Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 10

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 10
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  computer malware, physical or electronic break-ins and similar disruptions;  

  security breaches and hacking attacks;  

  failure by third-party vendors, including data center and bandwidth providers, to provide steady and high-speed access to our online platforms and systems. Any disruption in our network access ...  

  incidents of fraud.  

We have not yet created sufficient redundancy
for our information technology systems and data, and we do not presently maintain backup copies of all of its data. Newegg has a limited
disaster recovery plan in effect and may not have sufficient insurance for losses that may occur from natural disasters, catastrophic
events or the resulting business interruption. Any substantial damage to, or disruption of, our technology infrastructure could cause
interruptions or delays, loss of data, or reduced system availability, which could have a material adverse effect on our business, financial
condition and results of operations.

We may be unable to accurately project the rate
or timing of traffic flow, including any traffic increases, or successfully and cost-effectively upgrade our systems and infrastructure
in a timely manner to accommodate higher traffic levels on our online platforms. If the volume of traffic on our online platforms or the
number of purchases made by our customers increases substantially, we may experience unanticipated system disruptions, slower response
times, reduced levels of customer service and impaired quality and delays in reporting accurate financial information. For example, we
experience surges in online traffic and orders associated with promotional activities and holiday seasons, especially during Black Friday
and the Christmas holiday season, which can put additional demands on our technology platform at specific times.

Additionally, we must continue to upgrade and
improve our technology and infrastructure to support our business growth, and failure to do so could impede our growth. However, we cannot
assure you that we will be successful in executing these system upgrades and improvement strategies. Any such upgrades to our systems
and infrastructure could require substantial investments. In particular, our systems may experience interruptions during upgrades, and
the new technologies or infrastructures may not be fully integrated with the existing systems on a timely basis, or at all. If our existing
or future technology and infrastructure do not function properly, it could cause system disruptions and slow response times, affecting
data transmission, which in turn could materially and adversely affect our business, financial condition and results of operations.

We rely on third-party payment processors
to process deposits and withdrawals made by users of our Marketplace, and if we cannot manage our relationships with such third parties
and