Company: PHR
Filing Date: 2025-09-05
Form Type: 10-Q
Source: 0001412408-25-000062
Chunk: 46

Company: Phreesia, Inc.
Filing Date: 2025-09-05
Form: 10-Q
Item: Part II, Item 1A
Chunk 46
---
 producing are, or are alleged or perceived to be inaccurate, deficient, or biased, our reputation, competitive position, 

72

Table of Contents

business, financial condition, and results of operations may be adversely affected. The use of certain artificial intelligence technologies can also give rise to intellectual property risks, including by disclosing or otherwise compromising our confidential or proprietary intellectual property, or by undermining our ability to assert or defend ownership rights in intellectual property created with the assistance of artificial intelligence tools. Any of these effects could damage our reputation, result in the loss of valuable property and information, and adversely impact our business.

We use AI technologies licensed from third parties, including in our products, and our ability to continue to use such third-party AI technologies at the scale we need may be dependent on access to specific third-party software and infrastructure. We cannot control the availability or pricing of such third-party AI technologies, especially in a highly competitive environment, and we may be unable to negotiate favorable economic terms with the applicable providers. If any such third-party AI technologies become incompatible with our products and programs or unavailable for use, or if the providers of such models unfavorably change the terms on which their AI technologies are offered or terminate their relationship with us, our products may become less appealing to our clients and our business may be adversely affected. In addition, to the extent any third-party AI technologies are used as a hosted service, any disruption, outage, or loss of information through such hosted services could disrupt our operations or solutions, damage our reputation, cause a loss of confidence in our products, or result in legal claims or proceedings, for which we may be unable to recover damages from the affected provider.

A growing number of legislators and regulators are adopting laws and regulations and have focused enforcement efforts on the adoption of artificial intelligence and the use of such technologies in compliance with ethical standards and societal expectations. These developments may increase our compliance burden and costs in connection with the use of artificial intelligence and lead to legal liability if we fail to meet evolving legal standards or if use of such technologies results in harms or other causes of action we did not predict. For example, beginning January 1, 2026, two new state laws – California’s Generative Artificial Intelligence: Training Data Transparency Act (“AB 2013”) and the Texas Responsible Artificial Intelligence Governance Act (“TRAIGA”) – will impose novel requirements on AI developers and users. AB 2013 requires public disclosure of detailed information about the training data used in generative AI models, which, if applicable to us, may impact the