Wesco International (WCC) risk factors, FY2025 10-K

Risks Related to the Global Macroeconomic Environment and Our International Operations

1. 01Adverse conditions in the global economy and disruptions of financial and commodities markets could negatively impact us and our customers
2. 02Volatile trade policies, including a shift toward a “reciprocal” tariff regime in the U.S., and retaliatory measures by foreign governments, could materially increase our costs, disrupt supply availability and lead times, reduce price competitiveness, and adversely affect demand for our products and servicesNew
3. 03Our global operations expose us to political, economic, legal, currency and other risks37% rewritten
4. 04We are subject to various laws and regulations globally and any failure to comply could adversely affect our business24% rewritten
5. 05Fluctuations in foreign currency have an effect on our results from operations21% rewritten

Risks Related to Our Strategic Initiatives and Acquisitions

1. 06Expansion into new business activities, industries, product lines, services offerings, or geographic areas could subject the Company to increased costs and risks and may not achieve the intended results
2. 07Our strategic and operational initiatives, including our business transformation enabled by digital initiatives, are subject to various risks and uncertainties, and we may be unable to implement the initiatives successfully
3. 08We may not be able to fully realize the anticipated benefits and cost savings of mergers and acquisitions
4. 09Any future acquisitions that we may undertake will involve inherent risks, any of which could cause us not to realize the anticipated benefits
5. 10Divestitures are subject to various risks and uncertainties21% rewritten
6. 11Heightened antitrust and foreign investment scrutiny could delay, condition, or prevent our strategic transactionsNew

Risks Related to Our Information Systems and Technology and Intellectual Property

1. 12Any significant disruption or failure of our information systems could lead to interruptions in our operations, which may materially adversely affect our business operations, financial condition, and results of operations
2. 13We may not be able to realize the anticipated benefits and cost savings of our digital transformation initiatives or enhancing existing, and deploying new, technology, digital products and information systems in our operations
3. 14Our increasing use and reliance on artificial intelligence (“AI”), including machine learning, generative AI, agentic AI and large language models, may expose us to significant risks that could adversely affect our operations, financial condition, and results of operationsNew
4. 15Our business depends on cloud-based services operated by various third-party service providers, and any disruption in or interference with our use of these services could have adverse effects on our business, operational results, and financial condition
5. 16We may experience a failure in or breach of our information security systems, or those of our third-party product suppliers or service providers, as a result of cyber-attacks or information security breaches
6. 17We could incur significant and unexpected costs in our efforts to successfully avoid, manage, defend and litigate intellectual property matters

Risks Related to Our Industry, Markets and Business Operations

1. 18Loss of key suppliers could decrease sales, profit margins and earnings34% rewritten
2. 19We have been, and may continue to be, adversely affected by supply chain challenges, including product shortages, delays and price increases, which could decrease sales, profit margins and earnings36% rewritten
3. 20Product cost fluctuations could decrease sales, profit margins and earnings
4. 21Challenges in managing working capital and inventory in response to evolving customer demands, supply chain disruptions, and market fluctuations could significantly impact our cash flow, profit margins, and overall business performance
5. 22A decline in project volume could adversely affect our sales and earnings22% rewritten
6. 23We have risks associated with the sale of nonconforming products and services
7. 24Disruptions to our logistics capability, or our failure to effectively manage supply chain logistics during periods of disruption, may have an adverse impact on our operations
8. 25Our reliance on third-party service providers for outsourced functions could negatively impact our reputation, operations or financial results
9. 26An increase in competition could decrease sales, profit margins, and earnings
10. 27Our continued success may depend on our ability to execute ESG programs as planned and may impact our reputation and operating costs42% rewritten

Risks Related to Tax Matters

1. 28Changes in tax laws or challenges to the Company’s tax positions by taxing authorities could adversely impact the Company’s results of operations and financial condition70% rewritten

Risks Related to Our Indebtedness and Capital Structure

1. 29Our outstanding indebtedness requires debt service commitments that could adversely affect our ability to fulfill our obligations and could limit our growth and impose restrictions on our business, and fluctuations in interest rates could affect the cost of our indebtedness23% rewritten
2. 30Our debt agreements contain restrictive covenants that may limit our ability to operate our business

General Risk Factors

1. 31We are subject to costs and risks associated with global laws and regulations affecting our business, as well as litigation for product liability or other matters affecting our business
2. 32We must attract, retain and motivate our employees, and the failure to do so may adversely affect our business