Support.com 2014 Annual Report Download - page 10

Table of Contents
• Our assessment of seasonality, mix of revenue, and other trends for our business and the business of our partners;
• Our ability to deliver projected levels of profitability;
• Our expectations regarding the costs and other effects of acquisition and disposition transactions;
• Our expectations regarding unit volumes, pricing and other factors in the market for computers and other technology devices, and the effects of such factors on our business;
• Our ability to successfully operate in markets that are subject to extensive regulation, such as support for home security systems;
• Our expectations regarding the results of pending, threatened or future litigation;
• The assumptions underlying our Critical Accounting Policies and Estimates, including our assumptions regarding revenue recognition; assumptions used to estimate the fair value of stock-based
compensation; assumptions regarding the impairment of goodwill and intangible assets; and expected accounting for income taxes; and
• The expected effects of the adoption of new accounting standards.
An investment in our stock involves risk, and we caution investors that forward-looking statements are only predictions based on our current expectations about future events and are not guarantees of future
performance. We encourage you to read carefully all information provided in this report and in our other filings with the SEC before deciding to invest in our stock or to maintain or change your investment. Forward-
looking statements are based on information as of the filing date of this report, and we undertake no obligation to publicly revise or update any forward-looking statement for any reason.
Because forward-looking statements involve risks and uncertainties, there are important factors that may cause actual results to differ materially from our stated expectations. A number of these factors are
described below; provided, however that this list does not include all risks that could affect our business. If these or any other risks or uncertainties materialize, or if our underlying assumptions prove to be inaccurate,
actual results could differ materially from past results and from our expected future results.
Recently, our business has not been profitable and may not achieve profitability in future periods.
Through the fourth quarter of 2013, we delivered six consecutive quarters of profitability. Since then we have sustained significant changes in our largest partner program that materially affect our revenue and
margins. We also are making significant investments in support of our Nexus SaaS offering, and expect to continue to experience periods of losses in the future. If we fail to achieve revenue growth as a result of our
additional investments and efforts, or if such revenue growth does not result in our achieving profitability, the market price of our common stock will likely decline. A period of losses normally results in usage of cash to
fund our operating activities and a corresponding reduction in our cash balance.
Our business is based on a relatively new and evolving business model.
We are executing a plan to grow our business by providing technology support services, licensing our Nexus SaaS product, and providing end-user consumer software products. We may not be able to offer
these services and software products successfully. Our technology specialists are generally home-based, which requires a high degree of coordination and quality control of employees working from diverse and
remote locations. We experience financial losses in our business and we may use cash and incur losses in the future to support our growth initiatives. Our investments, which typically are made in advance of
revenue, may not yield increased revenue to offset these expenses. As a result of these factors, the future revenue and income potential of our business is uncertain. Any evaluation of our business and our
prospects must be considered in light of these factors and the risks and uncertainties often encountered by companies in our stage of development. Some of these risks and uncertainties relate to our ability to do the
following:
• Maintain our current relationships and service programs, and develop new relationships, with service partners and licensees of Nexus SaaS offering on acceptable terms or at all;
• Reach prospective customers for our software products in a cost-effective fashion;
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