Company: CXDO
Filing Date: 2025-03-04
Form Type: 10-K
Source: 0001654954-25-002287
Chunk: 24

Company: Crexendo, Inc.
Filing Date: 2025-03-04
Form: 10-K
Item: Item 1
Chunk 24
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 services including but not limited to data loss, or if any third party undertakes illegal or harmful actions using our communications or e-commerce services, our business and reputation could suffer substantial adverse publicity and impairment. We have experienced interruptions in service in the past. We have taken and continue to take steps to improve our infrastructure to prevent service interruptions.

In addition to our physical infrastructures, we have cloud infrastructure deployments with Amazon Web Services (“AWS”) and Oracle Cloud Infrastructure (“OCI”) which are intended to provide continuous service to our customers in the event of a disaster or failure of our physical infrastructures. If we fail to properly maintain our infrastructure or our third-party service providers fail to maintain these facilities properly, or fail to respond quickly to problems, our customers may experience service interruptions. The failure to properly maintain services may result in negative consequences to us including but not limited to: (i) cause a material loss of customers, (ii) adversely affect our reputation, (iii) cause negative publicity, (iv) negatively impact our ability to acquire customers, (v) negatively impact our revenue and profitability, (vi) potential law suits for not reaching E-911 services, and (vii) potential law suits for loss of business and loss of reputation.

Failure in our data centers or services could lead to significant costs and disruptions.

All data centers, including ours, are subject to various points of failure. Problems with cooling equipment, generators, uninterruptible power supply, routers, switches, or other equipment, whether or not within our control, could result in service interruptions for our customers as well as equipment damage. Any failure or downtime could affect a significant percentage of our customers. The total destruction or severe impairment of our data center facilities could result in significant downtime of our services and the loss of customer data.

Migration to Oracle Cloud Infrastructure

We are in the process of migrating from our own physical data centers to the Oracle Cloud Infrastructure (OCI). While this transition is expected to improve operational efficiency, scalability, and cost-effectiveness in the long term, migration presents several risks and challenges including duplicate costs during migration. During the migration period, we will incur duplicate costs as we continue to operate and maintain our existing physical data centers while simultaneously building and utilizing the Oracle Cloud Infrastructure. These overlapping expenses may negatively impact our short-term profitability and cash flow. Additionally, unanticipated delays in the migration process could extend the period of duplicate costs, further straining our financial results.

Risks Associated with Relying on Oracle Cloud

 ●Vendor Dependence: Shifting critical infrastructure