Charles Schwab 2013 Annual Report Download - page 24

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THE CHARLES SCHWAB CORPORATION
- 13 -
Increased price competition from other financial services firms, such as reduced commissions to attract trading volume or
higher deposit rates to attract client cash balances, could impact the Company’s results of operations and financial condition.
The industry in which the Company competes has undergone a period of consolidation.
The Company faces intense competition for the clients that it serves and the products and services it offers. There has been
significant consolidation as financial institutions with which the Company competes have been acquired by or merged into or
acquired other firms. This consolidation may continue. Competition is based on many factors, including the range of products
and services offered, pricing, customer service, brand recognition, reputation, and perceived financial strength.
Consolidations may enable other firms to offer a broader range of products and services than the Company does, or offer
such products at more competitive prices.
The Company faces competition in hiring and retaining qualified employees, especially for employees who are key to
the Company’s ability to build and enhance client relationships.
The market for quality professionals and other personnel in the Company’s business is highly competitive. Competition is
particularly strong for financial consultants who build and sustain the Company’s client relationships. The Company’s ability
to continue to compete effectively will depend upon its ability to attract new employees and retain existing employees while
managing compensation costs.
The Company’s stock price has fluctuated historically, and may continue to fluctuate.
The Company’s stock price can be volatile. Among the factors that may affect the volatility of the Company’s stock price are
the following:
speculation in the investment community or the press about, or actual changes in, the Company’s competitive
position, organizational structure, executive team, operations, financial condition, financial reporting and results,
effectiveness of cost reduction initiatives, or strategic transactions;
the announcement of new products, services, acquisitions, or dispositions by the Company or its competitors;
increases or decreases in revenue or earnings, changes in earnings estimates by the investment community, and
variations between estimated financial results and actual financial results.
Changes in the stock market generally or as it concerns the Company’s industry, as well as geopolitical, economic, and
business factors unrelated to the Company, may also affect the Company’s stock price.
Future sales of CSC’s equity securities may adversely affect the market price of CSC’s common stock and result in
dilution.
CSC’s certificate of incorporation authorizes CSC’s Board of Directors to, among other things, issue additional shares of
common or preferred stock or securities convertible or exchangeable into equity securities, without stockholder approval.
CSC may issue additional equity or convertible securities to raise additional capital or for other purposes. The issuance of any
additional equity or convertible securities could be substantially dilutive to holders of CSC’s common stock and may
adversely affect the market price of CSC’s common stock.
Item 1B. Unresolved Securities and Exchange Commission Staff Comments
None.