Risk Factors Dashboard
Once a year, publicly traded companies issue a comprehensive report of their business, called a 10-K. A component mandated in the 10-K is the ‘Risk Factors’ section, where companies disclose any major potential risks that they may face. This dashboard highlights all major changes and additions in new 10K reports, allowing investors to quickly identify new potential risks and opportunities.
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Item 1A. Risk Factors—Legal and Regulatory Risks.”
Under the guidance of our Chief Information Officer and Chief Information Security Officer, we have adopted cybersecurity risk management processes that are informed by the ISO 27000 family of standards and take a risk-based approach to improving capabilities, addressing vulnerability, and performing detection and response activities against cyber events .We also rely on a managed detection and response service provider that helps us manage cybersecurity risks, monitors our environment, and is retained to provide incident response services. We maintain a detailed incident response plan and perform testing of the plan on a quarterly basis. We have also engaged other third-party cybersecurity experts to conduct periodic audits and testing of our processes and systems and maintain cybersecurity insurance. Our cybersecurity program is led by our Chief Information Officer (CIO) and Chief Information Security Officer (CISO) . The CIO is responsible for the management of cybersecurity risks within our environment and key cybersecurity capabilities are developed and operated under the CISO. The CIO is responsible for the management of cybersecurity risks and the associated capabilities are developed and operated under the Director of Enterprise Information Security. The CISO holds a Master's degree in Information Security Engineering. Other leaders and contributors on the cybersecurity team have experience in information assurance, digital forensics, network security, and information technology. Several members of the team hold over 15 years of cybersecurity experience and over 20 years of information technology experience, and have various cybersecurity and vendor certifications. The CISO provides regular updates on the cybersecurity program to key executives including the Chief Executive Officer, CIO, Chief Financial Officer, and Chief Legal Officer.As of this filing, we have not identified any cybersecurity incidents or threats that have materially affected us or are reasonably likely to materially affect us. However, like other companies in our industry, we and our third-party vendors have from time to time experienced threats to and security incidents relating to information systems. For more information, please see the section entitled “Item 1A. Risk Factors—Risks Related to Our Business Operations.
Medical Segment
As of December 31, 2025, we own approximately 43 issued U.S. utility patents, 36 issued foreign utility patents (including in the European Union, China, Japan and Canada), 3 pending U.S. non-provisional utility patent applications and 5 pending foreign utility patent application in the European Union that include claims directed to products in our medical segment, including our cancer diagnostics and therapeutics QA, occupational dosimetry, medical imaging and nuclear medicine equipment products. These issued patents are expected to expire between 2026 to 2038 and these pending applications, if issued, are expected to expire between 2039 to 2040, in each case without taking into account any possible patent term adjustment or extensions and assuming payment of all appropriate maintenance, renewal, annuity, or other governmental fees.
Seasonality
General economic conditions impact our business and financial results, and our business experiences seasonal and other trends related to the industries and end markets that we serve. Our highest volume of sales and cash flows occurs in the fourth quarter of the fiscal year due in large part to the timing of customers’ capital spending programs and increased outages occurring in the fall in our Nuclear & Safety segment. In addition, while we believe that we are poised for growth from governmental customers in both of our segments, our revenues and cash flows from government customers are influenced, particularly in the short-term, by budgetary cycles. This impact can be either positive or negative.
For more information about the trends that impact our business and financial results, see “Part I, Item 1A—Risk Factors—Risks Related to Our Business and Industry—Our results of operations may fluctuate significantly, which could make our future results difficult to predict and could cause our results of operations to fall below expectations.”
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Government Regulation
Our current and contemplated activities, and the products that result from such activities, are subject to substantial government rules and regulations, both in the United States and in other countries, addressing, among other things, products approvals, manufacturing, testing, qualifications, certifications, labeling, marketing, promotion, export, import, distribution and sale, and disposal.
Environmental Regulations
We use, generate, discharge and dispose of hazardous substances, chemicals and wastes at some of our facilities and are subject to various laws and governmental regulations concerning environmental matters and employee safety and health in the United States and other countries. Historically our capital expenditures, earnings and competitive position have not been materially affected by our compliance with environmental regulations however those regulations are subject to change, and we monitor developments carefully.
Trade Controls
Our products and technologies are subject to export and import controls under United States, Canada, France, the United Kingdom and European Union laws. Export licenses, permits or other authorizations from government export control authorities may be required depending on the product, technology, destination, end-user and end-use. In addition, United States laws and regulations implemented by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) impose economic sanctions on certain countries, business entities and individuals.
Anti-Corruption Laws
We are subject to anti-bribery and anti-corruption laws, including the U.S. Foreign Corrupt Practices Act (the “FCPA”), the United Kingdom Bribery Act (the “UKBA”), and anti-corruption laws enacted in various other countries.
Privacy and Information Security Laws
In the ordinary course of our business, we collect, store, use, transmit and process certain types of data, including personal information, subjecting us to privacy and information security laws in the United States and internationally, including the EU General Data Protection Regulation (“EU GDPR”), the EU AI Act Regulation 2024/1689, and other laws, rules and regulations designed to regulate the processing of personal information. These laws impose obligations with respect to the collection, processing, storage, disposal, use, transfer, retention and disclosure of personal information. Privacy and information security laws evolve regularly, and complying with these evolving laws, rules, regulations and standards could cause us to incur substantial costs that are likely to increase over time, requiring us to adjust our compliance program on an ongoing basis and presenting compliance challenges, change our business practices in a manner adverse to our business, divert resources from other initiatives and projects, and restrict the way products and services involving data are offered.
Medical Device Regulation
We are required to register for permits and/or licenses with, obtain approvals from and comply with operating standards of the U.S. Food and Drug Administration (the “FDA”), the U.S. Department of Health and Human Services (“HHS”), the European Medicines Agency (the "EMA”), the U.K. Medicines and Healthcare Products Regulatory Agency (the "MHRA"), and other foreign agencies.
Our medical devices are subject to regulation under the U.S. Food, Drug, and Cosmetic Act (the “FDCA”), including design, development, testing, manufacturing, marketing, distribution, and recordkeeping. We must also comply with post-market surveillance regulations and adverse event reporting requirements.
We are subject to various U.S. federal healthcare related laws regulating fraud and abuse, research and development, pricing and sales and marketing practices, and the privacy and security of health information such as the U.S. Federal Anti-Kickback Statute, the Health Insurance Portability and Accountability Act of 1996 (HIPAA), and the False Claims Act. Similar laws and regulations may apply in foreign countries.
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Federal consumer protection and unfair competition laws broadly regulate marketplace activities and activities that potentially harm consumers. Analogous U.S. state laws and regulations, such as state anti-kickback and false claims laws, also may apply to our business practices, including research, distribution, sales and marketing arrangements, and claims involving healthcare items or services reimbursed by any third-party payor, including private insurers. Further, there are state laws that require medical device manufacturers to comply with the voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws and regulations that require manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; state and local laws requiring the registration of sales representatives; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA. Similar laws and regulations apply in many non-U.S. countries.
Human Capital Resources
We are committed to our people and aim to be an employer of choice in the industries in which we operate. Our culture is team-based and progressive; our core values are central to how we operate as a company.
As of December 31, 2025, we employed 3,281 full-time and part-time employees. We also use temporary or contract workers who totaled approximately 128 as of December 31, 2025, on a full-time equivalent basis. Of these, approximately 1,767 were employees in the United States and 1,514 were employees outside of the United States. Some of our operations are subject to union contracts, with 3 unions active in the United States as of December 31, 2025. Approximately 1.4% of our workforce is covered by collective bargaining agreements.
We are committed to fostering a workplace that attracts and retains exceptional talent. We value teamwork, practicing intellectual honesty and candor. We support a wide range of backgrounds, experiences and perspectives in our workforce and promote an engaging workplace that encourages participation of all employees.
Employee Engagement
We regularly conduct employee engagement surveys to collect feedback to better understand and improve our employees' experience and identify opportunities to strengthen our culture. Through these surveys, town halls, emails and other platforms, we hear directly from employees on what is working well, what we can do better, and how well our employees understand and are practicing our values. As part of our annual employee development program, frequent check-ins occur between employees and their managers tied to key human capital measures and objectives. We frequently report employee engagement results to our Board of Directors to drive action in response to employee feedback.
Employee Compensation and Benefits
We require a talented workforce and are committed to providing total rewards that are market-competitive and performance-based, driving innovation and operational excellence. Our compensation programs, practices and policies reflect our commitment to reward short- and long-term performance that aligns with, and drives, stockholder value. Total direct compensation is generally positioned within a competitive range of the relevant market median, with differentiation based on tenure, skills, proficiency, and performance.
In addition to providing competitive compensation, another part of our strategy to attract and retain high-performing employees is to offer a variety of benefits to further their personal and professional development. In the U.S., these include:
•Comprehensive medical, dental and vision coverage for employees and their families
•A 401(k) plan with an employer match of up to 4% for eligible employees
•PTO programs, including parental leave, personal sick and bereavement time off
•Workplace support for families and children such as childcare benefits including dependent care assistance via employee flexible spending accounts and access to an employee assistance program
•Eight hours of paid volunteer time off for eligible employees
In other jurisdictions, we provide similar or other benefits adapted to local practices.
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Training and Development
Human capital development underpins our efforts to execute our strategy and continue to design, manufacture and market innovative products and services. The professional development of our employees is critical to this success. We invest in our employees’ career growth and provide employees with a wide range of development opportunities, including but not limited to mentoring, product and sales training, as well as compliance training including on the topics of cybersecurity, artificial intelligence and other workplace safety training.
Employee Health and Safety
As a company that sells solutions to keep others safe, we place great focus on the safety of our own employees. We are committed to providing a safe and healthy work environment. Safety is a key consideration in our manufacturing processes. We are deliberate in designing programs to protect our employees and mitigating potential workplace incidents that could arise. All facilities are expected to comply with local safety laws and regulations. Additionally, each site maintains comprehensive safety programs, including corrective action processes and emergency response plans. Employees undergo regular health and safety training to ensure compliance with, and communication of, safety policies and procedures. Material occupational health and safety incidents are reported to our Risk Management Committee which monitors safety performance across the Company. We are continuously assessing risk and looking to improve our processes in an effort to prevent safety incidents.
Ethics and Corporate Responsibility
We are committed to ensuring that our employees conduct our Company’s business with the highest levels of ethics and corporate governance. In 2023, we published our inaugural Corporate Social Responsibility Report detailing our focus and commitment to continuing to grow as a responsible company, and it was updated in 2025. We maintain an Anti-Bribery and Corruption Policy and conduct regular training on bribery and corruption. We provide an ethics hotline supported by a Whistleblower Policy outlining information, procedures and non-retaliation guidelines for reporting suspected violations of our Code of Ethics, policies or procedures. We also publish a Human and Labor Rights Statement outlining expectations with regard to respecting the dignity of our employees and all persons involved in the Company’s business.
Available Information
Our website is www.mirion.com. The information found on, or that can be accessed from, or that is hyperlinked to, our website is not part of this Annual Report on Form 10-K. We file or furnish Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, including exhibits, amendments to these reports and other information with the United States Securities and Exchange Commission (“SEC”). You may obtain a copy of any of these reports, free of charge, from the Investor Relations section of our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. You may obtain a copy of any of these reports, free of charge, from the Investors Relations section of our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The SEC maintains an Internet site that also contains these reports at: www.sec.gov.
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TEM 1A. RISK FACTORS
We operate in complex markets and regulatory environments and that involves significant risk. You should carefully consider the following risk factors before making an investment decision as they may have an adverse effect on our business, results of operations and financial condition:
•Risks Related to Our Business and Industry
•Risks Related to Our Business Operations
•Legal and Regulatory Risks
•Capital Structure Risks
These risks are not the only risks we face but represent known risks we believe are material. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, could also materially adversely affect our business, results of operations and financial condition or future results. Additional risks and uncertainties not currently known to us, or those we currently view to be immaterial, may also adversely affect our business, results of operations and financial condition.
Risks Related to Our Business and Industry
We have incurred operating losses in the past and we cannot yet assure you we will always achieve positive net income. As of December 31, 2025, we had an accumulated deficit of $512.7 million. For the years ended December 31, 2025, December 31, 2024, and December 31, 2023, we experienced net income (losses) of $29.8 million, $(36.6) million, and $(98.7) million, respectively. For the years ended December 31, 2024, December 31, 2023, and December 31, 2022, we experienced net losses of $36.6 million, $98.7 million, and $288.4 million, respectively. Our prior year losses were significantly impacted by the amortization of intangible assets established as part of the GSAH acquisition. We cannot yet assure you that we will always achieve positive net income, but our results from the last three fiscal years have trended favorably. We cannot yet assure you that we will achieve positive net income, but our results from the last three fiscal years have trended favorably. We continuously seek to reduce operating costs through lean initiatives, supply chain management and optimizing our capital structure but our plans could be impacted by events outside of our control including rising inflation. If our revenue and gross profit growth do not outpace the growth of our operating expenses, we may not achieve and maintain positive net income.
Our results of operations may fluctuate significantly and cause our results of operations to fall below expectations. Our financial performance is subject to fluctuations due to varying demand for our products and services across our core markets. Demand for our solutions in these markets has fluctuated due to a variety of factors, many of which are beyond our control. In the past demand for our solutions in these markets has fluctuated due to a variety of factors, many of which are beyond our control. Sales and cash flow typically peak in the fourth quarter of the fiscal year, reflecting customers’ spending cycles and increased outages occurring in the fall in our Nuclear & Safety segment. This has caused our results of operations to fluctuate. The nuclear sector has recently seen a resurgence in demand, driven by an overall increase in electricity demand from a number of sources, including electric cars, the anticipated infrastructure build of data centers for artificial intelligence, and other sources. This presents both opportunities if the additional electricity demand is supplied by nuclear power plants (“NPPs”) and risks if demand is lower than expected or electricity is produced by other means. This has caused and we expect it will continue to cause our results of operations to fluctuate. See also “Risks Related to Our Business and Industry—Our sales cycles in certain end markets can be long and unpredictable.”
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Our operating results may be impacted by the effects of, and changes in, worldwide economic conditions, international trade, tariffs and retaliatory countermeasures, export controls and other trade barriers, global trade wars or domestic preferences which could increase our costs and materially and adversely affect our business, results of operations and financial condition. Our global business, operations, and the execution of our business strategies and plans are subject to global competition and economic and geopolitical risks that are beyond our control, such as, among other things, tariffs and retaliatory countermeasures, trade barriers and other governmental protectionist measures impacting international trade agreements or imposing trade restrictions, any of which can negatively affect us. The global economy has been impacted by geopolitical tensions. There is currently significant uncertainty about future trade relationships between the United States and various other countries, most significantly Russia, Canada, Mexico, and China. There is currently significant uncertainty about the future trade relationships between the United States and various other countries, most significantly Russia, Canada, Mexico, China and the EU. Further escalation of specific trade tensions, including those between the U.S. and China, or more broadly in global trade conflicts, could materially and adversely affect the Company’s business and operations. The U.S. government and other governments have imposed export controls and tariffs on certain products and certain components that we import into, and export out of, the United States, and we, our customers, suppliers, and partners may become subject to additional tariffs and export controls and our products and services may be subject to increased competition outside of the United States. In addition, geopolitical tensions could result in, among other things, cyberattacks, supply chain disruptions, higher energy and other commodity costs, lower demand, changes to foreign exchange rates and financial markets. Additional tariffs and trade restrictions may result in increased manufacturing costs and product pricing, further supply chain disruptions, limit access to end markets and lower profitability. We also generate a significant amount of our revenue outside of the United States which may be adversely affected by tariffs and trade controls imposed by other countries. Revenue generated from outside of North America accounted for approximately 37.1% of our net sales for the year ended December 31, 2025, and approximately 37.0% of our net sales for the year ended December 31, 2024, and international sales are expected to remain a material percentage of our total revenue in future periods. If we are not successful in offsetting the impact of tariffs, export controls, trade barriers, and other geopolitical disruptions, our business, results of operations and financial condition may be adversely affected. If we are not successful in offsetting the impact of any such added tariffs, our business revenue, gross margins, results of operations and financial condition may be adversely affected.
Following the Paragon acquisition, our growth strategy relies in part on plans to supply our products and services to SMRs and other advanced reactors in the U.S., an emerging market that may grow more slowly than we expect. Our Nuclear and Safety growth strategy relies on market research that estimates that the market for SMRs will surge, driven by a global growth in energy, and specifically electricity demand, and we have accordingly pursued entering into strategic agreements with a number of SMR companies in the U.S. However, these companies face multiple commercialization obstacles including reactor design, regulatory licensing, and securing customers willing and able to make large investments in emerging nuclear technologies. Each SMR developer faces unique risks, including risks related to technology, regulatory approvals, and financing. Even for those SMR companies that succeed, the cost curves that will be required for successful commercialization at scale will be aggressive and competition will be fierce among them, and also from other cost-competitive energy solutions. Further, many of these SMR companies are new entrants to the nuclear market and may fail operationally even if they develop a successful reactor, which may negatively impact the entire market. Our assumptions, estimates and plans about the SMR market may not be correct or they may change at any time, and our revenue may be subject to volatility as our SMR partners succeed, delay or cancel their projects, or fail altogether, which could cause material and adverse impacts on our business, results of operations and financial condition.
International conflicts, such as the military conflict between Russia and Ukraine have adversely affected and may further adversely affect our business, results of operations, and financial condition. We do business with Russian customers both within and outside of Russia and with customers who have contracts with Russian counterparties. Russia’s invasion of Ukraine, the ensuing build-up of Russian sanctions and other impacts on this region have impacted the global economic environment resulting in fluctuating demand for our products and services, delays or cancellations of customer projects and difficulties in supplying and sourcing products from this and other geographic regions. We have also experienced and may continue to experience delays in revenue recognition, order fulfillment and contract payments due to export controls and other sanctions instituted to date. A number of nuclear power plants are being constructed or are operated by or with the participation of Russian state-owned enterprises. As the situation evolves, there is a growing risk that those Russian state-owned enterprises could become further sanctioned by the United States or the European Union. We also sell medical equipment and related products into Russia for medical and humanitarian applications, however this process has become more complicated, time consulting and uncertain as some of our medical equipment exports require export licenses. We may also be subject to criticism for continuing to sell products to Russia, which could damage our reputation and adversely affect our business, results of operations and financial condition. It has become more difficult to transact with Russian parties due to the continued expansion of U.S. and EU sanctions directed at Russia.
In April 2023, a Russian customer claimed $19.3 million in liquidated damages for delays on a Hungarian project, later increasing the claim to $21 million, despite a $14 million contractual cap (all amounts converted from Euros to U.S. Dollars). In November 2024, the parties reached a settlement and agreed to modify the contract. The parties are now working on implementing the terms of the settlement which is complicated by the current sanctions regime. The modification was accounted for under ASC 606 Revenue Recognition which resulted in an immaterial impact to the Statement of Operations for the year ended December 31, 2024.
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We have made and plan to continue to make acquisitions, investments and divestitures that involve numerous risks and uncertainties. We pursue growth by selectively acquiring and investing in, businesses, products or technologies, while also divesting businesses that no longer align with our strategic plans. However, there can be no assurance that suitable opportunities will be identified or that transactions will close on favorable terms. The expected benefits may not materialize, and such activities can introduce risks, including competition for attractive or promising businesses or assets, financing needs, and regulatory approvals. Financing acquisitions through equity or debt may dilute our stockholders or increase financial obligations. Divestitures can be time consuming, disruptive our business, may not close on the expected timing or at all, have in the past resulted in additional costs following the transaction and may continue to do so in the future. Divestitures also require significant time and resources, could disrupt our business, may not close on the expected timing or at all, have in the past resulted in additional costs following the transaction and may continue to do so in the future. Potential and actual transactions could also divert management's attention, and could potentially deplete corporate resources and adversely impact the Company’s business, results of operations and financial condition.
In July 2025 and December 2025 we acquired Certrec and Paragon, respectively. These acquisitions may not meet our expectations. Their success, including anticipated benefits, will depend, in part, on our ability to successfully integrate our respective organizations without materially disrupting existing business and strategic relationships. If we experience difficulties in the integration process, we may not fully realize the anticipated benefits of the acquisitions in a timely manner, or at all.
We operate in an industry where risks related to radioactive materials and public views on nuclear energy could materially and adversely affect our markets and increase regulatory requirements and costs, negatively impacting our business, results of operations and financial condition. Risks related to radioactive materials and public views on nuclear energy can significantly impact our business. Our success in the nuclear power end market depends on favorable public opinion of nuclear energy. Opposition from various groups or a nuclear incident could lead to unfavorable public opinion, stricter regulations, higher costs and reduced customer demand for our products thereby materially and adversely affecting our business, results of operations and financial condition. We purchase materials, components, and equipment from third parties for our manufacturing operations including from sole or limited source suppliers due to quality assurance, cost effectiveness, availability, contractual obligations or unique design or technology.
Supply chain issues could disrupt production, cause delays and increase costs for the commodities or components that we use in our operations which may materially and adversely impact our business, results of operations and financial condition.Supply chain issues could cause production interruptions, delays and increased costs for the commodities or components that we use in our operations which may materially and adversely impact our business, results of operations and financial condition. We rely on third party suppliers for our manufacturing operations including from sole or limited source suppliers due to quality assurance, cost effectiveness, availability, contractual obligations or unique design or technology. This dependence exposes us to risks like price volatility, supply disruptions, and geopolitical issues as suppliers are often located in developing countries. Suppliers capacity constraints, operational or quality issues, bankruptcies or other business terminations, decreased availability of key materials, and external events like natural disasters, pandemics, war, terrorism, tariffs wars and other governmental actions can make it difficult to find replacements quickly or at similar costs. Our supply chains could also be disrupted by factors such as supplier capacity constraints, operational or quality issues, bankruptcy or exiting of the business for other reasons, decreased availability of key materials, and external events like natural disasters, pandemics, war, terrorism, tariffs wars and other governmental actions. Such disruptions could cause increased expenses, production interruptions, delays, extended lead times, and inefficiencies, and adversely impact our business, results of operations and financial condition.
Our sales cycles in certain end markets can be long and unpredictable. The sales cycle for new construction or refurbishment of existing NPPs ranges from 12 to 36 months and occasionally extends up to 60 months or more, while medical end market cycles range from 1 to 18 months. We invest heavily before securing orders, with no guarantee of a sale. Revenue recognition may be delayed due to the need for customer notices to proceed, certification of successful installation and operation, or construction or scheduled outage delays, making revenue predictions difficult, particularly on a quarterly basis, and can cause our operating results to fluctuate significantly. Revenue recognition may be delayed due to the need for customer notices to proceed, certification of successful installation and operation or construction or scheduled outage delays.
Many of our products and services involve the detection, identification, measurement or monitoring of radiation and the failure of our products or services to perform to specification could materially and adversely affect our business, results of operations and financial condition. Our products and services are technically complex, involve the detection and monitoring of radiation and are crucial components of the safety measures employed with respect to ionizing radiation. Any actual or perceived quality issues or safety failures could result in incorrect medical treatments, personal injury, death or property damage (including environmental contamination). Resulting legal claims and regulatory actions could generate significant costs to us. Product issues could adversely affect our reputation and customer relationships. While we have attempted to secure appropriate insurance coverage at a reasonable cost, we may not be fully covered against all risks and we are also subject to significant deductibles. There can be no assurances that insurance policies will continue to be available on commercially acceptable terms or at all. We seek to limit our liability in customer contracts, but these contractual limitations may not always be effective or sufficient in scope in all cases, which could subject us to material and adverse impacts on our business, results of operations and financial condition. We seek to limit our liability in customer contracts, but these contractual limitations may not always be effective or sufficient in scope in all cases, potentially which could subject us to material and adverse impacts on our business, results of operations and financial condition.
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Certain of our products require the use of radioactive sources or incorporate radioactive materials, which subjects us and our customers to regulations, related costs and potential liabilities for violation of environmental, health and safety laws. The majority of our products require the use of radioactive sources for testing and calibration, which are held in our facilities and by our customers. Certain of our reactor instrumentation and control equipment and systems also incorporate radioactive materials. In all such cases, licenses for radioactive sources and materials or other sources ionizing radiation are provided by the appropriate regulatory authority in the relevant jurisdiction. Failure, to secure or comply with the necessary licenses could result in purchase cancellations, delays, or regulatory actions. Licensing processes generally require safety policies and procedures, emergency plans, proper handling and disposal procedures and adequately training personnel at the site. Ongoing compliance obligations include paying license fees, submitting reports, and agree to site inspections by regulators. Non-compliance or improper handling of radioactive materials can result in license revocation, which could result in the cancellation or delay of purchases by our customers, penalties, fines and liability for accidents or contamination. Related claims for related violations of environmental, health and safety laws could result in substantial damages, be costly and time-consuming to defend and adversely affect the marketability of our products, our reputation, our results of operations and financial condition.
We enter into fixed-price contracts and contracts with limited pricing escalation and our failure to mitigate certain risks associated with such contracts may result in reduced operating margins. For NPPs new builds, we periodically enter into fixed-price arrangements and contracts with price escalation terms that may not fully cover all possible cost increases. The actual revenue, cost and gross profit from these contracts can differ substantially from original projections due to factors including inaccurate costs estimation, inflation, currency fluctuations, design error, technical problems, supplier failures, regulatory delays, customer issues, changes in laws, construction delays, limited history with new products and customers, contract termination, or other unanticipated circumstances. We may experience cost overruns due to these factors resulting in losses or reduced profitability which could materially and adversely affect our business, results of operations and financial condition.
Risks Related to Our Business Operations
We derive a significant portion of our revenue from international sales and our operations in non-U.S. countries are subject to political, economic, legal, currency and other risks, which could materially and adversely affect us. Revenue generated from outside of North America accounted for approximately 37%, 37%, and 36% of our net sales for the years ended December 31, 2025, December 31, 2024, and December 31, 2023, respectively. International sales are expected to remain a material percentage of our total net sales in future periods. Our operations are subject to risks such as currency fluctuations, complex non-U.S. laws and regulations, new or increased tariffs, and the need for government approvals and certifications. We must also manage localization requirements, export/import licenses, and challenges in collecting payments. Additional risks include protecting our intellectual property, staffing and managing international operations, and overseeing third party sales agents and distributors. Contract management, restrictions on cross-border fund transfers and tax consequences add further complexity. Regional political and economic instability can also impact operations. All these factors could materially and adversely affect our business, results of operations and financial condition. Any of these results would materially and adversely affect our business, results of operations and financial condition.
Unfavorable currency exchange rate fluctuations could materially and adversely affect our financial results.
Our international sales and our operations in countries other than the United States expose us to risks associated with fluctuating currency values and exchange rates which may exacerbate if trade wars escalate. A significant amount of our international sales, costs, assets and liabilities are denominated in currencies other than the U.S. dollar. Gains and losses on the conversion of accounts receivable, accounts payable and other monetary assets and liabilities to U.S. dollars have contributed and may continue to contribute to fluctuations in our results of operations. In addition, continued increases in the value of the U.S. dollar relative to the Euro could have an adverse effect on our results of operations. We do not currently purchase forward contracts to hedge against the risks associated with fluctuations in exchange rates.
We rely on third-party sales representatives to assist in selling our products and services, and their failure to perform as expected could materially and adversely affect us. A significant portion of our revenue is derived from sales through third-party sales representatives e.g., sales agents and distributors, whose success in marketing and selling our products and services is unpredictable. Additionally, many of these representatives also market and sell competing products and services, potentially impacting their promotion of our products and services. If they misrepresent our products, we could become subject to risk or liability from government regulatory bodies or agencies for criminal or civil claims, including false claims and improper advertising and promotion. Furthermore, violations of laws or regulations, in particular, anti-corruption, environmental, or sanctions laws, by these representatives could be imputed to us and result in adverse publicity, fines, penalties, judgments, money damages and other significant losses, any of which could adversely affect our business, results of operations and financial condition.
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We derive a substantial portion of our U.S. revenue from contracts with U.S. governmental customers or their contractors, and any shutdown or other development where such customers may be required to reduce their spending, cancel contracts, initiate audits and investigations, or require unusual or more onerous contractual terms could materially and adversely affect us. A substantial portion of our business relies on government budgets and spending, such as nuclear power plants and medicine. Revenue is often tied to government customers or their contractors or sub-contractors. Any reduction in government funding, such as a shutdown, failure to raise the debt ceiling, or general budget cuts could reduce our sales and revenue. Changes in capital spending policies or increased scrutiny of government budgets could also reduce demand and could also result in audits and investigations. Even when selling to non-government entities, we must comply with strict procurement processes for government contractors and subcontracts, in particular in the United States. European Union and United Kingdom. Bids for government contracts may require security clearances with the Department of Defense or Department of Energy, or compliance with regulations like the Buy-American Act. Obtaining and maintaining security clearances is a lengthy process and may be denied or revoked. Recruiting qualified employees for these clearances can be difficult. We are subject to government audits and investigations which can result in financial penalties and debarment, financial penalties, contract delays, or loss of business if adverse findings occur. Increased government spending cuts may lead to more audits. Failure to meet requirements (security clearances, product qualifications, audit standards) could result in contract termination, penalties and loss of future business opportunities, any of which could adversely affect impact our business, results of operations and financial condition.
We operate as an entrepreneurial, decentralized company reliant on local business units which could materially and adversely affect our business, results of operations and financial condition. Failure to meeting environmental, social and governance expectations or standards could adversely affect our business, reputation, brand, results of operations and financial condition. We operate in multiple countries and are subject to numerous, complex and frequently changing business conditions and regulatory environments. In addition, certain of our business teams are from time to time staffed leanly due to our growth-oriented organizational structure. If we are not able to detect or resolve financial, operational and compliance matters promptly, this could adversely affect our business, results of operations and financial condition.
The use of Artificial Intelligence (AI) and machine learning in our business and operations may result in legal liability, regulatory action, increased compliance obligations, competitive or reputational harm, ethical or other concerns and adversely affect our business, financial condition and results of operations. Any significant data breach or misuse of confidential information may result in significant costs, litigation and regulatory enforcement actions, harm our reputation, and therefore, may have a material adverse impact on our business, reputation, results of operations and financial condition. We leverage artificial intelligence, including generative artificial intelligence and machine learning in certain of our business operations and may also use products and services from third parties that use artificial intelligence technology. Our competitors or other third parties may incorporate artificial intelligence into their operational processes more quickly or more successfully than us, which could have a material adverse effect on our competitive position, reputation and operations.Certain of our products require the use of radioactive sources or incorporate radioactive materials, which subject us and our customers to regulations, related costs and potential liabilities for violation of environmental, health and safety laws. In addition, there are significant risks involved in developing and deploying artificial intelligence and there can be no assurance that our use of artificial intelligence will increase our efficiency or profitability or be beneficial to our business. Laws and regulations regarding artificial intelligence technologies are rapidly evolving and complex, including in the areas of intellectual property, cybersecurity, privacy and data protection. We have implemented policies and controls to mitigate many of the novel risks presented by these new technologies but compliance with new or changing laws, regulations or industry standards relating to artificial intelligence may impose significant costs and limit our ability to develop, deploy or use artificial intelligence technologies in our business. There has been an increase in artificial intelligence related litigation and government regulatory actions targeting the design, deployment and other uses of artificial intelligence and claiming liability under numerous areas of law, such a consumer protection, product liability, privacy, intellectual property, securities and defamation. Any of these risks could have an adverse effect on our business, results of operations and financial condition. Any of these results would materially and adversely affect our business, results of operations and financial condition.
We have, and could continue to experience cyberattacks, intrusions into our systems by unauthorized parties or other data theft or loss, which could cause us to incur significant costs, and could also subject us to litigation, regulatory enforcement actions and damage to our reputation, any one of which could materially and adversely impact our business, reputation, results of operations and financial condition. We are facing increasing cybersecurity risks due to more aggressive and sophisticated attacks, including the rapid evolution and growing adoption of artificial intelligence and machine learning technologies by threat actors. These risks include hacking, computer viruses, malicious code, ransomware, social engineering attacks (including phishing and impersonation), denial-of-service attacks and machine learning algorithms and techniques that automate, accelerate or enhance cyberattacks. These include hacking, computer viruses, malicious code, ransomware, social engineering attacks (including phishing and impersonation), denial-of-service attacks and machine learning algorithms and techniques that automate, accelerate or enhance cyberattacks. Our IT systems are subject to constant attempts to gain unauthorized access to, capture, destroy or manipulate confidential information and we have experienced, and may in the future experience, cyberattacks and data breaches. Additionally, the use of artificial intelligence by our employees, or by our customers and business partners, could increase our exposure to cyber threats. Despite the implementation of information security systems and processes to protect against unauthorized access, data loss and theft (see "Item 1C. Cybersecurity"), there is no guarantee that this governance will be adequate to safeguard against all breaches or misuse of our data and systems. Additionally, some confidential information and customer data is gathered, processed, and stored by third-party vendors or service providers whose security and protection policies and procedures we ultimately do not, and are unable to, control. We maintain private liability insurance intended to help mitigate the financial risks of such incidents, but there can be no guarantee that insurance will be sufficient to cover all losses related to such incidents or available on commercially acceptable terms or at all, and our exposure resulting from any unauthorized access
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to, or use of our data and systems, could far exceed the limits of our insurance coverage for such events. Any significant data breach or misuse of confidential information may result in significant costs, litigation and regulatory enforcement actions, harm our reputation, and therefore, may have a material adverse impact on our business, reputation, results of operations and financial condition.
The loss of the services of our key personnel, including our executive officers, and our ability to attract, develop and retain key talent could materially and adversely effect our business and operations. The Company’s future success depends to a significant degree on the skills, experience and efforts of its executive management team and other key personnel. Losing any executive officer or lacking adequate succession plans for key personnel could have an adverse impact on our business and operations. The inability to attract, develop and retain qualified individuals, or a significant increase in the costs to do so, could adversely affect our business, results of operations and financial conditions.
If we encounter manufacturing problems, or if our manufacturing facilities do not continue to meet federal, state or international manufacturing standards, we may be required to adapt our manufacturing operations, which would result in delays and lost revenue. Our manufacturing and assembly processes are complex, involving multiple suppliers and regulatory requirements across different countries. Challenges include limited availability or qualified personnel and increased costs due to trade policy developments. For example, whole body monitors are produced exclusively in Ontario, Canada and disruptions at this site such as higher costs of imported materials and components would be difficult to remediate elsewhere because qualified personnel may not relocate or be found locally. This could result in production delays, reliance on third parties, and financial losses. Additionally, our manufacturing is subject to inspections and regulatory requirements, See "Risk Factors—Legal and Regulatory Requirements. Additionally, our manufacturing processes are subject to inspections and regulatory requirements, See "Risk Factors—Legal and Regulatory Requirements. " Failure to comply could lead to enforcement actions, product recalls, civil or criminal penalties, or other sanctions, penalties, and negative publicity.
Our operations, and the operations of our suppliers, distributors or customers, could be subject to natural and man made disasters as well as the impact of governmental actions and regulations in response to such events, any of which could materially and adversely affect our business and increase our expenses. Extreme weather events such as winter storms, hurricanes, earthquakes, fires, flooding, hail and tornadoes could disrupt our operations, leading to reduced revenue and increased costs and expenses. For example, some of our facilities are located in areas with acute climate related risks, such as Florida and Texas. For example, some of our facilities are located in areas with earthquake fault lines or in hurricane zones such as our Sun Nuclear factory located in Florida . We also have climate-related risks for our operations outside of the United States, such as Europe. Depending on the location and severity of such events we could experience business interruptions, destruction of, or damage to, facilities or loss of life, any of which could materially and adversely affect our business, results of operations and financial condition. We could also be required to incur significant costs to report on, and enhance the resiliency of, our operations, infrastructure and supply chain in order to comply with government regulations addressing climate change. These additional expenses could place pressure on profit margins or require us to increase the price of our products and services potentially affecting demand and, consequently, our business, results of operations and financial condition. These additional expenses will place pressure on profit margins or require us to increase the price of our products and services potentially affecting demand and, consequently, our business, results of operations and financial condition.
Fluctuations in our effective tax rate, including as a result of changes in law or recent changes in our organizational structure, or adverse outcomes resulting from examination of our income tax returns, could materially and adversely affect our results of operations. As a global company we are subject to taxation in numerous jurisdictions. Several factors, many beyond our control, could adversely affect our effective tax rate. These include changes in profitability across jurisdictions; inability to use tax credits; evolving tax laws and regulations, such as OECD Pillar Two legislation enacted in various countries in which we do business; non-deductible expenses; tax effects on acquisitions and restructuring; changes in deferred tax assets; results of tax audits and decisions regarding the reinvestment of foreign earnings. Any of these could significantly alter our effective tax rate, impacting our business, results of operations and cash flows.
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Legal and Regulatory Risks
We are subject to extensive laws and regulatory regimes and any failure to comply with them could subject us to penalties and legal expenses which could materially and adversely affect our business, results of operations, revenue, supply chain and financial condition. The Company operates under extensive regulation by various federal, state, and local governmental agencies in the United States and other countries in which we conduct business covering areas such as radioactive materials, antitrust, environmental, health and safety, food and drug, medical device, import/export, and labor laws. Noncompliance may result in investigations, penalties, sanctions, prosecution, enforcement actions by governments or claims from other third parties, damages, fines, settlements, injunctions or debarment from government contracting or subcontracting. Noncompliance may result in investigations, sanctions, prosecution, enforcement actions by governments or claims from other third parties, damages, fines, civil and criminal penalties, settlements, injunctions or debarment from government contracting or subcontracting. Separately, compliance with anti-corruption laws, including the U.S. Foreign Corrupt Practices Act (FCPA) and the U.K. Bribery Act, is critical as we operate globally including through third parties, agents, or other business partners whose misconduct could be imputed to us. While we require that they operate in compliance with our policies and procedures, there is no guarantee they will be fully effective, and violations could occur, for which we may be held responsible. While werequire that they operate in compliance with our policies and procedures, there is no guarantee they will be fully effective, and violations could occur, for which we may be held responsible. Further, the interpretation and enforcement of government regulations in the U.S. has been subject to unpredictable changes. This has created additional uncertainty regarding how the FCPA will be enforced, in particular with respect to international operations, and it may also have the effect of increasing competitive pressures within our industries.
Legal compliance with import and export controls, as well as with sanctions, in the United States and other countries, is complex, and compliance restrictions and expenses could materially and adversely impact our revenue and supply chain. Many of our products are regulated by complex and changing trade controls and violations can lead to severe penalties, including fines and loss of export rights. Trade wars, sanctions and export controls imposed against Russia, China or other countries or specific parties in those countries where we do business could materially and adversely impact our business, results of operations and financial condition. Trade wars and sanctions and export controls imposed against Russia, China or other countries or specific parties in those countries where we do business could materially and adversely impact our business, results of operations and financial condition. Regulatory actions such as audits or investigations could result in significant penalties or restrictions on international sales. For more information, see “Risks Related to Our Business and Industry—The military conflict between Russia and Ukraine and the sanctions imposed as a result have adversely affected and may further adversely affect our business, results of operations, and financial condition.”
We and our customers and partners operate in highly regulated industries that require us and them to obtain, and comply with, federal, state, local and international government permits and approvals. We and our customers operate in a highly regulated environment requiring compliance with various domestic and international standards and certifications from agencies such as the National Voluntary Laboratory Accreditation Program and the FDA in the United States and by other governmental agencies in international markets. Our customers and partners are required to obtain and maintain various government licenses and permits for facilities or possession and use of radioactive materials. Accreditations and approvals may be denied, revoked or modified due to non-compliance or other governmental actions. Changing regulatory requirements could cause us to incur substantial costs or delays if we need to modify our products or cancel customer orders. Failure to meet new regulatory requirements could materially and adversely impact our business, results of operations and financial condition.
Failure to meeting environmental, social and governance expectations or standards could adversely affect our business, reputation, brand, results of operations and financial condition. Governments, regulators, investors, employees, customers, and other stakeholders are placing emphasis on environmental, social and governance performance of companies with varying and sometimes conflicting expectations. Global companies face increasingly complex and fragmented requirements for ESG reporting and disclosure. Compliance with these diverse and sometimes conflicting rules could be difficult and costly to implement. Our failure to successfully meet these mandates could adversely affect our business, results of operations and financial condition as they may result in operational constraints and cause us to incur expenses that may place pressure on margins or require us to increase the price of our products and services to the point that it affects demand for those products and services. Our failure to successfully answer to any such mandates could adversely affect our business, results of operations and financial condition as they may result in operational constraints and cause us to incur expenses that may place pressure on margins or require us to increase the price of our products and services to the point that it affects demand for those products and services.
We could incur substantial costs as a result of violations of, or liabilities under, environmental laws. Our operations and properties are subject to a number of environmental, health and safety laws and regulations governing emissions, wastewater discharges, hazardous materials management and worker health and safety. Failure to comply with these standards may result in significant civil or criminal fines or penalties or enforcement actions, including regulatory or judicial orders enjoining or curtailing our operations or requiring us to conduct or fund remedial or corrective measures, install pollution control equipment or perform other actions. Failure to comply may result in significant civil or criminal fines or penalties or enforcement actions, including regulatory or judicial orders enjoining or curtailing our operations or requiring us to conduct or fund remedial or corrective measures, install pollution control equipment or perform other actions. We have been, and may continue to be, subjected to claims of violations which could lead to costly litigation. Compliance with these and future laws and regulations may involve significant costs potentially adversely impacting our business, results of operations and financial condition.
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Our ability to compete successfully and achieve future growth will depend on our ability to obtain, maintain, protect, defend and enforce our intellectual property and to operate without infringing, misappropriating or otherwise violating the intellectual property of others. Our intellectual property is vital to our business and insufficient protection or invalidation of these rights could significantly harm our business, results of operations and financial condition, including forcing us to, among other things, rebrand or re-design our affected products. Foreign laws may not adequately protect our intellectual property rights, increasing risks as we conduct a substantial portion of our operations and a majority of our sales outside of the United States. In addition, advances in artificial intelligence and the increasingly widespread use of such technology by us, our third parties or others, including generative artificial intelligence tools, may increase the risk of unauthorized access to, or use of, our intellectual property and unauthorized or unintended exposure of our confidential information and proprietary information, all of which could adversely affect the value of our intellectual property, including our brands, our trade secrets and our investment in research and development. Third parties have claimed and may continue to claim infringement, misappropriation or misuse of their proprietary rights, leading to costly litigation. Third parties have claimed and may continue to claim that we have infringed upon, misappropriated or misused their proprietary rights. Unsuccessful defense against such claims could result in substantial damages, halted product sales, expensive technology changes, or the need to obtain licenses to use the infringed technology or indemnify our customers. We currently have in effect, and may in the future enter into, agreements to defend, indemnify and hold harmless our customers or suppliers against damages and costs from alleged infringement, misappropriation or other violation by our products of third-party patents, trademarks or other proprietary rights. We currently have in effect, and may in the future enter into, agreements in which we agree to defend, indemnify and hold harmless our customers or suppliers from damages and costs that may arise from the infringement, misappropriation or other violation by our products of third-party patents, trademarks or other proprietary rights. Litigation related to such obligations could be costly and divert the efforts of our technical and management personnel, regardless of the outcome. Our insurance does not cover intellectual property infringement. Any of the foregoing would materially and adversely affect our business, results of operations and financial condition. Any of the foregoing could materially and adversely affect our business, results of operations and financial condition.
Our use of “open source” software could negatively affect our ability to sell our products and subject us to possible litigation.26Table of ContentsOur use of “open source” software could negatively affect our ability to sell our products and subject us to possible litigation. A portion of our products incorporate so-called “open source” software, and future products may incorporate more. If an author or other third party that distributes such open source software were to allege that we had not complied with the conditions of one or more of these licenses, we could face costly legal disputes and significant damages, enjoined from the sale of our products that contained the open source software. Non-compliance could halt product sales and disrupt business operations. These risks could adversely affect our business, results of operations and financial condition.
Any actual or perceived failure to comply with data privacy or security laws and regulations could lead to government enforcement actions, private litigation or adverse publicity and could materially and adversely affect our business. Privacy and data security have become significant issues in many jurisdictions where we conduct business. Due to the global nature of our business, our collection, processing, distribution, and storage of personal information is subject to a variety of evolving laws and regulations. Compliance may increase our operational costs and, despite these efforts, there is a risk that we fail to comply and may become subject to government enforcement actions, fines and penalties, litigation and reputational harm. In the United States, these regulations include the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) for certain medical data in the US, as well as the California Consumer Privacy Act (“CCPA”) and California Privacy Rights Act (“CPRA”). In the United States, these regulations include the Health Insurance Portability and Accountability Act of 1996 ("HIPAA") for certain medical data in the US, as well as the California Consumer Privacy Act (“CCPA”) and California Privacy Rights Act (“CPRA”). Internationally, virtually every jurisdiction in which we operate has established its own data privacy and security legal framework with which we must comply including the comprehensive European Union General Data Protection Regulation (“GDPR”), regulations in individual countries in the EU, including France and Germany, and UK GDPR in the United Kingdom. These laws and regulations and others that may be enacted in the future, may require us to modify our data processing practices and policies, incur substantial compliance-related costs and expenses, divert resources from other initiatives and project and otherwise suffer adverse impacts on our business. Further, they may be inconsistent from one jurisdiction to another, subject to differing interpretations and may be interpreted to conflict with our practices. We cannot ensure that our compliance programs and policies will be sufficient to protect us from claims, proceedings, liability or adverse publicity. Although we endeavor to comply with our policies, we may at times fail to do so or be alleged to have failed to do so.
Additionally, we may be bound by contractual requirements applicable to our collection, use, processing and disclosure of various types of data, including personal information, and may be bound by, or voluntarily comply with, self-regulatory or other industry standards relating to these matters. Claims that we have violated individuals’ privacy rights, failed to comply with privacy and data security laws, or breached our contractual obligations, even if we are not found liable, could be expensive and time consuming to defend and could result in adverse publicity, increase our operational costs and harm our business, results of operations and financial condition.
We do not control our suppliers, customers or business partners, and their actions or omissions could harm our reputation and sales. We do not control our suppliers, customers or partners or their business practices. A violation of environmental or other laws by our suppliers, other customers or partners, or an environmental or public health incident at customer locations (e. A violation of environmental or other laws by our suppliers, other customers or partners, or an environmental or public health incident at customer locations could create negative publicity and harm our reputation. g., release of radioactive materials) could create negative publicity and harm our reputation. Any conduct or actions that our suppliers could take could reduce demand for our products, harm our ability to meet demand or our reputation, brand image, business, results of operations and financial condition.
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Portions of our workforce are represented by unions or works councils and are covered by collective bargaining agreements. Labor group representation has led to and may lead in the future to work stoppages that could materially and adversely affect our business. The majority of our EU employees are members of, or are represented by, works councils or trade unions and are covered by collective bargaining agreements, and a small number of our U.S. and U.K. employees are presently unionized. Non-union employees may seek such membership or representation in the future. We face risks of work stoppages and labor disturbances, including during collective bargaining renegotiations, which could adversely affect our business. Union and works council rules may limit our flexibility to respond to changing market conditions and the application of these rules could harm our business, results of operations and financial condition. Union and 27Table of Contentsworks council rules may limit our flexibility to respond to changing market conditions and the application of these rules could harm our business, results of operations and financial condition. Additionally, renegotiation of collective bargaining agreements may result in terms that are less favorable to us.
The elimination or any modification of the Price-Anderson Act’s financial protection and indemnification authority could have adverse consequences for our business. The Price-Anderson Act, supports the nuclear services industry by offering financial protection through nuclear liability insurance and broad indemnification for third-party public liability claims arising from a nuclear accident occurring at any commercial NPP in the United States. If this protection is reduced or removed it could lead the owners and operators of NPPs cancel or delay plans to build new plants or curtail the operations of existing plants, materially and adversely affecting our business. Although it is unlikely that the nuclear liability financial protection authority under the Price-Anderson Act would be completely abolished, some aspects of the Act could be changed during future reauthorizations and if the owners and operators of NPPs cancel or delay plans to build new plants or curtail the operations of existing plants as a result of such modifications our business could be adversely affected.
Certain of our products are subject to regulation by the FDA or international regulatory bodies as medical devices . If we are not able to obtain or maintain required approvals or registrations or if the timeline for receiving the approvals or registrations were to increase significantly due to staffing shortages we may not be able to continue to market and sell such products and it may make it more difficult for us to attract new customers, retain existing customers or maintain sales at existing levels, which could adversely affect our business. If we are not able to obtain or maintain required approvals or registrations or if the timeline for receiving the approvals or registrations were to increase significantly due to staffing shortages we may not be able to continue to market and sell such products and it may make it more difficult for us to attract new customers, retain existing customers or maintain sales at existing levels, which could adversely affect our business. The FDA regulates virtually all aspects of a medical device design, development, testing, manufacturing, labeling, storage, record keeping, adverse event reporting, sale, promotion, distribution and shipping. Additionally, international marketing of these products requires approvals from international counterparts of the FDA, which can be a time consuming and uncertain process. We can offer no assurance that devices or their modifications will be approved or cleared by the FDA or international agencies in a timely manner or at all. Even with regulatory clearances or approvals, significant limitations on the products, indicated uses may be imposed.
Compliance with medical device reporting regulations and cGMP in the United States and ISO 13485 certification internationally is required to maintain product clearances.We must also comply with medical device reporting regulations and cGMP in the United States and ISO 13485 certification internationally to maintain clearances. Advertising and promotion of our products is closely monitored by the FDA and Federal Trade Commission to prevent false or misleading claims and manufacturers must assess whether product modifications to approved products require new approvals, though the FDA can review these decisions. We cannot ensure that the FDA will agree with our decisions not to seek approvals or clearances or that new approvals will be obtained timely fashion, if at all. Additionally FDA regulations and similar international regulations necessitate product recalls for significant deficiencies or defects in design, manufacture or labeling, which can be voluntary or mandated. Recalls, whether voluntary or mandated, can result from design, manufacturing, or labeling defects, and can lead to significant expenses, negative publicity, harm to reputation and adverse effects on our business, financial condition and operating results. Recalls, whether voluntary or mandated, can result from component failures, manufacturing errors or design defects, and can lead to significant expenses, negative publicity, harm to reputation and adverse effects on our business, financial condition and operating results. In these circumstances, we may also be subject to significant enforcement action. If any of these events were to occur, our ability to introduce new or enhanced products would be adversely affected, which in turn would also harm our future growth.
We are subject to federal, state, local and international regulations related to healthcare, the violation of which could result in substantial penalties and harm to our business. Our operations are governed by various laws and regulations affecting interactions with healthcare providers, particularly in sales, marketing and promotional activities. These laws limit financial arrangements with customers, potential customers, marketing consultants and other service providers, impacting how we structure offerings, like discount practices, customer support, product loans, education and training programs, physician consulting, research grants and other service arrangements. These laws limit financial arrangements with customers, potential customers, marketing consultants and other service providers, impacting how we structure our sales offerings, including discount practices, customer support, product loans, education and training programs, physician consulting, research grants and other service arrangements. We must comply with federal and state “false claims” laws, physician self-referral laws and patient confidentiality laws such as Health Insurance Portability and Accountability Act (“HIPAA”). Non-compliance can result in legal penalties, adverse publicity, and harm our business and financial condition and impair our ability to attract new customers. Non-compliance with HIPAA can lead to civil and criminal liabilities, adverse publicity, and harm our business and financial condition and impair our ability to attract new customers. The Physician Payments Sunshine Act requires annual reporting of payments to U.S. licensed physicians and teaching hospitals as well as physician ownership of such applicable manufacturer’s equity, with non-compliance resulting in monetary penalties. Similar state and foreign laws also apply, and violations could lead to civil monetary penalties and adversely impact our reputation and business, results of operations and financial condition.
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Changes in insurance reimbursement to providers or changes in patient coverage could adversely affect our business.
Our customers rely significantly on reimbursement from public and private third-party payers for procedures utilizing our radiation oncology and other medical products. Adequate coverage and reimbursement for procedures using our products, as well as the continued health insurance coverage of patients treated with our products, are crucial for commercialization and market acceptance. Changes in reimbursement policies or a reduction in insured patients could negatively impact our revenue, customer retention and acquisition. Additionally, annual reviews by the Centers for Medicare and Medicaid Services (“CMS”), may lead to significant changes, potentially discouraging the use of our products. Reimbursement practices may also vary internationally, affecting market acceptance based on coverage and reimbursement levels in different countries. Reimbursement practices may also vary internationally, affecting market acceptance based on coverage and reimbursement levels in different countriesSome of our products access data from third parties, and changes to that access may adversely impact our business.
Some of our products access data from third parties, and changes to that access may adversely impact our business.
Our SunCHECK software requires access to data such as electronic health information (“EHI”) from other third-party vendors of our customers, typically original equipment manufacturers, in order to perform quality assessments. The functioning of our analytics applications and our ability to perform analytics services is predicated on our ability to establish interfaces that download the relevant data from these third party source systems on a repeated basis and in a reliable manner. If certain market actors engage in “information blocking,” meaning activity that is likely to interfere with, prevent or materially discourage access, exchange or use of EHI, it may inhibit our ability to access the relevant data on behalf of customers and any steps we take to enforce the anti-information blocking provisions of the Cures Act could be costly, could distract management attention from the business and could materially and adversely impact our business, results of operations and financial condition.
Capital Structure Risks
The price of our Class A common stock may be volatile. The price of our Class A common stock has in the past, and may continue to fluctuate due to a variety of factors, such as changes in industry conditions, competitor developments, regulatory changes, variations in operating performance and operating results, changes in global economic and geopolitical conditions, including the imposition of sanctions and tariffs, publications by securities analysts, public reactions to our press releases, filings with the SEC, actions by stockholders, personnel changes, litigation, changes in our capital structure, such as the issuance and potential sales of 5,869,555 shares of our Class A common stock upon the redemption of 5,869,555 shares of Class B common stock of Mirion IntermediateCo, Inc. (“IntermediateCo”) together with 5,869,555 shares of our Class B common stock outstanding as of December 31, 2025, announcements by us with regard to equity or other financing or acquisitions we may make, stock repurchases, the volume of shares available for sale by significant stockholders, and other risk factors listed in this “Risk Factors” section. (“IntermediateCo”) together with 6,504,885 shares of our Class B common stock outstanding as of December 31, 2024, announcements by us with regard to equity or other financing or acquisitions we may make, stock repurchases pursuant to our previously announced stock repurchase program, and the volume of shares available for sale by significant stockholders, and other risk factors listed in this section "Risk Factors.
Conversion of our Convertible Notes may dilute the ownership interest of our stockholders or may otherwise depress the price of our Class A common stock. Upon conversion of our Convertible Notes (as defined below), we have the option to pay or deliver, cash, shares of our Class A common stock, or a combination of both. If we elect to settle our conversion obligation in shares of our Class A common stock or a combination of cash and shares of our Class A common stock, any sales in the public market of our Class A common stock issuable upon such conversion could adversely affect prevailing market prices of our Class A common stock. In addition, the existence of our Convertible Notes may encourage short selling by market participants because the conversion of the notes could be used to satisfy short positions, or anticipated conversion of our Convertible Notes into shares of our Class A common stock could depress the price of our Class A common stock.
The conditional conversion feature of our Convertible Notes, if triggered, may adversely affect our financial condition and operating results. In the event the conditional conversion feature of our Convertible Notes is triggered, holders of such notes will be entitled to convert their notes at any time during specified periods at their option. If one or more holders elect to convert their Convertible Notes, we can elect to satisfy our conversion obligation by delivering solely shares of our Class A common stock (other than paying cash in lieu of delivering any fractional share) or we can settle a portion or all of our conversion obligation through the payment of cash. If we elected to settle a portion or all of our conversion obligations through the payment of cash, it could adversely affect our liquidity. In addition, even if holders do not elect to convert their Convertible Notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.
Our indebtedness could adversely affect our financial condition. As of December 31, 2025, we had $450.0 million aggregate principal amount of indebtedness outstanding under our senior secured term loan facility (the “Term Loan Facility”) and there is additional availability under our senior secured revolving facility (the “Revolving Facility” and, together with the Term Loan Facility, the “Credit Facilities”) of up to $175.0 million. In addition, our Credit Facilities bear interest based on variable interest rates which have recently increased and may increase further from time to time in the
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future. Continued increases in interest rates will increase the cost of servicing our outstanding indebtedness as well incurring new indebtedness and refinancing our outstanding indebtedness, and could materially and adversely affect our business, results of operations and financial condition. Our indebtedness could have important consequences to us, such as requiring us to dedicate a significant portion of our cash flows to debt payments, reducing available funds for other needs, increasing vulnerability to economic changes, limiting business flexibility, placing us at a competitive disadvantage, restricting future financing options, and exposing us to variable interest rate risks. If we fail to make scheduled payments on our debt, we risk default, which could lead to lenders terminating their commitments, demanding immediate repayment, or foreclosing on secured assets, potentially resulting in bankruptcy or liquidation.
We may incur additional debt in the future and the credit agreement governing our Credit Facilities (the “Credit Agreement”) permits us to do so subject to certain limitations. We have the ability to draw upon our $175.0 million Revolving Facility and utilize an uncommitted “accordion” feature for additional debt if certain incurrence and leverage ratio tests are satisfied. If additional debt is incurred, the related risks could increase, making it harder to meet debt obligations.
The Credit Agreement imposes restrictive covenants limiting our activities, such as incurring additional debt, merge or consolidate with other entities and creating liens. It includes a “First Lien Net Leverage Ratio” (as defined in the Credit Agreement), that could be affected by uncontrollable events, and failure to comply with any of the covenants or any other term of the Credit Agreement could cause a default. A default could accelerate of the outstanding indebtedness an cause further financial difficulties. Complying with these covenants may cause us to take actions that we otherwise would not take or not take actions that we otherwise would take.
We may continue to require additional capital to support our growth plans, and such capital may not be available on terms acceptable to us, if at all."We may require additional capital to support our growth plans, and such capital may not be available on terms acceptable to us, if at all. We intend to continue making significant investments to support our business growth including acquiring businesses, personnel and technologies. Continuing to raise additional funds through issuances of equity, equity-linked or convertible debt securities, could result in significant dilution for existing stockholders, and any new equity securities could have superior rights, preferences and privileges. Raising additional funds through future issuances of equity, equity-linked or convertible debt securities, could result in significant dilution for existing stockholders, and any new equity securities could have superior rights, preferences and privileges.
We are subject to certain ownership and voting power laws and regulations which may limit the ability of stockholders to acquire our Class A common stock and therefore limit demand for our Class A common stock. Under foreign direct investment and public interest laws in various jurisdictions such as Germany, Finland, France, and the UK, certain acquisitions of our Class A common stock by investors necessitate government approval. These restrictions may limit investments and demand for shares of our Class A common stock. These restrictions may limit investments and demand for shares of our Class A common stock.
Anti-takeover provisions contained in our Charter and Bylaws, as well as provisions of Delaware law, could impair or delay a takeover attempt. Our Charter and Bylaws contain provisions that may discourage takeover proposals including the board' authority to issue preferred stock without stockholder approval, no cumulative voting in director elections, the board's exclusive right to fill certain vacancies, prohibitions on stockholder action by written consent and on stockholders calling special meetings, a requirement of a two-thirds vote for certain amendments, and advance notice procedures for stockholder nominations and proposals. These measures complicate the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.
Our Charter includes forum selection clauses, which could discourage claims or limit stockholders’ ability to make a claim against us, our directors, officers, or other employees. Our Charter generally provides that the Court of Chancery in Delaware is the exclusive forum for any stockholder (including a beneficial owner) to bring derivative actions and related claims against the Company or its directors, officers or employees and our Charter provides that the federal district courts of the United States are the exclusive forum for any complaint under the Securities Act. These clauses may discourage claims or increase costs for those seeking to bring claims.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
29
ITEM 1C. CYBERSECURITY
Cyber Risk Management and Strategy
We have also implemented a process requiring our employees, contractors, and consultants to complete annual cybersecurity training that is designed to raise awareness of cybersecurity threats and risks through training and simulations. Our cybersecurity risk management functions include dedicated teams, tools, and processes focused on the reduction of vulnerability and exposures, risk management, and incident detection, investigation, and remediation. Our cybersecurity risk management processes also include dedicated teams, tools, and processes focused on the reduction of vulnerability and exposures, risk management, and incident detection, investigation, and remediation. We also have processes to review vendor cybersecurity risk, including inspection of certain vendor certifications.
Governance
The Board has overall oversight responsibility for our risk management, and delegates its oversight of cybersecurity risk assessment and management guidelines to the Audit Committee. The Audit Committee reviews and makes recommendations to management or the Board on matters relating to cybersecurity. Management provides quarterly updates to the Audit Committee and an annual update to the Board . These discussions may include updates on threat focus, roadmaps covering planned improvements, status updates on key improvements efforts, overview information on any recent incidents or significant vulnerabilities (if any), and the status of key information security initiatives. Three of our Board members have received cybersecurity training and certification from the National Association of Corporate Directors (NACD).
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