Toll Brothers (TOL) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01Housing market demand fluctuations have adversely affected, and may continue to adversely affect our business, results of operations, and financial conditionNew
2. 02Adverse changes in economic conditions in markets where we conduct our operations and where prospective purchasers of our homes live could reduce the demand for homes and, as a result, could adversely affect our business, results of operations, and financial condition
3. 03Significant inflation, higher interest rates or deflation could adversely affect our business and financial results
4. 04The risks associated with our land, lot and rental inventory could adversely affect our business or financial results
5. 05If land is not available at reasonable prices, our sales and results of operations could decrease24% rewritten
6. 06Our ability to execute on our business strategies is uncertain, and we may be unable to achieve our goals
7. 07Negative publicity could adversely impact sales, which could cause our revenues or results of operations to decline
8. 08A significant portion of our revenues and income from operations is generated from California
9. 09The construction cycle for mid-rise, high-rise and multifamily building is generally longer than that of single family detached homes, which puts us at greater risk of construction delays and changing market conditions that could adversely affect our operating results in this part of our business
10. 10Our condominium and rental multi-unit buildings are subject to fluctuations in delivery volume due to their extended construction time, levels of pre-sales and lease-up, and quick delivery of units once buildings are complete30% rewritten
11. 11Increases in cancellations of existing agreements of sale could have an adverse effect on our business
12. 12The home building industry is highly competitive, and, if other home builders are more successful or offer better value to our customers, our business could decline
13. 13We participate in certain joint ventures where we may be adversely impacted by the actions of the joint venture or its participants
14. 14Government regulations and legal challenges may delay the start or completion of our communities, increase our expenses, or limit our home building activities, which could have a negative impact on our operations
15. 15Product liability claims and litigation and warranty claims that arise in the ordinary course of business may be costly, which could adversely affect our business
16. 16Our quarterly operating results may fluctuate due to the seasonal nature of our business
17. 17Increases in taxes or government fees could increase our costs, and adverse changes in tax laws or their interpretation could reduce demand for our homes and negatively affect our operating results
18. 18We are subject to extensive environmental regulations, which may cause us to incur additional operating expenses, subject us to longer construction cycle times, or result in material fines or harm to our reputation
19. 19Failure by our employees or representatives to comply with laws and regulations may harm us
20. 20Component shortages and increased costs of labor and supplies are beyond our control and can result in delays and increased costs to develop our communities

Risks Related to Indebtedness and Financing

1. 21If we are not able to obtain suitable financing, or if the interest rates on our debt are increased, or if our credit ratings are lowered, our business and results of operations may decline84% rewritten
2. 22$1.75 billion of our senior notes become due and payable at various times from March 2027 through June 2035. We cannot be certain that we will be able to replace existing financing and credit lines or find additional sources of financing in the future on favorable terms or at allNew
3. 23If we are not able to obtain suitable financing at reasonable terms or replace existing debt and credit facilities when they become due or expire, our costs for borrowings may increase and our revenues may decrease or we could be precluded from continuing our operations at current levels or expanding them40% rewritten
4. 24If home buyers are not able to obtain suitable financing, our results of operations may decline
5. 25If our ability to resell mortgages to investors is impaired, our home buyers may be required to find alternative financing

Risks Related to Other Events and Factors

1. 26Public health issues such as a major epidemic or pandemic could adversely affect our business or financial results
2. 27Adverse weather conditions, natural disasters, and other conditions could disrupt the development of our communities, which could harm our sales and results of operations
3. 28Increased domestic or international instability could have an adverse effect on our operations
4. 29We could be adversely impacted by the loss of key management personnel or if we fail to attract qualified personnel26% rewritten
5. 30Information technology failures and data security breaches could harm our business