834208--3/1/2007--NAVTEQ

related topics

{system, service, information}

{stock, price, share}

{product, market, service}

{customer, product, revenue}

{regulation, change, law}

{stock, price, operating}

{property, intellectual, protect}

{acquisition, growth, future}

{control, financial, internal}

{operation, international, foreign}

{provision, law, control}

{tax, income, asset}

{personnel, key, retain}

{financial, litigation, operation}

{condition, economic, financial}

Risks Related to Our Business We derive a significant portion of our revenue from a limited number of customers, and if we are unable to maintain these customer relationships or attract additional customers, our revenue will be adversely affected. If we are unable to integrate acquired companies effectively, our business could be adversely affected. The issuance of shares of our common stock to Traffic.com stockholders in the pending acquisition and charges associated with the acquisition may have a negative impact on our earnings per share. The market for products and services incorporating our map database is evolving and its rate of growth is uncertain. Our product offering is not diversified and if we attempt to diversify, we may not be successful. If we are unable to manage our growth effectively, our profitability and ability to implement our strategy will be adversely affected. We derive the majority of our revenue from the use of our map database in vehicle navigation systems and fluctuations in the condition of the automotive market may result in fluctuations in the demand for products incorporating our database. If our customers are unable to pay their fees in a timely manner, our revenue and results of operations could be materially negatively impacted. We are experiencing significant changes in our customer base which is resulting in new challenges that may decrease our growth, negatively impact our business and make it more difficult to forecast our results. Our results of operations will suffer if we are not able to maintain our license fees. Increased competition could result in price reductions, reduced profit margins or loss of market share by us. One of our primary competitors has filed a complaint against us alleging various anti-competitive and tortious acts which could adversely affect our business, results of operations and financial condition. We have historically incurred operating losses and we may not achieve sustained profitability. Our dependence on our vehicle navigation systems manufacturer customers for compilation could result in a material decrease in our revenue or otherwise adversely affect our business. We derive a significant portion of our revenue from our international operations and economic, political and other inherent risks of international operations may adversely affect its financial performance. Currency translation risk and currency transaction risk may adversely affect our results of operations. We are subject to income taxes in many countries because of our international operations and we exercise judgment in order to determine our provision for income taxes. Because that determination is an estimate, we cannot be certain that our income tax provisions and accruals will be adequate. We may not generate sufficient future taxable income to realize our deferred tax assets. Increased governmental regulation may place additional burdens on our business and adversely affect our ability to compete. We are required to evaluate our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002 and any adverse results from such evaluation could result in a loss of investor confidence in our financial reports and have an adverse effect on our stock price. If we cannot retain our existing management team or attract and retain highly skilled and qualified personnel, our business could be adversely affected. If we fail to adapt our technology infrastructure, map database and data collection tools to changes in technology, we could lose our existing customers and be unable to attract new business. If we fail to establish and maintain relationships with third party sources of data used in our map database or other suppliers, our business is likely to suffer. If our customers do not accurately report the amount of license fees owed to us, we will not receive all of the revenue to which we are entitled. Errors or defects in the database we deliver to customers may expose us to risks of product liability claims and adversely affect our reputation, which could result in customer loss, decreased revenue, unexpected expenses and loss of market share. Our inability to adequately protect our map database and other intellectual property could enable others to market databases with similar coverage and features that may reduce demand for our database and adversely affect our revenue. We may face intellectual property infringement claims that could be time consuming, costly to defend and result in our loss of significant rights. Our intellectual property indemnification practices and potential obligations may adversely affect our business. Our technology systems may suffer failures and business interruptions that could increase our operating costs and cause delays in our operations. We are required to achieve and maintain various quality assurance standards and if we are unable to do so, our key customers may not do business with us. Changes to financial accounting standards may affect our results of operations and cause us to change our business practices. Risks Related to Ownership of Our Common Stock Our stock price may be volatile, and you may not be able to resell shares of our common stock at or above the price you paid or at all. Our quarterly revenue and operating results are difficult to predict and if we do not meet quarterly financial expectations, our stock price may experience increased volatility. If securities or industry analysts do not publish research or reports about our business, or if they change their recommendations regarding our stock adversely, our stock price and trading volume could decline. We may require additional capital in the future, which may not be available to us. Sales of our equity securities to provide this capital may dilute your ownership in us. We do not intend to pay dividends for the foreseeable future. Delaware law and our certificate of incorporation and bylaws contain provisions that could delay and discourage takeover attempts that stockholders may consider favorable.

Full 10-K form ▸

834208--3/1/2007--NAVTEQ_CORP