Vishay Precision Group (VPG) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01A shortage of qualified labor could have a material adverse effect on our business and results of operations
2. 02We face intense competition in our business
3. 03To remain successful, we must continue to innovate, and our investments in new technologies may not prove successful
4. 04We may not be successful in future acquisitions or other strategic transaction endeavors, if any, which could have an adverse effect on our business and results of operations
5. 05Future acquisitions may require us to incur or issue additional indebtedness or issue additional equity
6. 06We may experience difficulties, delays, or unexpected costs in completing our cost reduction programs
7. 07We may encounter difficulties in the implementation or operation of new enterprise resource planning systems
8. 08Our success is dependent upon our ability to protect our proprietary technology and other intellectual property
9. 09The success of our business is highly dependent on maintenance of intellectual property rights
10. 10We may be exposed to product liability claims
11. 11We must expend significant resources to obtain design wins without assurance that we will be successful
12. 12The long development times for certain of our products and systems may result in unpredictable fluctuations in revenue and results of operations
13. 13We may not have adequate manufacturing capacity to satisfy future increases in demand for our products
14. 14The nature of the market for our products may render them particularly susceptible to downturns in the economic environment
15. 15Our backlog is subject to customer cancellation
16. 16The complexity of our sophisticated measurement systems may require costly corrections if design flaws are found
17. 17Our results are sensitive to raw material availability, quality, and cost
18. 18Certain metals used in the manufacture of our products are traded on active markets, and can be subject to significant price volatility and sourcing challenges
19. 19Our product sales may be adversely affected by changes in product classification levels under various qualification and specification standards
20. 20Failure to maintain effective internal control over financial reporting could adversely affect our ability to meet our reporting requirements
21. 21We are subject to costs and liabilities related to current and future environment, health and safety laws and regulations, as well as changes in the global climate, that could adversely affect our business
22. 22Our credit facilities subject us to financial and operating restrictions
23. 23A significant portion of our cash and cash equivalents and short-term investments balances are held by our non-U.S. subsidiaries
24. 24Changes in our tax rate or exposure to additional income tax liabilities could affect our profitability. In addition, audits by tax authorities could result in additional tax payments for prior periods
25. 25As a global business, we have a complex tax structure, and there is a risk that the tax authorities will disagree with our transfer pricing
26. 26We may not be able to realize our deferred tax assets which would adversely impact tax expense in future periods
27. 27We use the mark Vishay under license from Vishay Intertechnology, which could result in product and market confusion

Risks relating to our operations outside the United States

1. 28We attempt to improve profitability by operating in countries in which manufacturing efficiencies may be achieved, but the shift of operations to these regions may entail considerable expense
2. 29Current and future tariffs, trade regulation or other restrictions may adversely impact our business, financial condition and results of operations
3. 30We are subject to the risks of political, economic, health, and military instability in countries outside the United States in which we operate
4. 31customer orders and sales to certain regions and end-markets and materially and adversely affect our overall financial condition and operating results
5. 32We are exposed to foreign currency exchange rate risks, particularly due to market values of transactions in currencies other than the functional currencies of certain subsidiaries
6. 33As of December 31, 2024, we did not have in place any arrangements to mitigate or hedge against exposures relating to fluctuations in foreign currency exchange rate
7. 34Our global operations are subject to extensive anti-corruption laws and other regulations
8. 35Our business and results of operations may be materially adversely affected by compliance with import and export laws

Risks Relating to Our Common Stock

1. 36The holders of Class B convertible common stock have effective voting control of our company
2. 37Certain provisions of our certificate of incorporation and bylaws may reduce the likelihood of any unsolicited acquisition proposal or potential change of control that you might consider favorable
3. 38Difficult and volatile conditions in the capital, credit and commodities markets and in the overall economy could adversely affect our financial position, results of operations and cash flows
4. 39We might require additional capital to support business growth and this capital might not be available
5. 40Our future success is substantially dependent on our ability to attract and retain highly qualified technical, managerial, marketing, finance, and administrative personnel
6. 41We are exposed to, and may be adversely affected by, interruptions to our computer and information technology systems and sophisticated cyber-attacks
7. 42Interruptions in our information technology systems could adversely affect our business
8. 43We may use artificial intelligence in our business, and challenges with properly managing its use could adversely affect our business
9. 44Unexpected events, such as a natural disaster, could disrupt our operations and adversely affect our results of operations
10. 45Our stock price could become more volatile and investments could lose value
11. 46A significant drop in our stock price could expose us to costly and time consuming litigation, which could result in substantial costs, and divert management’s attention and resources, resulting in an adverse effect on our business
12. 47Your percentage ownership of our common stock may be diluted in the future