Sportsman's Warehouse Holdings (SPWH) risk factors, FY2026 10-K

Risks Related to the Firearms Business

1. 01Current and future government regulations, particularly regulations relating to the sale of firearms and ammunition, may negatively impact the demand for our products and our ability to conduct our business
2. 02FTC regulations governing the manner in which orders may be solicited and prescribing other obligations in fulfilling orders and consummating sales41% rewritten
3. 03We have incurred, and may incur in the future, costs from litigation involving products that we sell, particularly firearms and ammunition, which could adversely affect our net sales and profitability33% rewritten
4. 04Our net sales and profitability could be impacted if the strength of our brand is not maintained, and our sales of firearm-related products could present reputational risks and negative publicity

Risks Related to Our Retail Operations

1. 05Our concentration of stores in the Western United States makes us susceptible to adverse conditions in this region
2. 06Competition in the outdoor activities and sporting goods market could reduce our net sales and profitability
3. 07If we fail to anticipate changes in consumer demands, including regional preferences, in a timely manner, our operating results could suffer
4. 08Our same store sales may fluctuate and may not be a meaningful indicator of future performance
5. 09Our operating results are subject to seasonal fluctuations
6. 10If we are unable to protect against inventory shrink, our results of operations and financial condition could be adversely affected46% rewritten
7. 11We currently rely on a single distribution center for our business, and if there is a natural disaster or other serious disruption at such facility, we may be unable to deliver merchandise effectively to our stores or customers
8. 12Dynamic freight costs could adversely affect our business, financial condition, results of operations and our ability to accurately predict financial results25% rewritten
9. 13We have experienced in the past, and may experience in the future, supply chain disruptions and delays of the supply of products from our vendors, which may have an adverse impact on our net sales and profitability
10. 14Political and economic uncertainty and unrest in foreign countries where our merchandise vendors are located and trade restrictions, including new tariffs and duties upon imports from these foreign countries, could adversely affect our ability to source merchandise and operating results69% rewritten
11. 15adverse fluctuations of foreign currencies and geopolitical turmoil, and any resulting disruption, instability or volatility in the global markets and industries resulting from such conflictNew
12. 16We and the third parties with whom we work are subject to stringent and evolving U.S. obligations related to data privacy and security, and our actual or perceived failure to comply with such obligations (or such failure by the third parties with whom we work) could lead to adverse business consequences
13. 17We are also bound by other contractual obligations related to data privacy and security, and our efforts to comply with such obligations may not be successful92% rewritten
14. 18lacking in transparency, deceptive, unfair, misleading, or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators, or other adverse consequencesNew
15. 19Our business depends on our ability to meet our labor needs and control our labor costs
16. 20Increases in the minimum wage have recently adversely affected our financial results

Risks Related to Our Business Strategy

1. 21Our long-term strategy includes opening new stores. If we open new stores, in particular in new, unfamiliar markets to us, increased risks related to operating new stores may prevent us from being profitable in those marketsNew
2. 22general economic, political, and business conditions affecting consumer confidence and spending and the overall strength of our business
3. 23If we decide to close underperforming stores, the costs to do so may be significant and may negatively impact our cash flows and our results of operationsNew
4. 24If we are unable to successfully develop and maintain our omni-channel strategy, we may not be able to compete effectively and our sales and profitability may be adversely affected
5. 25If our information technology systems, or those of third parties with whom we work, or our data are or were compromised, we could experience adverse consequences54% rewritten
6. 26We may expend significant resources or modify our business activities to try to protect against security incidents. Additionally, certain data privacy and security obligations require us to implement and maintain specific security measures to protect our information technology systems and sensitive data
7. 27Our computer hardware and software systems are vulnerable to damage from natural disasters, power loss or other events outside of our control that could harm our business39% rewritten
8. 28Our future growth may strain our business infrastructure, which could adversely affect our operations and financial condition21% rewritten
9. 29The utilization, expansion and management of machine learning and other types of artificial intelligence in our business could adversely affect our business, financial condition and results of operations
10. 30Our private label brand offerings expose us to various risks
11. 31other risks generally encountered by entities that source, sell and market exclusive branded offerings for retail
12. 32Our inability to protect our intellectual property could have a negative impact on our operating results
13. 33We may pursue strategic acquisitions or investments, and the failure of an acquisition or investment to produce the anticipated results or the inability to fully integrate the acquired companies could have an adverse impact on our business

Risks Related to Liquidity and Capital Resources

1. 34Our ability to operate and expand our business and to respond to changing business and economic conditions will depend on the availability of adequate capital
2. 35Our revolving credit facility and our term loan facility contain restrictive covenants that may impair our ability to access sufficient capital and operate our business
3. 36An increase in market interest rates could increase our interest costs on existing and future debt and could adversely affect our stock price23% rewritten

Risks Related to Our Common Stock

1. 37Our bylaws, our certificate of incorporation and Delaware law contain provisions that could discourage another company from acquiring us and may prevent attempts by our stockholders to replace or remove our current management30% rewritten
2. 38authorizing the issuance of “blank check” preferred stock without any need for action by stockholders
3. 39We expect that the price of our common stock will fluctuate