eTrade 1999 Annual Report Download - page 16

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transaction data. If any such compromise of our security were to occur, it could have a material adverse effect on our business,
financial condition and operating results.
Risks Associated with Significant Fluctuations In Quarterly Operating Results
We do not believe that our historical operating results should be relied upon as an indication of our future operating results. We expect
to experience large fluctuations in future quarterly operating results that may be caused by many factors, including the following:
. the timing of introductions or enhancements to online investing services and products by us or our competitors;
. market acceptance of online investing services and products;
. the pace of development of the market for online commerce;
. changes in trading volume in securities markets;
. trends in securities markets;
18
. domestic and international regulation of the brokerage and internet industries;
. changes in pricing policies by us or our competitors;
. changes in strategy;
. the success of, or costs associated with, acquisitions, joint ventures or other strategic relationships;
. changes in key personnel;
. seasonal trends;
. the extent of international expansion;
. the mix of international and domestic revenues;
. changes in the level of operating expenses to support projected growth; and
. general economic conditions.
We have also experienced fluctuations in the average number of customer transactions per day. Thus, the rate of growth in customer
transactions at any given time is not necessarily indicative of future transaction activity.
Risks Associated with Substantial Competition
The market for electronic brokerage services over the Internet is new, rapidly evolving and intensely competitive. We expect
competition to continue and intensify in the future. We face direct competition from discount brokerage firms providing either
touch-tone telephone or online brokerage services, or both. These competitors include, among others, such discount brokerage firms
as:
.Charles Schwab & Co., Inc.;
.Fidelity Brokerage Services, Inc.;
.Waterhouse Securities, Inc.;
.Quick & Reilly, Inc. (a subsidiary of Fleet Financial Group, Inc.);
.National Discount Brokers (a subsidiary of National Discount Brokers Group);
2002. EDGAR Online, Inc.