Varex Imaging Corp
For the period ended Jul 3, 2026. Filed Aug 10, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jul 3, 2026 · Filed Aug 10, 2026
VREX$18.440.0%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-Q
Period ended 2026-04-03; filed 2026-05-07.
0001681622-26-000052
Item 1A. Risk FactorsCurrent report: 10-Q
Period ended 2026-07-03; filed 2026-08-10.
0001681622-26-000063
Item 1A. Risk FactorsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 161 previous paragraphs and 183 current paragraphs.
37 unchanged; 95 reworded; 46 added; 26 removed; 3 previous and 5 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (46)
Current report
Risks Relating to Proposed Acquisition by Teledyne
Current report
The announcement of our entry into the Merger Agreement and pendency of the Merger may result in disruptions to our business, and the Merger could divert management's attention, disrupt our relationships with third parties and employees, and result in negative publicity, customer concerns, or legal proceedings, any of which could negatively impact our operating results and ongoing business.
Current report
On August 10, 2026, we entered into the Merger Agreement with Teledyne, providing for the acquisition of Varex by Teledyne. Completion of the Merger, which is currently expected in early calendar year 2027, is subject to the satisfaction or waiver of certain closing conditions, including: (1) the adoption of the Merger Agreement by the affirmative vote of the holders of a majority of the outstanding shares of our common stock, (2) the expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and clearance under applicable foreign merger control laws and foreign investment laws, (3) the absence of any order, judgment, injunction, or determination of a governmental entity or applicable law preventing or prohibiting the consummation of the Merger, (4) the accuracy of each party’s representations and warranties, subject to certain standards set forth in the Merger Agreement, (5) the performance and compliance in all material respects of each party’s agreements and covenants under the Merger Agreement, and (6) in the case of the obligations of Teledyne and Merger Sub to effect the Merger, no Company Material Adverse Effect (as defined in the Merger Agreement) with respect to Varex having occurred since the date of the Merger Agreement. There is no assurance that all of the conditions will be satisfied or waived, or that the Merger will be completed on the proposed terms, within the expected timeframe, or at all. Furthermore, there are additional inherent risks in the Merger, including, but not limited to, the risks detailed below.
Current report
During the period prior to the closing of the Merger, our business is exposed to certain inherent risks due to the effect of the announcement or pendency of the Merger on our business relationships, financial condition, operating results, and business, including:
Current report
•potential uncertainty in the marketplace, which could result in current and prospective customers and distributors to purchase products and services from our competitors or reduce, delay or cancel purchasing from us;
Current report
•the possibility of disruption to our business and operations, including diversion of management attention and resources;
Current report
•the inability to attract and retain key personnel (including as a result of solicitation by our competitors or others), and the possibility that our current employees could be distracted, and their productivity decline as a result, due to uncertainty regarding the Merger;
Current report
•the inability to pursue alternative business opportunities or make changes to our business and other restrictions on our ability to conduct our business, pending the completion of the Merger;
Current report
•our inability to solicit other acquisition proposals during the pendency of the Merger;
Current report
•the amount of the costs, fees, expenses, and charges related to the Merger Agreement and the Merger; and
Current report
•other developments beyond our control, including, but not limited to, changes in domestic or global economic or political conditions that may affect the timing or success of the Merger.
Current report
The Merger may be delayed, and may ultimately not be completed, due to a number of factors, including:
Current report
•the failure to obtain the approval of the adoption of the Merger Agreement by our stockholders;
Current report
•the failure to obtain regulatory approvals from certain governmental entities (or the imposition of any conditions, limitations or restrictions on such approvals);
Current report
•potential future stockholder litigation and other legal and regulatory proceedings, which could delay or prevent the Merger; and
Current report
•the failure to satisfy the other conditions to the completion of the Merger, including the possibility that a Company Material Adverse Effect on our business would permit Teledyne not to close the Merger.
Current report
If the Merger does not close, our business and stockholders would be exposed to additional risks, including:
Current report
•to the extent that the current market price of our common stock reflects an assumption that the Merger will be completed, the price of our common stock could decrease if the Merger is not completed;
Current report
•investor confidence could decline, stockholder litigation could be brought against us, relationships with existing and prospective customers, distributors, manufacturers, service providers, investors, lenders, and other business partners may be adversely impacted, we may be unable to hire or retain key personnel, and profitability may be adversely impacted due to costs incurred in connection with the pending Merger; and
Current report
•the requirement that we pay a customary termination fee of $25.3 million if the Merger Agreement is terminated in certain circumstances, including by us in order to accept a superior proposal or by Teledyne because our Board of Directors withdraws its recommendation in favor of the Merger.
Current report
Even if successfully completed, there are certain additional risks to our stockholders from the Merger, including:
Current report
•the amount of cash to be paid under the Merger Agreement is fixed and will not be adjusted for changes in our business, assets, liabilities, prospects, outlook, financial condition, or operating results or in the event of any change in the market price of, analyst estimates of, or projections relating to, our common stock;
Current report
•the fact that receipt of the all-cash per share merger consideration under the Merger Agreement is taxable to stockholders that are treated as U.S. holders for U.S. federal income tax purposes; and
Current report
•the fact that, if the Merger is completed, our stockholders will forego the opportunity to realize the potential long-term value of the successful execution of our current strategy as an independent company, and will be affected by the ability of Teledyne to integrate and implement its plans, forecasts and other expectations with respect to our business and realize additional opportunities for growth and innovation.
Current report
Any of the foregoing, individually or in combination, could materially and adversely affect our business, our financial condition, and our results of operations and prospects.
Current report
Completion of the Merger is subject to the conditions contained in the Merger Agreement, including receipt of regulatory approvals, which may not be received, may take longer than expected or may impose conditions that are not presently anticipated or that cannot be met, and if these conditions are not satisfied or waived, the Merger will not be completed.
Current report
Before the Merger may be completed, various consents, clearances, approvals, authorizations and declarations of non-objection, or expiration of waiting periods (or extensions thereof), must be obtained from certain regulatory and governmental authorities in the U.S., in China, and in numerous other jurisdictions. In addition, the Merger may be reviewed under antitrust statutes or foreign direct investment regimes of other governmental authorities.
Current report
In deciding whether to grant the required regulatory approval, consent or clearance, the relevant governmental entities will consider the effects of the Merger on competition within their relevant jurisdiction. Regulatory and governmental entities may impose conditions on their respective approvals, in which case lengthy negotiations may ensue among such regulatory or governmental entities, Teledyne and us. Such conditions, any such negotiations and the process of obtaining regulatory approvals could have the effect of delaying or preventing consummation of the Merger.
Current report
Subject to the terms of the Merger Agreement, we have agreed to use our reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper, or advisable under applicable laws to consummate and make effective the transactions contemplated by the Merger Agreement, including the Merger. Satisfaction of many of the closing conditions is not within our control. For example, we cannot be certain that required regulatory clearances and approvals will be obtained in a timely manner or at all, or that the granting of these regulatory clearances and approvals will not involve the imposition of regulatory remedies on the completion of the Merger.
Current report
If any of the closing conditions are not satisfied or waived prior to May 10, 2027, which deadline may be extended to August 27, 2027, under certain circumstances, it is possible that the Merger Agreement will be terminated.
Current report
Litigation may arise in connection with the Merger, which could be costly, prevent or delay consummation of the Merger, divert management’s attention, and otherwise adversely impact our business.
Current report
It is possible that litigation against us or our directors may be filed in the future as securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into acquisition, merger, or other business combination agreements like the Merger Agreement. The outcome of any such litigation is uncertain, and any litigation related to the Merger could delay or prevent the consummation of the proposed Merger.
Current report
Regardless of the outcome of any future litigation related to the Merger, such litigation may be time-consuming and expensive and may distract our management from running the day-to-day operations of our business. The litigation costs and diversion of management’s attention and resources to address the claims and counterclaims in any litigation related to the Merger may adversely impact our business, results of operations, prospects, cash flows, and financial condition. If the Merger is not consummated for any reason, litigation could be filed in connection with the failure to consummate the Merger. Any litigation related to the Merger may result in negative publicity or an unfavorable impression of us, which could negatively affect the price of our common stock, impair our ability to recruit or retain employees, damage our relationships with our customers, resellers, distributors, and other business partners, or otherwise adversely impact our operations and financial performance.
Current report
Further, one of the conditions to the completion of the Merger is that no restraining order, preliminary or permanent injunction, or other order issued by any court of competent jurisdiction will be in effect which prevents the consummation of the Merger. As such, if any such order or injunction preventing the consummation of the Merger is obtained, that order or injunction may prevent the proposed Merger from becoming effective or from becoming effective within the expected timeframe.
Current report
Tariff exclusions, refunds, drawback programs, foreign trade zones, bonded warehouse mechanisms and other mitigation measures may provide only partial relief, may require government approval or administrative action, may be unavailable or delayed, and may be subject to further litigation, negotiation or policy changes. Even if we are able to obtain refunds, exclusions, drawback or other mitigation benefits, we may incur additional costs to pursue them, and disputes may arise with customers, suppliers, logistics providers or other parties regarding allocation, timing or entitlement to any recovered amounts.
Current report
China’s stated policy of reducing its dependence on foreign manufacturers and technology companies may reduce demand for our products and our customers' products in China. China and other jurisdictions may require or incentivize the use of local suppliers, local manufacturing, local content, local partnerships, certification, product registration, local testing, technology-transfer expectations, price preferences, reimbursement preferences, procurement restrictions, or similar requirements that favor locally manufactured goods. These measures could reduce demand for our products, limit our ability to participate directly or indirectly, require us or our customers to restructure supply chains or manufacturing footprints, increase compliance costs, or make our products less competitive.
Current report
In April 2025, the China Ministry of Commerce ("MOFCOM") initiated investigations related to imports of X-ray tubes and certain medical CT X-ray tubes and tube inserts for CT devices originating from the United States and India (the “MOFCOM Investigations”). We produce CT tubes and inserts in the United States and export them to China, but do not produce CT tubes and inserts in India. The MOFCOM Investigations were suspended indefinitely in November 2025, but they could be recommenced, expanded or replaced by other trade, procurement, localization, anti-dumping, countervailing duty, safeguard, export-control or industrial policy measures. Any such measures could affect our ability to export CT tubes and inserts, other X-ray imaging components or related products to China, affect customer procurement decisions in China, or require us to alter pricing, sourcing, production, product registration or distribution strategies.
Current report
We also compete with independent X-ray tube manufacturers for OEM and independent servicing business, with numerous smaller competitors in flat panel detectors, and with other OEM suppliers in our Industrial business, primarily outside of the United States. Some foreign competitors may receive government support or local-manufacturer preferences that we do not, and they may not be subject to the same tariffs, trade policies, trade compliance regulations, government investigations, product safety, quality system, environmental, restricted-substance, cybersecurity, data, labeling, registration, or other regulatory or legal requirements as we are. Any inability to develop, validate, qualify, obtain, or support required regulatory clearances, approvals, certifications, registrations, or customer acceptances for, and supply commercial quantities of competitive products as quickly and effectively as our competitors could limit product acceptance and adversely affect our pricing, sales, revenues, position in the market, gross margins, and operating margins.
Current report
•acquisitions, investments, and joint ventures may increase our exposure to risks, including litigation;
Current report
Changes to FDA regulations, guidance, inspection procedures, user fee programs, cybersecurity expectations, software guidance or quality system requirements could increase the cost, timing and complexity of developing, manufacturing, modifying, clearing, approving or commercializing our products. In particular, FDA’s transition to the QMSR and its incorporation of ISO 13485 requirements may require changes to our quality systems, documentation, supplier controls, internal procedures and inspection-readiness processes. If we are unable to implement or maintain these processes effectively, we could experience inspection findings, delays, remediation costs, restrictions on manufacturing or sales, or other enforcement or commercial consequences.
Showing the first 40 of 46 passages. Open the source sections for the rest.
Removed paragraphs (26)
Previous report
In the past, both the governments of the United States and China have granted tariff exclusions that temporarily eliminate certain duties payable for specific commodities, providing partial relief from such tariffs, but with certain exceptions, they must be solicited and approved. There is no guarantee that exclusions will be granted or that existing exclusions will be extended by either government. In addition, we cannot provide any guarantee that we will be able to effectively implement other tariff mitigation measures, such as free trade zones, bonded mechanisms, or drawback programs.
Previous report
In addition to tariffs, China’s stated policy of reducing its dependence on foreign manufacturers and technology companies may result in reduced demand for our products and our customers' products in China, which could have a material adverse impact on our business, results of operations and financial position. There are risks that the Chinese government may, among other things, require the use of local suppliers, compel companies that do business in China to partner with local companies to conduct business, or provide incentives to government-backed local customers to buy from local suppliers rather than companies like ours, all of which could adversely impact our business, results of operations and financial position. As an example, in April 2025 the China Ministry of Commerce ("MOFCOM") initiated two investigations related to medical products imported into China (the "MOFCOM Investigations"). One investigation related to the impact of imports of X-ray tubes on the domestic industry and its competitiveness, and another related to imports into China of certain medical CT X-ray tubes and tube inserts for CT devices (collectively “CT Tubes and Inserts”) originating from the United States and India. We produce CT Tubes and Inserts in the United States and export them to
Previous report
China, but do not produce CT Tubes and Inserts in India. Total sales of medical X-ray tubes we imported into China represented approximately 11% of our total revenue during the first six months of fiscal year 2026.
Previous report
MOFCOM temporarily suspended both of the MOFCOM Investigations in May 2025 and again in August 2025. In November 2025, the MOFCOM Investigations were suspended indefinitely. If recommenced, we anticipate that the MOFCOM Investigations may take approximately one year from recommencement to resolve. If, as a result of the outcome of the MOFCOM Investigations, we are required to increase our prices or tariffs are imposed on the CT Tubes and Inserts we export to China, our prices may not be competitive with local and other manufacturers, which could negatively impact our ability to compete in China and negatively impact our business, results of operations and financial condition.
Previous report
In addition, we compete against other stand-alone, independent X-ray tube manufacturers for both the OEM business of major diagnostic imaging equipment manufacturers and the independent servicing business for X-ray tubes. The flat panel detectors industry is also very competitive, and we face intense competition from over a dozen smaller competitors. In our Industrial business, we also compete with other OEM suppliers primarily outside of the United States. Some of our competitors outside of the United States may have resources and support from their governments that we do not, such as preferences for local manufacturers, and they may not be subject to the same tariffs, trade policies, trade compliance regulations and government investigations as us.
Previous report
Our competitors may not all be subject to the same standards, regulatory and/or other legal requirements to which we are subject and, therefore, they could have a competitive advantage in developing, manufacturing, and marketing products and services. Any inability to develop, gain regulatory approval for, and supply commercial quantities of competitive products to existing and potential customers as quickly and effectively as our competitors could limit acceptance of our products and negatively and materially affect our pricing, sales, revenues, position in the market, and gross margins and our ability to maintain or increase our operating margins.
Previous report
•acquisitions, investments, and joint ventures could result in increased risks, including from potential litigation;
Previous report
If we or any of our suppliers, distributors, agents, or customers fail to comply with FDA, Federal Trade Commission, or other applicable United States regulatory requirements or are perceived to have failed to comply with regulations, we may face:
Previous report
•adverse publicity affecting both us and our customers;
Previous report
•partial suspension or total shutdown of production facilities or the imposition of operating restrictions;
Previous report
•increased difficulty in obtaining required clearances or approvals or losses of clearances or approvals already granted;
Previous report
•seizures or recalls of our products or those of our customers;
Previous report
•delays in purchasing decisions by customers or cancellation of existing orders;
Previous report
•difficulty in obtaining product liability or operating insurance at a reasonable cost, or at all.
Previous report
We are required to timely file various reports with the FDA, including reports required by the medical device reporting regulations (“MDRs”), that require we report to regulatory authorities if our devices may have caused or contributed to a death or serious injury, or malfunctioned in a way that would likely cause or contribute to a death or serious injury if the malfunction were to recur. If we initiate a correction or removal of a device to reduce a risk to health posed by the device, we would be required to submit a publicly available correction and removal report to the FDA and, in many cases, similar reports to other regulatory agencies. This report could be classified by the FDA as a device recall, which could lead to increased scrutiny by the FDA, other international regulatory agencies, and our customers regarding the quality and safety of our devices. If these MDRs or correction and removal reports are not filed on a timely basis, regulators may impose sanctions, sales of our products may suffer, and we may be subject to product liability or regulatory enforcement actions, all of which could harm our business.
Previous report
Government regulation may also cause significant delays or prevent the marketing and full commercialization of future products or services that we may develop and/or may impose costly requirements on our business. As we enter new businesses or pursue new business opportunities, we will become subject to additional laws, rules, and regulations, including FDA and foreign rules and regulations and compliance can be costly. Failure to comply with these laws, rules and regulations could delay the introduction of new products and could materially and adversely affect our business.
Previous report
We are also subject to federal and state laws and regulations of general applicability relating to matters such as environmental protection, safe working conditions, manufacturing practices, data privacy and other matters. Insurance coverage is not commercially available for violations of law, including the fines, penalties, or investigatory costs that we may incur as the consequence of regulatory violations. Consequently, we do not have insurance that would cover this type of liability.
Previous report
Changes in the valuation of our deferred tax assets or liabilities, changes in tax laws or rates, changes in the interpretation of tax laws in other jurisdictions, or other changes beyond our control could materially and adversely affect our financial position and results of operations.
Previous report
•unable to raise additional debt or equity financing on acceptable terms or at all, to operate during general economic or business downturns;
Previous report
•limited in our ability to borrow additional funds as needed or the cost of such borrowing may be higher;
Previous report
•vulnerable to adverse economic and general industry conditions, including interest rate fluctuations, because a portion of our borrowings are and will continue to be at variable rates of interest;
Previous report
•required to dedicate a substantial portion of our cash flow from operations to payments on our debt, which would reduce the availability of our cash flow from operations to fund working capital, capital expenditures, or other general corporate purposes;
Previous report
•disadvantaged compared to competitors that may have proportionately less debt; or
Previous report
Our business is subject to evolving matters relating to environmental, social and governance and/or our reporting of such matters that could expose us to numerous risks.
Reworded paragraphs (95)
Previous wording
Investing in Varex Imaging Corporation common stock involves risks, and the following risk factors and other information included in this Quarterly Report on Form 10-Q (this "Quarterly Report") under Part I, Item 2 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" and Part I, Item 3 "Quantitative and Qualitative Disclosures about Market Risk" should be carefully considered. Although the risk factors described below are the ones management deems significant, additional risks and uncertainties not presently known to us or that are presently known to us that we presently deem not material may also adversely affect our business operations.
Current wording
Investing in Varex Imaging Corporation common stock involves risks, and the following risk factors and other information included in this Quarterly Report on Form 10-Q (this "Quarterly Report") under Part I, Item 2 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" and Part I, Item 3 "Quantitative and Qualitative Disclosures about Market Risk" should be carefully considered. Although the risk factors described below are the ones management deems significant, additional risks and uncertainties that are not currently known to us or that we currently deem immaterial, may also adversely affect our business operations.
Previous wording
We are both a global importer of raw materials that are used in our finished products and an exporter of finished goods to our customers worldwide. Our products are integrated into the systems and products of our OEM customers, as well as into our own industrial systems. Tariffs, trade wars, import/export restrictions, boycotts, embargoes, government investigations, trade policies and compliance matters have in the past limited, are currently limiting, and in the future could limit our ability and our customers' ability to compete, which could cause our long-term prospects in such countries to suffer. Tariffs on imported materials have increased our costs and prices and lowered gross margins on some of our products, thereby having a direct adverse impact on our business and results of operations. Retaliatory tariffs have increased our customers’ costs for products exported from the United States, which has caused us to make, and may in the future require us to make, price and other concessions on some products and has caused, and may in the future cause, some customers to stop purchasing our products.
Current wording
We are a global importer of raw materials used in our finished products and an exporter of finished goods to customers worldwide. Tariffs, trade wars, import/export restrictions, boycotts, embargoes, government investigations, trade policies, and compliance matters have in the past limited, are currently limiting, and in the future could limit our ability and our customers' ability to compete. Tariffs on imported materials have increased our costs and prices and lowered gross margins on some of our products, and retaliatory tariffs have increased our customers’ costs for products exported from the United States, which has caused us to make, and may in the future require us to make, price and other concessions or cause customers to reduce or stop purchasing our products.
Previous wording
For example, changes to tariff policies in 2025 by the United States and other countries, particularly bilateral United States and Chinese tariffs, impacted our results of operations and profitability in fiscal year 2025 and in the first half of fiscal year 2026. Absent a de-escalation of the current trade environment, tariffs are expected to continue to negatively impact our business, results of operation, and financial condition, including by increasing our costs and prices, lowering gross margins, adversely impacting revenue, and making our products less competitive with similar products not imported from the United States. Additional new, or increases to existing tariffs, trade restrictions or other retaliatory actions aimed at specific industries, such as X-ray imaging products, could also materially impact our business.
Current wording
For example, changes to tariff policies in 2025 by the United States and other countries, particularly bilateral United States and Chinese tariffs, impacted our results of operations and profitability in fiscal year 2025 and the first half of fiscal year 2026. Although certain IEEPA-based tariffs have been invalidated, the United States has imposed or proposed tariffs and trade measures under other authorities, including Section 122 and 301 of the Trade Act of 1974, Section 232 of the Trade Expansion Act, and Section 338 of the Tariff Act of 1930, and may continue to do so. Additional tariffs, trade restrictions, or retaliatory actions targeting specific industries, such as X-ray imaging products, medical equipment or other products we manufacture, or the components or raw materials used in manufacturing our products, could increase our costs and prices, lower gross margins, adversely impact revenue, make our products less competitive, and otherwise adversely affect our business, results of operations and financial condition.
Previous wording
Increasing tensions between countries, such as China and Taiwan, and other conflicts including the Ukraine-Russia war, the United States and Israel conflict with Iran, as well as other Middle East conflicts, may lead the United States and/or other countries to impose new tariffs and sanctions or expand existing tariffs and sanctions, enact boycotts and embargoes, and otherwise seek to limit or stop the flow of goods to or from involved countries. Such conflicts have caused, are causing, and could in the future cause, significant disruptions in the regions and industries we serve and in our supply chain, as well as decrease demand from customers for the ultimate products using our solutions. The current conflict in Iran, for example, has and may continue to cause increases in cost of goods and raw materials, transportation, and other costs. Tensions and conflicts between countries, including those discussed in this risk factor, have in the past, are currently, and may in the future continue to, adversely impact our costs, margins, supply chain, and ability to timely deliver products to our customers, and these risks could continue to harm our business, financial condition, and results of operations.
Current wording
Increasing tensions between countries, such as China and Taiwan, and other conflicts including the Ukraine-Russia war, the conflict involving the United States and Israel with Iran, as well as other Middle East conflicts, may lead to new or expanded tariffs, sanctions, boycotts, embargoes, export controls, or other restrictions on the flow of goods. Such conflicts have caused, are causing, and could in the future cause disruptions in the regions and industries we serve, supply chain disruption, increased costs for goods, raw materials, transportation and logistics, reduced customer demand and delays in our ability to timely deliver products.
Previous wording
Any of the foregoing factors could require us to reconsider our current operating model, including whether we can continue to operate in specifically impacted locations, or if we need to relocate or otherwise restructure existing operations. Such changes may require us to invest significant additional capital we had anticipated using for other purposes such as expanding existing operations, entering new markets, or paying down debt. Diversion of these funds from their anticipated uses could adversely impact our business, results of operations, financial position, and our ability to pay down or restructure our existing debt.
Current wording
Any of the foregoing factors could adversely affect our business, results of operations and financial condition by increasing our costs and prices, lowering gross margins, reducing demand for our products or our customers’ products, making our products less competitive, limiting our ability to export or sell certain products, impairing our ability to fulfill orders on a timely basis, or requiring us to alter pricing, sourcing, production, product registration, regulatory certification, supplier qualification, distribution, supply chain or manufacturing strategies. These factors could also require us to reconsider our current operating model, including whether we can continue to operate in specifically impacted locations or need to relocate or restructure existing operations, which may require us to invest significant additional capital we had anticipated using for other purposes, such as expanding existing operations, entering new markets or paying down debt.
Previous wording
We sell our products and services to a limited number of OEM customers, many of which are also our competitors, and a delay in an order to a future period, as well as a reduction in or loss of business of one or more of these customers has in the past and may in the future materially reduce our sales.
Current wording
We sell our products and services to a limited number of OEM customers, many of which are also our competitors, and a delay, reduction, or loss of business of one or more of these customers has in the past and may in the future materially reduce our sales.
Previous wording
We had one customer during the three months ended April 3, 2026 that accounted for 19% of our revenue, all of which was in our Medical segment. Our ten largest customers as a group accounted for approximately 52% and 55% of our revenue for the three months ended April 3, 2026 and April 4, 2025, respectively. Our ten largest customers as a group accounted for approximately 52% and 54% of our revenue for the six months ended April 3, 2026 and April 4, 2025, respectively. Because we often take significant time to replace lost business, in the past our operating results have been, and in the future our operating results could be, materially and adversely affected if one or more of our major OEM customers were to cancel, or significantly delay or reduce orders.
Current wording
One customer accounted for 15% of our revenue during the three months ended July 3, 2026, all of which was in our Medical segment. Our ten largest customers as a group accounted for approximately 53% and 52% of our revenue for the three months ended July 3, 2026 and July 4, 2025, respectively, and approximately 52% and 53% of our revenue for the nine months ended July 3, 2026 and July 4, 2025, respectively. Because replacing lost business often takes significant time, our operating results have been, and could in the future be, materially and adversely affected if one or more of our major OEM customers cancel, or significantly delay or reduce orders.
Previous wording
Furthermore, we generate significant accounts receivables from the sale of our products and the provision of services directly to these customers. One customer accounted for 13% of our accounts receivables as of April 3, 2026. If one or more of these customers were to cancel a significant product order or service contract, become insolvent, or otherwise be unable or fail to pay for our products and/or services in a timely manner, our operating results and financial condition could be materially and adversely affected.
Current wording
We also generate significant accounts receivables from the sales of products and services to these customers. One customer accounted for 9% of our accounts receivables as of July 3, 2026. If one or more of these customers cancel a significant product order or service contract, become insolvent, or fail to pay on a timely basis, our operating results and financial condition could be materially and adversely affected.
Previous wording
Customer-driven changes in order forecasts is a frequent occurrence that has created and continues to create challenges for us in accurately predicting the demand or delivery schedules for our products.
Current wording
Customer-driven changes in order forecasts are a frequent occurrence that has created and continues to create challenges for us in accurately predicting the demand or delivery schedules for our products.
Previous wording
End-user product demand, economic uncertainties, the impact of pandemic diseases, natural disasters, armed conflicts, geopolitical tensions, legislative, tariff, and trade policy reforms, and government investigations including, for example, those described in the risk factor"Our business has in the past been, is currently being, and in the future may be, negatively impacted by changes in import/export regulatory regimes, tariffs, trade wars, and national policies, including exemptions thereto", and other matters beyond our control, make it difficult for our customers to accurately forecast and plan future business activities, which makes it difficult for us to accurately predict demand or delivery schedules for our products. Because the manufacture of our products requires some lead-time, changes in customer purchasing forecasts have previously resulted in excess inventory and slowdowns in sales, which are likely to occur again in the future. Changes to customer forecasts can occur on short notice, as our customers face inherent competitive issues, new product introduction delays, and regulatory risks. Our agreements for imaging components contain purchasing estimates that are typically based on our customers’ forward-looking forecasts rather than firm commitments, and actual purchasing volumes under the agreements may vary significantly from these estimates. The variation from forecasted purchasing volume may be due, in part, to the increasing life of X-ray tubes, which can result in reduced demand for replacement X-ray tubes in ways we may not be able to accurately forecast. Reductions in purchasing patterns have in the past, and may in the future, materially and adversely affect our operating results.
Current wording
End-user product demand, economic uncertainties, pandemics, natural disasters, armed conflicts, geopolitical tensions, legislative, tariff, and trade policy reforms, government investigations, including those described in the risk factor titled"Our business has in the past been, is currently being, and in the future may be, negatively impacted by changes in import/export regulatory regimes, tariffs, trade wars, and national policies, including exemptions thereto", and other factors beyond our control, make it difficult for our customers to accurately forecast and plan their businesses, and therefore for us to accurately predict demand and delivery schedules for our products. Because manufacturing our products requires lead time, changes in customer purchasing forecasts have previously resulted in excess inventory and slower sales, which are likely to occur again in the future. Customers may change forecasts on short notice due to competitive pressures, new product introduction delays, and regulatory risks. Our imaging component agreements include purchasing estimates based on customer forecasts rather than firm commitments, and actual volumes may vary significantly from those estimates. Longer X-ray tube life can also reduce replacement demand in ways that are difficult to forecast. Reductions in purchasing patterns have in the past, and may in the future, materially and adversely affect our operating results.
Previous wording
We compete in industries characterized by rapidly evolving technology, intense competition and pricing pressure. We often compete with companies that have greater financial, marketing and other resources than us. Some of the major diagnostic imaging systems companies, which are the primary OEM customers for our X-ray imaging components, also manufacture X-ray imaging components, including X-ray tubes and flat panel detectors, for use in their own imaging systems products. We have experienced, and may in the future experience, decreased sales of our products to these customers if they manufacture a greater percentage of their components in-house or purchase components from external sources other than us, which has had and may in the future have an adverse effect on our business and results of operations. We have in the past made price and other concessions to maintain existing customers and attract new customers, and may have to make additional price and other concessions in the future.
Current wording
We compete in industries characterized by rapidly evolving technology, intense competition, and pricing pressure, and often compete with companies that have greater financial, marketing, and other resources than we do. Some of the major diagnostic imaging systems companies that are our primary OEM customers also manufacture X-ray imaging components, including X-ray tubes and flat panel detectors, for use in their own systems. We have experienced, and may again in the future experience, reduced sales to these customers if they increase in-house manufacturing or purchase components from other external sources, which has in the past had, and may in the future have, an adverse effect on our business and results of operations. We have in the past made, and may in the future make, price and other concessions to retain existing customers and attract new ones.
Previous wording
To be successful, we must anticipate our customers’ needs and demands, as well as potential shifts in preferences. If we are unable to anticipate these needs and demands, or the mix of products requested by our customers changes from what we expect, our revenue, margins, and financial results could be adversely affected. When the U.S. Dollar is strong compared to the operating currencies of our international customers, our ability to meet such customers’ pricing expectations is particularly challenging and may result in erosion of revenues, product margin, and/or position in the market or other concessions on business terms.
Current wording
To be successful, we must anticipate our customers’ needs, demands, and potential shifts in preferences. If we fail to do so, or the mix of products requested by our customers differs from what we expect, our revenues, margins, and financial results could be adversely affected. When the U.S. Dollar is strong relative to the operating currencies of our international customers, meeting those customers’ pricing expectations is particularly challenging and may result in reduced revenues, lower product margins, loss of our position in the market, or other concessions on business terms.
Previous wording
In addition, certain costs, including installation and warranty costs, associated with new products have been, and may in the future be proportionately greater than the costs associated with existing products and have or may therefore disproportionately, materially, and adversely affect our gross and operating margins. We may also experience lower margins due to increased commodities prices, higher tariffs, and inadequate transfer pricing favoring sales to third parties over internal sales. If we are unable to lower these costs over time, our operating results could be materially and adversely affected. Some of the electronic components and integrated circuits used in our flat panel detectors are susceptible to discontinuance and obsolescence risks, which may force us to incorporate newer generations of these components, resulting in unplanned additional R&D expenses, delays in the launch of new products, supply disruptions, and/or inventory write-downs. Further, using aging production equipment might hamper our capacity to innovate to meet customers’ needs and demands and stay competitive. Failure to develop and adopt artificial intelligence ("AI") technology or to properly manage its uses and applications could also hinder product development, our competitiveness, and growth potential. We may also experience challenges in developing and implementing effective product and sales strategies, leading to missed opportunities and customer dissatisfaction.
Current wording
Certain costs associated with new products, including installation and warranty costs, have been, and may in the future be, proportionately greater than the costs associated with existing products and therefore may disproportionately and adversely affect our gross and operating margins. We may also experience lower margins due to increased commodity prices, higher tariffs, and transfer pricing that favors sales to third parties over internal sales. If we are unable to lower these costs over time, our operating results could be materially and adversely affected.
Previous wording
We operate in business segments characterized by rapid change and technological innovation. Our customers use our products in their medical diagnostic, security, and industrial imaging systems, and we must continually introduce new products at competitive prices while also improving existing products with higher quality, lower costs, and increased features. We and our joint ventures have in the past spent, and in the future may need to spend, more time and money than we expect to develop, market, and introduce new products, product enhancements, and technologies. Even if we succeed in introducing new products, enhancements, or technologies as quickly as expected, potential customers may not accept or purchase these new products, enhancements, or technologies, and we may not be able to recover all or a meaningful part of our investment. Once introduced, new products may materially and adversely impact sales of our existing products or make them less desirable or even obsolete, which could materially and adversely impact our revenues and operating results.
Current wording
We operate in business segments characterized by rapid change and technological innovation. Our customers use our products in medical diagnostic, security, and industrial imaging systems, and we must continually introduce new products at competitive prices while improving existing products with higher quality, lower costs, and additional features. We and our joint ventures have spent, and may in the future need to spend, more time and money than expected to develop, market, and introduce new products, enhancements, or technologies. Even if we introduce new products, enhancements, or technologies on the expected timeline, customers may not accept or purchase them, and we may be unable to recover all or a meaningful portion of our investment. Once introduced, new products may materially and adversely reduce sales of existing products or make them less desirable or obsolete, which could materially and adversely impact our revenues and operating results.
Previous wording
Furthermore, we may not be able to successfully develop, manufacture, or introduce new products or enhancements to existing products, the roll-out of which involves compliance with complex quality assurance processes, including the Quality System Regulation (“QSR”) of the U.S. Food and Drug Administration (“FDA”). Failure to complete these processes timely and efficiently could result in delays that could affect our ability to attract and retain customers or cause customers to delay or cancel orders, which would materially and adversely affect our revenues and operating results.
Current wording
We may be unable to successfully develop, manufacture, or introduce new products or enhancements to existing products. Product roll-outs and changes to existing products require compliance with complex quality assurance, design control, risk management, verification and validation, production and process control, supplier control, compliant handling, post-market surveillance, and change-control requirements, which may include the Quality Management System Regulation (“QMSR”) of the U.S. Food and Drug Administration (“FDA”) ISO 13485, the EU Medical Device Regulation and In Vitro Diagnostic Medical Device Regulation, Medical Device Single Audit Program ("MDSAP") requirements, notified body certification requirements, and other country-specific product registration, listing, licensing, labeling, and vigilance obligations. Failure to complete these processes on a timely and efficient basis could delay product launches, impair our ability to attract or retain customers, or cause customers to delay or cancel orders, any of which would materially and adversely affect our revenues and operating results.
Previous wording
Revenues generated from customers located outside the United States accounted for approximately 67% and 70% of our total revenues for the three months ended April 3, 2026 and April 4, 2025, respectively and approximately 68% and 69% of our total revenues for the six months ended April 3, 2026 and April 4, 2025, respectively. We intend to continue to expand our presence internationally and expect to expend significant resources in doing so. Our results have in the past, are currently, and could in the future be impacted by a variety of factors, including:
Current wording
Revenues from customers located outside the United States accounted for approximately 71% and 69% of our total revenues for the three months ended July 3, 2026 and July 4, 2025, respectively, and approximately 69% and 69% of our total revenues for the nine months ended July 3, 2026 and July 4, 2025, respectively. We intend to continue expanding internationally and expect to expend significant resources in doing so. Our results have been, are currently being, and could in the future be affected by a variety of factors, including:
Previous wording
•events and actions described in the risk factors "Our business has in the past been, is currently being, and in the future may be, negatively impacted by changes in import/export regulatory regimes, tariffs, trade wars, and national policies, including exemptions thereto"and "Customer-driven changes in order forecasts is a frequent occurrence that has created and continues to create challenges for us in accurately predicting the demand or delivery schedules for our products";
Current wording
•events and actions described in the risk factors "Our business has in the past been, is currently being, and in the future may be, negatively impacted by changes in import/export regulatory regimes, tariffs, trade wars, and national policies, including exemptions thereto"and "Customer-driven changes in order forecasts are a frequent occurrence that has created and continues to create challenges for us in accurately predicting the demand or delivery schedules for our products";
Previous wording
•currency fluctuations, and in particular the relative strength of the U.S. Dollar, which is our functional and reporting currency;
Current wording
•currency fluctuations, particularly the relative strength of the U.S. Dollar, which is our functional and reporting currency;
Previous wording
•difficulties in coordinating our operations globally and in maintaining uniform standards, controls, procedures, and policies across our operations;
Current wording
•difficulties in coordinating global operations and maintaining uniform standards, controls, procedures, and policies;
Previous wording
•the longer payment cycles associated with many customers located outside the United States;
Current wording
•longer payment cycles associated with many customers located outside the United States;
Previous wording
•difficulties in interpreting or enforcing agreements and collecting receivables through many foreign countries’ legal systems; and
Current wording
•difficulties in interpreting or enforcing agreements and collecting receivables through many foreign legal systems; and
Previous wording
•imposition of burdensome governmental regulations, including changing data privacy laws and regulations.
Current wording
•burdensome and/or changing governmental regulations, including data privacy laws and regulations.
Previous wording
Some of our locations expose us to higher security risks, which could result in both harm to our employees and contractors or substantial costs. Some of our services are performed in or adjacent to high-risk locations where the country or location and surrounding area experience political, social, or economic turmoil, war or civil unrest, or high levels of criminal or terrorist activities. In those locations where we have employees or operations, we may incur substantial costs to maintain the safety of our personnel, and we may suffer the loss of employees and contractors, which could harm our business, reputation, and operating results.
Current wording
Some of our locations expose us to elevated security risks. Certain services are performed in or near high-risk locations that experience political, social, or economic turmoil, war or civil unrest, or high levels of criminal or terrorist activities. In those locations, we may incur substantial costs to protect our personnel and we may suffer the loss of employees and contractors, which could harm our business, reputation, and operating results.
Previous wording
Our ability to identify and take advantage of attractive acquisitions or other business development opportunities (including through joint ventures) is an important component in implementing our overall business strategy. Such transactions involve a number of risks, including the following:
Current wording
Our ability to identify and pursue attractive acquisitions or other business development opportunities, including joint ventures, is an important part of our overall business strategy. These transactions involve a number of risks, including that:
Previous wording
•we may have difficulty integrating organizations, products, technologies, or employees of an acquired business into our operations and may have difficulty retaining the key personnel of the acquired business;
Current wording
•we may have difficulty integrating organizations, products, technologies, or employees of an acquired business and retaining the key personnel;
Previous wording
•we may find that we need to restructure or divest acquired businesses or assets of the acquired business; and
Current wording
•we may need to restructure or divest acquired businesses or assets; and
Previous wording
•if we fail to achieve the anticipated growth from an acquisition or joint venture, or if we decide to sell assets or a business, we may be required to dispose of a business at a lower price or on less advantageous terms, or to recognize an impairment loss on the write-down of our assets and goodwill.
Current wording
•if we fail to achieve the anticipated growth from an acquisition or joint venture, or if we decide to sell assets or a business, we may be required to dispose of a business on less advantageous terms or recognize an impairment of assets or goodwill.
Previous wording
LLC, a joint venture in Saudi Arabia and a minority interest in another X-ray imaging components technology company. These and other investments are subject to risk of loss of investment capital as well as losses associated with contributed or jointly developed intellectual property, or intellectual property developed at or about the same time as these investments. These types of investments are inherently risky, in some instances because customer demand and sales for the technologies or products under development may never materialize, may develop more slowly than expected, or may underperform relative to our expectations. If these companies do not succeed, we could lose or be required to write down some or all of our investment in these companies, we may experience significant and unpredictable losses or charges as a result of decisions made by joint ventures that we do not control but whose financial results proportionally affect our reported financial results. As discussed in the risk factor "Legal proceedings may materially and adversely affect our business, results of operations, or cash flows," we may incur significant time, management resources, and costs to enforce our rights, protect our intellectual property and other assets, address disputes or legal claims that have arisen, are ongoing, or may arise in the future, and/or unwind, dispose of or terminate our arrangements with respect to these joint ventures and/or investments. There is no guarantee that the time and money invested by us in developing these projects, intellectual property, or product or product enhancements, will yield the expected returns on the anticipated timeline or at all.
Current wording
We participate in joint ventures and other investments in privately held and publicly traded companies. For example, we hold a 40% ownership interest in dpiX Holding Company LLC, the parent company of the major supplier of amorphous silicon-based thin film transistor arrays for flat panels used in our digital image detectors; a 50% interest in VEC Imaging GmbH & Co. KG ("VEC"), a joint venture formed to develop technology for use in X-ray imaging components; a 75% interest in Varex Imaging Arabia LLC, a joint venture in Saudi Arabia ("Varex Arabia"); and a minority interest in another X-ray imaging components technology company. These and other investments are subject to risk of loss of invested capital and losses associated with contributed, jointly developed, or contemporaneously developed intellectual property. These investments are inherently risky, in some cases because customer demand for the technologies or products under development may never materialize, may develop more slowly than expected, or may underperform relative to our expectations. If these companies do not succeed, we could lose or be required to write down some or all of our investment and could experience significant and unpredictable losses or charges as a result of decisions made by joint ventures that we do not control but whose financial results proportionally affect our reported results. As discussed in the risk factor "Legal proceedings may materially and adversely affect our business, results of operations, or cash flows," we may incur significant time, management resources, and costs to enforce our rights, protect our intellectual property and other assets, address disputes or legal claims, or unwind, dispose of or terminate our arrangements relating to these joint ventures and investments. There is no guarantee that the time and money we invest in these projects, intellectual property, products, or product enhancements will yield the expected returns on the anticipated timeline or at all.
Previous wording
From time to time, we are a party to or otherwise involved in legal proceedings, claims, government inspections, audits or investigations, and other legal matters, both inside and outside the United States, arising in the ordinary course of our business or otherwise. Such proceedings are often lengthy, subject to significant uncertainty and may be expensive, time consuming, and disruptive to our operations. For these and other reasons, we may choose to settle legal proceedings and claims, regardless of their actual merit. If a legal proceeding were to be ultimately resolved against us, we may be required to pay damages or fines, some of which may be in excess of our insurance coverage, or may require us to change our business practices, which could materially and adversely impact our business, results of operations, or cash flows.
Current wording
From time to time, we are a party to or otherwise involved in legal proceedings, claims, government inspections, audits or investigations, and other legal matters, both inside and outside the United States, arising in the ordinary course of our business or otherwise. These matters are often lengthy, uncertain, expensive, time-consuming, and disruptive to our operations. For these and other reasons, we may choose to settle legal proceedings and claims, regardless of their actual merit. If a matter is ultimately resolved against us, we may be required to pay damages or fines, some of which may exceed our insurance coverage, or to change our business practices, any of which could materially and adversely impact our business, results of operations, or cash flows.
Previous wording
Our subsidiary Varex Imaging Deutschland AG ("Varex Germany") holds a 50% interest in VEC. Since August 2023, the partners to the VEC joint venture have been engaged in judicial proceedings in Germany against one another disputing the validity of certain shareholder resolutions seeking to exclude the other party from the joint venture. If either party is successful, the prevailing party would be required to purchase the non-prevailing party’s interest in the joint venture for an amount equal to 75% of the fair market value thereof, which amount is in dispute. In addition, in June 2024, Varex Germany filed an action in Germany for a negative declaratory judgment and an injunction against business damaging statements made by certain third parties, and Varex Germany and Varex Imaging Corporation have filed additional lawsuits in Germany and the United States relating to intellectual property matters, breach of contracts and other matters. These disputes, including any determinations not in Varex Germany’s favor, have diverted, are diverting, and could in the future divert management’s attention, increase our costs, and otherwise adversely impact our business, results of operations, or cash flows.
Current wording
Our subsidiary Varex Imaging Deutschland AG ("Varex Germany") holds a 50% interest in VEC. Since August 2023, the VEC joint venture partners have been engaged in judicial proceedings in Germany disputing the validity of certain shareholder resolutions seeking to exclude the other party from the joint venture. If either party is successful in excluding the other, the prevailing party would be required to purchase the non-prevailing party’s interest for an amount equal to 75% of the fair market value, which amount is in dispute. In addition, in June 2024, Varex Germany filed an action in Germany for a negative declaratory judgment and an injunction against business-damaging statements made by certain third parties, and Varex Germany and Varex Imaging Corporation have filed additional lawsuits in Germany and the United States relating to intellectual property, breach of contracts, and other matters. These disputes, including any determinations not in Varex Germany’s favor, have diverted, are diverting, and could in the future divert management’s attention, increase our costs, and otherwise adversely impact our business, results of operations, or cash flows.
Previous wording
Our subsidiary Varex Imaging International AG holds a 75% interest in Varex Imaging Arabia LLC. We currently have ongoing disputes with our joint venture partner relative to the operation of the joint venture. These disputes have in the past, are currently and could in the future divert management's time and attention, increase our costs, and otherwise adversely impact our business, results of operations, or cash flows.
Current wording
Our subsidiary Varex Imaging International AG holds a 75% interest in Varex Arabia. We currently have ongoing disputes with our joint venture partner regarding the operation of the joint venture. These disputes have diverted, are diverting and could in the future divert management's time and attention, increase our costs, and otherwise adversely impact our business, results of operations, or cash flows.
Previous wording
As discussed in the risk factor "Our business has in the past been, is currently being, and in the future may be, negatively impacted by changes in import/export regulatory regimes, tariffs, trade wars, and national policies, including exemptions thereto," if the MOFCOM Investigations are recommenced in the future, the outcome of these investigations has the potential to negatively impact our business, results of operations and financial condition.
Current wording
As discussed in the risk factor titled "Our business has in the past been, is currently being, and in the future may be, negatively impacted by changes in import/export regulatory regimes, tariffs, trade wars, and national policies, including exemptions thereto," if the MOFCOM Investigations are recommenced, the outcome could adversely impact our business, results of operations and financial condition.
Previous wording
Our business exposes us to potential product and other liability claims that are inherent in the manufacture, sale, installation, servicing, and support of components that are used in medical devices and other devices that deliver radiation. Because our products are involved in the intentional delivery of radiation to the human body and other situations where people may come into contact with radiation, the possibility for significant personal injury or loss of life exists. Furthermore, if our X-ray inspection systems fail to detect the presence of bombs, explosives, weapons, contraband, or other threats to personal safety, this may lead to personal injury, loss of life, and extensive property damage. We may also be subject to warranty and damage claims for property damage, personal injury, or economic loss related to or resulting from any errors or defects in our products or the installation, servicing, or support of our products. Any accident or mistreatment could subject us to legal costs, litigation, adverse publicity, and damage to our reputation, whether or not our products or services were a factor. From time to time, we may be a party to certain product liability litigation which, if adversely determined, could have an adverse material impact on our financial results. If a product we design or manufacture were defective, we may be required to correct or recall the product and notify regulatory authorities.
Current wording
Our business exposes us to product and other liability claims inherent in the manufacture, sale, installation, servicing, and support of components used in medical devices and other devices that deliver radiation. Because our products are involved in the intentional delivery of radiation to the human body and other situations where people may come into contact with radiation, significant personal injury or loss of life is possible. In addition, if our X-ray inspection systems fail to detect bombs, explosives, weapons, contraband, or other threats to personal safety, the result could include personal injury, loss of life, and extensive property damage. We may also face warranty and damage claims for property damage, personal injury, or economic loss arising from errors or defects in our products or the installation, servicing, or support of our products. Any accident or mistreatment could subject us to legal costs, litigation, adverse publicity, and reputational harm, whether or not our products or services were a factor. From time to time, we may be a party to product liability litigation that, if adversely determined, could materially and adversely affect our financial results. If a product we design or manufacture is defective, we may be required to correct or recall the product and notify regulatory authorities.
Previous wording
We may choose to settle product liability claims against us regardless of their actual merit. A product liability action determined against us could result in adverse publicity or significant damages, including the possibility of punitive damages, and our financial position, results of operations, or cash flows could be materially and adversely affected.
Current wording
We may choose to settle product liability claims against us regardless of actual merit. An adverse determination in a product liability action could result in adverse publicity or significant damages, including punitive damages, and could materially and adversely affect our financial position, results of operations, or cash flows.
Previous wording
We maintain limited product liability insurance coverage. Our product liability insurance policies are expensive and have high deductible amounts and self-insured retentions. Our insurance coverage may prove to be inadequate, and future policies may not be available on acceptable terms or in sufficient amounts, if at all. If a material claim is not insured or is in excess of our insurance coverage, we may have to pay substantial damages, which could have a material and adverse effect on our financial position and/or results of operations.
Current wording
We maintain limited product liability insurance coverage. Our policies are expensive and have high deductibles and self-insured retentions. Coverage may prove to be inadequate, and future policies may not be available on acceptable terms or in sufficient amounts, if at all. If a material claim is uninsured or exceeds our coverage, we may be required to pay substantial damages, which could materially and adversely affect our financial position and results of operations.
Previous wording
Inflation and supply chain disruptions, including the loss of a key supplier, and any inability to obtain raw materials or supplies of important components, trade restrictions, and other constraints, have impacted our ability to manufacture products, have caused delays in our ability to deliver products, and have increased our costs and may continue to do so.
Current wording
Inflation and supply chain disruptions, including the loss of a key supplier, inability to obtain raw materials or important components, trade restrictions, and other constraints, have impacted our ability to manufacture and deliver products, and have increased our costs, and may continue to do so.
Previous wording
Inflation and supply chain disruptions have had, and could in the future have, an impact on our ability to manufacture certain products. Any rise in future inflation has the potential to increase our overall cost structure, and sustained inflation has resulted in, and may continue to result in, higher interest rates and capital costs, increased shipping costs, supply shortages, increased costs of labor, weakening exchange rates, higher pricing that reduces demand for our products, and other similar effects.
Current wording
Inflation and supply chain disruptions have affected, and could in the future affect, our ability to manufacture certain products. Sustained inflation has resulted in, and may continue to result in, higher interest rates and capital costs, increased shipping costs, supply shortages, higher labor costs, weaker exchange rates, higher pricing that reduces demand for our products, and other similar effects. Recent geopolitical conflicts, including conflicts in the Middle East, and related disruption or perceived disruption to energy markets, shipping routes, air cargo capacity, insurance markets, freight networks and logistics providers, have increased and may continue to increase transportation, fuel, input and other costs.
Previous wording
Material shortages and delays due to inflation, trade restrictions, geopolitical tensions, armed conflicts, and other constraints have caused, and could in the future cause, us to temporarily stop production of certain products or miss opportunities to pursue additional sales of some products. We require certain raw materials, such as copper, nickel, silver, gold, lead, tungsten, iridium, rhenium, molybdenum, rhodium, niobium, zirconium, beryllium, gadolinium, and various high grades of steel alloy for X-ray tubes and industrial products. Worldwide demand, availability, and pricing of these raw materials is volatile. Additionally, the availability of certain raw materials could be affected if suppliers choose to limit their exposure to certain markets in response to unfavorable trade policies or otherwise. If we are unable to obtain the materials necessary to make certain products without unreasonable cost or delay, our customers may seek alternative suppliers, or decide to in-source certain products or if we must pay more for certain materials, it could reduce our profit margin and/or sales, it could make it uneconomical for us to produce certain products, or otherwise have a material adverse effect on our business and financial results. Further, our competitors with greater financial resources may be better able to restructure their manufacturing and supply chains in response to geopolitical and economic trends and thereby have a competitive advantage over us.
Current wording
Material shortages and delays due to inflation, trade restrictions, geopolitical tensions, armed conflicts, and other constraints have caused, and could in the future cause, us to temporarily stop production of certain products or miss opportunities for additional sales. We require certain raw materials for X-ray tubes and industrial products, including copper, nickel, silver, gold, lead, tungsten, iridium, rhenium, molybdenum, rhodium, niobium, zirconium, beryllium, gadolinium, and various high grades of steel alloy. Worldwide demand, availability, and pricing of these raw materials are volatile and may be affected by export controls, sanctions, resource nationalism, military demand, energy costs, geopolitical conflicts, trade restrictions, supplier concentration, or changes in Chinese or other government policies. Availability may also be affected if suppliers limit their exposure to certain markets in response to unfavorable trade policies or otherwise. If we are unable to obtain materials needed for certain products without unreasonable cost or delay, customers may seek alternative suppliers or in-source certain products. Higher material costs could also reduce our margins or sales, make it uneconomical to produce certain products, or otherwise materially and adversely affect our business and financial results. Competitors with greater financial resources may be better able to restructure their manufacturing and supply chains in response to geopolitical and economic trends, giving them a competitive advantage.
Previous wording
We obtain some of the components included in our products, such as transistor arrays, cesium iodide coatings and specialized integrated circuits for flat panel detectors, X-ray tube targets and windows, housings, glass frames, high-voltage cable, bearings, and various other components, from a limited group of suppliers, or from sole-source suppliers. If our suppliers cease producing these or other components, prioritize other customers, fail to provide products on our delivery timelines, are in countries subject to significant tariffs, or become unable to continue operations, we may be unable to obtain the components from other suppliers on reasonable terms or at all.
Current wording
We obtain some product components, such as transistor arrays, cesium iodide coatings, and specialized integrated circuits for flat panel detectors, as well as X-ray tube targets and windows, housings, glass frames, high-voltage cable, bearings, and various other components, from a limited group of suppliers or sole-source suppliers. If suppliers cease producing these or other components, prioritize other customers, fail to meet our delivery timelines, are located in countries subject to significant tariffs, or become unable to continue operations, we may be unable to obtain the components from other suppliers on reasonable terms, or at all.
Previous wording
Furthermore, we may be required to obtain and qualify one or more replacement suppliers or to manufacture the components internally. Such an event could (1) require us to redesign or modify our products to incorporate new parts and/or further require us to obtain clearance, qualification, or certification of these products, including by the FDA, or obtain other applicable regulatory approvals in other countries, (2) significantly increase costs for the affected products, (3) cause material delays in the delivery of affected and other related products, or (4) prevent us from meeting our delivery obligations to our customers. Any of the foregoing, could materially and adversely affect our business and financial results.
Current wording
In that event, we may need to obtain and qualify one or more replacement suppliers or manufacture the components internally. Doing so could require us to redesign or modify our products to incorporate new parts or require us to obtain clearance, qualification, or certification, or other regulatory approvals, including from the FDA or foreign regulators; significantly increase costs for the affected products; delay delivery of affected and related products; or prevent us from meeting delivery obligations to customers. Any of the foregoing could materially and adversely affect our business and financial results.
Showing the first 40 of 95 pairs. Open the source sections for the rest.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
Some of the electronic components and integrated circuits used in our flat panel detectors are susceptible to discontinuance and obsolescence risks, as well as counterfeit-part and unauthorized substitution risks, which may force us to incorporate newer generations of these components and result in unplanned additional R&D expenses, delayed product launches, supply disruptions, or inventory write-downs. Aging production equipment may also limit our ability to innovate, meet customer needs, and remain competitive. Failure to develop, validate, adopt, govern, or properly manage artificial intelligence ("AI") technology, its use and applications, including AI used in products, engineering, manufacturing, quality, regulatory, service or commercial processes, could hinder product development, competitiveness, and growth. Challenges in developing and implementing effective product and sales strategies could also result in missed opportunities and customer dissatisfaction.
Current report — wording carried from elsewhere
Despite security measures, the threat of information security breaches and attacks is increasing, including from computer viruses and other malicious code, unauthorized access attempts, employee misuse, including misuse or failure to effectively manage the use of AI and machine learning technologies, human error, and cyber-attacks. The techniques used to obtain unauthorized access or to sabotage systems change frequently, are increasingly sophisticated, and often are not recognized until launched against a target. As a result, we may be unable to anticipate or promptly detect these techniques, or the vulnerabilities they have caused or other potential vulnerabilities or security defects, or to implement adequate preventative measures. A security breach could result in disclosure, misuse, or loss of confidential information, trade secrets, personal information, proprietary data, or other competitively sensitive information; data leaks; material disruption of our operations; litigation; and liability to employees, customers, shareholders, and/or regulatory authorities.
Current report — wording carried from elsewhere
If our data management or other systems do not effectively collect, secure, store, process, or report data needed to operate our business, whether due to equipment malfunction or constraints, service interruptions, software deficiencies, misuse, or human error, our ability to effectively plan, forecast, and execute our business plan and comply with applicable laws and regulations could be impaired, perhaps materially.
Current report — wording carried from elsewhere
For example, under a remediation plan for certain hazardous volatile organic compounds at our Salt Lake City property, we and Varian Medical Systems, Inc. ("Varian") entered into an environmental covenant with the Director of the Utah Division of Waste Management and Radiation Control on behalf of the Utah Department of Environmental Quality. The covenant requires specified remediation measures and limits use of the property and of groundwater in the underlying aquifer, including restricting the property to commercial and industrial uses and prohibiting culinary or other domestic use of that groundwater, among other limitations.
Current report — wording carried from elsewhere
Our United States-based employees, including our senior management team, work for us on an at-will basis, and we cannot assure that any of them will remain with us. Replacing key employees can take a significant amount of time. To the extent we hire employees from competitors, we may also face allegations that they were improperly solicited or that they disclosed proprietary or other confidential information. Workforce reductions, hiring freezes, or underinvestment in training and career development could also make it harder to execute our strategy, maintain institutional knowledge, and develop the skilled personnel and leadership we need. If we cannot attract, retain, and train qualified personnel, we may be unable to maintain or expand our business.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
We participate in joint ventures and other investments in privately held and publicly traded companies. For example, we hold a 40% ownership interest in dpiX Holding Company LLC, the parent company of the major supplier of our amorphous silicon-based thin film transistor arrays for flat panels used in our digital image detectors, a 50% interest in VEC Imaging GmbH & Co. KG ("VEC"), a joint venture formed to develop technology for use in X-ray imaging components, a 75% interest in Varex Imaging Arabia
Previous report — wording carried elsewhere
•the inability to sell our products; and
Previous report — wording carried elsewhere
•limited in how we conduct our business;