Overstock.com 2006 Annual Report Download - page 33

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information from users, which could be costly or harm our marketing efforts, and could require us to implement new and potentially
costly processes, procedures and/or protective measures.
Risks Relating to the Securities Markets and Ownership of Our Securities
The price of our securities may be volatile and you may lose all or a part of your investment.
Our common stock has been publicly traded only since May 30, 2002. The market price of our common stock has been subject to
significant fluctuations since the date of our initial public offering. These fluctuations could continue. It is possible that in some future
periods our results of operations may be below the expectations of public market analysts and investors. If this occurs, the market
price of our securities may decline. Among the factors that could affect the market price of our securities are as follows:
• changes in securities analysts' recommendations or estimates of our financial performance or publication of research reports by
analysts;
• changes in market valuations of similar companies;
• announcements by us or our competitors of significant contracts, acquisitions, commercial relationships, joint ventures or
capital commitments;
• general market conditions;
• actual or anticipated fluctuations in our operating results;
• intellectual property or litigation developments;
• changes in our management team;
• economic factors unrelated to our performance; and
• our issuance of additional shares of stock or other securities.
In addition, the securities markets have experienced significant price and trading volume fluctuations. These broad market
fluctuations may adversely affect the trading price of our securities. In the past, following periods of volatility in the market price of a
public company's securities, securities class action litigation has often been instituted against that company. Such litigation could
result in substantial cost and a diversion of management's attention and resources.
Our quarterly operating results are volatile and may adversely affect the market price of our securities.
Our future revenues and operating results are likely to vary significantly from quarter to quarter due to a number of factors, many
of which are outside our control, and any of which could harm our business. As a result, we believe that quarterly comparisons of our
operating results are not necessarily meaningful and that you should not rely on the results of one quarter as an indication of our future
performance. In addition to the other risk factors described in this report, additional factors that have caused and/or could cause our
quarterly operating results to fluctuate and in turn affect the market price of our securities include:
• increases in the cost of advertising;
• our inability to retain existing customers or encourage repeat purchases;
• the extent to which our existing and future marketing agreements are successful;
• price competition that results in lower profit margins or losses;
• the amount and timing of operating costs and capital expenditures relating to the expansion of our business operations and
infrastructure;
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