Penumbra

operations in Europe as well as distributor relationships in Europe, the Middle East and Africa; the offices in Brazil, Australia, Singapore, Japan, Hong Kong and Taiwan support our sales and marketing efforts, including through our distribution partners, in Latin America, Australia and Southeast Asia, respectively; and the offices in Italy support the operations of Crossmed S.p.A., our wholly-owned subsidiary in Italy, including supporting our direct sales operations in Italy, San Marino, Vatican City, and Switzerland. We also warehouse and distribute finished products to our international customers utilizing third-party logistics providers in the Netherlands and Australia.

During the year ended December 31, 2025, we entered into agreements to acquire property in Costa Rica and construct a manufacturing facility and warehouse for the production of medical devices. Refer to Note “5. Balance Sheet Components” to our consolidated financial statements in Part II, Item 8 of this Form 10-K for more information. In addition, during the year ended December 31, 2025, we entered into an agreement to lease approximately 46,000 square feet of manufacturing and warehouse facilities in Costa Rica. The lease will commence upon the completion of certain improvements to the premises, which are expected to be completed in 2026, and will expire five years after commencement, subject to our option to renew the lease for an additional three years.

• We may not have the resources to successfully market and sell our products, which would adversely affect our business and results of operations.
• Third-party reimbursement may not be available or adequate for the procedures or sessions for which our products are used, and may be subject to change.
• We have generated a significant portion of our revenue and revenue growth from a limited number of product families, and our revenue and business prospects would be adversely affected if sales of any of these product families were to decline.
• If specialist physicians or other healthcare providers do not recommend and endorse, or use, our products or if our relationships with specialist physicians or other healthcare providers deteriorate, our products may not be accepted or maintain acceptance in the marketplace, which would adversely affect our business and results of operations.
• Our dependence on key suppliers puts us at risk of interruptions in the availability of our products, which could reduce our revenue and adversely affect our results of operations.
• We cannot be certain that we will be able to manufacture our products in high volumes at commercially reasonable costs.
• We are required to maintain high levels of inventory, which consume a significant amount of our working capital and could lead to permanent write-downs or write-offs of our inventory.
• Defects or failures or alleged defects or failures associated with our products could lead to recalls, safety alerts, or product-related or securities litigation, as well as significant costs and negative publicity.
• Our products are continually the subject of clinical trials conducted by us, our competitors, or other third parties, the results of which may be unfavorable, or perceived as unfavorable, which could materially adversely affect our business, financial condition and results of operations.
• Negative publicity regarding our products or marketing tactics by competitors or other third parties could reduce demand for our products, which would adversely affect sales and our financial performance.
• Our corporate culture has contributed to our success, and if we cannot maintain this culture as we grow, we could lose the innovative approach, creativity, and teamwork fostered by our culture, and our business may be harmed.
• To successfully market and sell our products internationally, we must address a number of unique challenges applicable to international markets.
• We rely on our distributors to market and sell our products in certain international markets.
• Most of our customer relationships outside of the United States are with governmental entities, and we could be materially adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws in non-U.S. jurisdictions.
• Foreign currency exchange rates may adversely affect our results.
• We have experienced rapid growth in recent periods, and if we fail to manage our growth effectively, our business and results of operations may suffer.
• We depend on key personnel to operate our business and develop our products, and if we are unable to retain, attract and integrate qualified personnel, our ability to develop and successfully grow our business could be harmed.
• We depend on information technology systems to operate our business, and issues with maintaining, upgrading or implementing these systems, could have a material adverse effect on our business.
• Cost-containment efforts of our customers, purchasing groups and governmental organizations could have a material adverse effect on our sales and ability to achieve or maintain profitability.
• If we are unable to educate specialist physicians or other healthcare providers in the proper use of our products, which may be more complex than competitive products or alternative treatments that do not use our products, our business may be material adversely affected and we may experience a high risk of product liability.
• Regulatory Risks
• We are subject to stringent domestic and foreign medical device regulations, which may impede the approval or clearance process for our products, hinder our development activities and manufacturing processes and, in some cases, result in the recall or seizure of previously approved or cleared products.
• If we modify our FDA cleared products, we may need to seek and obtain new clearances, which, if not granted, would prevent us from selling our modified products or require us to redesign our products.
• We may not receive necessary foreign regulatory approvals or clearances or otherwise comply with foreign regulations.
• We may not be able to meet regulatory quality requirements applicable to our manufacturing process.
• Notices of inspectional observations or deficiencies from FDA or other regulatory bodies could require us to undertake corrective and preventive actions or other actions in order to address FDA’s or other regulatory body’s concerns, which could be expensive and time-consuming to complete and could impose additional burdens and expenses.
• We are subject to federal, state and foreign healthcare laws and regulations that could result in significant liability, require us to change our business practices and restrict our operations in the future.
• If we are found to have improperly promoted our products for off-label uses, we may become subject to significant fines and other liability.
• Risks Related to Our Intellectual Property
• We rely on a variety of intellectual property rights, and if we are unable to maintain or protect our intellectual property, our business and results of operations will be harmed.
• We may file lawsuits or initiate other proceedings to protect or enforce our patents or other intellectual property rights, which could be expensive, time consuming and unsuccessful.
• Our commercial success depends significantly on our ability to operate without infringing upon the intellectual property rights of third parties.
• Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our existing and future products.
• Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
• If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.
• If we are unable to protect the confidentiality of our trade secrets and other proprietary information, our business and competitive position may be harmed.
• Risks Related to Our Finances and Capital Requirements
• We may require additional financing in the future and may not be able to obtain such financing on favorable terms, if at all, which could force us to delay, reduce or eliminate our research and development activities or otherwise harm our business.
• By engaging in acquisitions and other business development arrangements, we will incur a variety of costs and may potentially face numerous risks that could adversely affect our business and operations.
• Fluctuations in our effective tax rate and changes to tax laws may adversely affect us.
• Risks Relating to Securities Markets and Investment in Our Common Stock
• The price of our common stock may be volatile, and you could lose all or part of your investment.
• If our executive officers, directors and largest stockholders choose to act together, they may be able to significantly influence our management and operations, acting in their own best interests and not necessarily those of other stockholders.
• A sale of a substantial number of shares of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business is doing well.
• Techniques employed by short sellers have in the past and may in the future drive down the market price of our common stock.
• Our amended and restated certificate of incorporation, our third amended and restated bylaws and Delaware law contain provisions that could discourage another company from acquiring us and may prevent attempts by our stockholders to replace or remove our current management.
• Our third amended and restated bylaws designate the state courts located within the state of Delaware (or if no state court located within Delaware has jurisdiction, the federal district court for the District of Delaware) as the exclusive forum for certain disputes between us and our stockholders, which could limit our stockholders’ ability to access a favorable judicial forum for disputes with us or our directors, officers or employees.
• We do not anticipate paying cash dividends, and accordingly, stockholders must rely on stock appreciation for any return on their investment.
• An additional valuation allowance against our deferred tax assets could require a charge to earnings, which could result in a negative impact on our results of operations.
• We cannot guarantee we will make any additional repurchases of our common stock under our share repurchase program or otherwise.
• General Risk Factors
• It is difficult to forecast future performance, which may cause our financial results to fluctuate unpredictably.
• We are exposed to the risk of nonpayment by our customers, which could adversely affect our financial condition or results of operations.
• Natural disasters and other events beyond our control could harm our business.
• Failure to protect our information technology infrastructure against cyber-based attacks, network security breaches, service interruptions, or data corruption could significantly disrupt our operations and adversely affect our business and operating results.
• Our operations are subject to environmental, health and safety, and data privacy laws and regulations, compliance with which may be costly.
• We incur significant costs and devote substantial management time as a result of operating as a public company.
• If we fail to maintain an effective system of disclosure controls and procedures and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired.
• If securities or industry analysts publish inaccurate or unfavorable research about our business or cease publishing research, our stock price and trading volume could decline.