What changed in this filing

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Item 1. Business

2021-08-30 compared with 2020-09-02 · 128 added, 95 removed, 312 unchanged (42% of the section changed)

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We are a designer, developer and global supplier of a broad portfolio of power semiconductors.

Our portfolio of power semiconductors includes approximately 2,300 products, and has grown significantly with the introduction of over 160 new products in the fiscal year ended June 30, 2020 , and over 200 new products in each of the fiscal year ended June 30, 2019 and 2018 , respectively.

Our portfolio of power semiconductors includes approximately 2,400 products, and has grown significantly with the introduction of over 160 new products in the fiscal year ended June 30, 2021, and over 160 and 200 new products in the fiscal year ended June 30, 2020 and 2019, respectively.

Our teams of scientists and engineers have developed extensive intellectual properties and technical knowledge that encompass major aspects of power semiconductors, which we believe enables us to introduce and develop innovative products to address the increasingly complex power requirements of advanced electronics.

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Our metal-oxide-semiconductor field-effect transistors, or MOSFET, portfolio expanded significantly across a full range of voltage applications.

We also developed new technologies and products designed to penetrate into markets beyond our MOSFET computing base, including the consumer, communications and industrial markets, IGBTs for the home appliance market, as well as power ICs for the next generation computing applications.

We also developed new technologies and products designed to penetrate into markets beyond our MOSFET computing base, including the consumer, communications and industrial markets, Insulated Gate Bipolar Transistors, or IGBTs for the home appliance market, as well as power ICs for the next generation computing applications.

Our business model leverages global resources, including research and development and manufacturing in the United States and Asia.

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As of June 30, 2021, we own 51%, and the Chongqing Funds own 49%, of the equity interest in the JV Company.

The JV Company had been ramping

up its production of assembly and testing during the fiscal year 2020.

The 12-inch wafer fabrication facility commenced its limited mass production in the quarter ended September 30, 2019 and continued its ramp in the year ended June 30, 2020.

During the fiscal year 2021, the

additional capacity at the JV Company contributed significantly to meeting the increasing demand for our products.

The JV Company has reached its targeted production of assembly and testing and is currently ramping up its Phase I of the 12-inch wafer fabrication.

While the JV Company is our consolidated subsidiary for purpose of financial reporting, it operates as an independent and separate legal entity.

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For example, the JV Company incurs debt through its own financing and bank loan agreements, and we are not parties to these agreements and do not provide any guarantee or security for the JV Company’s debt, nor do we have direct access to any cash proceeds borrowed from such loan agreements.

In September 2017, we entered into a license agreement with STMicroelectronics International N.V.

(“STMicro”), pursuant to which STMicro granted us a world-wide, royalty-free and fully-paid license to use its technologies to develop, market and distribute certain digital power multi-phase controller products, which have been previously offered by STMicro.

We have been in the process of developing this new digital power business.

Our digital power team continues to work with customers in their product designs and is making steady progress on our product roadmap.

In July 2020, we shipped our first digital power product.

We were incorporated in Bermuda on September 27, 2000 as an exempted limited liability company.

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The function of power discrete devices is power delivery by switching, transferring or converting electricity.

Power transistors comprise the largest segment of the power discrete device market.

Power transistors comprise the largest portion of the power discrete device market.

Power ICs, sometimes referred to as power management ICs, perform power delivery and power management functions, such as controlling and regulating voltage and current and controlling power discrete devices.

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In the area of AC-DC power supplies for electronic equipment, data centers and servers, the market is characterized by a continuous demand for energy conservation through higher efficiency, which is driving the need for our medium voltage (40V-400V) and high voltage (500V-1000V) MOSFET products.

The increased application of power semiconductors to control motors in white goods and industrial applications, is driving demand for Insulated Gate Bipolar Transistors, or IGBTs.

The increased

application of power semiconductors to control motors in white goods and industrial applications, is driving demand for Insulated Gate Bipolar Transistors, or IGBTs.

IGBTs are also being used in renewable energy and automotive applications.

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Our in-house manufacturing capability allows us to retain a higher level of control over the development and application of our proprietary process technology, thereby reducing certain operational risks and costs associated with utilizing third-party foundries.

We also expect to increase our manufacturing capacity through the JV Transaction, which we believe will also allow us to expand and diversify our markets in China, as well as to accelerate the development of our proprietary process technology and new product offerings.

Although our largest end-market segment is the personal computing ("PC") market, we have successfully diversified our business by expanding into other market segments, including the consumer, communications, power supply and industrial market segments.

We recently commenced a plan to enhance the manufacturing capability and capacity of our Oregon fab by investing in new equipment and expanding our factory facilities, which we expect will have a positive impact on our future new product development and revenue, particularly during the period of global shortage of capacity.

Although our largest end-market is the personal computing ("PC") market, we have successfully diversified our business by expanding into other markets, including the consumer, communications, power supply and industrial markets.

While we have made progress in our diversification and expansion into additional applications, we continue to support and grow our PC business by expanding bill-of-material content, gaining market share, and acquiring new customers.

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We are also in the process of developing a digital power controller and smart power stage product lines based on the technology that we licensed from STMicro.

We believe that our increased product offerings will allow us to penetrate new end-market applications and

provide us with an important competitive advantage.

We believe that our increased product offerings will allow us to penetrate new end-market applications and provide us with an important competitive advantage.

OEMs and ODMs generally prefer to limit their supplier base to a smaller set of vendors capable of providing a comprehensive menu of products across multiple electronic platforms.

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We also believe that engineers with experience and understanding of these multiple disciplines are in great demand but short supply.

Within this context, we believe that we are well positioned to be a leader in providing total power management solutions because of our extensive pool of experienced scientists and engineers and our strong IP portfolio.

Within this context, we believe that we are well positioned to be a leader in providing total power management solutions

because of our extensive pool of experienced scientists and engineers and our strong IP portfolio.

Accordingly, we intend to leverage our expertise to increase the number of power discrete technology platforms and power IC designs, including future digital power controller products that are currently under development, to expand our product offerings and deliver complete power solutions for our targeted applications.

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Our power discretes products consist primarily of low, medium and high voltage power MOSFETs.

Our low voltage MOSFET series is based on our proprietary silicon and package technologies, with deep application know-how in various market segments.

Our low voltage MOSFET series is based on our proprietary silicon and package technologies, with deep application know-how in various markets.

We have precisely defined technology platforms to address different requirements from various applications.

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Our power ICs deliver power as well as control and regulate the power management variables, such as the flow of current and level of voltage.

Our DrMOS family of products continued to grow as we paired our latest high performance MOSFET

silicon with our latest Driver IC technologies.

Our DrMOS family of products continued to grow as we paired our latest high performance MOSFET silicon with our latest Driver IC technologies.

We continued to expand our EZBuck power IC family with products that feature lower on-resistance, less power consumption, smaller footprint and thermally enhanced packages.

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The following table lists our product families and the principal end uses of our products:

Product Family

Product Categories

within Product Type

Typical Application

Power Discretes

Low on-resistance switch used for routing current and switching voltages in power control circuits

Product Family Description Product Categories

within Product Type Typical Application

Power Discretes Low on-resistance switch used for routing current and switching voltages in power control circuits

High power switches used for power circuits

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Smart phone chargers, battery packs, notebooks, desktop and servers, data centers, base stations, graphics card, game boxes, TVs, AC adapters, power supplies, motor control, power tools, E-vehicles, white goods and industrial motor drives, UPS systems, solar inverters and industrial welding

Integrated devices used for power management and power delivery

DC-DC Buck conversion

Power ICs Integrated devices used for power management and power delivery DC-DC Buck conversion

DC-DC Boost conversion

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Flat panel displays, TVs, Notebooks, graphic cards, servers, DVD/Blu-Ray players, set-top boxes, and networking equipment

Analog power devices used for circuit protection and signal switching

Transient voltage protection

Analog power devices used for circuit protection and signal switching Transient voltage protection

Analog switch

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We introduced several new products based on our proprietary technology platform and continue to expand our product families.

During the fourth quarter of fiscal year of 2020, we announced a new Type-C Power Delivery 2-in-1 combo protection switch capable up to 28V absolute maximum voltage.

This new device provides true reverse current blocking intended for applications where protection from exposure to high voltages is required.

We also announced the release of the new 1200V silicon carbide (SiC) αSiC MOSFET technology platform.

Specifically targeting the industrial and automotive market, this next-generation technology enables customers to achieve higher levels of efficiency and power density compared to existing silicon solutions.

In addition, we released several 18V Input 1.25MHz EZBuck™ Regulators.

These devices offer a low on-resistance power stage and are packaged in a 3mm x 3mm DFN 8-lead package with an exposed thermal pad, allowing cooler power conversion for a variety of consumer and networking equipment such as wireless AP/routers, set-top boxes, cable modems, audio equipment, and LCD TVs.

During the third quarter of fiscal year of 2020, we released a new intelligent power module, AIM702H50B, specialized for low-power BLDC motor drives system such as fan motors in home appliances and air-

conditioners that require highly compact size with reliable and efficient design allowance.

The new IPM7 series consists of advanced super junction MOSFETs designed for motor drive and high voltage gate driving ICs with an integrated bootstrap circuit in a new ultra-compact surface mountable package.

Also, we released 700V and 600V αMOS5™ Super Junction MOSFET families in SMD-type DFN5x6 and DFN8x8 packages.

αMOS5 is our latest generation of high voltage MOSFET, designed to meet the high efficiency and high-density needs for Quick Charger, Adapter, PC Power, Server, Industrial Power, Telecom, and Datacenter applications.

During the second quarter of fiscal year of 2020, we introduced the AOZ8621UNI, a series of Transient Voltage Suppressor (TVS) for VBUS protection using the latest high-surge TVS platform.

This new series is ideal for USB Type-C Power Delivery, including but not limited to laptops and smartphones.

In addition, we introduced AOZ6682CI and AOZ6683CI which offer high efficiency over the full load range, allowing greener power conversion for a variety of consumer electronics applications such as LCD TVs, set-top boxes, high definition Blu-ray TM Disc Players and Networking terminals.

During the first quarter of fiscal year of 2020, we introduced the “Source Down” in a DFN 5x6 package in combination with a 40V Shield-Gate Technology (AlphaSGT™).

Our innovative flip-chip know-how achieves the Source Down capability and this packaging technology offers a very low package resistance and inductance.

The AOE66410 is ideally suited to telecommunications applications for secondary rectification, in half bridge configuration for BLDC motor applications, and battery management where paralleling is important.

In addition, we introduced the TO-Leadless (TOLL) package in combination with a 60V and 100V Shield-Gate Technology providing the highest current capability in its voltage class.

The TOLL package has high current capacity due to our innovative technology, which utilizes a clip to accommodate the in-rush current.

The TOLL packaging technology offers a very low package resistance and inductance due to the clip technology when compared to other TO-Leadless packages.

This packaging technology uses a standard wire-bonding technology which enables improved EMI performance.

During the fourth quarter of fiscal year of 2021, we introduced a series of single-channel Transient Voltage Suppressor (TVS) for high-speed line protection using the best-in-class low capacitance TVS platform.

The new products are well suited for Electrostatic Discharge (ESD) protection of Type-C connectors in mobiles, laptops, televisions, and other electronic devices.

We also announced a new series of Smart Power Stages (SPS) targeting multiphase VR regulators powering high-performance GPU and CPU in desktop Add-In Graphics Cards (AICs), gaming laptops, servers, data storage, artificial intelligence, and networking equipment.

In addition, we introduced a new family of application-specific EZBuck™ regulators.

The AOZ2263VQI-01 and AOZ2263VQI-02 are offered in a QFN 4 x 4 package and offer the industry’s most compact footprint to support VCCIO rails in Intel Rocket Lake platforms used in desktop computing systems.

During the third quarter of fiscal year of 2021, we released a new family of active AC-DC bridge rectifiers.

Aptly trademarked AlphaZBL™ for “zero bridge loss,” this new family of products virtually eliminates the bridge rectifier losses in AC-DC power supplies and adaptors.

Typical end applications include high power 100W and above adaptors used for high-end laptops and televisions as well as power supplies for Desktops, Game consoles, Servers, and Telecom.

We also released the new AEC-Q101 qualified 1200V silicon carbide (SiC) αSiC MOSFETs in optimized TO-247-4L package.

Ideal for the high efficiency and reliability requirements of electric vehicle (EV) on-board chargers, motor drive inverters, and off-board charging stations, these 1200V SiC MOSFETs provide the industry-leading lowest on-resistance available for an automotive qualified TO-247-4L with a standard gate drive of 15V.

We introduced a new family of application-specific EZBuck™ regulators.

The AOZ2264VQI and AOZ2369VQI are offered in a QFN 4 x 4 and QFN 5 x 5 package, respectively, and offer the industry’s most compact footprint to support VCCIN_AUX rails in Intel Tiger Lake platforms used in notebook and desktop computing systems.

Moreover, we announced a new Type-C Power Delivery (PD) high voltage source protection switch capable up to 28V absolute maximum voltage.

The AOZ1374 is a smart protection switch in a small thermally enhanced 3mm x 3mm DFN package.

AOS’s prowess in high-performance ICs combined with AOS’s state of the art high SOA MOSFETs using advanced co-packaging techniques.

AOZ1374 supports a slew of protection features, including true reverse blocking in a small solution footprint with an industry-leading on-resistance of 36mOhm.

During the second quarter of fiscal year of 2021, we released AOTL66518 and AOB66518L, a 150V MOSFET with low on-resistance and a high Safe Operating Area (SOA) capability designed for demanding applications in Telcom Hot Swap.

Also, we announced the release of a Fast Switching 600V αMOS5™ Super Junction MOSFETs in SMD-type TOLL Package.

αMOS5 is AOS’s latest generation of high voltage MOSFET, designed to meet the high efficiency and high-density needs for Quick Charger, Adapter, PC Power, Server, Industrial Power, Telecom, and Hyperscale Datacenter applications.

During the first quarter of fiscal year of 2021, we introduced a series of Transient Voltage Suppressors for high-speed line protection using the best-in-class low capacitance TVS platform.

The new products are well suited for Electrostatic Discharge (ESD) protection for laptops, televisions, and other electronic devices.

In addition, we announced a new series of DrMOS targeting multiphase VR regulators powering high-performance GPU and memory in desktop Add-In Graphics Cards (AICs) and gaming notebooks.

The AOZ531xQI series uses AOS latest generation of Gen Alpha MOSFET technology to provide benchmark performance in a 5mm x 5mm QFN package.

The series comprises of three DC current levels for multiphase voltage regulator optimization.

Also, we announced the release of, AONS32310, a 30V MOSFET with low on-resistance and a high Safe Operating Area (SOA) capability which is ideally suited for demanding applications such as hot swap and effuse.

Moreover, we announced the release of RigidCSP™ for battery management.

The new package technology is ideal for applications such as smartphones, tablets, and ultra-thin notebooks.

Distributors and customers

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In order to take advantage of the expertise of end-customer fulfillment logistics and shorter payment cycles, we sell most of our products through distributors.

In general, under the agreements with our distributors, they have limited rights to return unsold merchandise, subject to time and volume limitations.

In general, under our agreements with distributors, they have limited rights to return unsold merchandise, subject to time and volume limitations.

As of June 30, 2021, 2020 and 2019, our two largest distributors were WPG Holdings Limited, or WPG, and Promate Electronic Co.

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We believe that the technical background of our marketing team, including application engineers, helps us better define new products and identify potential end customers and geographic and product market opportunities.

For example, as part of our market diversification strategy, we have deployed and plan to recruit more for our new market segments, field application engineers, or FAEs, who provide real-time and local response to our end customers' needs.

For example, as part of our market diversification strategy, we have deployed and plan to recruit more, field application engineers, or FAEs, for our new product offerings, who provide real-time and local response to our end customers' needs.

FAEs work with our end customers to understand their requirements and resolve technical problems.

FAEs also strive to anticipate future customer needs and facilitate the design-in of our products into the end products of our customers.

FAEs also strive

to anticipate future customer needs and facilitate the design-in of our products into the end products of our customers.

We believe this strategy increases our share of revenue opportunities within the applications we currently serve, as well as in new end-market applications.

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Our sales cycle varies depending on the types of products and can range from six to eighteen months.

In general, our traditional power discrete products in PC and TV applications progress are progressing more rapidly through the design and marketing processes, therefore they generally have shorter sales cycle.

In contrast, our newer Power IC and IGBT products, mostly in the power supply, home appliance and industrial applications, require a more extended design and marketing timeline and thus have a longer sales cycle.

In general, our traditional power discrete products in PC and TV applications progress more rapidly through the customer's design and marketing processes, and therefore they generally have a shorter sales cycle.

In contrast, our newer Power IC and IGBT products, used mostly in the power supply, home appliance and industrial applications, require a more extended design and marketing timeline and thus have a longer sales cycle.

Typically, our sales cycle for all products comprises of the following steps:

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Some of our competitors have longer operating histories, more brand recognition, and significantly greater financial, technical, research and development, sales and marketing, manufacturing and other resources.

However, we believe that we can compete effectively through our integrated and innovative technology platform and design capabilities, including our strong and extensive patent portfolio, strategic global business model, expanding suites of new products, diversified and broad customer base, and excellent on-the-ground support and quick time to market for our products.

However, we believe that we can compete effectively through our integrated and innovative technology platform and design capabilities, including our strong

and extensive patent portfolio, strategic global business model, expanding suites of new products, diversified and broad customer base, and excellent on-the-ground support and quick time to market for our products.

As we provide power semiconductors used in consumer electronic products, our business is subject to seasonality.

Our sales seasonality is affected by a number of factors, including global and regional economic conditions as well as the PC market conditions, revenue generated from new products, changes in distributor ordering patterns in response to channel inventory adjustments and end customer demand for our products and fluctuations in consumer purchase patterns prior to major holiday seasons.

Our normal seasonality may be affected by the COVID-19 pandemic and given the uncertainty of the global economic conditions resulting from the pandemic, it is difficult for us to predict to what extent our sales seasonality may change.

Our normal seasonality has been affected significantly by the COVID-19 pandemic, which has resulted in changes in consumer behavior and industry trends.

Given the uncertainty of the global economic conditions resulting from the pandemic, it is difficult for us to predict to what extent our sales seasonality may change in the future.

Our sales are made primarily pursuant to standard purchase orders from distributors and direct customers.

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We also evaluate appropriate investment levels and stay focused on new product introductions to improve our competitiveness.

We have research and development teams in Silicon Valley (Sunnyvale, California), Oregon, Taipei, Taiwan, and Shanghai, China.

We have research and development teams in Silicon Valley (Sunnyvale, California), Oregon, Taipei, Taiwan, and China.

We believe that these diverse research and development teams enable us to develop leading edge technology platforms and new products.

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Consumer demand for smaller and more compact electronic devices with higher power density is driving the need for advanced packaging technology.

Our group of dedicated packaging engineers focuses on smaller form factors, higher power output with efficient heat dissipation and cost-effectiveness.

Our group of dedicated packaging engineers focuses on smaller form factors, and higher power output with efficient heat dissipation and cost-effectiveness.

We have invested resources to develop and enhance our proprietary packaging technologies, including the establishment of our in-house packaging and testing facilities.

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We focus on specialized process technology in the manufacturing of our products, including vertical DMOS, Shielded Gate Trench, Trench field stop IGBTs, charge-balance high voltage MOSFETs, Schottky Diode and BCDMOS processes.

Our process engineers work closely with our design team to deploy and implement our proprietary manufacturing processes at our Oregon fab, and more recently, at the Chongqing manufacturing facility under the JV, as well as the third-party foundries that fabricate our wafers.

We also expect our 12-inch fab at the JV Company will provide us with enhanced ability to develop and accelerate new process technology for advanced products.

Our process engineers work closely with our design team to deploy and implement our proprietary manufacturing processes at our Oregon fab, and more recently, at the 12 inch fab at the JV Company as well as the third-party foundries that fabricate our wafers.

To improve our process technology, we continue to develop and enhance our expertise in device physics in order to better understand the physical characteristics of materials and the interactions among these materials during the manufacturing process.

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Our Oregon fab allows us to accelerate the development of our technology and products, as well as to provide better service to our customers.

We allocate our wafer production between our in-house facility and third-party foundries, although in the past three years, we have gradually reduced our reliance on third-party foundries and increased allocation of capacity to our Oregon fab.

Currently our main third-party foundry is Shanghai Hua Hong Grace Electronic Company Limited, ("HHGrace"), or formerly HHNEC, located in Shanghai.

HHGrace has been manufacturing wafers for us since 2002.

manufactured 12.7%, 14.1% and 15.4% of the wafers used in our products for the fiscal years ended June 30, 2020 , 2019 and 2018 , respectively.

HHGrace manufactured 11.5%, 12.7% and 14.1% of the wafers used in our products for the fiscal years ended June 30, 2021, 2020 and 2019, respectively.

On March 29, 2016, we entered into the JV agreement with two investment funds affiliated with the municipalities of Chongqing for the purpose of constructing a power semiconductor packaging, testing and 12-inch wafer fabrication facility in the Liangjiang New Area of Chongqing.

The JV Company had been ramping up its production of assembly and testing during the fiscal year 2020.

The 12-inch wafer fabrication facility commenced its limited mass production in the quarter ended September 30, 2019 and continued its ramp in the year ended June 30, 2020.

During the fiscal year 2021, the additional capacity at the JV Company contributed significantly to meeting the increasing demand for our products.

The JV Company has reached its targeted production of assembly and testing.

We believe the JV Company will increase and diversify our customer base, particularly in China, and accelerate the development of proprietary process technology.

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Intellectual property is a critical component of our business strategy, and we intend to continue to invest in the growth, maintenance and protection of our intellectual property portfolio.

We own significant intellectual property in many aspects of

power semiconductor technology, including device physics and structure, wafer processes, circuit designs, packaging, modules and subassemblies.

We own significant intellectual property in many aspects of power semiconductor technology, including device physics and structure, wafer processes, circuit designs, packaging, modules and subassemblies.

We have also entered into intellectual property licensing agreements with other companies, including On Semiconductor Corp.

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As of June 30, 2021, we had 863 patents issued in the United States, of which 856 were based on our research and development efforts and 7 were acquired, and these patents are set to expire between 2022 and 2040.

We also had a total of 851 foreign patents, including 400 Chinese patents, 415 Taiwanese patents, 21 Korean patents, 4 Hong Kong patents, 2 Philippine patents, and 9 Japanese patents as of June 30, 2020 .

We also had a total of 898 foreign patents, including 421 Chinese patents, 438 Taiwanese patents, 21 Korean patents, 4 Hong Kong patents, 4 Philippine patents, 8 Japanese patents, 1 Europe patent and 1 India patent as of June 30, 2021.

Substantially all of our foreign patents were based on our research and development efforts.

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We also enter into confidentiality and invention assignment agreements with our employees, consultants, suppliers, distributors and customers and seek to control access to, and distribution of, our proprietary information.

Human Capital Resources

As of June 30, 2021, we had 3,939 employees, of whom 656 were located in the United States, 3,145 were located in China, and 138 were located in other parts of the world.

None of our employees is represented by a collective bargaining agreement.

Notwithstanding our global footprint and various geographical locations, we have created an integrated workforce where employees worldwide work and collaborate as a team to advance our common business objectives, while retaining local and regional practices and cultures.

We are committed to provide a working environment in which our employees can realize fully their talents and develop successful careers.

As our strength is in our people, we invest significantly in our employees by providing a wide range of training and development opportunities, including mentoring, coaching, attendance at external seminars and professional conferences, and regular in-house training sessions on specific topics.

We train our managers to become good stewards for our employees, balancing the need of quality of life and performance results.

We believe that these efforts contributed to the growth of our employee, as more than 50% of our managerial positions are promotions of existing employees within our companies.

We also keep our employees engaged and informed by providing periodic all staff communications, and semi-annual performance reviews to ensure that efforts and results are aligned with our business and strategic corporate objectives.

We value feedback from our employees and have an open door policy in our engagement with employees, and we encourage

employees to have regular conversations with their managers to share feedback and express concerns.

We also solicit employee feedback informally through regular employee interactions.

In addition, we conduct employee satisfaction surveys at certain locations to help management identify areas that may require improvement.

As part of AOS tradition, we also organize social events, including annual appreciation picnics, when possible given Covid-19 conditions, and holiday parties, inviting both employees and their families to join.

We believe these efforts enable us to build a strong and solid group of loyal employees who form the core of our human capital resource.

We are committed to provide an environment where employees from all walks of life are treated with respect, care and dignity.

To recruit new talent, we reach out to a broad range of sources, including employee referrals, on-line advertising, recruitment agencies, and other social medias to seek out the best qualified candidates regardless of their backgrounds.

We are also focused on ensuring a diverse workforce, including our management team.

Our Nominating and Corporate Governance Committee leads the effort in recruiting qualified directors to serve on our Board, and we are in compliance with California’s gender diversity laws, as well as recent laws requiring a minimum number of directors from underrepresented communities.

Our employees appreciate and value the strength of our people oriented culture and the benefits the workplace diversity brings.

We offer competitive compensation and benefits packages for our employees that include a combination of base salary, annual bonus, discretionary bonus for outstanding achievements, employee share purchase plan, time-based and performance based long term equity compensation.

Our equity related compensation programs are designed to motivate and incentivize our employees and align their rewards to financial and other business performance goals, while increasing our shareholder value.

We adhere strictly to the Company’s Code of Business Conduct and Ethics and other policies, and ensure that our employment practices respect human rights and comply with national, state and local regulatory requirements at all locations where we conduct business.

In addition, we have engaged nationally, recognized outside compensation consulting firms to independently evaluate the appropriateness and effectiveness of compensation for our executives and other officers and to provide benchmarks for executive compensation as compared to peer companies.

The health and safety of our employees are paramount to our companies.

At each of our major locations, we have formed site safety committees that conduct regular meetings to assess and improve effectiveness of our safety policies and guidelines, to monitor safety incidents and to oversee the implementation of corrective actions.

During the pandemic in 2020 and 2021, our COVID-19 prevention committees at factory sites in China took swift and decisive actions to prevent work-place contagion and to ensure the health and safety of our employees.

These actions included providing employees with Personal Protective Equipment ("PPE"), strict visitor controls, frequent sanitization of shuttle buses, temperature checking prior to boarding the shuttles, and temperature checking at the factory entrances, and regular self-audits.

As a result of these plans, we had zero COVID-19 cases at our facilities in China.

facilities, the COVID-19 prevention committees met regularly to update and enhance prevention measures in accordance to federal, state and county health orders, which allowed us to continue our operations without significant disruptions.

In addition, to support remote-working arrangements, we provided office workers with technology resources and in some cases a monthly stipend to set up home offices.

To protect our employees and their families against COVID-19 virus, we also implemented and sponsored bi-weekly on-site COVID-19 testing since January 2021 for essential employees who were authorized to work in our Sunnyvale lab facilities.

Environmental matters

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Our products sold in worldwide are subject to RoHS in Electrical and Electronic Equipment, which requires that the products do not contain more than agreed levels of lead, cadmium, mercury, hexavalent chromium, polybrominated biphenyl and polybrominated diphenyl ether flame retardants.

Our manufacturing facilities in China also obtained QC080000 certification, which is an IECQ Certificate of Conformity Hazardous Substance Process Management for European Directive 2002/95/EC requirements and a Certificate of Green Partner for Sony Green Partner Program.

Our manufacturing facilities in China also obtained QC080000 certification, which is an IECQ Certificate of Conformity Hazardous Substance Process Management for European Directive

2002/95/EC requirements and a Certificate of Green Partner for Sony Green Partner Program.

We avoid using these restricted materials to the extent possible when we design our products.

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As of June 30, 2021, 2020 and 2019, we were in compliance with the related conflict minerals rule.

As of June 30, 2020 , we had 3,978 employees, of whom 671 were located in the United States, 3,169 were located in China, 2 were located in Europe, and 136 were located in other parts of Asia.

None of our employees is represented by a collective bargaining agreement.

We consider our relationships with our employees to be good.

Export Control

We are subject to export and import control laws, trade regulations and other trade requirements that limit which products we sell and where and to whom we sell our products.

Because we are committed to complying with all applicable export control laws, regulations, and requirements, we have reviewed and revised our processes and procedures to ensure that our shipments to our customers remain compliant with applicable export laws.

As part of the enhanced process, we have also conducted extensive risk assessment on export control compliance and implemented training programs for our employees.

Executive Officers

The following table lists the names, ages and positions of our executive officers as of July 31, 2020 .

The following table lists the names, ages and positions of our executive officers as of August 15, 2021.

There are no family relationships between any executive officer, except that Mr.

Chang is a son of Dr.

Name Age Position

76 Chairman of the Board and Chief Executive Officer

Yueh-Se Ho, Ph.D.

Director and Chief Operating Officer

Chief Financial Officer and Corporate Secretary

Executive Vice President of Product Line

Chang 44 President

Yifan Liang 57 Chief Financial Officer and Corporate Secretary

Wenjun Li, Ph.D.

52 Chief Operating Officer

Bing Xue, Ph.D.

Senior Vice President of Global Sales

57 Executive Vice President of Worldwide Sales and Business Development

Chang, Ph.D ., is the founder of our company and has served as our Chairman of the Board and Chief Executive Officer since the incorporation of our company.

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in electrical engineering from the University of Missouri.

Yueh-Se Ho, Ph.D ., is a co-founder of our company and has served as our Chief Operating Officer since January 2006 and our director since March 2006.

Ho has held various operational management positions in our company since our inception, including the Vice President of Worldwide Operations from 2003 to 2006 and the Vice President of Back End Operations from 2000 to 2003.

Prior to co-founding our company, Dr.

Ho served as the Director of Packaging Development and Foundry Transfer at Siliconix from 1998 to 2000.

Ho received his B.S.

in chemistry from Tamkang University, Taiwan, and Ph.D.

in chemistry from the University of Pittsburgh.

Chang has been serving as our President since January 2021.

Prior to that, Mr.

Chang served in various management positions including Executive Vice President of Product Line Management, Senior VP of Marketing, VP of the MOSFET Product Line, and Senior Director of Product Marketing.

Chang has over 20 years of industry experience and leads our Product Line Marketing with various managerial responsibilities, including new product development, product lifecycle management, business development, and business strategy.

Chang received his B.A.

in Electrical Engineering from University of California, Berkeley and M.B.A.

from Santa Clara University.

Yifan Liang has been serving as our Chief Financial Officer since August 2014 and Corporate Secretary since November 2013.

6 unchanged sentences

in finance and accounting from the University of Alabama.

Chang has been serving as our Executive Vice President of Product Line Management since October 2019.

Prior to that, he served in various management positions in our product line and marketing divisions, including Senior Vice President of Marketing, Vice President of the MOSFET Product Line and Senior Director of Product Marketing.

Chang has over 20 years of industry experience and leads our Product Line Marketing with various managerial responsibilities, including new product introduction, product lifecycle management, business development, and business strategy.

He received his B.S.

in Electrical Engineering from University of California, Berkeley and M.B.A.

from Santa Clara University.

Bing Xue, Ph.D., has been serving as our Senior Vice President of Global Sales since November 2017 and Vice President of Global Sales since May 2015.

Li, Ph.D ., has served as our Chief Operating Officer since August 2021.

Prior to that, Dr.

Xue held various managerial positions in our company since 2003, including the Vice President of Worldwide Manufacturing from 2008 to 2012 and General Manager of China Operation from May 2005

to December 2007.

Li served in various management positions in our Company since 2012, including Executive Vice President of World-Wide Manufacturing, Senior Vice President of World-Wide Manufacturing, Vice President of Front-End Operation, the director of Process Integration and Senior Manager of Process Integration.

Li holds a B.S.

in Chemistry and a M.S.

in Chemical Engineering from Taiyuan

University of Technology, and a Ph.D.

in Microelectronics & Solid-State Electronics from the Research Institute of Micro-Nanometer Technology at Shanghai Jiao Tong University.

Bing Xue, Ph.D., has been serving as our Executive Vice President of Worldwide Sales and Business Development since January 2021.

Prior to that, Dr.

Xue held various managerial positions in our company since 2003, including Senior Vice President of Global Sales, Vice President of Global Sales, Vice President of Worldwide Manufacturing, and General Manager of China Operation.

Prior to joining us, Dr.

8 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business