Xerox Holdings (XRX) risk factors, FY2024 10-K

Other

1. 01Summary of Principal Risk Factors
2. 02Company-Specific Risk Factors

Risks Related to our Pending Acquisition of Lexmark

1. 03Our business, results of operations, cash flow, and financial condition are affected by global macroeconomic conditions
2. 04Table of Contents Legal Sign-off 2.24.25
3. 05If we fail to successfully develop new and existing products, technologies, and service offerings, we may be unable to retain current customers and gain new customers and our revenues would decline
4. 06Our business and financial performance could suffer if we do not manage the risks associated with our services businesses properly
5. 07We may not be able to replace the revenue and earnings from lost customers or reductions in services. Although our services agreements may include penalties for early termination, these penalties may not fully cover our investments in these businesses
6. 08Our profitability is dependent upon our ability to obtain adequate pricing for our products and services and to improve our cost structure
7. 09We have outsourced a significant portion of our manufacturing operations and increasingly rely on third-party manufacturers, subcontractors, and suppliers
8. 10We may be unable to attract and retain key personnel while our business model undergoes significant changes
9. 11We may not achieve the expected benefits of our restructuring and transformation plans, including Reinvention, which may adversely affect our business
10. 12If we fail to achieve some or all of the expected benefits of our restructuring and transformation plans, it could have a material adverse effect on our competitive position, business, financial condition, results of operations and cash flows
11. 13Our government contracts are subject to termination rights, audits, and investigations, which, if exercised, could negatively impact our reputation and reduce our ability to compete for new contracts
12. 14Our ability to fund our customer financing activities at economically competitive levels depends on our ability to source capital and the cost of capital in the credit markets
13. 15Our level of indebtedness could adversely affect our financial condition and reduce our financial flexibility
14. 16working capital borrowings or debt or equity financing may not be available to pay or refinance such debt at attractive rates or at all
15. 17Our financial condition and results of operations could be adversely affected by employee benefit-related funding requirements
16. 18Our intellectual property rights are valuable, and any inability to protect them could reduce the value of our products, services, and brand
17. 19Failure to meet CSR expectations or standards or achieve our CSR goals could adversely affect our business, results of operations, financial condition, or stock price
18. 20and Canada, and the Law on Child Labour Due Diligence in The Netherlands. There are also a number of voluntary reporting schemes that provide a framework to report CSR-related information
19. 21The international nature of our business subjects us to a number of risks, including foreign exchange and interest rate risk and unfavorable political, regulatory, and tax conditions in foreign countries
20. 22Tariffs or other restrictions on foreign imports could negatively impact our financial performance
21. 23We operate globally and changes in tax laws could adversely affect our results
22. 24We are subject to breaches of our security systems, cyber-attacks, and service interruptions, which could expose us to liability, litigation, regulatory action and damage our reputation
23. 25We receive, process, transmit and store information relating to identifiable individuals, both in our role as a technology provider and as an employer. As a result, we are subject to numerous privacy and data protection laws and regulations in the United States (both federal and state) and foreign jurisdictions
24. 26The use or anticipated use of artificial intelligence (AI) technologies, including generative AI, by us or third parties, may increase or create new regulatory or operational risks
25. 27We are subject to numerous environmental laws, regulations, and procurement initiatives and failure to comply could result in substantial costs, including cleanup costs, fines, civil or criminal sanctions, third-party damage or personal injury claims, or limited market access
26. 28The Lexmark acquisition may not be completed and the equity purchase agreement may be terminated in accordance with its terms
27. 29The Lexmark acquisition may present certain risks to our business and operations prior to the closing and, if consummated, after the closing
28. 30We will incur a substantial amount of indebtedness in connection with the financing of the Lexmark Acquisition
29. 31Our business, results of operations and financial condition may be negatively impacted by legal and regulatory matters
30. 32Our failure to maintain an adequate system of internal control over financial reporting, could adversely affect our ability to accurately report our results