The COVID-19 pandemic may also result in both unpredictable short-term and long-term changes in customer needs for our products and services in various sectors, along with IT-related capital spending reductions, or shifts in spending focus, that could materially adversely affect us if we are unable to adjust our product and service offerings to match customer needs. The process of developing new technology is complex and uncertain, and if we fail to accurately predict customers’ changing needs and emerging technological trends, then our business could be harmed. We must commit significant resources, including the investments we have strong competitorsbeen making in our strategic priorities to developing new products and expectservices, before knowing whether our investments will result in products and services the market will accept. In particular, if our model of the evolution of hybrid working and focus on the professional customer does not emerge as we believe it will, or if the industry does not evolve as we believe it will, or if our strategy for addressing this evolution is not successful, many of our strategic initiatives and investments may not meet our expectations. In addition, our business could be adversely affected in periods surrounding our new product introductions if customers delay purchasing decisions to face additional competitionqualify or otherwise evaluate the new product offerings. There can be no assurance that we will successfully identify new product and services opportunities, develop and bring new products and services to market in a timely manner, or achieve market acceptance of our products and services or that products, services and technologies developed by others will not render our products, services or technologies obsolete or noncompetitive.

As we expand into new product and service categories and/or go-to- market strategies in pursuit of growth, we will have to continue to build relationships with our existing channel partners, or may have to build relationships with new channel partners and/or directly with suppliers and manufacturers and adapt to evolving or new distribution and marketing models. These partners, suppliers, practices and models may require significant management attention and operational resources and may affect our accounting, including revenue recognition, gross margins, and the future.ability to make comparisons from period to period. If we are unable to compete effectively,maintain and/or build successful distribution channels or successfully market our products and services in these new categories, we may not be able to take advantage of the growth opportunities, and our business and our ability to grow our business could be adversely affected.

As our manufacturing is in Asia and Mexico and distributors located globally, we rely upon logistics providers to transport goods around the world. As supply chains have become more constrained, the need to expedite shipments to manufacturing facilities and customers has increased. Further, we continue to experience higher transportation and fuel costs which has resulted in decreased margins and may result in the future in increased inventory and further margin decline, which would adversely affect our results of operations and financial condition.

The markets for our Consumer products are volatile and our ability to compete successfully in one or more of these categories is subject to many risks.

The success of our productsnew product introductions depends on severala number of factors, including our ability to:

We also need to continually educate and train our channel partners to avoid any confusion as to the desirability of new product offerings and solutions compared to our customersexisting product offerings and end-users

The communications market shift to fully- integrated solutions, cloud-based/hybrid offerings and accurate technical product supportnew business models over time may require us to our customers

We have experienced delays in the introduction of certain new products and enhancements in the past. The delays in product release dates that canwe experienced in the past have been due to factors such as unforeseen technology issues, third-party changes to technology, manufacturing ramping issues, availability of component parts, and other factors, which we believe negatively impacted our revenue in the relevant periods. In addition, we have experienced delays in product certifications required with respect to our new product releases. Any of these or other factors may occur again and delay our future product releases. As such, disruption due to geopolitical conflicts, public health, or natural disasters could create an increased risk of delays in new product introductions.

Our communications equipment includes both hardware and software and incorporates new technologies and component parts from different suppliers. Resolving product defect and technology and quality issues could cause delays in new product introductions. Further, some defects may not be volatile,detected or cured prior to a new product launch or may be detected after a product has already been launched and may be incurable or result in a product recall. The occurrence of any of these events could result in the failure of a partial or entire product line or a withdrawal of a product from the market. We may also have to establishinvest significant capital and maintain successful relationshipsother resources to correct these problems, including product re-engineering expenses and inventory, warranty and replacement costs. These problems might also result in claims against us by our customers or others and could harm our reputation and adversely affect future sales of our products.

Any delays for new product offerings recently announced or currently under development, including product offerings for mobile, cloud-based delivery, software delivery or any product quality issues, product defect issues or product recalls could adversely affect the market acceptance of these products, our ability to compete effectively in the market, and our reputation with our channelcustomers, and therefore could lead to decreased product sales and could harm our business. We may also experience cancellation of orders, difficulty in collecting accounts receivable, increased service and warranty costs in excess of our estimates, diversion of resources and increased insurance costs and other losses to our business or to end-user customers.

We have invested significant resources developing products that are dependent on third-party unified communication as a service (UCaaS) and video conferencing as a service (VCaaS) platforms and software. We made the decision to design our products to work with different third-party platforms and software to offer customers greater choice and flexibility, while expanding our ecosystem partners and enhancing their unique value differentiation through our products. If these partners’ solutions do not gain adoption and growth, it could materiallyimpact the sales of our endpoint devices. If other hardware manufacturers follow the Company’s strategy and enter into the market, thereby increasing competition, we could see less market demand or revenue for our products. Lastly, the third-party platforms may be, or become, competitors of ours who have chosen, or in the future may choose, to design competing products for their platforms and offer features for their own hardware platforms to provide further differentiated features that may be perceived as better than our products, or they may choose not to work with us. If third parties are unwilling to provide us access to their platforms or technologies, or if such access is withdrawn, denied, or delayed, or if access is provided under terms that are not commercially reasonable, our business and operations could be adversely affected. We believe though that customers want the ability of choice and quality that Poly products provide.

The pace of change in technology and in the release of new products has increased and is expected to continue to increase, which can often render existing or developing technologies obsolete more quickly. In addition, customer bankruptciesthe

introduction of new products and any related actions to discontinue existing products can cause existing inventory to become obsolete. These obsolescence issues, or financial difficulties may impact our business.

Further, we continually evaluate our product lines both strategically and telephony service providers. Effectively managing these relationshipsin terms of potential growth rates and avoiding channel conflicts is challenging. Our existing relationships with these parties are generally not exclusivemargins. Such evaluations could result in the discontinuance or divestiture of those products in the future, which could be disruptive and can be terminated by us or them without cause on short notice. These customers also sell or may sell products offered by our competitors. To the extent our competitors offer more favorable terms or more compelling products, our customerscostly and may not recommend, de-emphasize, or discontinue carrying our products. Moreover, our OEMs may elect to manufacture their own products similar to those we offer. Additionally, it is becoming easier for small online sellers to enteryield the market unburdened with physical locations, employees and support personnel which can force our larger traditional brick and mortar resellers to reduce their selling prices. In turn, our traditional resellers may demand lower selling prices from us, reduce their sales support needed to maintain our premium brand image, discontinue carrying our products and other similar adverse actions. The inability to establish or maintain successful relationships with distributors, OEMs, retailers, and telephony service providers or to expand our distribution channels and sales models could materially adversely affect our business, financial condition, or results of operations.intended benefits.

We are increasingly incorporating advanced software features and functionalities into our products, offering firmware and software fixes, updates, and upgrades and developing Internet based software-as-a-service offerings that provide additional value that complements our headsets.products. As the nature and extent of software integration in our products increases, or if sales of standalone software applications or services become material, the way we report revenue related to our products and services could be significantly affected. For example, we are increasingly required to evaluate whether our revenue transactions include multiple deliverables and, as such, whether the revenue generated by each transaction should be recognized upon delivery, over a period of time or apportioned and recognized based on a combination of the two in light of all the facts and circumstances related to each transaction.two. Moreover, the software and services revenue recognition rules are complex and dynamic.

If the market does not accept our products, particularly our new product offerings on which we are relying for future revenues, such as product offerings for platform software, new hardware products and cloud-based delivery, our business and operating results could be harmed. Further, revenues relating to new product offerings are unpredictable and new products typically have lower gross margins for a period of time after their introduction and higher marketing and sales costs. As we introduce new products, they could increasingly become a higher percentage of our revenues. Our profitability could also be negatively affected in the future as a result of continuing competitive price pressures in the sale of UC&C solutions equipment and UC platform products. Further, in the past we have reduced prices in order to expand the market for our products, and in the future, we may further reduce prices, introduce new products that carry lower margins in order to expand the market or stimulate demand for our products, or discontinue existing products as a means of stimulating growth in a new product.

Finally, if we do not fully anticipate, understand and fulfill the needs of end-user customers in the vertical markets that we serve, we may not be able to fully capitalize on product sales into those markets and our revenues may, accordingly, fail to grow as anticipated or may be adversely impacted. We face similar risks as we expand and focus our business strategieson the SMB and acquisitionsservice provider markets. In light of COVID-19, there are disruptiveshifts in end user needs, including for example, increased work from home, telemedicine, tele-education, and other remote services that are exacerbated in a pandemic, which may present opportunities for growth. However, if we fail to take advantage of such changes and they impact our products, we may risk missing a critical market shift.

Some of our current and future products are directly competitive with the products sold by both our channel and strategic partners. For example, Cisco, Amazon, Google and Microsoft, have developed or may develop and offer, their own data integration solutions and some of these partners are currently, and others may in the future become, competitors. These strategic partners are among the largest and most well capitalized companies in the world and may have significant competitive advantages over us, including greater name recognition, larger customer bases, and greater financial, technical, marketing, public relations, sales, distribution and other resources than us. Such competitors may be more likely to promote and sell their own solutions over our products and they may ultimately be able to transition customers onto their competing solutions, which could materially and adversely affect our revenues and growth. Further, such competitors may cease their relationships with us. As a result of these conflicts, there is the potential for our channel and strategic partners to compete head-to-head with us or to significantly reduce or eliminate their orders of our products or design our technology out of their products. Moreover, because the market for optimized telecommunication offerings is evolving to support a hybrid work environment, we expect additional competition from other established and emerging companies if this market continues to develop and expand. Increased competition from our strategic partners or from other companies that may in future decide to enter and compete in our market may significantly adversely impact our financial performance.

conflicts could arise which cause channel partners to devote resources to the communications equipment and services of competitors, which would negatively affect our business and results of operations.

Our website is an important presentation of our company, identity and brands and an important means of interaction with and source of information for our channel partners and end user customers alike. We also rely on our centralized information technology systems for product-related information and to store intellectual property, rightsforecast our business, maintain financial records, manage operations and inventory, and operate other critical functions. The secure maintenance of this information and technology is critical to our business operations. We have implemented multiple layers of security measures designed to protect the confidentiality, integrity, availability and privacy of this data and the systems and devices that store and transmit such data. We utilize current security technologies, and our defenses are monitored and routinely tested internally and by external parties. Despite these efforts, threats from malicious persons and groups, new vulnerabilities and advanced new attacks against information systems create risk of cybersecurity incidents. These incidents can include, but are not limited to, gaining unauthorized access to digital systems for purposes of misappropriating assets or protections;

Our products, services, network systems, and servers For example, our customers can use certain of our product offerings that provide product management and analytics, such as Poly Lens, that collect, use, and store certain PII regarding a variety of individuals in connection with their operations. Our customers rely on our technologies for the secure transmission of such sensitive and confidential information in the conduct of their business. We are also subject to existing and proposed laws and regulations, as well as government policies and practices, related to cybersecurity, privacy and security requirements;data protection worldwide. National, state, and

Although we take physical and cybersecurity seriously and devote significant salesresources and marketing educational campaigns both internallydeploy protective network security tools and throughoutdevices, data encryption and other security measures to prevent unwanted intrusions and to protect our distribution channels. Furthermore, eachsystems, products and data, we have and will continue to experience attacks of these services remainvarying degrees in the early stagesconduct of developmentour business. Cyber attackers tend to target the most popular products, services and require significant additional time, efforttechnology companies, which can include our products, services or networks. As a result, our network is subject to unauthorized access, viruses, embedded malware and costsother malicious software programs. In addition, outside parties may attempt to develop before their likelihood of market success can be determined with any degree of certainty.

In addition, the cost and operational consequences of investigating, remediating, eliminating and putting in place additional information technology tools and devices designed to prevent actual or perceived security breaches, as well as the costs to comply with any notification obligations resulting from such a breach, could be significant and impact margins. Further, due to the growing sophistication of the techniques used to obtain unauthorized access to or to sabotage networks, systems, or our products, which change frequently and often are not detected immediately by existing anti-virus and other detection tools, we may decidebe unable to anticipate these techniques or to implement adequate preventative measures. We can make investmentsno assurance that we will be able to detect, prevent, timely and adequately address or acquisitions,mitigate such cyber attacks or security breaches.

Our success depends in part on our ability to protect our copyrights, patents, trademarks, trade dress, trade secrets, and other intellectual property, including our rights to certain domain names. We rely primarily on a combination of nondisclosure agreements and other contractual provisions as well as patent, trademark, trade secret, and copyright laws to protect our proprietary rights. Effective protection and enforcement of our intellectual property rights may not be available in every country in which our products and media properties are distributed to customers. The process of seeking intellectual property protection can be lengthy, expensive, and uncertain. Patents may not be issued in response to our applications, and any that may be issued may be invalidated, circumvented, or challenged by others. If we are required to enforce our intellectual property rights through litigation, the costs and diversion of management's attention could be substantial. Furthermore, we may be countersuedcounter-sued by an actual or alleged infringer if we attempt to enforce our intellectual property rights, which may materially increase our costs, divert management attention, and result in injunctive or financial damages being awarded against us. In addition, existing patents, copyright registrations, trademarks, trade secrets and domain names may not provide competitive advantages or be adequate to safeguard and maintain our rights. If it is not feasible or possible to obtain, enforce, or protect our intellectual property rights, our business, financial condition, and results of operations could be materially, adverselynegatively affected.

Claims or allegations may relate to intellectual property that we develop or that is incorporated in the materials or components provided by one or more suppliers. As we have grown, intellectual property rights claims against us and our suppliers have increased along withincreased. There has also been a general trend of increasing intellectual property infringement claims against all corporations.corporations that make and sell products. Our products, technologies and the components and materials contained in our products may be subject to certain third-party claims and, regardless of the merits of the claim, intellectual property claims are often time-consuming and expensive to litigate, settle, or otherwise resolve. In addition,Many of our agreements with our distributors and resellers require us to indemnify them for certain third-party intellectual property infringement claims. To the extent claims against us or our suppliers are successful, we may have to pay substantial monetary damages or discontinue the manufacture and distribution of products that are found to be in violation of another party's rights. We also may have to obtain, or renew on less favorable terms, licenses to manufacture and distribute our products or materials or components included in those products, which may significantly increase our operating expenses. Moreover, many of our agreements with our distributors and resellers require us to indemnify them for certain third-party intellectual property infringement claims. Discharging our indemnity obligations may involve time-consuming and expensive litigation and result in substantial settlements or damages awards, our products being enjoined, and the loss of a distribution channel or retail partner, any of which may have a material adversenegative impact on our operating results.

Our products must meet existing and new requirements set by regulatory authorities in each jurisdiction in which we sell them. For example, certain of our Enterprise products must meet local phone system standards. Certainstandards and certain of our wireless products must work within existing permitted radio frequency ranges. Moreover, competition for limited radio frequency bandwidth as a result of an increasing use of wireless products increases the risk of interference or diminished product performance. For instance, in the U.S. the increase in the number of products operating in the unlicensed 903-928 megahertz radio frequency range using significantly higher power than our wireless products and those of many other users of the unlicensed frequency range may cause our wireless products to experience interference which, if material, may harm our reputation and adversely affect our sales.

As regulations and local laws change, new regulations are enacted, and competition increases, we may need to modify our products to address those changes. Regulatory restrictions and competition may increasechanges, increasing the costs to design, manufacture, and sell our products, resulting in a decrease inand thereby decreasing our margins or a decrease in demand for our products if we attempt to pass along the costs. Regulations may also negatively affect our ability to procure or manufacture raw materials and components necessary for our products. Compliance with regulatory restrictions and bandwidth limitations may impact the actual or perceived technical quality and capabilities of our products, reducing their marketability. In addition, if the products we supply to various jurisdictions fail to comply with the applicable local or regional regulations, if our customers or merchants transfer products into unauthorized jurisdictions or our products interfere with the proper operation of other devices, we or consumersend users purchasing our products may be responsible for the damages that our products cause; thereby causing us to alter the performance of our products, pay substantial monetary damages or penalties, cause harm to our reputation, or cause us to suffer other adverse consequences.

We are subject to various federal, state, local, and foreign environmental laws and regulations, including those governing the use, discharge, and disposal of hazardous substances in the ordinary course of our manufacturing process.processes or the recycling of all or a portion of the components of our products. It is possible that future environmental legislation may be enacted or current environmental legislation may be interpreted in any given country in a manner that creates environmental liability with respect to our facilities, operations, or products. We may also be required to implement new or modify existing policies, processes and procedures as they relate to the usemeet such environmental laws. Although our management systems are designed to maintain compliance, we cannot assure you that we have been or will be at all times in complete compliance with such laws and disposalregulations. If we violate or fail to comply with any of our products.them, a range of consequences could result, including fines, import/export restrictions, sales limitations, criminal and civil liabilities or other sanctions. To the extent any new or modified policies, processes or procedures are difficult, time-consuming or costly to implement orimplement. we may incur claims for environmental matters exceeding reserves or insurance for environmental liability, our operating results could be negatively impacted.impacted