1236038--7/2/2007--REDENVELOPE

related topics

{product, market, service}

{system, service, information}

{stock, price, operating}

{cost, operation, labor}

{property, intellectual, protect}

{personnel, key, retain}

{customer, product, revenue}

{cost, regulation, environmental}

{condition, economic, financial}

{operation, natural, condition}

{control, financial, internal}

{provision, law, control}

{regulation, government, change}

We are dependent on the success of our advertising and marketing efforts which are costly and may not achieve desired results. We have a history of significant losses. If we do not achieve or sustain profitability, our financial condition and stock price could suffer. Because we experience seasonal fluctuations in our net sales, our quarterly results will fluctuate and our annual performance will depend largely on results from one quarter. Our operating results are volatile and difficult to predict and may adversely affect our stock price. Our computer and communications hardware and software systems are vulnerable to damage and interruption, which could harm our business. If we fail to offer a broad selection of innovative merchandise that consumers find attractive, our revenues could decline or fail to reach anticipated levels. Failure to successfully manage or expand our fulfillment and distribution operation would have a material adverse effect on us. If we do not manage our inventory levels successfully, our operating results may be adversely affected. We may have difficulty in product sourcing. Our facilities and systems are vulnerable to natural disasters or other catastrophic events. If we fail to manage our growth and successfully integrate our management team, our business will suffer. We experience intense competition in the rapidly changing retail gift market. If we do not successfully expand our website and order processing systems or respond to rapid technological changes, we could lose customers and our net revenues could decline. Delivery of our merchandise could be delayed or disrupted by factors beyond our control, and we could lose customers as a result. The loss of our senior management or other key personnel could harm our current and future operations and prospects. We rely on seasonal and temporary employees during periods of peak activity and any failure by such employees to adequately perform their jobs could adversely affect our operations. If we are unable to successfully manage the costs of our catalog operations or our catalogs fail to produce sales at satisfactory levels it could adversely affect our business. If we are unable to provide satisfactory customer service, we could lose customers. If the protection of our trademarks and proprietary rights is inadequate, our brand and reputation could be impaired and we could lose customers. Intellectual property and other claims against us could be costly and could impair our business. Poor economic conditions may constrain discretionary consumer spending on retail products such as ours. We may incur significant costs or experience delays in product availability due to regulations applicable to the sale of food products and live plants, which may hurt our business. Our charter documents, Delaware law and third-party contractual restrictions may make an acquisition of us more difficult, even if an acquisition would be beneficial to our stockholders. Our directors, executive officers and significant stockholders hold a substantial portion of our stock, which may lead to conflicts with other stockholders over corporate transactions and other corporate matters. The security risks of online commerce, including credit card fraud, may discourage customers from purchasing goods from us. Existing or future government regulation could harm our business.

Full 10-K form ▸

1236038--7/2/2007--REDENVELOPE_INC