Company: CRCT
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001828962-25-000075
Chunk: 18

Company: Cricut, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Part II, Item 1A
Chunk 18
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 additional products, including processed critical minerals and derivative products, which may lead to additional tariffs on such products once the investigations are complete. 

 The U.S. government also has continued to impose stricter export controls on items destined for China In addition, the Bureau of Industry and Security, or BIS, of the Department of Commerce has continued to add certain Chinese entities to U.S. lists of restricted parties including the Entity List, limiting the ability of U.S. companies to do 

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business with those entities. The U.S. government may continue to add additional parties to these restricted parties list, which could harm our business or increase the cost of conducting our operations in China. 

In addition, the U.S. government has exercised additional trade-related powers in a manner that could have a material adverse impact on our business, financial condition or results of operations. For example, on May 15, 2019, then-President Trump issued an executive order that invoked national emergency economic powers to implement a framework to regulate the acquisition or transfer of information communications technology in transactions that imposed undue national security risks. On December 5, 2024, the U.S. Department of Commerce published final rules in the Federal Register, establishing the terms under which the Department of Commerce may investigate transactions involving the use of information communications technology products or services provided by persons owned or controlled by certain nations, including China, and potentially to modify or prohibit those transactions. In addition, the White House, the Department of Commerce and other executive branch agencies have implemented additional restrictions and may implement still further restrictions that would affect conducting business with certain Chinese companies. 

The trade and tariff policies of the U.S. and other countries, including country of origin analysis, are currently fluid and subject to further changes. As a result of tariffs and other trade controls, our cost of goods imported from China increased substantially, and could increase further. Although we continue to work with our vendors to mitigate the impact of current or potential tariffs, there can be no assurance that we will be able to offset any increased costs. Other changes in U.S. tariffs, quotas, trade relationships, tax provisions, or the imposition of retaliatory tariffs on U.S. goods could also reduce the supply of goods available to us or increase our cost of goods. We may fail to effectively adapt to and manage the adjustments in strategy that would be necessary in response to those changes. In addition to the general uncertainty and overall risk from potential changes in the laws and policies of the U.S. or its trading partners, as we make business decisions