BAND

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How BAND rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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Risks Related to Our Business Our growth and financial health are impacted by a number of risks, including uncertain capital markets, political and economic instability in a number of regions, the imposition of widespread tariffs, unfavorable macroeconomic conditions, recessionary fears, high rates of inflation and higher interest rates.
In addition, we are vulnerable to changes in market preferences or other market changes, as well as general macroeconomic conditions, reduced growth rates, interest rates, tax rates and policies, inflation, a significant shift in U.S., state and foreign government policies and the deterioration of economic relations between countries or regions, including potential negative consumer sentiment toward non-local products or sources.
As a result of recent changes to U.S. and foreign government policies, there may be changes to existing trade agreements, greater restrictions on free trade generally, the imposition of or significant increases in tariffs on goods imported into the U.S., and adverse responses by foreign governments to U.S. trade policies, among other possible changes.
The U.S. government has implemented or announced it intends to implement or increase tariffs, and it remains unclear what the U.S. government or foreign governments will or will not do with respect to tariffs or trade agreements and policies.
These trade measures enacted, or threatened to be enacted, by the U.S. and other countries have led to increased volatility and uncertainty in certain parts of the global economy.
We cannot predict the timing, strength, or duration of the current or any future potential economic volatility or slowdown in the U.S. or globally.
Increased tariffs could adversely impact the costs to us of the fiber, computers, software, transmission electronics and related network components, including network colocation facilities, that are critical to the operation of our network.
We may not be able to offset any such increase in costs with a commensurate increase in the price of our services, which could have an adverse impact on our business, results of operations and financial condition.
The U.S. and global economies have in the past, and will in the future, experience recessionary periods and periods of economic instability, which could affect the rate of technology spending generally.
Government shutdowns or delays in government agency operations, including those of the FCC, could materially and adversely affect our business, financial condition, and results of operations.
Lapses in U.S. federal government funding, such as the government shutdown experienced in the U.S. in October 2025, and other significant disruptions to government agency operations may have a material adverse effect on our business, financial condition, and results of operations.
As a telecommunications services provider, our business depends on the continued operations and timely reviews of federal agencies, such as the FCC, which oversees licensing and other authorizations, regulatory proceedings, product certifications and other telecommunications industry issues.
Importantly, the FCC also provides telecommunications service providers like Bandwidth with a venue for dispute resolution when certain disputes with other providers arise, and this venue is unavailable during a government shutdown.
The recent government shutdown caused significant impacts to FCC operations, suspending transaction review timelines and extending various types of filing and review deadlines until one day after the government reopened, effectively delaying the regulatory process and impacting the pace at which certain business goals could be pursued and disputes resolved.
The government shutdown also delayed our participation in open FCC rulemaking proceedings surrounding issues like the transition of communications networks to all-Internet Protocol technology, which is important to our competitive positioning, growth strategy, and long-term business objectives.
Any future government shutdowns or significant reduction in federal agency operations, may also diminish our ability to access the public markets and obtain necessary capital to properly capitalize and continue operations.
Although we have insignificant sales involving the government, a shutdown may also impede our customers’ ability to obtain or utilize federal funds and regulatory approvals, potentially reducing their demand for our services or adversely affecting their ability to make timely payments to us.
If we are unable to attract new customers in a cost-effective manner, our business, results of operations and financial condition could be adversely affected.
This market is subject to a number of risks and uncertainties.
For example, developers and organizations may not recognize the need for, or benefits of, our services and platform.
The market for our services and platform could fail to grow significantly or there could be a reduction in demand for our services and platform as a result of a lack of customer acceptance, technological changes or challenges, or our inability to successfully introduce new product offerings.
If demand for our services and platform does not grow or if it decreases, then our business, results of operations and financial condition could be adversely affected.
Our ability to achieve revenue growth, cashflow, and operating performance depends on retaining customers and increasing their use of our services.
Such applications, functions or technologies may inadvertently filter legal and desired calls or messages to or from our customers and in some cases, we may need to update our services and technology or work with these providers to ensure customer success in the face of these applications, functions or technologies.
If we cannot respond to technological changes and evolving customer requirements in a timely and cost-effective manner, or if our new or enhanced services do not gain market acceptance, our services may become less competitive or obsolete and our business, results of operations and financial condition would be adversely affected.
If we are unable to effectively maintain our corporate culture or fail to achieve the necessary level of efficiency in our organization as we grow, then our business, results of operations and financial condition could be adversely affected.
If we are unable to develop, maintain, and scale these systems effectively, or if data migration or integration efforts fail or are significantly delayed, we may experience errors or delays in processing orders, provisioning services, providing customers with accurate information about their services, or supporting billing activities.
Any such issues could negatively affect customer satisfaction, increase our costs and harm our business, results of operations and financial condition.
Increased demand for customer support, without corresponding revenue, could increase costs.
We operate internationally, which exposes us to risks that are incremental to those experienced by a company operating only domestically.
Our experience with international operations is more limited than our domestic experience, and further international expansion efforts may not be successful.
In particular, we face risks in doing business internationally that could adversely affect our business, including: • exposure to international political developments that may cause instability for businesses and volatility in global financial markets and the value of foreign currencies, any of which could disrupt trade and the sale of our services in international markets; • difficulties in managing and staffing international operations, including difficulties related to the increased operations, travel, infrastructure, employee attrition and legal compliance costs associated with numerous international locations; • our ability to effectively price our products in competitive international markets; • new and different sources of competition; • costs associated with network service providers outside of the United States; • the need to adapt and localize our products for specific countries. • challenges in keeping abreast of, understanding and complying with local laws, regulations and customs in multiple foreign jurisdictions, particularly in the areas of telecommunications, data privacy and security, and artificial intelligence; • complexities related to differing technical standards, certification requirements and audit requirements outside the United States, which could prevent customers from deploying our products or limit their usage; • export controls and economic sanctions administered by the Bureau of Industry and Security of the U.S.
Bribery Act 2010; • international trade policies, tariffs and other non-tariff barriers, such as quotas; • more limited protection for intellectual property rights in some countries; • adverse consequences relating to the complexity of operating in multiple international jurisdictions with differing tax frameworks; • fluctuations in currency exchange rates, which could increase the price of our products outside of the United States, increase the expenses of our international operations and expose us to foreign currency exchange rate risk; • currency control regulations, which might restrict or prohibit our conversion of other currencies into U.S. dollars; • restrictions on the transfer of funds from or between international jurisdictions; • deterioration of political relations between the United States and other countries; • public health epidemics, such as COVID-19, or natural disasters, which could have an adverse impact on our employees, contractors, customers, partners, travel and the global economy; • political or social unrest, acts of war or economic instability in a specific country or region in which we operate, which could have an adverse impact on our operations in that location; and • exposure to geopolitical conflicts and related government actions, such as the military conflict between Russia and Ukraine and the resulting sanctions and export controls imposed by the U.S., U.K., EU, and others, which led us to terminate our services in Russia and Belarus; although these countries did not constitute a material portion of our business, continued or expanded conflict in the region, or similar conflicts in other regions, could disrupt our operations in affected areas (including locations such as our office in Romania), impact customer demand or cause broader volatility in global markets.
A significant portion of our revenue is concentrated in a limited number of large customers.
A significant portion of our revenue is concentrated among a limited number of large customers.
If we lost several of our top ten customers, or, if several of these major customers significantly decreased their usage of our services, our business would be materially and adversely affected.
We use AI technologies internally, and we also have incorporated AI-powered features into certain of our solutions and may continue to do so in the future.
The integration of AI models and large data sets into our products and internal systems, including those provided by third parties, may heighten our exposure to cyber-attacks, data breaches, misuse of our data and other security incidents.
In addition, AI technologies may be used in connection with cyber-attacks, which may increase in sophistication, frequency or speed of such attacks and, in turn, make them more difficult to detect or mitigate.
We have also filed a lawsuit against the city of San Francisco with respect to its assessment of certain 911-related taxes and charges.

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Gone since FY2024

Risks Related to Our Business Our future growth and the success of our expansion plans depend on a number of factors that are beyond our control.
We have grown our business considerably since inception and cannot guarantee we will be able to maintain or choose to target the same pace of growth in the future.
Our success in achieving continued growth depends upon several factors including: • our ability to hire and retain qualified and effective personnel, including, but not limited to, those with the expertise required to develop and maintain our service offerings, to sell those offerings and to operate our business effectively; • the overall economic health of new and existing markets; • the number and effectiveness of competitors; • the pricing structure under which we will be able to purchase services required to serve our customers; • our ability to successfully introduce new service offerings and features that generate revenue growth, and maintain or enhance existing offerings; • the availability to us of technologies needed to remain competitive; • federal, state and international regulatory conditions, including the maintenance of regulation that protects us from unfair business practices by traditional network service providers or others with greater market power who have relationships with us as both competitors and suppliers; and • changes in industry standards, laws, regulations, or regulatory enforcement trends in the United States and internationally.
Our growth and financial health are impacted by a number of risks, including uncertain capital markets, political and economic instability in a number of regions, recessionary fears, high rates of inflation and higher interest rates.
In addition, we are vulnerable to changes in market preferences or other market changes, such as general economic conditions, reduced growth rates, interest rates, tax rates and policies, inflation, a significant shift in government policies and the deterioration of economic relations between countries or regions, including potential negative consumer sentiment toward non-local products or sources.
The U.S. and global economies have in the past, and will in the future, experience recessionary periods and periods of economic instability.
Key vendors upon which we rely also could be unwilling or unable to provide us with the materials or services that we need to operate our communications platform or otherwise on a timely basis or on terms that we find acceptable.
If any of our key vendors fail to continue to provide us with the materials or services that we rely upon to operate, we may not be able to replace them without disruptions to, or deterioration of, our services and we also may incur higher costs associated with new vendors.
Transitioning to new vendors also may result in the loss of the value of assets associated with our integration of third-party services into our network or service offerings.
In addition, some of our competitors have lower list prices than us, which may be attractive to certain customers even if those services have different or lesser functionality.
If we are unable to maintain our current pricing due to competitive pressures, our revenue and margins will be reduced and our business, results of operations and financial condition will be adversely affected.
In addition, pricing pressures and increased competition generally could result in reduced revenue, reduced margins, increased losses or the failure of our services to achieve or maintain widespread market acceptance, any of which could harm our business, results of operations and financial condition.
If we are unable to attract new customers in a cost-effective manner, then our business results of operations and financial condition would be adversely affected.
This market is relatively new and unproven and is subject to a number of risks and uncertainties.
For example, the utilization of software APIs by developers and organizations to build communications functionality into their applications is still relatively new, and developers and organizations may not recognize the need for, or benefits of, our services and platform.
The market for our services and platform could fail to grow significantly or there could be a reduction in demand for our services and platform as a result of a lack of customer acceptance, technological changes or challenges, our inability to successfully introduce new product offerings, competing services and platforms, decreases in spending by current and prospective customers, weakening economic conditions, geopolitical developments, global pandemics, adverse regulatory developments or other causes.
If our market does not experience significant growth or demand for our services and platform decreases, then our business, results of operations and financial condition could be adversely affected.
Our ability to realize our goals for anticipated revenue growth, cash flow and operating performance depends on customers increasing their use of our services, and any loss of customers or decline in their use of our services could materially and adversely affect our business, results of operations and financial condition.
Such applications, functions or technologies may inadvertently filter legal and desired calls or messages to or from our customers.
In certain instances, we may need to update our services and technology or work with these providers to ensure customer success in the face of these applications, functions or technologies.
If we cannot respond to these changes in a cost-effective manner, our services may become less competitive or obsolete, and our business, results of operations and financial condition could be adversely affected.
Furthermore, our ability to increase the usage of our services depends, in part, on the development of new use cases for our services, which may be outside of our control.
Our ability to generate usage of additional services or features by our customers may also require increasingly sophisticated and more costly sales efforts and result in a longer sales cycle.
If we are unable to successfully enhance our existing services to meet evolving customer requirements, increase adoption and usage of our services or develop new services or features, or if our efforts to increase the usage of our services are more expensive than we expect, then our business, results of operations and financial condition would be adversely affected.
This, in turn, could adversely affect our business, results of operations and financial condition.
If we fail to achieve the necessary level of efficiency in our organization as we grow, then our business, results of operations and financial condition could be adversely affected.
Increased demand for customer support, without corresponding revenue, could increase costs and adversely affect our business, results of operations and financial condition.
We operate internationally, which exposes us to significant risks.
We have limited experience with international operations, and further international expansion efforts may not be successful.
In addition, we face risks in doing business internationally that could adversely affect our business, including: • exposure to international political developments that may cause instability for businesses and volatility in global financial markets and the value of foreign currencies, any of which could disrupt trade and the sale of our services in international markets; • difficulties in managing and staffing international operations, including difficulties related to the increased operations, travel, infrastructure, employee attrition and legal compliance costs associated with numerous international locations; • our ability to effectively price our products in competitive international markets; • new and different sources of competition; • costs associated with network service providers outside of the United States; • the need to adapt and localize our products for specific countries; • challenges in keeping abreast of, understanding and complying with local laws, regulations and customs in multiple foreign jurisdictions, particularly in the areas of telecommunications and data privacy and security; • complexities related to differing technical standards, certification requirements and audit requirements outside the United States, which could prevent customers from deploying our products or limit their usage; • export controls and economic sanctions administered by the Bureau of Industry and Security of the U.S.
Bribery Act 2010; • international trade policies, tariffs and other non-tariff barriers, such as quotas; • more limited protection for intellectual property rights in some countries; • adverse consequences relating to the complexity of operating in multiple international jurisdictions with differing tax frameworks; • fluctuations in currency exchange rates, which could increase the price of our products outside of the United States, increase the expenses of our international operations and expose us to foreign currency exchange rate risk; • currency control regulations, which might restrict or prohibit our conversion of other currencies into U.S. dollars; • restrictions on the transfer of funds from or between international jurisdictions; • deterioration of political relations between the United States and other countries; • public health epidemics, such as COVID-19, or natural disasters, which could have an adverse impact on our employees, contractors, customers, partners, travel and the global economy; and • political or social unrest, acts of war or economic instability in a specific country or region in which we operate, which could have an adverse impact on our operations in that location.
The military conflict between Russia and Ukraine, and the global response to that conflict, may adversely affect our business and results of operations.
In response to the military conflict between Russia and Ukraine, the U.S., U.K., EU and others imposed significant additional sanctions and export controls against Russia and certain Russian individuals and entities, and we terminated our service offerings in Russia and Belarus.
We have operations, as well as current and potential new customers, in several locations in Europe, including an office in Romania.
If the conflict extends beyond Ukraine or further intensifies, it could have an adverse impact on our operations in Romania or other affected areas.
Although neither Russia nor Belarus constituted a material portion of our business, a significant escalation or further expansion of the conflict’s current scope or related disruptions to the global markets could have a material adverse effect on our results of operations.
And while we do not offer any services in Ukraine, we continue to monitor the situation in that country and globally, and assess the military conflict’s potential impact on our business.
A significant portion of our revenue is concentrated in a limited number of customers.
A significant portion of our revenue is concentrated among a limited number of customers.
If we lost one or more of our top ten customers, or, if one or more of these major customers significantly decreased orders for our services, our business would be materially and adversely affected.

and 44 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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