8x8 2016 Annual Report Download - page 28

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We have limited experience in operating our business internationally, which increases the risk that any potential future expansion efforts that we may undertake
will not be successful. We expect to invest substantial time and resources to expand our international operations. If we are unable to do this successfully and in a
timely manner, our business and operating results could be materially adversely affected.
Acquisitions may divert our management's attention, result in dilution to our stockholders and consume resources that are necessary to sustain our
business.
We completed two acquisitions in fiscal 2016, DXI Limited, API Telecom Limited, Easycallnow Limited and RAS Telecom Limited (collectively, "DXI") and
Quality Software Corporation ("QSC") on May 29, 2015 and June 3, 2015, respectively. On November 29, 2013, we acquired Voicenet Solutions Limited
("Voicenet"), a UK-based provider of cloud communication services in the United Kingdom. In fiscal 2012, we completed two acquisitions of businesses. In fiscal
2011, we completed one acquisition and one investment in another company. If appropriate opportunities present themselves, we may make additional acquisitions
or investments or enter into joint ventures or strategic alliances with other companies. Risks commonly encountered in such transactions include:
the difficulty of assimilating the operations and personnel of the combined companies;
the risk that we may not be able to integrate the acquired services or technologies with our current services, products, and technologies;
the potential disruption of our ongoing business;
the diversion of management attention from our existing business;
the inability of management to maximize our financial and strategic position through the successful integration of the acquired businesses;
difficulty in maintaining controls, procedures, and policies;
the impairment of relationships with employees, suppliers, and customers as a result of any integration;
the loss of an acquired base of customers and accompanying revenue;
the loss of an acquired base of customers and accompanying revenue while trying to transition the customer from the legacy systems to 8x8's technology
due to mismatch of the features, usability, packaging, or pricing at the renewal times;
the loss of an acquired base of customers and accompanying revenue due to failure and/or lack of maintenance/support for the legacy services and/or
equipment/software/services being end of life;
litigation arising from or relating to the transaction;
the assumption of leased facilities, other long-term commitments or liabilities that could have a material adverse impact on our profitability and cash flow;
and
the dilution to our existing stockholders from the issuance of additional shares of common stock or reduction of earnings per outstanding share in
connection with an acquisition that fails to increase the value of our company.
As a result of these potential problems and risks, among others, businesses that we may acquire or invest in may not produce the revenue, earnings, or business
synergies that we anticipate. In addition, there can be no assurance that any potential transaction will be successfully completed or that, if completed, the acquired
business or investment will generate sufficient revenue to offset the associated costs or other potential harmful effects on our business.
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