What Benchmark Electronics, Inc. told the SEC could break it.

Benchmark's EMS revenue is concentrated in a small number of OEM customers: its ten largest customers accounted for approximately 51% of total sales in 2025 (50%/52% in 2024/2023), its largest customer Applied Materials was 14%, and one customer exceeded 10% of consolidated gross accounts receivable. Loss of, an in-sourcing decision by, or a program loss at a major customer — especially in the cyclical semi-cap sector (28% of sales) — would, if not replaced, materially reduce revenue. Applied Materials is captured as a named edge; this risk reflects the aggregate top-customer concentration. A high customer concentration in a cyclical contract-manufacturing model.

“Sales to our ten largest customers represented 51%, 50% and 52% of our total sales in 2025, 2024 and 2023, respectively.”

With 64% of sales from international operations and plants in China, Malaysia, Thailand and Mexico, Benchmark is exposed to multiple trade-policy channels: increasing US-China tariffs and trade-protection measures affect the cost of China-made products, the demand for them (if customers exit China), and the cost/availability of components it sources from Chinese suppliers; changing export controls/sanctions may limit producing or selling certain technologies in or destined to China; and its Mexico facilities depend on the Maquiladora (IMMEX) program for reduced tariffs, exposure to changes in that program. It also faces a ~$12.0 million Mexican (SAT) customs/import-duty assessment under appeal, and escalating China-Taiwan tensions. A specific, multi-pronged tariff/export-control/customs exposure on a cross-border manufacturing footprint.

“increasing tariffs and other trade protection measures between the United States and China may affect the cost of our products originating in China as well as the demand for our products manufactured in China”

Benchmark procures components against customer purchase orders/forecasts and occasionally must use components or materials for which a supplier is the single source of supply. If a single-source supplier could not provide these materials, a component shortage could temporarily interrupt operations and lower profits until an alternate component is identified and qualified (a slow process, especially for regulated A&D/medical builds). It also carries inventory exposure from single-source components ordered under non-cancellable, non-returnable purchase orders. The suppliers are not named, so this is a single-source component dependence rather than a named edge. A real component sole-source vulnerability.

“occasionally utilize components or other materials for which a supplier is the single source of supply. If any of these single-source suppliers were unable to provide these materials, a shortage of components could temporarily interrupt our operations and lower our profits until an alternate component could be identified and qualified for use.”