What Shoals Technologies Group, Inc. told the SEC could break it.

Shoals' EBOS products (cable assemblies, combiner boxes, wire, connectors) are metals-intensive, and the company states its market-risk exposure is primarily a result of fluctuations in steel, aluminum and copper prices (alongside customer concentration). Copper is the dominant cost driver — its aluminum-based 'BLA' product is marketed partly on aluminum being ~80% cheaper than copper — so a copper/aluminum price spike directly pressures cost of goods and margins. A specific, named multi-metal commodity dependence.

“Our market risk exposure is primarily a result of fluctuations in steel, aluminum and copper prices and customer concentrations.”

Shoals' solar-EBOS revenue is concentrated among large EPCs: one customer contributed approximately 19.1% of total 2025 revenue (and 25.2% of accounts receivable), it had two customers each contributing 10% or more, and its five largest customers accounted for ~53.7% of revenue (46.8% of AR). Because EPC customers build for multiple project owners and projects are lumpy, the loss of, or a slowdown at, the top EPC would materially affect revenue and receivables collection. Customers are not named in the filing, so this is a quantified customer-concentration risk rather than named edges.

“One customer contributed approximately 19.1% of our total revenue for the year ended December 31, 2025 and 25.2% of accounts receivable as of December 31, 2025.”

Shoals continues to incur expenses related to its wire insulation 'shrinkback' issue — a product-quality/warranty matter in which wire insulation on certain installed EBOS products recedes and requires remediation. The 2025 gross-margin change reflected a reduced (but still present) amount of wire insulation shrinkback expenses versus the prior year, indicating an ongoing warranty/remediation liability and potential customer-relationship and litigation exposure. A specific, company-specific product-defect/warranty risk.

“This change in gross margin was due to a reduced amount of wire insulation shrinkback expenses in the current year compared to the prior year”

Shoals sources certain raw materials used to make its components and system solutions from vendors outside the United States, exposing it to tariffs and trade restrictions. On February 1, 2025 the U.S. announced 10% tariffs on imports from China and China imposed retaliatory 10% tariffs, with heightened impositions suspended until November 2026; if maintained or escalated, these would affect Shoals' revenue and cost of goods sold. Ongoing U.S.–China tariff regimes and China–Taiwan uncertainty could also impair the availability and cost of components. Tariffs already contributed to higher 2025 material costs. A realized and prospective trade-policy exposure on a metals-and-components supply chain.

“on February 1, 2025, the U.S. government announced 10% tariffs on product imports from China. China imposed retaliatory 10% tariff measures on U.S. goods. Both the U.S. and China have suspended heightened tariff imposition until November 2026.”