others, could have a material adverse effect on our business, financial condition and results of operations
5. 15Third-party security incidents could result in the loss of our or our customers’ data, expose us to liability, harm our reputation, damage our competitiveness and adversely impact our financial results
6. 16We use, and may continue to expand our use of, machine learning and artificial intelligence (“AI”) technologies to deliver our services and operate our businessNew

Risks Related to Our Credit and Liquidity

1. 17Challenges in the commercial and credit environment may adversely affect our future access to capital on favorable terms
2. 18We incurred debt obligations that could adversely affect our business and profitability and our ability to meet other obligations33% rewritten

Risks Related to Litigation and Regulation

1. 19We are subject to claims arising from our transportation operations
2. 20From time to time, we are involved in lawsuits and are subject to various claims that could result in significant expenditures and impact our operations
3. 21Our third-party carriers are subject to increasingly stringent laws protecting the environment, including transitional risks relating to climate change, which could directly or indirectly have a material adverse effect on our business
4. 22We are subject to governmental regulations and political conditions, which could negatively impact our business

Risks Related to Our Strategy and Operations

1. 23We depend on our ability to attract and retain qualified employees and temporary workers
2. 24Failure to successfully implement our cost and revenue initiatives could cause our future financial results to suffer
3. 25We may not successfully manage our growth
4. 26Our inability to successfully manage the costs and operational difficulties of adding new customers or more volume from existing customers may negatively affect our financial condition and operations
5. 27We derive a significant portion of our total revenue from our largest customers52% rewritten
6. 28Damage to our reputation through unfavorable publicity or the actions of our employees or independent contractors could adversely affect our financial condition
7. 29If we determine that our goodwill has become impaired, we may incur impairment charges, which would negatively impact our operating results
8. 30Any acquisitions that we may complete in the future may be unsuccessful or result in other risks or developments that adversely affect our financial condition and results
9. 31We may not realize all of the anticipated benefits of any divestitures we may make in the future, or the benefits of any such divestitures may take longer to realize than expected

Risks Related to Our Common Stock

1. 32Sales of shares of our common stock in connection with registration rights granted to certain stockholders, or the prospect of any such sales, could affect the market price of our common stock and could impair our ability to raise capital through future sales of equity securities88% rewritten
2. 33Any stockholder’s percentage of ownership in RXO may be diluted in the future at any given time
3. 34Certain provisions in RXO’s amended and restated certificate of incorporation and bylaws, and of Delaware law, may prevent or delay an acquisition of RXO, which could decrease the trading price of our common stock
4. 35RXO’s amended and restated certificate of incorporation contains an exclusive forum provision that may discourage lawsuits against RXO and our directors and officers