UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

OR

OR

Commission File Number 0-18655

EXPONENT, INC.

(Exact name of registrant as specified in its charter)

(650) (650) 326-9400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes x        No¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes ¨        Nox

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yesx        No¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yesx        No¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Emerging growth company¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨☐

Indicate by check mark whether the registrant ishas filed a shell company (as defined in Rule 12b-2report on and attestation to its management’s assessment of the Exchange Act).effectiveness of internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

Yes¨        Nox

The aggregate market value of the common stock held by non-affiliates of the registrant based on the closing sales price of the common stock as reported on the NASDAQ Global Select Market on June 30, 2017,2023, the last business day of the registrant’s most recently completed second quarter, was $1,297,837,521.approximately $3.4 billion. Shares of the registrant’s common stock held by each executive officer and director and by each entity or person that, to the registrant’s knowledge, owned 10% or more of registrant’s outstanding common stock as of June 30, 20172023 have been excluded in that such persons may be deemed to be affiliates of the registrant. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

The number of shares of the registrant’s common stock outstanding as of February 16, 20182024 was 25,769,113.50,563,193.

DOCUMENTS INCORPORATED BY REFERENCE

EXPONENT, INC.

FORM 10-K ANNUAL REPORT

FISCAL YEAR ENDED DECEMBERDecember 29, 20172023

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains, and incorporates by reference, certain “forward-looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995, and the rules promulgated pursuant to the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended), including but not limited to statements regarding future growth and market opportunities, revenue, margins, headcount, utilization and operating expenses,amended (the “Exchange Act”) that are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Such forward-looking statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. When used in this document and in the documents incorporated herein by reference, statements other than statements of current or historical fact are forward-looking statements. Thethe words “intend,” “anticipate,” “believe,” “estimate,” “continue”, “could”, “may”, “plan”, “expect” and similar expressions, as they relate to the Company or its management, identify certain of such forward-looking statements. Such statements reflect the current views of the Company or its management with respect to future events and are subject to certain risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, the Company’s actual results, performance, or achievements could differ materially from those expressed in, or implied by, any such forward-looking statements. Factors that could cause or contribute to such material differences include the possibility that the demand for our services may decline as a result of changes in general and industry specific economic conditions, the timing of engagements for our services, the effects of competitive services and pricing, the absence of backlog related to our business, our ability to attract and retain key employees, the effect of tort reform and government regulation on our business and liabilities resulting from claims made against us. Additional risks and uncertainties are discussed in this Annual Report under the heading “Risk Factors” and elsewhere.elsewhere in this Annual Report on Form 10-K.

The inclusion of such forward-looking information should not be regarded as a representation by the Company or any other person that the future events, plans, or expectations contemplated by the Company will be achieved. Due to such uncertainties and risks, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligationdoes not intend to updaterelease publicly any updates or reviserevisions to any such forward-looking statements.

PART I

Item 1. Business

GENERAL

GENERAL

Exponent, Inc., together with its subsidiaries, (“Exponent”, the “Company”, “we”, “us” and “our”) is a science and engineering consulting firm that provides solutions to complex problems. Our multidisciplinaryinterdisciplinary team of scientists, physicians, engineers, and business and regulatory consultants brings togetherdraws from more than 90 different technical disciplines to solve the most pressing and complicated issueschallenges facing industrystakeholders today. The firm leverages over 50 years of experience in analyzing accidents and government today. Our services include analysisfailures to advise clients as they innovate their technologically complex products and processes, ensure the safety and health of product development, product recall, regulatory compliance,their users, and address the discoverychallenges of potential problems related to products, people, property and impending litigation.sustainability.

The history of Exponent, Inc. goes back to 1967, with the founding of the partnership Failure Analysis Associates, which was incorporated the following year in California and reincorporated in Delaware as Failure Analysis Associates, Inc. in 1988. The Failure Group, Inc. was organized in 1989 as a holding company for Failure Analysis Associates, Inc. and changed its name to Exponent, Inc. in 1998.

CLIENTS

CLIENTSGeneral

General

Exponent serves clients in chemical, construction, consumer products, energy, food, beverage and nutrition, government, life sciences, insurance, manufacturing, technology, industrial equipment, transportation and other sectors of the economy. Many of our engagements are initiated directly by large corporations or by lawyers or insurance companies whose clients anticipate, or are engaged in, litigation related to their products, equipment, processes or services. The scope of our services in failure prevention and technology evaluation has grown as the technological complexity of products has increased over the years. During fiscal 20172023, we provided services representing approximately 27%22%, 18%, 17% and 11% of revenues to clients in the consumer products industry. During fiscal 2017 we provided services representing approximately 15% of revenues to clients in theindustry, energy and utilities industries. During fiscal 2017 we provided services representing approximately 15% of revenues to clients in theindustries, transportation industry. No client accounted for more than 10% of our consolidated revenues for 2016industry and 2015. One client accounted for 14% of our consolidated revenues for 2017.chemical industry, respectively.

Pricing and Terms of Engagements

We provide our services on either a fixed-price basis or on a time and material basis, charging in the latter case hourly rates for each staff member involved in a project, based on his or hertheir skills and experience. Our standard rates for professionals range from $180$200 to $750$985 per hour. Our engagement agreements typically provide for monthly billing, require payment of our invoices within 30 days of receipt and permit clients to terminate engagements at any time. Clients normally agree to indemnify us and our personnel against liabilities arising out of the use or application of the results of our work or recommendations.

SERVICES

SERVICES

Exponent provides high quality engineering and scientific consulting services to clients around the world. Our service offerings are provided on a project-by-project basis. Many projects require support from multiple practices. We currently operate 18the following 17 practices in two reportable operating segments, (i) Engineering and Other Scientific and (ii) Environmental and Health:

ENGINEERING AND OTHER SCIENTIFIC

ENVIRONMENTAL AND HEALTH

ENGINEERING AND OTHER SCIENTIFIC

Biomechanics

Our Biomechanics Practice uses engineering and biomedical scienceprinciples of biomechanics to solve complex problems at the intersection of biology and engineering. Our expertise is used to understand and evaluate the interaction between the human body as a biological system and the physical environment to explore the cause, nature, and severity of injuries. Additionally, we utilize biomechanical principles to evaluate injury potential associated the use (and misuse) of consumer and industrial products.

During the past year, our biomechanics staff performed analyses of human injuries which occurred while individuals were utilizing a variety of products including recreational vehicles, sporting goods, trucks, trains, aircraft, industrial equipment, and automobiles. They also looked at the implications of using protective devices (such as restraint systems, airbags, and helmets) on reducing the potential for injury, and assessed injuries in the workplace, in the home, and during recreational activities. Our consultants also evaluated product designs for performance, hazards, and injury risks to assist clients with design modifications, address consumer feedback, and respond to regulators.

Biomedical Engineering and Sciences

Our Biomedical Engineering and Sciences Practice applies engineering principles and scientific methodologies to medical technologies, including the evaluation of designs and performance of medical devices, pharmaceuticals, and biologics. Our engineers and scientists assist clients with characterization of biomaterials, medical devices, and their interactions with pharmaceuticals, cells, and tissues. To assist in regulatory clearance and approval, we perform preclinical testing, help formulate related regulatory strategy, and conduct design verification and validation. We also assist with design and manufacturing failure analyses, root cause assessment, recall management, and medical device explant analysis. In addition, our staff performs analysis of clinical outcomes for medical devices and related procedures using administrative claims databases. Our expertise is also utilized in product liability, intellectual property litigation, technology acquisition and due diligence matters.

Buildings & Structures

The basic function of a building, bridge, or other type of structure is to provide structurally sound,a safe, durable, economically constructed and environmentally controlled spacesystem to house, andtransport, or otherwise protect occupants and contents. If thisthese basic function isfunctions are not achieved, it is because one or more aspect(s) of the buildingstructures design or construction has failed to perform its intended function.meet a performance objective. Our architects, structural engineers, and material scientists have been investigating such failures for decades, and we use this experience to solve problems with buildinga variety of structural systems and components, including finding the best repair options and mitigating the risk of future failures.

During the past year, we have evaluated numerous problems with residential, commercial, transportation, and industrial structures for owners, designers, and builders.builders at project sites around the world. Our evaluations often include property inspections, laboratory or on siteon-site testing, engineering analysis, and the development of repair recommendations. In addition, we have worked with owners to assess and mitigate the risk of failure associated with hazards such as hurricanes, flooding, earthquakes, tsunamisexplosions, ground movement, and aging infrastructure. We have assessed these risks to high-rise buildings, bridges, tunnels, industrial facilities, pipelines and nuclear power plant structures.structures and provided testimony both in the U.S. and international courts of law.

Civil Engineering

Our Civil Engineering Practice provides broad expertise that includes geotechnical engineering, geological engineering, engineering geology, and geology to address a host of geo-failures, includingcomplex international and domestic construction claims, and disputes involving expert consultation and testimony. Examples of geo-failures evaluated by the practice include landslides, foundation and retaining wall failures, pipeline failures, dam and levee failures,failures.

The practice’s evaluation of complex construction claims involves geotechnical design issues, site characterization, and construction claims. We also provide peer review services for complicated structures. Our water resources staff specializes in the application of proven hydrologic, hydraulic, hydrodynamic, and sediment transport research and science to provide scientifically sound and cost-effective solutions to our clients.

damage from adjacent construction. Over the past year, our consultants have been engaged in a number of investigations related to wildland fires, landslides,landslide evaluations, construction claim and defect evaluations, foundation and retaining wall failures, and foundation failures, large construction claims, floodingeffects of infrastructure projects on the surrounding environments. The practice has been a leader in using advanced remote sensing technologies to evaluate complex problems and sediment transport.applying this state of the art technology to solutions and insight into clients' engineering challenges. This practice provided services for property owners, contractors, design professionals, state agencies, international government agencies, attorneys and insurance carriers.

Construction Consulting

Our Construction Consulting Practice provides expertise in the areas of project advisory, risk analysis, strategic planning, dispute resolution, delay analysis and assessment of financial damages services. During the past year, we expandeddamages. We have continued to expand the practice by leveraging key client relationships in several constructionindustry sectors including utilities, mining,data centers, infrastructure, and oil and gas. The practice has expanded to Asia

Over the past year, our team of advisors and employs senior personnel based in Exponent’s Hong Kong office and hasexperts have been retained on numerous complex projects around the world. Our advisors and experts have successfully collaborated with our clients on numerous assignments, from assisting in establishing best-in-class construction and risk management processes and structures, managing a variety of programs and projects, to providing forensic analysis and expert advice in analyzing and resolving project performance, cost and schedule impact claims in both domestic and international arbitrations.arbitration, and private and public litigation matters. Our multi-disciplinary staff, which includes engineers, architects, constructionproject and program managers, schedulers, accountants,quantity surveyors, and technicalcost specialists, providesprovide these services to both the public and private sectors for clients who represent a diverse mix of companiescorporations, law firms, and agencies.

Our projects includesupport many sectors of the construction and engineering industry which include electric and gas utilities, refineries, petrochemical facilities, data centers, building construction, transportation systems, infrastructure, power plants, transmissionhospitals, airports, and distribution facilities, petrochemical facilities, water treatment plants, bridgessporting arenas.

Data Sciences

The Data Sciences practice comprises our core capabilities in statistics, data analytics, and roads, raildedicated data collection. Drawing on experience in a breadth of engineering, science, health, and environmental applications, we assist clients with their most complex data challenges at all stages of the product or process life cycle. Our team of interdisciplinary scientists and engineers designs sampling plans, surveys, and experiments to create, manage, and analyze data sets of all sizes and varieties. User-focused visualizations support data-driven decision-making and help clients measure risks and benefits to determine appropriate courses of action. Utilizing rigorous statistical methods, our team can help assess and improve quality and reliability and mitigate risk. Our experience helps clients build products that perform for a wide variety of users while preventing data bias, collecting personal data with consideration for privacy, and managing the risks associated with global data collection.

During the past year, our team worked on diverse projects for government, industry, and legal clients. We performed assessments of manufacturing quality systems, tunnels, airports, sporting arenasevaluated the durability and gaming facilities. We provide services to firms involved inreliability of smart cards for identity management and credentialing, examined the engineeringin-service safety record of home appliances and construction industry including corporate clients, public agencies, lending agencies, engineeringmedical devices and construction contractors, subcontractors, attorneys and insurance carriers.developed sampling plans associated with product recall campaigns.

Electrical Engineering & Computer Science

Our Electrical Engineering and Computer Science Practice offers a broad range of expertise to address complex issues for industrial, government and privatelegal clients. Our power engineers advise and offer guidance to clients on problemschallenges relating to reliability of electrical systems, includingfailures in power generation, transmission and distribution. distribution as well as on distributed generation, and renewables. In the area of energy storage, we are a leader in the industry in expertise and capabilities for safety of large format batteries, whether for electric vehicles or distributed storage.

Our team of electricalelectronic engineers works on failure analysis, product robustness and reliability for consumer devices, industrial electronics and industrial electronics.the health industry. Our computer scientists and engineers advise high-tech industry clients and scientists work with high-tech industries and computer controlledcomputer-controlled applications to evaluate product safety and software reliability. The computer engineeringscience and scienceengineering expertise we offer encompasses a breadth of areas including machine learning and artificial intelligence, information and numerical sciences, algorithms and data structures, computer graphics, computer architecture, networking and communications, as well as security and cryptography. We operate laboratories for testing heavy equipment and electronics and we have a broad capability in analyzing computer software.

Over the past year, we performed a wide array of investigations ranging from assessing electrical damage to electrical power infrastructure from the effect of weather relatedweather-related events to working with clients to develop sophisticated machine learning algorithms applied to large quantities of unstructured data. We continue to work with consumer electronics manufacturers and the transportation industry on the reliability and robustness of computer controlledcomputer-controlled equipment for user safety.

Human Factors

Our Human Factors Practice evaluates human performance and safety in product and system use. Our consultants study how the limitations and capabilities of people, including memory, perception, attention, reaction time, judgment, physical size and dexterity, affect the way they use a product, interact with an organization or environment, process information or participate in an activity.

We review warnings and labeling issues related to consumer products, pharmaceuticals, motor vehicles, medical devices and industrial products – supporting the development of safety information to accompany products and assessing claims that the safety information provided was inadequate.

We apply our expertise in human behavior, warnings, and decision making in class actions suits, and in evaluating claims seeking to establish a class. In addition, we assist manufacturers with compliance with regulatory guidelines related to products and work with them regarding analysis of adverse event reports and consumer complaints in publicly available databases overseen by the Consumer Product Safety Commission and the U.S. Food and Drug Administration.

We examine the role that attention plays in human perception, memory, and behavior, and how attention, inattention, and distraction may affect safety in a wide range of settings and activities (e.g., operating vehicles and machinery, walking, and using consumer products).We address the reliability of human memory and retrospective reporting in the gathering of fact-based evidence. We utilize scientific investigations and research (e.g., human perception, reaction time, and looking behavior) to assess driver behavior in both accident investigations and during the design of automotive systems.Exponent’s Our Human Factors scientists have been actively engaged in research and project work with Advanced Driver Assistive SystemAssistance Systems (ADAS) and automated vehicle technology, in order to understand and advise our clients on how these technologies may change the nature and dynamic of driving, and the role and performance of the driver.

We provide user experience research, including focus groups, usability testing, and complex user studies with custom-tailored designs, across a wide range of industries, including consumer electronics, medical devices, and vehicle technologies. Our state-of-the-art Phoenix User Research Center, with 5,000 square feet of research space, has six lab suites, including a dedicated focus group room, an ophthalmological lab, a motion capture lab, and wearable eye tracking technology, plus connectivity to our vehicle test track. The scope of human factors engagements rangeranges from consulting on our clients’ research to providing turnkey research solutions, for which we operationalize our clients’ business questions, recruit participants, provide research space, execute customized study designs using specially-built apparatuses, analyze the data,solutions.

We perform incident investigations and report results to stakeholders.

Industrial Structures

Our Industrial Structures Practice, basedroot cause analyses of near-misses and accidents involving human error in Düsseldorf, Germany with offices in Hamburg and Berlin, provides specialized engineering expertise required for industrial structures subject to extreme conditions. We have provided planning, condition assessment, rehabilitation design and engineered demolition and dismantling for more than 1,000 industrial facilities around the world. Much of our Industrial Structures Practice centers on three types of facilities: antenna masts and towers, power plants, and specialized industrial structures such as refractories to protect against high process temperatures or tanks containing potentially dangerous product. Each year we provide quality assurance, including both inspection and engineering analysis, on almost 1,000 tower structures for a variety of facilities including telecommunications, overhead lines, wind energy,occupational and industrial chimneys. settings. Our Human Factors scientists have advanced technical systems training and experience required to understand how humans contribute to the initiation of, and emergency response to, explosions, fires, chemical releases, and major equipment failures in the manufacturing, utility, oil and gas, and construction industries, among others. We also capitalize on this knowledge to conduct human error risk and culture assessments to help clients proactively control human performance gaps, improve occupational and process safety performance, and create administrative controls and procedures.

In addition our consultants provide inspection services to assist ourhelping clients with on-time, quality construction on their projects.address the frequency and severity of incidents related to human error, fatigue, and performance, these and other similar project activities can be leveraged to improve efficiency, reliability, and maintainability of normal operations.

We have developed in-house, specialized computer software for non-linear material behavior that can provide realistic performance assessment of a wide variety of specialized structures such as cracked reinforced concrete components, multi-layer refractories and masonry towers. In addition, our staff regularly participates in the creation of consensus engineering standards for assessment and design of industrial facilities.

Materials & Corrosion Engineering

Our in-depth knowledge of materials science, corrosion, and metallurgical engineering combined with the breadth of our collective experience across many industries and disciplines gives our Materials and Corrosion Engineering Practice a unique ability to efficiently provide our clients with solutions to their complex materials-based problems. We use our knowledge and experience to understand how and why materials, products, and processes may not perform their intended function,function. Further, we use this knowledge to help our clients minimize the risk for future failures of new products as well as to prevent future problems. Inaging infrastructure.

Over the past year, our Materials and Corrosion Engineering Practice helped clients solve critical materials-related issues in the consumer electronics, medical device,devices, battery systems, chemical processing, transportation, energy, utilities, and aerospace fields, among others. The Materials and Corrosion Engineering Practice continues to expand its presence in Asia with hires in our Shanghai and Hong Kong offices and expects accelerated growth thereOur support of dispute resolution in the coming years.intellectual property, premises and product liability fields continued to grow supported by our strong position in direct industrial consulting.

Mechanical Engineering

We provide clients with a thorough comprehension of current and alternativealternate designs of mechanical systems to identify vulnerabilities before failures occur, develop appropriate risk mitigation methods, and provide post-failure investigations.

Our consultants review the performance and reliability of industrial processes, manufactured products, and engineered systems, and we determine the root cause of failures. We assist in legal and insurance matters, failure investigations, product recall investigations, internal compliance programs, product development, workplace safety evaluations, and intellectual property matters.

Our staff members develop and utilize detailed and validated computational models and laboratory experimental methods to evaluate products, systems, and equipment. We perform field inspections, rely on industry standards, and utilize operational data to inform our analyses. We have performed these activities in a broad range of industries including transportation, heavyenergy, industrial equipment, building systems, medical devices, energy, and consumer products.

During the past year, our mechanical engineers worked on a wide variety of projects ranging from high-profile consumerincluding international construction disputes, product recall investigations to oilfield equipment failuresrecalls, and workplacemechanical safety issues.in product development.

Polymer Science & Materials Chemistry

Our Polymer Science and Materials Chemistry Practice consults with industrial, government, legal, insurance and individual clients regarding polymers and textiles used in diverse applications as well as chemicalthe chemistry, materials and processing aspects of batteries, drug delivery systems, and other products that depend on highly controlled manufacturing environments.

We assist clients in understanding the short- and long-term performance of plastic, rubber, adhesive, coating, composite, reactive chemical systems, and electrochemical energy storage systems when challenged by physical, chemical, thermal and other operational stressors. Our work also includes customized chemical, electrochemical and rheological testing and leverages significantexpanding internal electron microscopyinfrastructure for instrumented analysis and computerized tomographyadvanced imaging capabilities.

Our consultants participate in product development programs, perform failure analyses and provide support to clients involved in regulatory and legal proceedings and the protection of intellectual property. Clients value our technical expertise related to chemistry, formulation, manufacturing and materials performance, our understanding of the history and evolution of these materials, and our ability to assist them in identifying and incorporating emerging materials and manufacturing technologies into their businesses.

During the past year, significant program activities addressed aspects of automotive materials, battery systems, consumer electronics, wearable devices, sporting goods, implantable medical devices, combination drug delivery systems, historical formulations and components, manufacturing technology, industrial textiles, performance apparel,medical diagnostics, building materials, water handling systems, oil and gas applications, the plastics supply chain, fire retardancy and flammability, technology

scouting, materials science aspects of health risk, service life prediction, sustainability, and intellectual property related to consumer, recreational, medical, pharmaceutical, food packaging and other products, including trade secrets.products.

Statistical & Data Sciences

The Statistical and Data Sciences Practice comprises our core capabilities in methods for the collection, management, visualization, and inferential analysis of data. Drawing on experience in a breadth of engineering, science, health, and environmental applications—and frequently working in collaboration with other practices—we assist clients at all stages of the product or process life cycle: designing and analyzing product development studies; improving and controlling manufacturing process and product quality; and monitoring the safety, reliability, and performance of products in use by customers.  We design sample surveys and experiments, create value-added databases through synthesis of client-supplied and public data, and implement innovative techniques for machine learning and predictive analytics. Our approach to studies is intended to support data-driven decision making and to help clients measure their risks and benefits to determine appropriate courses of action.

During the past year, our statisticians and data scientists worked on diverse projects for government, industry, and legal clients. We performed assessments of manufacturing quality systems, evaluated the durability and reliability of smart cards for identity management and credentialing, supported research and development of an automated medical device through data visualization and reduction, examined the in-service reliability of home appliances and components, and provided forecasts for a utility integrity management program from statistical analysis of field inspection data.

Thermal Sciences

Our Thermal Sciences Practice provides multi-disciplinary expertiserapid response expert analysis to assist clientsinvestigate failures involving thermo-fluid systems, fires, and explosions in chemical, fire protection,industrial, residential, commercial, and mechanical engineering.transportation sectors. We have investigated and analyzed thousands of fires and explosionsthermal incidents ranging from high loss disasters at manufacturing facilities, energy facilities andaccidents in the oil and gas installationssector and major wildland fires, to small insurance claims. Information gained from these analyses has helpedallowed us assist clients with preventive measures related to the design of their facilities and products. Wealso assist clients in minimizing theproactively making their assets and products safer.

Our staff, consisting of mechanical, chemical, fire protection, aeronautical & astronautical and nuclear engineers, have assisted clients in assessing risk of firesto, and explosions, wefrom, their facilities, consumer product recalls, regulatory compliance and frequently provide regulatory consulting for permitting new industrial facilities,expert testimony in domestic litigation and we assist manufacturers in addressing the risk of fires associated with consumer products.international arbitration. Our engineers use fire modeling and otheradvanced computational fluid dynamics, fire, and explosion modeling tools to supplement our analytical, experimental, and field-based activities. Preventive services include process safety hazard analysis for the chemical, oil & gas, and oil and gassemiconductor industries, fire protection engineering, product development support, risk-based asset management, and dust explosion consulting.

In recent years, the Thermal Sciences Practice has developed tools to evaluate fire and explosion risks of lithium-ion batteries. We have consulted with a variety of clients to evaluate and mitigate fire and explosion hazards of batteries in applications including consumer products, vehicles, and grid-scale energy storage. We continue to be very active in wildland fire investigation and continue to assist our clients in making informed risk-based decisions related to their assets and wildfires. We have also developed analytical tools to assist utility clients assess the risk of ignition from their infrastructure.

During the past year, we have continued to grow in our work in oil and gas exploration and production, Liquefied Natural Gas (LNG)liquefied natural gas and downstream oil & gas. Our work in fire detection and gas sectorsprotection related issues has continued. Our servicesremained robust, and our work in these areas include assessing new oil well control technologies, assessing potential fireconsumer product recall and explosion risks and consequences, investigating loss of containment incidents and assessing the integrity of fixed assets.international arbitration has also grown.

Vehicle AnalysisEngineering

We have performed thousands of investigations for the automotive, trucking, recreational vehicle, marine, aerospace, and rail industries. Internal research programs and client projects have resulted in technological contributions that have assisted manufacturers in the understanding of product performance and provided insight to government agencies in establishing policy and regulations. Information gained from these analyses has also assisted clients in assessing preventive measures related to the design of their products, as well as evaluating failures.

Our Test and Engineering Center located in Phoenix, Arizona, is used for our most complex testing and analysis. We have gained a worldwide reputation for our ability to mobilize resources expeditiously and efficiently, integrate a broad array of technical disciplines, and provide valuable insight that is objective and withstands rigorous scrutiny. Many of our projects involve addressing the cause of accidents and our clients rely on us to determine what happened in an accident and why it happened. In many cases, clients also want us to assess what could have been done to reduce the severity of the accident or to mitigate occupant injuries to those involved.

Current advances in emerging transportation technologies and concepts allow the multi-disciplineour multi-disciplinary team of scientists, engineers, and analysts across numerous practices to focus on the development and implementation of connected vehicles, automated vehicles, connected/smart cities, and data analyses. Whether the objective is design analysis, component testing, failure analysis, or accident reconstruction, our knowledge of vehicle systems and engineering principles coupled with our experience from conducting full-scale tests aim to add insight and proficiency to every project.

ENVIRONMENTAL AND HEALTH SCIENCES

Chemical Regulation & Food Safety

Our Chemical Regulation and Food Safety Practice includes both technical and regulatory specialists who are experiencedexperts in dealing with foods, food ingredients, cosmetics, dietary supplements, pesticidepesticides and biocides (including conventional chemicals, biochemicals, microbials, antimicrobials/biocides, biopesticides, emerging technologies and products of biotechnology), industrial chemicals, pesticide/biocide devices, consumer products, medical devices and industrial chemicals.pharmaceuticals. We provide practical, scientific and regulatory support to meet global business objectives at every stage of the product life cycle, from research and development to retail and beyond.

During the past year, our Chemical Regulation and Food Safety staff have conducted a wide array of work. The European and U.S. sides of the practice were jointly involved with the ongoing support of multipleseveral new pesticide active ingredients and end-use products. The European side of our business was involved with many projects related to plant protection and biocidal product regulatory submissions, from new active substances and those under review to product-specific dossiers for individual European member states. This has included new technologies in plant protection that meet the regulatory pressures to achieve greater sustainability. We have provided support for reviews of a large number of biocidal products through European and South Korean regulatory reviews. In addition, we provided many specialist assessments relating to human and environmental exposure, risk and product efficacy as well as national and international Maximum Residue Limit/import tolerance submissions.submissions covering countries such as South Korea, Taiwan and Hong Kong. The U.S. side of our business was also involved in many projects related to agrochemical, antimicrobial, emerging technologies and biochemical product regulatory submissions in the U.S., Canada and Mexico. These included new active ingredients, end-use products, emerging technologies and import tolerances (EPA and FDA). Our state registration business remained solid in the U.S. In Europe and the U.S., we continued to provide clients with regulatory compliance support for food contact materials, food additives, novel foods, nutrition-related analyses, as well as undertaking safety assessments for food, cosmetic and cosmeticsconsumer products. Our European and U.S. teams have been working together to help clients navigate and comply with the new FDA MoCRA Cosmetics regulations that took effect in 2023.

We also provided proactive and reactive product safety and litigation support. For industrial chemicals, we continued to provide full regulatory support for our clients who prepared and submitted registrations and risk assessmentsassessments. Our European and our European Offices have been particularlyU.S. offices were active in dealingsupporting our clients with the EU REACHtheir E.U. and U.K. Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) and U.S. Toxic Substances Control Act regulatory requirements as the 2018 deadline approaches. In the U.S. we continued to provide services related to new pesticide active ingredients and end-use product development and registrations in the U.S., Canada, and Mexico, registration review under EPA, import tolerances in the U.S. and Canada, due diligence related to product and/or business sales, and data compensation, as well as the approval of new pesticide inert ingredients and new non-pesticide active ingredient approvals.requirements.

Ecological & Biological Sciences

Our ecological and biological scientists provide strategic support on issues related to the environment and natural resources damages associated with chemicals and forest fires, international environmental disputes, ecosystem service assessments for businesses, adverse weather events/climate change, ecological risk assessment, ecotoxicology, novel remediation methods, restoration of wetlands and other natural resources, large development projects, resource utilization (such as mineral mining, oil and gas, wood pulp, transportation, etc.), agriculture land-use impacts, genomic assessments, product stewardship, and the use of chemicals and other products in commerce. TheFocusing on both legacy and emerging contaminants, the practice specializes in assessing the integrated affectseffects of chemical, biological, and physical stressors on aquatic and terrestrial ecosystems. Many of these assessments utilize a causal analysis approach to determine causation systematically and transparently determine causation in complex and interrelated situations. The practice is comprised of nationally and internationally recognized experts that cover disciplines related to the fate and effects of chemical constituents and other stressors, including the ecological implications and risks associated with these projects.

Environmental & Earth Sciences

Our environmental scientists and engineers provide cost-effective, scientifically defensible and realistic assessments and solutions to complex environmental issues. We offer technical, regulatory, and litigation support to industries that include oil and gas, mining and minerals, chemicals, forest products, railroads, aerospace, development, and trade associations, and to municipal and governmentgovernmental clients. Our consultants specialize in the areas of environmental fate and transport, environmental chemistry and forensics, hydrogeology, air toxics, modeling and monitoring, water quality and water supply, data analytics, remediation consulting, environmental engineering and waste management, and natural resources damages assessment.

Our expertise also includes hydrology and hydrogeology, modeling and monitoring, water quality, water rights and water resources, extreme weather event and climate impacts,change risk management, and evaluation of environmental and social risks.

Our work oftenfrequently involves complex and high visibility environmental problems and issues, often the focus of environmental or toxic tort claims, where evaluation of contamination and historical reconstruction of events, releases, and doses and water resource issues are central to problem resolution.

We provide case-specific strategic and advisory consulting on risk mitigation, planning, and environmental regulatory and policy issues, as well as high-level technical strategic consulting to support critical business decisions and for complex matters where understanding the long-term implications of early technical actions is critical to managing overall liability.

Health Sciences

Our health scientists, including epidemiologists, toxicologists, industrial hygienists, exposure scientists, biostatisticians, risk assessors,assessment scientists, and physicians, apply scientific and medical principles to examine and address complex health-relatedhuman-health-related risk, benefit, and value issues in a variety of settings. The members of our staffOur consultants are recognized nationally and internationally for their outstanding expertise and credentials, and their decades of experience in government, academia, and industry sectors.

Our work has included numerous community and environmental health assessments, disease cluster investigations, air quality investigations and analyses, survey research, real-world data platforms, cohort and case-control studies, exposure assessment and simulation studies, biologically-basedbiologically based modeling, and preparation of meta-analyses, and state-of-the-art literature reviews. We have specifically addressed critical issues for clients on industrial chemicals, pesticides, mineral fibers, drugs,pharmaceuticals, medical devices, consumer products, digital health technology, nanotechnology, and other agents and products as they relate to human health risk.

Our multidisciplinary team has extensive experience investigating a broad variety of health concerns such as claims of adverse health effects from exposures to a wide range of physical agents (e.g., ionizing radiation, and low- and radio-frequency electromagnetic fields); chemical agents (e.g., volatile organic compounds, metals, dusts, and other airborne particulates,air pollutants, mineral fibers, fumes, nanoparticles, and pharmaceuticals)nanoparticles); and biological agents (fungi, (fungi/molds, bacteria, and other micro-organisms). Our atmospheric scientists provide air quality and meteorological modeling, permitting, and licensing support services. Our health scientists

We can assess the potential health effects of occupational and environmental exposures,exposures; investigate accidental releases of chemicals and evaluate fate and transport of chemical substances, simulate and analyzesubstances; characterize consumer and workplace exposures through simulation and exposure reconstruction; develop measures of prevention and exposure control,control; and assist clients with occupational safety and health evaluationsevaluations.

In the past few years, we have expanded our expertise to include pharmacoepidemiology; the development and emergency preparednessapplication of real-world evidence (RWE) for regulated medical products (pharmaceuticals and response.biologics, vaccines, devices, and combination products); and digital therapeutics, across the product life cycle from pre-approval planning to market access to post-approval safety evaluation and regulatory consulting on emergent safety issues. Our Health Sciences team, working closely with Biomechanics, Biomedical Engineering & Sciences, Data Sciences, Human Factors, Polymer Science & Materials Chemistry, and other practices, has considerable expertise in healthcare data science; strategy, design, and application of health economics and outcomes research such as burden-of-illness assessment; selection, quality assessment, and analysis of electronic health records (EHR) and healthcare claims and the explication of methodological issues such as randomization, bias, data linkages, drug interactions, and identification of high-risk populations.

COMPETITION

The marketplace for our services is fragmented and we face different sources of competition in providing various services. In addition, the services that we provide to some of our clients can be performed in-house by those clients. Clients that have the capability to perform such services themselves will retain Exponent or other independent consultants because of independence concerns.

In each of our practices, we believe that the principal competitive factors are: technical capability and breadth of services, ability to deliver services on a timely basis, professional reputation and knowledge of litigation and

regulatory processes. Although we believe that we generally compete favorably in each of these areas, some of our competitors may be able to provide services acceptable to our clients at lower prices.

We believe that the barriers to entry are low and that for many of our technical disciplines, competition is increasing. In response to competitive forces in the marketplace, we continue to look for new markets for our various technical disciplines.

BUSINESS SEGMENTS AND GEOGRAPHIC OPERATIONS OVERVIEWHUMAN CAPITAL

We report two operating segments based on two primary areas of service: Engineering and Other Scientific, and Environmental and Health. Engineering and Other ScientificExponent is a broad service group providingglobal engineering and scientific consulting firm that partners with clients to deliver breakthrough insights and answers. In a world experiencing accelerating change over our 50+ years in business, we still deliver the same vital promise: technical consultingexcellence, unrivaled expertise, and a unique multidisciplinary approach to asking and answering the right questions. Our vision is to work together, with our teams and our clients, to solve the most formidable scientific and engineering challenges to create a safer, healthier, sustainable world.

We work toward this vision by creating an unrivaled environment of engineering and scientific expertise, collaboration, and opportunity for exceptional people to achieve breakthrough insights and objective solutions for our clients’ vital challenges. Attracting, exciting, developing, and rewarding these people is central to our mission and our success. Our culture actively supports the development of our professionals and their potential by creating a stimulating, growth-oriented, and inclusive environment.

We keep our values and responsibilities front-and-center in different practices primarilyeverything we do: our hiring, our training, our processes, and our daily effort. These values include objectivity and work grounded in engineering. Environmentalevidence and Health provides servicesfacts; excellence in our work and rigorous commitment to the highest standards of quality and integrity; respect and care for our teammates, peers, and partners; a commitment to a diversity of ideas, disciplines, and lived experiences; and a shared belief in the areaimportance of environmental, epidemiologyservice, responsibility, and health risk analysis. This segment providesmaking a wide rangepositive difference for our peers, our professions, and our communities.

We advance scientific and engineering knowledge through the work of consulting services relatingemployees, but also through a comprehensive commitment to environmental hazardseducation, teaching, mentoring, publishing, and risksserving. Recognized leaders in their fields, Exponent staff serve on more than 250 individual scientific and engineering committees and advisory boards. Others serve in leadership roles or are actively working to develop technical standards. Exponent’s professionals routinely contribute to peer-reviewed scientific literature and publish articles, chapters, and books each year. To date, Exponent staff have published more than 1,200 articles in scientific and engineering journals. And today, more than 50 Exponent consultants serve as professors, lecturers, instructors, and advisors at universities and academic institutions across the impact on both human healthcountry and around the environment. Forworld.

To enable a culture where diversity, equity, and inclusion are embedded we have articulated four pillars of actions: communication, development, outreach, and recruiting.

Communication - Our annual employee survey and Diversity, Equity & Inclusion Advisory Committee help increase transparency and ensure a two-way dialogue between employees and leadership.

Development - We foster equitable opportunities via our development pathways. Our mentoring, sponsorship, and buddy programs provide unbiased growth opportunities, support, and connection.

Outreach - Our Diversity, Equity & Inclusion outreach leverages science, technology, engineering, and math (STEM) to empower the communities around us. Initiatives include staff volunteering in classrooms, professional societies, and direct gifts to universities.

Recruiting - We engage graduate students at more information about the financial condition and results of operations of each segment, please seePart II - “Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations”and“Item 8: Financial Statements and Supplementary Data.” For information about the Company’s operationsthan 100 universities, including those in different geographical areas, please see “Note 15: Segment Reporting” of ourNotesconnection with affinity professional organizations. We employ a behavioral, competency-based interviewing process to Consolidated Financial Statements. For information about the Company’s disclosures regarding foreign currency exchange rate risk, please see “Item 7A. Quantitative and Qualitative Disclosures About Market Risk.”actively avoid bias.

EMPLOYEES

As of December 29, 2017,2023, we employed 1,0751,320 full-time, part-time and hourlyintermittent employees, including 8481,047 engineering and scientific staff, 6173 technical support staff and 166200 administrative and support staff. Our staff includes 760955 employees with advanced degrees, of which 547746 employees have achieved doctorate degrees. As of December 29, 2023 approximately 89% of our employees were located in the levelUnited States and 11% were located in other global regions.

Technical full-time equivalent employees is a key metric that we use to analyze our revenues. During 2023 technical full-time equivalent employees increased 10% to 1,048 as compared to 955 during the prior year. We attribute our ability to grow technical full-time equivalent employees to a number of Ph.D., Sc.D. or M.D.factors, including exciting and challenging assignments, strong leadership and management, the opportunity to learn new skills and advance careers, along with competitive and equitable total rewards. To ensure a compelling total rewards philosophy and practice, we have practices in place to deliver fair and equitable compensation for employees based on their contribution and performance. We also offer a comprehensive set of benefits for employees and their families.

AVAILABLE INFORMATION

ADDITIONAL INFORMATION

The address of our Internet website is www.exponent.com.www.exponent.com. We make available, free of charge through our website, access to our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other periodic and current Securities and Exchange Commission (SEC)(“SEC”) reports, along with amendments to all of those reports, as soon as reasonably practicable after we file or furnish the reports with the SEC. Additionally, copies of materials filed or furnished by us with the SEC may be accessed at the SEC’s Public Reference Room at 100 F Street NE, Washington, D.C. or at the SEC’s website at http://www.sec.gov. For information about the SEC’s Public Reference Room, the public may contact 1-800-SEC-0330. Copies of material filed or furnished by us with the SEC may also be obtained by writing to us at our corporate headquarters, Exponent, Inc., Attention: Investor Relations, 149 Commonwealth Drive, Menlo Park, CA 94025, or by calling (650) 326-9400. The content of our Internet website is not incorporated into and is not part of this Annual Report on Form 10-K.

EXECUTIVE OFFICERS OF THE REGISTRANT

The executive officers of Exponent and their ages as of February 23, 20182024 are as follows:

Executive officers of Exponent are appointed by the Board of Directors of the Company (the “Board of Directors”) and serve at the discretion of the Board orof Directors until the appointment of their successors. There is no family relationship between any of the directors and officers of the Company.

Paul R. Johnston, Ph.D.,joined the Company in 1981, was promoted to Principal Engineer in 1987, and to Vice President in 1996. In 1997, he assumed responsibility for the firm’s network of offices. In 2003 he was appointed Chief Operating Officer and added responsibility for the Health and Environmental Groups. In 2006, he assumed line responsibility for all of the firm’s consulting groups. Dr. Johnston was named President in May 2007. He was named Chief Executive Officer and elected to the Board of Directors in May 2009. Dr. Johnston received his Ph.D. (1981) in Civil Engineering and M.S. (1977) in Structural Engineering from Stanford University. He received his B.A.I. (1976) in Civil Engineering with First Class Honors from Trinity College, University of Dublin, Ireland where he was elected a Foundation Scholar in 1975. Dr. Johnston is a Registered Professional Civil Engineer in the State of California and a Chartered Engineer in Ireland.

Catherine Ford Corrigan, Ph.D., joined the Company in 1996. She was promoted to Principal in the Biomechanics practice in 2002 and was appointed Group Vice President in May 2012. Dr. Corrigan was named President in July 2016. She was named Chief Executive Officer and elected to the Board of Directors in May 2018. Dr. Corrigan earned her Ph.D. (1996) in Medical Engineering and Medical Physics and M.S. (1992) in Mechanical Engineering from the Massachusetts Institute of Technology and her B.S. in Bioengineering from the University of Pennsylvania. Prior to joining Exponent, Dr. Corrigan was a researcher in the OrthopaedicOrthopedic Biomechanics Laboratory at Beth Israel Hospital and Harvard Medical School. On February 9, 2021, Dr. Corrigan was elected to the National Academy of Engineering.

Robert I. Haddad,Eric Guyer, Ph.D.,joined the Company in May 2016 as a Corporate Vice President and Principal Scientist.2005. He was promoted to Principal Engineer in 2011 and was appointed Corporate Vice President in 2019. Dr. Guyer was appointed Group Vice President on April 1, 2023. Dr. Guyer received his Ph.D. (2005) in October 2016.Materials Science and Engineering and M.S. (2003) in Materials Science and Engineering from Stanford University, and B.S. (2000) in Chemical Engineering from Iowa State University. Prior to joining the Company,Exponent, Dr. HaddadGuyer was Chief, Assessment & Restoration Division, Office of Response & Restorationemployed as a Senior Materials Engineer at the National Oceanic and Atmospheric Administration from 2007 to 2016 where he was responsible for the strategic evaluation and tactical resolution of environmental problems. From 2002 to 2007, Dr. Haddad was President and Principal Scientist at Applied Geochemical Strategies, Inc. where he was responsible for providing litigation support and expertise in environmental forensics, human health and ecological risk assessments, and natural resource damage assessments to regional, national, and international clients. Dr. Haddad received hisLockheed Martin’s Advanced Technology Center.

Brad A. James, Ph.D. (1989) in Chemical Oceanography from the University of North Carolina, Chapel Hill and B.S. (1979) in Geology from the University of California, Los Angeles. Dr. Haddad has published in peer-reviewed technical publications and scientific journals, and has authored over 300 technical reports and confidential documents for a variety of projects.

Harri K. Kytomaa, Ph.D.,joined the Company in 1994. He was promoted to Principal Engineer in 19992005 and was appointed Corporate Vice President in 2006.2014. Dr. KytomaaJames was appointed Group Vice President in October 2016.on January 4, 2020. Dr. KytomaaJames received his Ph.D. (1986)(1994) in Mechanical EngineeringMetallurgical and M.S. (1981) in MechanicalMaterials Engineering from the California InstituteColorado School of Technology,Mines and B.Sc. (1979)his B.S. (1988) in Metallurgical Engineering Science from Durhamthe University England.of Washington. He is a Registered Professional Engineer licensed professional engineer

in 9the states of California and a Certified Fire and Explosion Investigator in accordance with the National Association of Fire Investigators National Certification Board.Texas. Prior to joining Exponent, Dr. KytomaaJames was Assistant Professor and Associate Professor of Mechanical Engineeringemployed as a Research Engineer, Materials Performance Division, at the Massachusetts Institute of Technology, where he was head of the Fluid Mechanics Laboratory.Babcock and Wilcox R&D Center.

Steven J. Murray, Ph.D.,joined the Company in 2001. He was promoted to Principal Engineer in 2008. Dr. Murray was promoted to Corporate Vice President in May 2014 and Group Vice President in January 2015. Dr. Murray received his Ph.D. (2000) in Materials Science and Engineering (Electronic Materials Panel) from the Massachusetts Institute of Technology, B.S. (1996) in Materials Science and Mineral Engineering and B.S. (1996) in Mechanical Engineering from the University of California, Berkeley. He is a Registered Professional Electrical Engineer in the State of Oregon and Registered Professional Mechanical Engineer in the State of California.

John D. Osteraas, Ph.D., worked for the Company from 1982 to 1985 as a Senior Engineer. He rejoined the Company in 1990 as a Managing Engineer. He was promoted to Principal Engineer in 1992 and Group Vice President in 2006. Dr. Osteraas received his Ph.D. (1990) in Civil Engineering, M.S. (1977) in Civil Engineering: Structural Engineering from Stanford University and B.S. (1976) in Civil and Environmental Engineering from the University of Wisconsin. Dr. Osteraas is a Registered Professional Engineer in 17 states and is a Fellow of the American Society of Civil Engineers.

John D. Pye, Ph.D.,joined the Company in 1999. He was promoted to Principal Engineer in 2006 and was appointed Corporate Vice President in 2009. Dr. Pye was appointed Group Vice President in January 2014. Dr. Pye received his Ph.D. (1999) in Aerospace Engineering from Stanford University, M.S. (1993) in Aerospace Engineering from Stanford University, and B.A.Sc. (1992) in Engineering Science from the University of Toronto, Canada. He is a Registered Professional Mechanical Engineer in the State of California. Prior to joining Exponent, Dr. Pye held a research position in the Aerospace Fluid Mechanics Lab at Stanford University where he was responsible for the renovation and redesign of the Stanford Low-Speed wind tunnel as well as managing the Stanford experimental facilities for the Stanford/NASA Ames Joint Institute for Aeronautics and Astronautics.

Joseph Rakow, Ph.D., joined the Company in 2005. He was promoted to Principal Engineer in 2012 and was appointed Corporate Vice President in 2021. Dr. Rakow was appointed Group Vice President on April 1, 2023. Dr. Rakow received his Ph.D. (2005) in Aerospace Engineering and M.S. (2000) in Aerospace Engineering from the University of Michigan, and B.S. (1999) in Physics from the University of California, Davis. He is a licensed professional engineer in the state of California and a Fellow of the American Society of Mechanical Engineers. Prior to joining Exponent, Dr. Rakow held teaching and research positions at the University of Michigan and Sandia National Laboratories. As a volunteer, Dr. Rakow serves on multiple academic advisory boards at the university level, and is a Structures Specialist with FEMA Urban Search & Rescue.

Richard Reiss, Sc.D.,joined the Company in 2006 as a Principal Scientist. He was promoted to Group Vice President in January 2015. Dr. Reiss earned his Sc.D. (1994) in Environmental Health from the Harvard University School of Public Health, M.S. (1991) in Environmental Engineering from Northwestern University and B.S. (1989) in Chemical Engineering from the University of California, Santa Barbara. Prior to joining Exponent he was a Vice President with Sciences International. Dr. Reiss is a Fellow of the Society of Risk Analysis.

Maureen T.F. Reitman, Sc.D., joined the Company in 2002. She was promoted to Principal Engineer in 2006 and was appointed Corporate Vice President in 2014. Dr. Reitman was appointed Group Vice President on January 4, 2020. Dr. Reitman received her Sc.D. (1993) in Materials Science and Engineering from the Massachusetts Institute of Technology and her B.S. (1990) in Materials Science and Engineering from the Massachusetts Institute of Technology. She is a registered Professional Mechanical Engineer in the state of Maryland and a fellow of the Society of Plastics Engineers. Prior to joining Exponent, Dr. Reitman worked for the 3M Company in both research and management roles. Her activities at 3M included technology identification, materials selection and qualification, product development, customer support, program management, acquisition integration, intellectual property analysis, and patent litigation support. On February 6, 2024, Dr. Reitman was elected to the National Academy of Engineering.

Richard L. Schlenker, Jr., joined the Company in 1990. Mr. Schlenker is the Executive Vice President, Chief Financial Officer and Corporate Secretary of the Company. He was appointed Executive Vice President in April 2010, Chief Financial Officer in July 1999 and Secretary of the Company in November 1997. Mr. Schlenker was the Director of Human Resources from 1998 until his appointment as Chief Financial Officer. He was the Manager of Corporate Development from 1996 until 1998. From 1993 to 1996, Mr. Schlenker was a Business Manager, where he managed the business activities for multiple consulting practices within the Company. Prior to 1993, he held several different positions in finance and accounting within the Company. Mr. Schlenker holds a B.S. in Finance from the University of Southern California.

Sally B. Shepard, rejoined the Company in 2014 as Vice President - Human Resources and was promoted to Chief Human Resources Officer in 2017. From 2012 to 2014 she served as Vice President Human Resources at 41st Parameter, which was acquired by Experian. From 2002 to 2009 she served as Vice President Human Resources at CoWare, Inc., which was acquired by Synopsys. From 2000 to 2001 Ms. Shepard served as Vice President Human Resources at Lutris Technologies. She also provided Human Resources consulting services for a variety of companies between roles. From 1981 to 1999 Ms. Shepard held a variety of roles at Exponent including Managing Engineer, Business Manager, Director of Human Resources and Information Technology, and Vice President of Corporate Human Resources. Ms. Shepard holds a B.S. (1982) in Mechanical Engineering from Stanford University.

Item 1A. Risk Factors

Exponent operates in a rapidly changing environment that involves a number of uncertainties, some of which are beyond our control and may have a material adverse effect on our financial condition and results of operations. These uncertainties include, but are not limited to, those mentioned elsewhere in this report and those set forth below. Although the risks are organized by headings, and each risk is discussed separately, many are interrelated.

Risks Related to Our Clients and Demand for Our Services

The unpredictable and reactive nature of our business can create uneven performance in any given quarter or fiscal year.

Revenues are primarily derived from services provided in response to client requests or events that occur without notice, and engagements, generally billed as services are performed, are terminable or subject to postponement or delay at any time by clients. As a result, backlog at any particular time is small in relation to our quarterly or annual revenues and is not a reliable indicator of revenues for any future periods. Revenues and operating margins for any particular quarter are generally affected by staffing mix, resource requirements and timing and size of engagements.

Our financial results could suffer if our clients’ needs change more rapidly than we are able to secure the appropriate mix of trained, skilled and experienced personnel.

As our clients’ needs change, new technologies develop, and legal and regulatory processes change, we may be unable to timely hire or train personnel with the appropriate new set of skills and experience which could negatively impact our growth and profitability.

We may not manage our growth effectively, and our profitability may suffer.

FailureOur expected future growth presents numerous managerial, administrative, operational and other challenges. Our ability to manage the growth of our operations will require us to continue to improve our information systems and other internal systems and controls. In addition, our growth will increase our need to attract, develop, motivate and retain key employees may adversely affectboth our business.

Exponent’s business involves the delivery ofmanagement and professional services and is labor-intensive. Our success depends in large part upon our ability to attract, retain and motivate highly qualified technical and managerial personnel. Qualified personnel are in great demand and are likely to remain a limited resource for the foreseeable future. We cannot provide any assurance that we can continue to attract sufficient numbers of highly qualified technical and managerial personnel and to retain existing employees. The lossinability to effectively manage growth or the inability of key managerialour employees business generators or any significant number of employeesto achieve anticipated performance could have a material adverse impacteffect on our business, including our ability to secure and complete engagements.business.

CompetitionThe loss of a large client could reduce our pricing and adversely affect our business.

The markets for our services are highly competitive. In addition, there are relatively low barriers to entry into our markets and we have faced, and expect to continue to face, additional competition from new entrants into our markets. Competitive pressure could reduce the market acceptanceWe currently derive a significant portion of our servicesrevenues from clients in the chemical, construction, consumer products, energy, life sciences and result in price reductions thattransportation industries. The loss of any large client could have a material adverse effect on our business, financial condition or results of operations.

The loss of a large client could adversely affect our business.

We currently derive a significant portion of our revenues from clients in the chemical, consumer electronics, energy, insurance, transportation and utilities industries and the government sector. The loss of any large client, organization or insurer could have a material adverse effect on our business, financial condition or results of operations.

Our clients may be unable to pay for our services.

If a client's financial difficulties become severe, the client may be unwilling or unable to pay our invoices in the ordinary course of business, which could adversely affect collections of both our accounts receivable and unbilled services. Recent global economic volatility and increased cost of capital could impact the ability of our customers to pay for our services. On occasion, some of our clients have entered bankruptcy, which has prevented us from collecting amounts owed to us. The bankruptcy of a client with substantial accounts receivable could have a material adverse effect on our financial condition and results of operations.

We hold substantial investments that could present liquidity risks.

Our cash equivalent and short-term investment portfolio as of December 29, 2017, consisted primarily of obligations of U.S. government agencies and the U.S. Treasury. We follow an established investment policy to monitor, manage and limit our exposure to interest rate and credit risk. The policy sets forth credit quality standards and limits our exposure to any one issuer, as well as our maximum exposure to various asset classes.

Investments in some financial instruments may pose risks arising from liquidity and credit concerns. As of December 29, 2017, we had no impairment charge associated with our investment portfolio relating to such adverse financial market conditions. Although we believe our current investment portfolio has a low risk of impairment, we cannot predict future market conditions or market liquidity and can provide no assurance that our investment portfolio will remain unimpaired.

Our business is dependent on our professional reputation.

The professional reputation of Exponent and its consultants is critical to our ability to successfully compete for new client engagements and attract or retain professionals. Proven or unproven allegations against us may damage our professional reputation. Any factors that damage our professional reputation could have a material adverse effect on our business.

Our business can be adversely impacted by deregulation or reduced regulatory enforcement.

Public concern over health, safety and preservation of the environment has resulted in the enactment of a broad range of environmental and/or other laws and regulations by local, state and federal lawmakers and agencies. These laws and the implementation of new regulations affect nearly every industry, as well as the agencies of federal, state and local governments charged with their enforcement. To the extent changes in such laws, regulations and enforcement or other factors significantly reduce the exposures of manufacturers, owners, service providers and others to liability, the demand for our services may be significantly reduced.

Tort reform can reduce demand for our services.

Several of our practices have a significant concentration in litigation support consulting services. To the extent tort reform reduces the exposure of manufacturers, owners, service providers and others to liability, the demand for our litigation support consulting services may be significantly reduced.

Our engagements may result in professional or other liability.

Our services typically involve difficult engineering and scientific assignments and carry risks of professional and other liability. Many of our engagements involve matters that could have a severe impact on a client's business, cause a client to lose significant amounts of money, or prevent a client from pursuing desirable business opportunities. Accordingly, if a client is dissatisfied with our performance, the client could threaten or bring litigation in order to recover damages or to contest its obligation to pay our fees. Litigation alleging that we performed negligently, disclosed client confidential information, lost or damaged evidence, infringed on patents, were forced to withdraw from a legal matter due to a conflict or otherwise breached our obligations to a client could expose us to significant liabilities to our clients or other third parties or tarnish our reputation.

Potential conflicts of interest may preclude us from accepting some engagements.

We provide litigation support consulting and other services primarily in connection with significant disputes, or other matters that are usually adversarial or that involve sensitive client information. The nature of our consulting services mayhas and will continue to preclude us from accepting engagements with other potential clients because of conflicts. Accordingly, the nature of our business limits the number of both potential clients and potential engagements.

We are subject to unpredictable risks of litigation.

Although we seek to avoid litigation whenever possible, from time to time we are party to various lawsuits and claims. Disputes may arise, for example, from employment issues, regulatory actions, business acquisitions and real estate and other commercial transactions. There can be no assurances that any lawsuits or claims will be immaterial in the future. Any material lawsuits or claims could adversely affect our business and reputation.

We may experience security breaches that could lead to the inability to protect confidential information.

Despite the implementation of security measures, our operating systems are vulnerable to electronic breaches of security. Such breaches could lead to disruptions of our operations and potential unauthorized disclosure of confidential information, which could result in legal claims or proceedings. While we have taken reasonable steps to prevent and mitigate the damage of a security breach by continuously improving our design and coordination of security controls across our business, those steps may not be effective and there can be no assurance that any such steps can be effective against all possible risks.

Impairment of goodwill may require us to record a significant charge to earnings.

On our balance sheet, we have $8,607,000 of goodwill subject to periodic evaluation for impairment. Failure to achieve sufficient levels of cash flow at reporting units, the loss of key employees, changes to the scope of operations of our business or a significant and sustained decline in our stock price could result in goodwill impairment charges. During times of financial market volatility, significant judgment is required to determine the underlying cause of the decline and whether stock price declines are short-term in nature or indicative of an event or change in circumstances.

Impairment of long-lived assets or restructuring activities may require us to record a significant charge to earnings.

Our long-lived assets, including our office, laboratory and warehouse space in Menlo Park, California and our test and engineering center in Phoenix, Arizona, are subject to periodic testing for impairment. Failure to achieve sufficient levels of cash flow at the asset group level could result in impairment of our long-lived assets. In addition, we have operating lease commitments for office, warehouse and laboratory space of $27,428,000 as of December 29, 2017. Changes in the business environment could lead to changes in the scope of operations of our business. These changes, including the closure of one or more offices, could result in restructuring and/or asset impairment charges.

Our international operations create special risks that could adversely affect our business.

In addition to our offices in the United States, we have physical offices in the United Kingdom, Germany, Switzerland, Hong Kong and China and conduct business in several other countries. We expect to continue to expand globally and our international revenues may account for an increasing portion of our revenues in the future. Our international operations carry special financial, business and legal risks, including cultural and language differences; employment laws and related factors that could result in lower utilization, higher staffing costs, and cyclical fluctuations of utilization and revenues; currency fluctuations that adversely affect our financial position and operating results; burdensome regulatory requirements and other barriers to conducting business; managing the risks associated with engagements with foreign officials and governmental agencies, including the risks arising from the United States Foreign Corrupt Practices Act and the United Kingdom Bribery Act of 2010; greater difficulties in managing and staffing foreign operations; successful entry and execution in new markets; restrictions on the repatriation of earnings; and potentially adverse tax consequences.

Inherent risks related to government contracts may adversely affect our business.

We work for various United States and foreign governmental entities and agencies. Government contracts entail, among other things, the obligation to comply with numerous regulations and requirements that may not otherwise apply to us. Government entities reserve the right to audit our contracts and conduct inquiries and investigations of our business practices with respect to government contracts. Findings from an audit may result in fees being refunded to the government or prospective adjustment to previously agreed upon rates that will affect future margins. If a government client discovers improper or illegal activities in the course of audits or investigations, we may become subject to various civil and criminal penalties and administrative sanctions, which may include termination of contracts, forfeiture of profits, suspension of payments, fines and suspensions or debarment from doing business with other agencies of the government. The inherent limitations of internal controls may not prevent or detect all improper or illegal activities, regardless of the adequacy of such controls. Government contracts, and the proceedings surrounding them, are often subject to more extensive scrutiny and publicity than other commercial contracts. Negative publicity related to our government contracts, regardless of whether it is accurate, may further damage our business by affecting our ability to compete for new contracts.

A decline in the U.S. Government budget, changes in budgetary priorities or timing of contract awards may adversely affect our business.

Our operating results could be adversely affected by spending caps or changes in the budgetary priorities of the U.S. Government, as well as delays in program starts or the award of contracts or task orders under contracts. Current U.S. Government spending levels may not be sustained and future spending and program authorizations may not increase or may decrease or shift to programs in areas in which we do not provide services or are less likely to be awarded contracts. Such changes in spending authorizations and budgetary priorities may occur as a result of the rapid growth of the federal budget deficit, increasing political pressure and legislation. The U.S. Government also conducts periodic reviews of strategies and priorities, which may shift budgetary priorities, reduce overall U.S. Government spending or delay contract or task order awards. In addition, changes to the U.S. Government acquisition system and contracting models could affect whether and how we pursue certain opportunities and the terms under which we are able to do so. A significant decline in overall U.S. Government spending, the substantial reduction or elimination of particular programs or significant delays in contract or task order awards could adversely affect our business.

GovernmentsClients may terminate, cancel, modify or curtail our contracts at any time prior to their completion.

Under many of our contracts, including our government contracts, the client generally has the right not to exercise options to extend or expand our contracts and may otherwise terminate, cancel, modify or curtail our contracts at its convenience. Our engagements can therefore terminate suddenly and without advance notice to us. Any decision by the client not to exercise contract options or to terminate, cancel, modify or curtail our programs or contracts would adversely affect our revenues, revenue growth and profitability.

Risks Related to Our Operations

Failure to attract and retain key employees may adversely affect our business.

Our business involves the delivery of professional services and is labor-intensive. Our success depends in large part upon our ability to attract, retain and motivate highly qualified technical and managerial personnel. Qualified personnel are in great demand and are likely to remain a limited resource for the foreseeable future. We cannot provide

We are harmed by the products and systems we sell or the services we offer.

We design, develop, manufacture, sell, service and maintain various products and systems. In some instances, we also train operators of such products and systems. Many of these products and systems utilize software algorithms that are probabilistic in nature and subject to significant technical limitations.unpredictable risks of litigation.

Although we seek to avoid litigation whenever possible, from time to time we are party to various lawsuits and claims. Disputes may arise, for example, from employment issues, regulatory actions, business acquisitions and real estate and other commercial transactions. There can be no assurances that any lawsuits or claims will be immaterial in the future. Any material lawsuits or claims could adversely affect our business and reputation.

We are many factors, somesubject to security breaches that may disrupt our operations and/or lead to the inability to protect confidential information.

We have experienced, and expect to continue to be subjected to, security breaches and threats, none of which have been material to us to date. Despite the implementation of security and business continuity measures, our information technology infrastructure and networks are beyondvulnerable to electronic breaches of security. Furthermore, we are subject to risks to information security posed by external or insider threats, including unauthorized access, manipulation, misuse, or improper disclosure of proprietary, sensitive, or confidential information by employees, contractors, or other insiders. Any such breaches could lead to disruptions of our control,operations and potential unauthorized disclosure of confidential and/or personal information, which could result in legal claims or proceedings, have impacts to our operations, and/or cause harm to our reputation. Our systems and data are protected by a comprehensive Information Security program detailed in our Information Security Management System. Dedicated security, privacy, information governance, and compliance professionals maintain the program with oversight provided by the Board of Directors in conjunction with senior leadership. See Item 1C. for more information about our Cybersecurity Risk Management and Strategy. While we have taken reasonable steps to prevent and mitigate the damage of a security breach by continuously improving our design and coordination of security controls across our business, those steps may not be effective and there can be no assurance that any such steps can be effective against all possible risks.

Laws regarding data protection continue to rapidly evolve, and failure to protect client and employee data may have an adverse effect on our business.

We manage, utilize, and store sensitive or confidential client and employee data, including personal data and protected health information. As a result, we are subject to numerous laws and regulations designed to protect this information, such as the U.S. federal and state laws governing the protection of health or other personally identifiable information, including the Health Insurance Portability and Accountability Act, and international laws such as the European Union General Data Protection Regulation and the People’s Republic of China’s Data Security Law. In addition, many states, U.S. federal governmental authorities and non-U.S. jurisdictions have adopted, proposed, or are considering adopting

or proposing, additional data security and/or data privacy statutes or regulations. For instance, we may be subject to Federal Trade Commission (FTC) enforcement actions if the FTC has reason to believe we have engaged in unfair or deceptive privacy or data security practices in violation of the FTC Act. In addition, an increasing number of U.S. states have enacted U.S. state privacy laws that set forth comprehensive privacy and security obligations regarding the collection and processing of personal data, including such as the California Consumer Privacy Act, as amended by the California Privacy Rights Act, and other state laws that set forth comprehensive privacy and security obligations regarding the collection and processing of personal data. These laws and regulations are increasing in complexity and number. As a result of these legal and regulatory requirements we incur and expect to continue to incur significant ongoing costs as part of our productsefforts to comply with applicable law. Failure to comply with these laws and regulations may lead to significant monetary damages, regulatory enforcement actions, fines, penalties or systems. The failureother regulatory liabilities, such as orders or consent decrees forcing us to modify business practices, and reputational damage or third-party lawsuits for any noncompliance with such laws. If any person, including any of our productsemployees, negligently disregards or intentionally breaches our established controls with respect to client or employee data, or otherwise mismanages or misappropriates that data, we could also be subject to significant monetary damages, regulatory enforcement actions, fines, and/or criminal prosecution. In addition, unauthorized disclosure of sensitive or confidential client or employee data, whether through systems failure, employee negligence, fraud, or misappropriation, could damage our reputation and cause us to lose clients and their related revenue in the future.

Our international operations create special risks that could adversely affect our business.

In addition to our offices in the United States, we have a presence in the United Kingdom, Switzerland, Hong Kong, China, Singapore, Ireland, Germany, and Canada, and conduct business in several other countries. We expect to continue to expand globally and our international revenues may account for an increasing portion of our revenues in the future. Our international operations carry special financial, business and legal risks, including cultural and language differences; employment laws and related factors that could result in lower utilization, higher staffing costs, and cyclical fluctuations of utilization and revenues; currency fluctuations that adversely affect our financial position and operating results; burdensome regulatory requirements and other barriers to conducting business; tariffs/trade disputes and other trade barriers; geopolitical risks that could result in an adverse impact to our clients and Exponent, such as cyberattacks, trade sanctions, and increased regulatory scrutiny on operations; armed conflicts and wars, including the Russia-Ukraine war and the conflicts in the Middle East; managing the risks associated with engagements with foreign officials and governmental agencies, including the risks arising from the United States Foreign Corrupt Practices Act and the United Kingdom Bribery Act of 2010; managing the risks associated with global privacy and data security laws and regulations including the General Data Protection Regulation in Europe and China’s data protection and national security laws; greater difficulties in managing and staffing foreign operations; successful entry and execution in new markets; restrictions on the repatriation of earnings; potentially adverse tax consequences; and other impending legislation that could add additional risks to the business.

Employee or contractor misconduct, or our failure to comply with governmental, regulatory and legal requirements or with our company-wide Code of Business Conduct and Ethics and related policies could lead to injury, death,governmental or extensive propertylegal proceedings that could expose us to significant liabilities and damage our reputation.

Misconduct, fraud, non-compliance with applicable laws and mayregulations or other improper activities by one of our employees, agents or partners could have a significant negative impact on our business and reputation. Such misconduct could include the failure to comply with government procurement regulations, regulations regarding the protection of classified information, regulations prohibiting bribery and other foreign corrupt practices, regulations regarding the pricing of labor and other costs in government contracts, regulations on lobbying or similar activities, regulations pertaining to the internal controls over financial reporting, environmental laws and any other applicable laws or regulations. Our Code of Business Conduct and Ethics and related policies mandate compliance with applicable laws including anti-bribery, and insider trading. Nonetheless, we cannot assure that our policies, procedures and related training programs will ensure full compliance with all applicable legal requirements. Illegal or improper conduct by our executive officers, directors, employees, independent consultants or contractors, or others who are subject to our policies and procedures could damage our reputation in the U.S. and internationally, which could adversely affect our existing client relationships or adversely affect our ability to attract and retain new clients, or lead to product liability, professional liability,litigation or other claimsgovernmental or regulatory proceedings in the U.S. or foreign jurisdictions, or could subject us to fines and penalties, loss of security clearances and suspension or debarment from contracting, any or all of which could harm our reputation, reduce our revenue and profits and subject us to criminal and civil enforcement actions.

Failure to comply with domestic and international export laws could adversely affect our business.

To the extent we export technical services, data and information outside of the locations where we operate, we are subject to U.S. and international laws and regulations governing international trade and exports, including but not limited to the International Traffic in Arms Regulations, the Export Administration Regulations and trade sanctions against us. Further, if our productsembargoed countries. A failure to comply with these laws and regulations could result in civil or systems fail,criminal sanctions, including the imposition of fines, the denial of export privileges and suspension or are perceived to have failed, the negative publicitydebarment from such incidentparticipation in U.S. government contracts, which could have a material adverse effect on our business.

Our business depends on our ability to use and access information systems, and modernize or replace such systems from time to time, and failure to effectively maintain such systems or modernize or replace systems, or difficulties encountered in implementing new or replacement systems could materially adversely affect our business and operations and harm our reputation.

We depend on multiple internal and external information systems for operating our business. We utilize commercially available third-party technology solutions, which in many cases are customized to our business needs. Our information systems may be compromised by power outages, computer and telecommunications failures, computer viruses, security breaches, hackers, catastrophic events, human error and other events, many of which are beyond our control, and are subject to obsolescence and technological changes. If our information systems fail to work properly or otherwise become unavailable, or if we encounter difficulties in integrating new or replacement systems, we may incur substantial time, efforts and costs to repair or replace such systems, or otherwise carry out our operations without the ability to use such systems. Failure of any such information system could result in delays, significant additional costs, incorrect information, failure of internal control and harm to our reputation as well as expose us to regulatory actions and claims any of which could adversely affect our business and results of operations and our reputation.

Increases in operating expenses may adversely affect our profitability and margins.

Increases in compensation and related expenses, other operating expenses, general and administrative expenses, and tax expenses due to inflation, supply chain disruptions, labor market conditions, real estate market conditions, geographic conditions, regulatory requirements, or other economic or political factors may adversely affect our profitability and margins. Increases in compensation and related expenses that exceed our bill rate increases, increases in rent when our operating leases expire, increases in compliance costs associated with new regulations, and increases in tax rates would adversely affect our profitability.

General Risks

Competition could reduce our pricing and adversely affect our business.

The markets for our services are highly competitive. In addition, there are relatively low barriers to entry into our markets and we have faced, and expect to continue to face, additional competition from new entrants into our markets. Competitive pressure could reduce the market acceptance of our services and result in limitations in our ability to implement billing rate increases or maintain billing rates that could have a material adverse effect on our business, financial condition or results of operations.

We hold substantial investments that could present liquidity risks.

Our cash equivalent portfolio as of December 29, 2023 consisted primarily of obligations of the U.S. Treasury. We follow an established investment policy to monitor, manage and limit our exposure to interest rate and credit risk. The policy sets forth credit quality standards and limits our exposure to any one issuer, as well as our maximum exposure to various asset classes.

Investments in some financial instruments may pose risks arising from liquidity and credit concerns. As of December 29, 2023, we had no impairment charge associated with our investment portfolio relating to such adverse financial

Changes in, or interpretations of, accounting principles could have a significant impact on our financial position and results of operations.

We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These principles are subject to interpretation by the SEC and various bodies formed to interpret and create appropriate accounting principles. A change in these principles can have a significant effect on our reported results and may even retroactively affect previously reported transactions. Additionally, the adoption of new or revised accounting principles may require that we make significant changes to our systems, processes and controls.

Uncertainty about current and future economic conditions and other adverse changes in general political conditions in any of the countries in which we do business could adversely affect our operating results.

Our business can be adversely affected by downturnsWe are subject to risks arising from adverse changes in economic and political conditions, both domestically and globally, including unfavorable changes in economic conditions, such as inflation, rising interest rates or a recession, and other events beyond our control, such as geopolitical developments, economic sanctions, natural disasters, pandemics, epidemics, political instability, armed conflicts and wars, including the Russia-Ukraine war and the conflict in the overall economy.

The markets that we serve are cyclicalMiddle East. Worsening economic conditions have had and subjectmay continue to general economic conditions. The directionhave an adverse impact on the businesses and relative strengthfinancial health of the global economy continues to be uncertain. If economic growth in the United States, where we primarily operate, slows,many of our clients. As a result, current or potential clients may consolidate or go out of business and thus demand for our services couldmay be reduced significantly. Political changes and trends such as populism, protectionism, economic nationalism and sentiment toward multinational companies, as well as tariffs, export controls, restrictions on outbound investment or other trade barriers, sanctions, currency controls, or changes to tax or other laws or policies, have been and may continue to be disruptive to our business. These can interfere with our global operating model, client relationships, and competitive position. Further escalation of any specific trade tensions between the U.S. and China, or in global trade conflict more broadly could be harmful to global economic growth or to our business in or with China or other countries.

Our quarterly results may vary.

Variations in our revenues and operating results occur from time to time, as a result of a number of factors, such as the significance of client engagements commenced and completed during a quarter, the timing of engagements, the number of working days in a quarter, employee hiring and utilization rates, and integration of companies acquired.rates. Because a high percentage of our expenses,

particularly personnel and facilities related expenses, are relatively fixed in advance of any particular quarter, a variation in the timing of the initiation or the completion of our client assignments can cause significant variations in operating results from quarter to quarter.

The market price of our common stock may be volatile.

Many factors could cause the market price of our common stock to rise and fall. These include the risk factors listed above and below; changes in estimates of our performance or recommendations by securities analysts; future sales of shares of common stock in the public market; market conditions in the industry and economy as a whole; acquisitions or strategic alliances involving us or our competitors; restatement of financial results; and changes in accounting principles or methods. In addition, the stock market often experiences significant price fluctuations. These fluctuations are often unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the market price of our common stock. When the market price of a company's stock drops significantly, shareholders often institute securities class action litigation against that company. Any litigation against us could cause us to incur substantial costs, divert the time and attention of our management and other resources, or otherwise harm our business.

There can be no assurance that we will continue to declare cash dividends or repurchase our shares at all or in any particular amounts.

Our Board of Directors has declared quarterly dividends since March 2013. Our intent to continue to pay quarterly dividends and to repurchase our shares is subject to capital availability and, in the case of dividends, periodic determinations by our Board of Directors that cash dividends are in the best interest of our stockholders and are in compliance with all laws and agreements applicable to the declaration and payment of cash dividends by us. Future dividends and share repurchases may also be affected by, among other factors: our views on potential future capital requirements for investments, including acquisitions; legal risks; stock repurchase programs; changes in federal and state income tax laws or corporate laws; contractual restrictions; and changes to our business model. Our dividend payments and share repurchases may change from time to time, and we cannot provide assurance that we will continue to declare dividends or repurchase shares at all or in any particular amounts. A reduction or suspension in our dividend payments or share repurchase activity could have a negative effect on our stock price.

Catastrophic events may disrupt our business.

We rely on our network infrastructure and certain third-party hosted services to support our operations. A disruption or failure of these systems in the event of a major earthquake, fire, flood, tsunami or other weather event, power loss, telecommunications failure, software or hardware malfunctions, pandemics, cyber-attack, war, terrorist attack or other catastrophic event that our disaster recovery plans do not adequately address, could have a material adverse effect on our business, financial condition or results of operations.

Unavailability or cancellation of third-party insurance coverage would increase our overall risk exposure as well as disrupt the management of our business operations.

We maintain insurance coverage from third-party insurers as part of our overall risk management strategy and because some of our contracts require us to maintain specific insurance coverage limits. If any of our third-party insurers fail, suddenly cancel our coverage or otherwise are unable to provide us with adequate insurance coverage, then our overall risk exposure and our operational expenses would increase and the management of our business operations would be disrupted. In addition, there can be no assurance that any of our existing insurance coverage will be renewable upon the expiration of the coverage period or that future coverage will be affordable at the required limits.

Climate change may disrupt our business.

The areas where we conduct business are vulnerable to the effects of climate change. For example, in California, wildfire danger increases the probability of planned power outages which may impact our employees’ abilities to commute to work and to stay connected. Climate-related events, including the increasing frequency of extreme weather events and their impact on critical infrastructure, have the potential to disrupt our business.

Changes in interpretation and application of tax laws could harm our business, revenue, cash flows and financial results.

Tax reform remains a legislative priority for the U.S. government and certain legislations have already been enacted. While there is current uncertainty regarding what changes will eventually be enacted, such new laws may affect our operating results and financial conditions. On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 that includes, among other provisions, changes to the U.S. corporate income tax system, including a fifteen percent minimum tax based on “adjusted financial statement income,” and a one percent excise tax on net repurchases of stock after December 31, 2022. Changes, if any, to the U.S. or non-U.S. taxation of our operations may increase our worldwide effective tax rate, result in additional taxes, or other costs or have other material consequences, which could harm our business, revenue, cash flows and financial results.

Item 1B. Unresolved Staff Comments

None.

Item 1C. Cybersecurity

Risk Management and Strategy

We recognize the critical importance of cybersecurity and data privacy in safeguarding our operations, sensitive data, and maintaining the trust of our stakeholders. Cybersecurity incidents and threats as potential risks that may impact our operations and information systems. We have developed and implemented cybersecurity and data privacy programs in accordance with the requirements of ISO standards 27001:2013 and 27701:2019, which are intended to appropriately preserve the confidentiality, integrity, and availability of information maintained by our company. These programs identify, select, maintain, operate, and improve cybersecurity and privacy controls.

We have implemented processes for assessing, identifying, and managing material risks from cybersecurity threats. These processes are designed to preserve the confidentiality, integrity, and availability of our information systems and the information residing therein. Our cybersecurity incident response plan is based on the NIST 800-61r2 “Computer Security Incident Handling Guide.” This plan is used to process security events identified through our real-time, 24x7 monitoring, and conducts security incident tabletop exercises. The incident response plan includes detailed steps for incident leadership, escalation to established partners, response protocols based on the type of incident, responsibilities for follow-up and reporting, and steps to capture lessons learned and improvement opportunities. Our vulnerability management processes include real-time monitoring for vulnerabilities and standardized reporting for managing remediation efforts. Our cybersecurity risk management processes are integrated into our overall risk management system to ensure alignment with our business objectives and strategies. We engage assessors, consultants, auditors and other third parties to execute certification audits, penetration tests, and security framework risk assessments. These external entities provide specialized expertise and insights to enhance the effectiveness of our cybersecurity risk management processes.

We have established processes to oversee and identify cybersecurity risks associated with our use of third-party service providers. We conduct due diligence assessments and evaluate contractual obligations to mitigate potential risks arising from third-party relationships.

Cybersecurity threats, including previous incidents, have the potential to materially affect our company, including our business strategy, results of operations, and financial condition. While we have not experienced material adverse effects from cybersecurity threats to date, we recognize the evolving nature of these risks and remain vigilant in our efforts to mitigate potential impacts.

Governance

Our Board of Directors provides oversight of risks from cybersecurity threats. The Security and Privacy Management Committee (the “SPMC”) consists of our Chief Financial Officer, General Counsel, Vice President of Information Technology, Chief Human Resources Officer, Director of Information Security and Director of Environmental Health and Safety. The SPMC is tasked with ensuring risks are adequately addressed within our governance framework.

We maintain a dedicated team of cybersecurity professionals. The Director of Information Security, the Information Security team, the SPMC, the Vice President of Information Technology, and the Information Technology leadership team are principally responsible for assessing and managing cybersecurity risks for our company. These individuals possess relevant expertise in cybersecurity risk management and are equipped to address the evolving nature of cyber threats. Our Director of Information Security has over 20 years of cybersecurity experience, holds several professional certifications and is an adjunct faculty member teaching courses on information security management and governance. Our cybersecurity professionals have a proven track record of executing strategic security objectives across various sectors, including utility, government, healthcare, and consulting. They bring with them experience in designing, implementing, and managing information security programs focused on quality, performance, and compliance.

Our information security team and our third-party security service providers actively monitor the prevention, detection, mitigation, and remediation of cybersecurity incidents, ensuring timely response and resolution. Processes are in place to inform relevant management positions and committees about emerging threats and incident response activities. The Director of Information Security provides regular updates on cybersecurity risks and incidents to the Board of Directors, the SPMC, and IT leadership.

Item 2.Properties

Our Silicon Valley office facilities consist of a 153,738 square foot building, with office and laboratory space located on a 6.3-acre tract of land we own in Menlo Park, California and an adjacent 27,000 square feet of warehouse storage space on a 1.1-acre tract of land that we also own.

Our Test and Engineering Center (TEC) occupies 147 acres in Phoenix, Arizona. We lease this land from the state of Arizona under a 30-year lease agreement that expires in January 2028 and have options to renew for two fifteen-year15-year periods. We constructed ana 21,613 square foot indoor test facility as well as ana 44,053 square foot engineering and test preparation building at the TEC.

Our office facilities in Natick, Massachusetts, consist of a 60,480 square foot building, with office and laboratory space located on a 2.9 acre tract of land that we own and an adjacent building that consists of 9,100 square feet of office space located on a 0.81 acre tract of land that we also own.

In addition, we lease office warehouse and laboratory space in 1821 other locations in 13 states and the District of Columbia, as well as in Germany, China, Hong Kong, Singapore, Switzerland and the United Kingdom. Leases for these offices warehouse and laboratory facilities have terms generally ranging between one and ten10 years. Aggregate lease expense in fiscal 2017 for all leased properties was $6,712,000.

Item 3. Legal Proceedings

Exponent is not engaged in any material legal proceedings.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Exponent’s common stock is traded on the NASDAQ Global Select Market, under the symbol “EXPO.” The following table sets forth for the fiscal periods indicated the high and low sales prices for our common stock.

As of February 16, 2018,2024, there were 182166 holders of record of our common stock. Because many of the shares of our common stock are held by brokers and other institutions on behalf of stockholders, we believe that there are considerably more beneficial holders of our common stock than record holders.

We paid $21.6 million, $18.6 million and $15.5 million of dividends during fiscal 2017, 2016 and 2015, respectively. Total dividends paid per share were $0.84, $0.72 and $0.60 during fiscal 2017, 2016 and 2015, respectively. On February 1, 2018, our Board of Directors announced a quarterly cash dividend of $0.26 per share of the Company’s common stock, payable March 23, 2018, to stockholders of record as of March 2, 2018. We anticipate paying quarterly dividends each year in March, June, September and December, subject to declaration by our Board of Directors. See Part II, “Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources.”

The following table provides information on the Company’s share repurchases (of Company common stock) for the quarter ended December 29, 20172023 (in thousands, except price per share):

Repurchases of the Company’s common stock were effectedaffected pursuant to a repurchase program authorized by the Company’s Board of Directors. On May 29, 2014,February 22, 2022 the Company’s Board of Directors authorized $35,000,000announced approval of $150,000,000 for the repurchase of the Company’s common stock. On October 20, 2015,February 1, 2024 the Company’sCompany's Board of Directors authorized $35,000,000an additional $61,600,000 for the repurchase of the Company’s common stock. On October 18, 2016, the Company’s Board of Directors authorized $35,000,000 for the repurchase of the Company’sCompany's common stock. These repurchase programs have no expiration dates. As of December 29, 2017, there remained $45,376,000 available for repurchases under these authorizations.

COMPANY STOCK PRICE PERFORMANCE GRAPH

TheThis graph compares the Company’s cumulative total stockholder return calculated on a dividend-reinvested basis from 20122019 through 20172023 with those of the Standard & Poor’s (“S&P”) 500 Index, the S&P MidCap 400 Index, and the S&P SmallCap 600 Index. The Company does not have a comparable peer group and thus has selected the S&P Small CapMidCap 400 Index. In prior years the company used the S&P SmallCap 600 Index. During 2023, the company was added to the S&P MidCap 400 Index. As such the company selected this index for 2023. The graph assumes that $100

was invested on the last day of 2012.2018. Note that the historic stock price performance is not necessarily indicative of future stock price performance.

Item 6. Selected Financial Data(Reserved)

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This section of this Annual Report on Form 10-K generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022. Discussions of 2022 and year-to-year comparisons between 2022 and 2021 that are not included in this Annual Report form 10-K can be found in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 30, 2022.

OVERVIEW

Exponent is an engineering and scientific consulting firm providing solutions to complex problems. Exponent's interdisciplinary organization of scientists, physicians, engineers, and business consultants draws from more than 90 technical disciplines to solve the most pressing and complicated challenges facing stakeholders today. The firm leverages over 50 years of experience in analyzing accidents and failures to advise clients as they innovate their technologically complex products and processes, ensure the safety and health of their users, and address the challenges of sustainability.

CRITICAL ACCOUNTING ESTIMATES

In preparing our consolidated financial statements, we make assumptions, judgments and estimates that can have a significant impact on our revenue, operating income and net income, as well as on the value of certain assets and liabilities on our consolidated balance sheet. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions or conditions. On a regular basis we evaluate our assumptions, judgments and estimates and make changes accordingly. We believe that the assumptions, judgments and estimates involved in accounting for revenue recognition and estimating the allowance for contract losses and doubtful accounts have the greatest potential impact on our consolidated financial statements, so we consider these to be our critical accounting policies. We discuss below the assumptions, judgments and estimates associated with these policies. Historically, our assumptions, judgments and estimates relative to our critical accounting policies have not differed materially from actual results. For further information on our critical accounting policies, see“Note 1: Summary of Significant Accounting Policies”1 of ourNotes to Consolidated Financial Statements.

Revenue recognition.We derive our revenues primarily from professional fees earned on consulting engagements, fees earned for the use of our equipment and facilities, as well as reimbursements for outside direct expenses associated with the services that are billed to our clients.

Substantially all of our engagements are service contracts performed under time and material or fixed-price billing arrangements. For time and material and fixed-price service projects, revenue is generally recognized as the services are performed. For substantially all of our fixed-price service engagements, we recognize revenue based on the relationship of incurred labor hours at standard rates to our estimate of the total labor hours at standard rates we expect to incur over the term of the contract. Our estimate of total labor hours we expect to incur over the term of the contract is based on the nature of the project and our past experience on similar projects. We believe this methodology achieves a reliable measure of the revenue from the consulting services we provide to our customers under fixed-price contracts.

Management judgments and estimates must be made and used in connection with the revenues recognized in any accounting period. These judgments and estimates include an assessment of the estimate as to the total effort required to complete fixed-price projects. If we made different judgments or utilized different estimates, the amount and timing of our revenue for any period could be materially different.

All contracts are subject to review by management, which requires a positive assessment of the collectability of contract amounts. If, during the course of the contract, we determine that collection of revenue is not reasonably assured, we do not recognize the revenue until its collection becomes reasonably assured, which in those situations would generally be upon receipt of cash. We assess collectability based on a number of factors, including past transaction history with the client, as well as the credit-worthiness of the client. Losses on fixed-price contracts are recognized during the period in which the loss first becomes evident. Contract losses are determined to be the amount by which the estimated total costs of the contract exceeds the total fixed price of the contract.

Estimating the allowance for contract losses and doubtful accounts.We make estimates of our ability to collect accounts receivable and our unbilled but recognized work-in-process. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations to us or for disputes with customers that affect our ability to fully collect our accounts receivable and unbilled work-in-process, we record a specific allowance to reduce the net recognized receivable to the amount we reasonably believe will be collected. For all other customers we recognize allowances for contract losses and doubtful accounts taking into consideration factors such as historical write-offs, customer concentration, customer credit-worthiness,creditworthiness, current and forecasts of future economic conditions, and aging of amounts due.

The following table sets forth, for the periods indicated, the percentage of revenues of certain items in our consolidated statements of income and the percentage increase (decrease) in the dollar amount of such items year to year:

EXECUTIVE SUMMARY

Revenues for 20172023 increased 10%5% and revenues before reimbursements also increased 10%7% as compared to the prior year. The increase in revenues before reimbursements was due to an increase in billable hours and an increase in billing rates. Our multidisciplinary team of scientists and engineers continues to provide critical data, analyses and insights for our clients as society raises expectations for safety, health and the environment. Growth during 2023 was driven by our reactive business, which experienced strong demand for failure investigations and dispute-related work. Demand for our services across the transportation and energy sectors was strong during 2023. Proactive revenues for the consumer electronics sector declined during 2023 due to ongoing industry headwinds and product lifecycle timing. The remainder of our proactive portfolio grew during 2023 primarily driven by safety-related work evaluating the impacts of chemicals on human health and the environment.

Society is raising the bar for safety, health, sustainability and reliability, and clients are increasingly seeking our interdisciplinary proactive solutions. As our suite of offerings and key markets expands, so does the demand for our multidisciplinary services. We continue to see demand forexpand our proactive services inclient relationships and enhance our reputation and capabilities across the areas of designfirm. As innovation and regulatory consulting, specifically related to consumer electronics. We also continue to see demand for our reactive services in construction disputes, medical device litigations, consumer product and automobile recalls, and product liability claims.

During 2017, we had strong growth in our chemical regulation & food safety, construction consulting, human factors, mechanical engineering, and polymer science & materials chemistry practices. We have been engaged to perform human factors assessments by appliance manufacturers, consumer electronics companies, medical device firms, and video game developers, including work in augmented reality. Duringtechnology become increasingly complex, the year, we worked on a large human factors assessment for a client in the consumer products industry, driving increases in both revenue and profitability. This project represented approximately 6%critical nature of our revenues before reimbursements for 2017 and leveraged staff across many ofinsights uniquely positions Exponent to address our practices and offices.clients’ needs throughout the product lifecycle.

During the year, we increased our international construction disputes work with current mining, gas terminal and power plant projects. We also experienced growth from lithium-ion battery consulting for clients in the consumer products, transportation, medical device, and utility industries. Our interdisciplinary team of chemists, electrical engineers, materials scientists and mechanical engineers has guided clients with respect to the performance, reliability, and safety of new products, as well as with respect to recalls and litigation matters involving existing products with lithium-ion batteries.

Net income decreased to $41,305,000was $100,339,000 during 20172023 as compared to $47,480,000$102,330,000 during 2016.2022. Diluted earnings per share decreased to $1.53$1.94 for 20172023 as compared to $1.75$1.96 for 2016. The decrease in net2022. Net income and diluted earnings per share for 2023 and 2022 benefited from the excess tax benefit associated with stock-based awards. The excess tax benefit associated with stock-based awards decreased to $3,620,000 during 2023 as compared to $5,829,000 during 2022. The decrease in the excess tax benefit was due to the impact of the new tax legislation. During the fourth quarter of 2017, we recorded a tax expense of $16,507,000 related to the new tax legislation signed into law during the fourth quarter of 2017. We have domestic deferred tax assets primarily associated with our deferred compensation plan and stock-based compensation program, which were previously valued at the federal corporate income tax rate of 35%. Our deferred tax assets were re-measured at the lower enacted corporate tax rate of 21% which contributed $15,137,000 to thesmaller increase in income tax associated with the new tax legislation. We also have foreign earnings that were subject to the mandatory repatriation tax. The total mandatory repatriation tax, net of the benefitvalue of our foreign tax credits, contributed $1,370,000 tocommon stock between the increase in income tax expense associated withgrant date and the tax legislation.

Income before income taxes increased 19% to $82,509,000release date for the restricted stock units released during 20172023 as compared to $69,122,000 during 2016. We were able to improve pre-tax income by effectively managing headcount to align our resources with demand and benefited from a large human factors assessment for a client in the consumer products industry, which resulted in improved utilization and increased leverage of our cost structure.2022.

We remain focused on selectively adding top talentbuilding our world-class engineering and developingscientific team to position Exponent at the skills necessary to expand uponforefront of innovation and meet the ever-changing needs of our market position, providing clients with in-depth scientific research and analysis to determine what happened and how to prevent failures or exposures in the future.market. We also remain focused on capitalizing on emerging growth areas, managing other operating expenses, generating cash from operations, maintaining a strong balance sheet and undertaking activities such as share repurchases and dividends to enhance shareholder value.

OVERVIEW OF THE YEAR ENDED DECEMBERDecember 29, 20172023

Our revenues consist of professional fees earned on consulting engagements, fees for use of our equipment and facilities, and reimbursements for outside direct expenses associated with the services performed that are billed to our clients.

We operate on a 52-53 week fiscal year with each year ending on the Friday closest to December 31st. The fiscal years ended December 29, 2017, December 30, 2016 and January 1, 2016Fiscal period 2023 included 52 weeks of activity.activity and ended on December 29, 2023. Fiscal 2018period 2022 included 52 weeks of activity and ended on December 30, 2022. Fiscal period 2021 included 52 weeks of activity and ended on December 31, 2021. Fiscal period 2024 is 53 weeks and will end on Friday, December 28, 2018.January 3, 2025.

During 2017,2023, billable hours increased 9%2% to 1,218,0001,495,000 as compared to 1,118,0001,465,000 during 2016.2022. Our utilization increaseddecreased to 75%69% for 20172023 as compared to 70%74% for 2016.2022. The decrease in utilization during 2023 was due to an increase in technical full-time equivalent employees. Technical full-time equivalent employees increased 3%10% to 784 during 20171,047 for 2023 as compared to 764 during 2016 due to our recruiting and retention efforts.955 for 2022. We continue to selectively hire key talent to expand our capabilities.

FISCAL YEARS ENDED DECEMBERDecember 29, 2017,2023 AND DECEMBERDecember 30, 2016 2022

Revenues

Revenues

The increase in revenues for our Engineering and Other Scientific segment was due to an increase in billable hours and an increase in billing rates. Growth in this segment during 2023 was primary driven by demand for our services across the transportation and energy sectors. During 2017,2023, billable hours for this segment increased by 9.9%3% to 941,0001,188,000 as compared to 856,0001,153,000 during 2016. The increase was due2022. Utilization for this segment decreased to demand70% for services in our construction consulting, human factors, mechanical engineering, and polymer science & materials chemistry practices. Reactive services continued to grow as our engineers and scientists were engaged to address construction disputes, medical device litigations, and consumer product and automobile recalls. Proactive services expanded, as we performed human factors assessments for consumer products and design consulting for consumer electronics. Utilization increased to 77% for 20172023 as compared to 73%75% for 2016.2022 due to an increase in technical full-time equivalent employees. Technical full-time equivalentsequivalent employees in this segment increased 4.8%11% to 591818 during 2023 as compared to 736 for 2017 from 564 for 2016 due to our recruiting and retention efforts.2022.

The increase in revenues from our Environmental and Health segment was due to an increase in billing rates offset by a decrease in billable hours. Growth in this segment during 2023 was primarily driven by safety-related work evaluating the impacts of chemicals on human health and the environment. During 2017,2023, billable hours for this segment increaseddecreased by 5.7%2% to 277,000307,000 as compared to 262,000312,000 during 2016.2022. Utilization increasedfor this segment decreased to 64% for 2023 as compared to 69% for 20172022. Technical full-time equivalents increased 5% to 229 during 2023 as compared to 63%219 for 2016. During the year, the chemical regulation and food safety practice grew its proactive services to meet demand, as society remains concerned about chemicals affecting the global ecosystem and human health. Our environmental health scientists provided reactive services performing human health and environmental assessments. This segment’s contribution2022. The decrease in utilization was due to the large ongoing human factors assessment also contributed to the5% increase in billable hours and utilization. Technicaltechnical full-time equivalents decreased 3.5% to 193 during 2017 as compared to 200 for 2016 due to our efforts to align resources with anticipated demand.equivalent employees.

Revenues are primarily derived from services provided in response to client requests or events that occur without notice and engagements are generally terminable or subject to postponement or delay at any time by our clients. As a result, backlog at any particular time is small in relation to our quarterly or annual revenues and is not a reliable indicator of revenues for any future periods.

Compensation and Related Expenses

The increase in compensation and related expenses during 20172023 was due to an increase in bonus expense, an increase in payroll expense, an increase in fringe benefits, and a change in the value of assets associated with our deferred compensation plan. During 2017, bonus expense increased by $7,718,000 due to a correspondingplan and an increase in income before income taxes, before bonus expense, and before stock-based compensation. During 2017, payrollwages and fringe benefits increased $4,769,000 and $991,000, respectively, due to the increase in technical full-time equivalent employees and our annual salary increase.benefits. During 2017,2023, deferred compensation expense increased $2,686,000$28,502,000 with a corresponding increase to other income, net, as compared withto the prior year due to the change in value of assets associated with our deferred compensation plan. This increase consisted of an increase in the value of the plan assets of $6,547,000$14,315,000 during 20172023 as compared to an increasea decrease in the value of the plan assets of $3,861,000$14,187,000 during 2016. We expect2022. Wages increased $21,084,000 and fringe benefits increased $4,888,000 during 2023 due to the impact of our compensation expense, excluding the changeannual salary increase and increase in valuenumber of deferred compensation plan assets, to increase as we selectively add new talent and adjust compensation to market conditions.employees.

Other Operating Expenses

Other operating expenses include facilities-related costs, technical materials, computer-related expenses and depreciation and amortization of property, equipment and leasehold improvements. The increase in other operating expenses was primarily due to an increase in occupancy expense of $416,000,$2,037,000, an increase in computerdepreciation expense of $270,000,$1,837,000 and an increase in technical materialsinformation technology related expenses of $183,000, and several individually insignificant increases, which were associated with the$1,715,000. The increase in occupancy expenses was due to growth in technical full-time equivalent employees and investmentsthe transition back to our offices from a remote work environment. The increases in depreciation and information technology related expenses were due to continued investment in our corporate infrastructure. We expect other operating expenseexpenses to grow as we selectively add new talent and continue to make investments in our corporate infrastructure.

Reimbursable Expenses

The increase in reimbursable expenses was primarily due to an increase in travel related costs associated with our large human factors assessment project. The amount of reimbursable expenses will vary from year to year depending on the nature of our projects. The decrease in reimbursable expenses as compared to 2022 was due to a decrease in proactive projects for the consumer electronics sector.

General and Administrative Expenses