What changed in this filing

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Item 1. Business

2023-08-29 compared with 2022-09-20 · 140 added, 177 removed, 282 unchanged (53% 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 2,500 products, and has grown significantly with the introduction of over 130 new products in the fiscal year ended June 30, 2022, and over 160 new products in each of the fiscal years ended June 30, 2021 and 2020, respectively.

Our portfolio of power semiconductors includes approximately 2,600 products, and has grown significantly with the introduction of over 60 new products in the fiscal year ended June 30, 2023, and over 130 and 160 new products in the fiscal year ended June 30, 2022 and 2021, 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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We differentiate ourselves by integrating our expertise in technology, design, and advanced packaging to optimize product performance and cost.

Our portfolio of products targets high-volume applications, including portable computers, graphics cards, flat panel TVs, home appliances, power tools, smart phones, battery packs, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment.

Our portfolio of products targets high-volume applications, including portable computers, graphics cards, home appliances, power tools, smart phones, battery packs, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment.

During the fiscal year ended June 30, 2023, we continued our diversification strategy by developing new silicon and packaging platforms to expand our serviceable available market, or SAM, and offer higher performance products.

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We operate an 8-inch wafer fabrication facility located in Hillsboro, Oregon (the "Oregon fab"), which is critical for us to accelerate proprietary technology development, new product introduction and improve our financial performance.

Recently we expanded and upgraded our manufacturing capabilities at the Oregon Fab.

The expansion is expected to be completed in the fiscal quarter ending March 31, 2023.

To meet the market demand for more mature high-volume products, we also utilize the wafer manufacturing capacity of selected third party foundries.

For assembly and test, we primarily rely upon our in-house facilities in China.

In addition, we utilize subcontracting partners for industry standard packages.

We believe our in-house packaging and testing capability provides us with a competitive advantage in proprietary packaging technology, product quality, costs and sales cycle time.

On March 29, 2016, the Company entered into a joint venture contract (the “JV Agreement”) with two investment funds owned by the Municipality of Chongqing (the “Chongqing Funds”), pursuant to which the Company and the Chongqing Funds formed a joint venture, (the “JV Company”), for the purpose of constructing and operating a power semiconductor packaging, testing and 12-inch wafer fabrication facility (the “Chongqing Fab”) in the LiangJiang New Area of Chongqing, China (the “JV

Transaction”).

The Chongqing Fab is being built in phases.

As of December 1, 2021, the Company owned 50.9%, and the Chongqing Funds owned 49.1% of the equity interest in the JV Company.

The JV Company was accounted under the provisions of the consolidation guidance since the Company had controlling financial interest until December 1, 2021.

Effective December 1, 2021, the Company entered into a share transfer agreement (the “STA”) with a third-party investor (the “Investor”), pursuant to which the Company sold to the Investor approximately 2.1% of outstanding equity interest held by the Company in the JV Company for an aggregate purchase price of RMB 108 million or approximately $16.9 million (the “Transaction”).

The Transaction was closed on December 2, 2021 (the “Closing Date”).

As a result of the Transaction, as of the Closing Date, the Company’s equity interest in the JV Company decreased from 50.9% to 48.8%.

Also, the Company’s right to designate directors on the board of JV Company was reduced to three (3) out of seven (7) directors from four (4) directors prior to the Transaction.

As a result of the Transaction, AOS no longer had a controlling financial interest in the JV Company under generally accepted accounting principles.

Loss of control is deemed to have occurred when, among other things, a parent company owns less than a majority of the outstanding equity interest in the subsidiary, lacks a controlling financial interest in the subsidiary and, is unable to unilaterally control the subsidiary through other means such as having, or the ability to obtain or represent, a majority of the subsidiary’s board of directors.

Because of these factors, as of December 2, 2021, the Company ceased having control over the JV Company.

Therefore, the Company deconsolidated the financial statements of the JV Company as of that date.

Subsequently, the Company has accounted for its investment in the JV Company using the equity method of accounting.

On December 24, 2021, the Company entered into a share transfer agreement with another third-party investor, pursuant to which the Company sold to this investor 1.1% of outstanding equity interest held by the Company in the JV Company for an aggregate purchase price of RMB 60 million, or approximately $9.4 million.

In addition, on December 30, 2021, the JV Company adopted an employee equity incentive plan and issued an equity interest equivalent to 3.99% of the JV Company in exchange for cash.

As a result, the Company owned 45.8% of the equity interest in the JV Company as of December 31, 2021.

On January 26, 2022, the JV Company completed a financing transaction pursuant to a corporate financing agreement (the “Financing Agreement”) between the JV Company and certain third-party investors (the “New Investors”).

Under the Financing Agreement, the New Investors purchased newly issued equity interest of the JV Company for a total purchase price of RMB 509 million (or approximately $80 million based on the currency exchange rate as of January 26, 2022) (the “Investment”).

Immediately following the closing of the Investment, the percentage of outstanding JV Company equity interest beneficially owned by the Company was further reduced to 42.2%.

We also expanded and upgraded our manufacturing capabilities at the Oregon Fab in 2023.

To meet the market demand for the more mature high volume products, we also utilize the wafer manufacturing capacity of selected third party foundries.

We utilize both in house assembly and test facilities in China as well as subcontractors for industry standard packages.

We believe our in-house packaging and testing capability provides us with a competitive advantage in proprietary packaging technology, product quality, cost and sales cycle time.

On March 29, 2016, we entered into a joint venture contract (the “JV Agreement”) with two investment funds owned by the Municipality of Chongqing (the “Chongqing Funds”), pursuant to which the Company and the Chongqing Funds formed a joint venture, (the “JV Company”), for the purpose of constructing and operating a power semiconductor packaging, testing and 12-inch wafer fabrication facility in the Liangjiang New Area of Chongqing, China (the “JV Transaction”).

As of December 1, 2021, we owned 50.9%, and the Chongqing Funds owned 49.1%, of the equity interest in the JV Company.

The Joint Venture

was accounted under the provisions of the consolidation guidance since we had controlling financial interest until December 1, 2021.

As of December 2, 2021, we ceased having control over the JV Company.

Therefore, we deconsolidated the JV Company as of that date.

Subsequently, we have accounted for its investment in the JV Company using the equity method of accounting.

As of June 30, 2023, the percentage of outstanding JV equity interest beneficially owned by the Company was reduced to 42.2%.

Such reduction reflects (i) the sale by the Company of approximately 2.1% of the outstanding JV equity interest which resulted in the deconsolidation of the JV Company, (ii) additional sale by the Company of approximately 1.1% of outstanding JV equity interest in December 2021, (iii) the adoption of an employee equity incentive plan and the issuance of additional equity interest equivalent to 3.99% of the JV Company to investors in exchange for cash in December 2021, and (iv) issuance of additional equity interest of the JV to investors in January 2022.

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

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office is Alpha and Omega Semiconductor Incorporated, 475 Oakmead Parkway, Sunnyvale, CA 94085.

Telephone number of our U.S.

The telephone number of our U.S.

office is (408) 830-9742.

We have incorporated various wholly-owned subsidiaries in different jurisdictions, and a subsidiary (the JV Company) in which we have a minority interest.

We have incorporated various wholly-owned subsidiaries in different jurisdictions.

Please refer to Exhibit 21.1 to this Form 10-K for a complete list of our subsidiaries.

Semiconductors are electronic devices that perform a variety of functions, such as converting or controlling signals, processing data and delivering or managing power.

With advances in semiconductor technology, the functionality and performance of semiconductors have generally increased over time, while size and cost have generally decreased.

The functionality and performance of semiconductors have generally increased over time, while size and cost have generally decreased.

These advances have led to a proliferation of more complex semiconductors being used in a wide variety of consumer, computing, communications and industrial markets and have contributed to the growth of the semiconductor industry.

This has been accelerated by more regulations governing energy efficiency in many end applications.

Regulations governing energy efficiency have accelerated this process in many applications.

Analog semiconductors

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Therefore, experienced analog engineers with requisite knowledge are in great demand but short supply worldwide.

In addition, analog semiconductors tend to have a longer product life cycle because original design manufacturers, or ODMs and original equipment manufacturers, or OEMs typically design the analog portions of a system to span multiple generations of their products.

Once designed into an

application, the analog portion is rarely modified because even a slight change to the analog portion can cause unexpected interactions with other components, resulting in system instability.

Once designed into an application, the analog portion is rarely modified because even small changes to the analog portion can trigger unanticipated consequences in other components, resulting in system instability.

Power semiconductors

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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.

The growth of the power semiconductor market in recent years has several key drivers.

The proliferation of computer and consumer electronics, such as notebooks, tablets, smart phones, flat panel displays and portable media players created the need for sophisticated power management to improve power efficiency and extend battery life.

The evolution of these products is characterized by increased functionality, thinner or smaller form factors and decreasing prices.

Our Power IC and low voltage (5V-40V) MOSFET products address this market.

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 power semiconductor market has been driven by several key factors in recent years.

The proliferation of computer and consumer electronics, such as notebooks, tablets, smart phones, flat panel displays and portable media players created the need for sophisticated power management that increases power efficiency and extends battery life.

The evolution of these products is characterized by increased functionality, thinner and smaller form factors and decreasing prices.

Our Power IC and low voltage (5V-40V) MOSFET products address these markets.

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 drives the market 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.

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Power ICs can be implemented by incorporating all necessary power functions either on one piece of silicon or multiple silicon chips encapsulated into a single device.

Additionally, the advancement in semiconductor packaging technology enables increased power density and shrinking form factors.

Additionally, advancements in semiconductor packaging technology enables increased power density and shrinking form factors.

Power semiconductor suppliers develop and manufacture their products using various approaches which tend to fall across a wide spectrum of balancing cost savings with proprietary technology advantages.

At one end of the spectrum are integrated design manufacturers, or IDMs, which own and operate the equipment used in the manufacturing process and design and manufacture products at their in-house facilities.

IDMs exercise full control over the implementation of process technologies and have maximum flexibility in setting priorities for their production and delivery schedules.

At the other end of the spectrum are completely-outsourced fabless semiconductor companies, which rely entirely on off-the-shelf technologies and processes provided by their manufacturing partners.

IDMs exercise full control over the implementation of process technologies and have maximum flexibility in setting priorities for production and delivery schedules.

At the other end of the spectrum are completely-outsourced fabless semiconductor companies, which rely entirely on off-the-shelf technologies and processes provided by manufacturing partners.

These companies seek to reduce or eliminate fixed costs by outsourcing both product manufacturing and development of process technologies to third parties.

Our model seeks to achieve the best balance between technological advancement and cost effectiveness by using a dedicated in-house technology research and development team to drive rapid new product developments, while utilizing both in-house and third-party foundry capacity for our products.

Our model balances between technological advancement and cost effectiveness by using a dedicated in-house technology research and development team to drive rapid new product developments, while utilizing both in-house and third-party foundry capacity for our products.

This is particularly important in the development of power semiconductor products due to the unique nature of their technology.

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Our strategies

Our strategy is to advance our position as a leading designer, developer and global supplier of a broad portfolio of power semiconductors.

To accomplish this, we have adopted a strategy that allows us to accelerate the development of our proprietary technology at our in-house fabrication facilities, bring new products to market faster, and improve our financial performance in the long run.

This model also provides quicker response to our customer demands, enhances relationships with strategic customers, and provides flexibility in capacity management and geographic diversification of our wafer supply chain.

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 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.

The expansion is expected to be completed in the fiscal quarter ending March 31, 2023.

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.

AOS seeks to advance our position as a designer, developer and global supplier of a broad portfolio of power semiconductors.

We have adopted strategies that allow us to balance the development of proprietary technology at in-house fabrication and packaging facilities and also utilize the capacity and manufacturing capability of third-party foundries and subcontractors.

This enables us to bring new products to market faster, and improve our financial performance in the long run.

This model also allows us to respond more quickly to our customer demands, enhances relationships with strategic customers, provides flexibility in capacity management, and enables geographic diversification of our wafer supply chain.

In addition, we enhanced the manufacturing capability and capacity of our Oregon Fab by investing in new equipment and expanding factory facilities, which we expect will have a positive impact on our future new product development and revenue.

We intend to continue exploring opportunities to expand our manufacturing capabilities, including acquisition of existing facilities, formation of joint ventures or partnerships with third parties or applying for government funding or grants available in the semiconductor industry.

Although our largest end-market is the personal computing (“PC”) market, we have successfully diversified our business by expanding into other markets, including consumer, communications, 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 will continue to leverage our expertise to further increase our product lines, including higher performance power ICs, IGBTs and high, medium and low voltage MOSFETs, in order to broaden our addressable market and improve our margin profile.

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.

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.

This includes expanding our power IC portfolio with multiphase controllers and smart power stages to address advanced System on Chip (SoC) products used in personal computing, graphics cards, and gaming.

Leverage our power semiconductor expertise to drive new technology platforms

We believe that the ever-increasing demand for power efficiency in power semiconductors requires expertise in and a deep understanding of the interrelationship among device physics, process technologies, design and packaging.

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

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.

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Increase direct relationships and product penetration with OEM and ODM customers

We have developed direct relationships with key OEMs who are responsible for branding, designing and marketing a broad array of electronic products, as well as ODMs who have traditionally been responsible for manufacturing these products.

While OEMs typically focus their design efforts on their flagship products, as the industry has evolved, ODMs are increasingly responsible for designing portions, or entire systems, of the products they manufacture for the OEMs.

In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products which they sell directly to consumers.

We intend to strengthen our existing relationships and form new ones with both OEMs and ODMs by aligning our product development efforts with their product requirements, increasing the number of our products used within their systems, and leveraging our relationships to penetrate their other products.

In addition, we are refocusing our research and development efforts to respond more directly to market demand by designing and developing new products based on feedback from our customers, which also allows us to reduce time-to-market and sales cycles.

We have developed direct relationships with key OEMs that are responsible for branding, designing and marketing a broad array of electronic products, as well as ODMs that have traditionally been responsible for manufacturing these products.

While OEMs typically focus design efforts on flagship products, ODMs are increasingly responsible for designing portions, or entire systems, of the products they manufacture for OEMs.

In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products which are sold directly to consumers.

We intend to strengthen our existing relationships and form new ones with both OEMs and ODMs by aligning our product development efforts with their product requirements, thereby increasing the number of our products used within their systems, and leveraging relationships to penetrate other products.

In addition, we are focusing our research and development efforts to respond more directly to market demand by designing and developing new products based on feedback from our customers, which also allows us to reduce time-to-market and sales cycles.

Leverage global business model for cost-effective growth

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We will continue to deploy marketing, sales and technical support teams in close proximity to our end customers.

We plan to further expand and align our technical marketing and application support teams along with our sales team to better understand and address the needs of our end customers and their end-market applications, in particular for those with the new technology platforms developed in this past year and in the future.

We will further expand and align our technical marketing and application support teams along with our sales team to better understand and address the needs of end customers and end-market applications, in particular for those with the new technology platforms developed in this past year and in the future.

This will assist us in identifying and defining new technology trends and products and to help us gain additional design wins.

While we no longer retain a controlling interest in the JV Company, we expect to continue our strong relationship with the JV Company to support our manufacturing capacity, and we recently entered into a new agreement with the JV Company pursuant to which the JV Company agrees to provide us with a guaranteed supply of a fixed number of wafers until December 2023.

In addition, we intend to continue to seek potential partners and collaborators to develop new technologies and products, as well as to explore other strategic transactions that will enable us to expand our manufacturing capacity and establish our global footprint.

To serve the large and diverse analog market for power semiconductors, we have created a broad product portfolio consisting of two major categories:

power discretes and power ICs.

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

While we no longer retain a controlling interest in the JV Company, we continue our strong relationship with the JV Company to support our manufacturing capacity.

Also, we entered into an agreement with the JV Company, pursuant to which the JV Company agrees to provide us with a monthly wafer production capacity guarantee, subject to future increase when the JV Company’s production capacity reaches certain specified levels.

In addition, we continue to seek potential partners and collaborators to develop new technologies and products, as well as to explore other strategic transactions that will enable us to expand our manufacturing capacity and establish a global footprint.

We have created a broad product portfolio consisting of two major categories:

power discretes and power ICs that serve the large and diverse analog market for power semiconductors.

Our power discrete products consist 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 markets.

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Our medium voltage MOSFETs provide optimized performance with high efficiency, high robustness and high reliability, and are widely used in applications such as TV backlighting, telecom power supplies, and industrial applications.

We expanded our high voltage 600V and 700V MOSFET portfolio based on our aMOS5 technology platform to address robust consumer and industrial applications.

We expanded our high voltage 600V and 700V MOSFET portfolio based on our aMOS5 technology platform in order to address demanding consumer and industrial applications.

Our high-voltage portfolio includes our proprietary insulated-gate bipolar transistor ("IGBT") technology, which we provide highly robust and easy-to-use solutions for industrial motor control and white goods applications.

We have also released our first 1200V SiC (Silicon carbide) product based on our new AlphaSiC platform, designed to address high efficiency, high density industrial applications such as solar inverters, UPS, and battery management systems.

We have also deployed our 1200V SiC (Silicon carbide) products based on our AlphaSiC platform, designed to address high efficiency, high density industrial applications such as solar inverters, UPS, and battery management systems.

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.

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.

While we derive the majority of our revenue from the sales of power discretes products, sales of power ICs continued to gain traction during the past years.

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

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

While we derive the majority of our revenue from the sale of power discrete products, sale of power ICs continued to gain traction during the past years.

Our Type C smart load switch product line has also expanded as it offers reverse blocking capability, designed to protect applications against high voltage exposure.

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Power discrete products

Power discretes are used across a wide voltage and current spectrum, requiring them to operate efficiently and reliably under harsh conditions.

Due to this wide applicability across diverse end-market applications, we market general purpose MOSFETs that are used in multiple applications as well as MOSFETs targeted for specific applications.

Power discretes are used across a wide voltage and current spectrum, requiring high efficiency and reliability under harsh conditions.

Due to the diverse nature of end-market applications, we market both general purpose MOSFETs that are used in multiple applications as well as application specific MOSFETs.

Our current power discrete product line includes industry standard trench MOSFETs, SRFETs, XSFET, electrostatic discharge, protected MOSFETs, high and mid-voltage MOSFETs and IGBTs.

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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 2022, we introduced compact, 30V, 3A Buck Regulator Module.

This device offers a simple, compact solution suited to a wide variety of applications such as industrial, factory automation, networking, and general-purpose point of load.

We also introduced 2-in-1 super low capacitance TVS for USB4.0 & thunderbolt 4.0 & HDMI2.1 protection.

This device provides the best solution for an ideal pin-out for differential signal, space saving of super high-speed interface application, and reduces the part counts on circuit board.

We believe this new approach benefits customers to accomplish the best design and logistics management.

During the third quarter of fiscal year of 2022, we introduced the AOZ71026QI, a 2 rail, 6 phase controller for notebook Vcore power delivery.

This new device features the world’s lowest quiescent power for a multiphase controller designed to meet Intel IMVP 8, 9, 9.1, and 9.2 specifications.

We released the 600V 110mOhm and 140mOhm αMOS5™ Super Junction MOSFETs in DFN8x8 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.

We also released AOZ32034AQV, a new product in the family of coil drivers for wireless charging transmitter circuits of up to 50W.

Packaged in a thermally enhanced QFN 4 x 4 package, the device is designed for wireless charging applications in charging stations, cordless power tools, vacuum cleaners, drones, and other consumer electronic equipment.

In addition, we released our initial eFuse product for sub-power rails in server applications.

The new devices offer low RDS(ON) (20mohm) back-to-back MOSFETs to isolate the load from the input bus when the eFuse is off.

During the second quarter of fiscal year of 2022, we released 600V Low Ohmic and Fast Body Diode αMOS5™ Super Junction MOSFETs Family.

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 Hyperscale Datacenter applications.

We also released our latest 80V Power MOSFET using patented Shield Gate Technology which is optimized for higher switching frequencies used in telecom and server power supply to achieve higher efficiency.

The 80V MOSFET family of devices offers the highest levels of power density and energy efficiency, which are essential in solar, power supplies, and battery power applications such as in eScooters.

During the first quarter of fiscal year of 2022, we announced a new family of Coil Drivers.

The device is ideally suited to the design of Wireless Charging TX circuits used in cordless power tools, vacuum cleaners, drones, and other consumers’ electronic equipment composed of full-bridge topology with a resonant tank circuit to get the best power conversion efficiency.

We also announced a new Type-C Power Delivery high voltage sink protection switch using ideal diode methodology for reverse current protection.

The new devices offer low RDS(ON) (20mohm) back-to-back MOSFETs to block any reverse current under fault conditions and are capable of up to 28V absolute maximum voltage.

In addition, we introduced the first product of the AOS Digital Controller product portfolio.

The AOZ97774QE is offered in a QFN 5mm x 5mm package and provides the industry’s most flexible DC/DC controller supporting 5G Wireless, Networking, Optical Communication, and General-Purpose DC/DC applications.

During the fourth quarter of fiscal year of 2023, we released the 600V αMOS7™ Super Junction MOSFETs Family.

These devices are designed to meet the high efficiency and high-density needs of servers, workstations, telecom rectifiers, solar Inverters, EV charging, motor drives and industrial power applications.

During the third quarter of fiscal year of 2023, we introduced a powerful duo of sink and source switches that can increase the power delivery capability of USB Type-C ports to 140W, paving the way for Type C extended power range (EPR)

implementations.

The AOZ13937DI is suited for 28V Type C sinking applications while the AOZ15333DI is capable of Type C sourcing applications.

These new switches are suited for 28V Type C EPR implementations in high-performance laptops, personal computers, monitors, docking, and other applications.

Also, we introduced an extension to our active bridge driver, AlphaZBL™ family.

The new device in this family is suitable for use in adapters for high-end laptops and televisions, as well as power supplies for Desktops, Game consoles, and Servers.

During the second quarter of fiscal year of 2023, we introduced our new industry-leading 650V and 750V SiC MOSFET platform for both industrial and automotive applications.

The 650V SiC MOSFETs are ideal switching solutions for industrial applications such as solar inverters, motor drives, industrial power supplies, and new energy storage systems, while the AEC-Q101 qualified 750V SiC MOSFET line is targeted for the high-reliability needs in electric vehicle (EV) systems such as the on-board charger (OBC) and the main traction inverter.

Also, we introduced an extension to our compact Smart Motor Module (SMM) family.

Available in an ultra-compact, thermally enhanced 3mm x 3mm QFN-18L package, the highly integrated AOZ9530QV SMM is a half-bridge power stage with a slew of features and protections that simplify motor drive designs.

The AOZ9530QV SMM is suitable for use in a large number of BLDC fan applications ranging from PC and server fans, seat cooling and home appliances.

In addition, we released AONS30300, a 30V MOSFET with low on-resistance.

The AONS30300 features a high Safe Operating Area (SOA) capability making it ideally suited for demanding applications such as hot swap and eFuse.

Distributors and customers

We have established direct relationships with key OEMs, including Dell Inc., Hewlett-Packard Company, LG Electronics, Inc.

and Samsung Group, most of whom we serve through our distributors and ODMs.

We have established direct relationships with key OEMs, including Dell Inc., Hewlett-Packard Company, Samsung Group, and Stanley Black & Decker, Inc., most of whom we serve through our distributors and ODMs.

In addition, based on our historical design win activities, our power semiconductors are also incorporated into products sold to many other leading OEMs.

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In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products, which they sell directly to consumers.

Our ODM customers include Compal Electronics, Inc., Foxconn, Quanta Computer Incorporated, Pegatron, Wistron Corporation and AOC International.

Our ODM customers include Compal Electronics, Inc., Foxconn, Quanta Computer Incorporated, Wistron Corporation and Delta Electronics.

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.

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Our sales team consists of sales personnel, field application engineers, customer service representatives and customer quality engineers who are responsible for key accounts.

We strategically position our team near our end customers through our offices in Taipei, Hong Kong, Shenzhen, Shanghai, Qingdao, Tokyo, Seoul, Heilbronn, and Sunnyvale, California, complemented by our applications centers in Sunnyvale and Shanghai.

We strategically position our team near our end customers through our offices in Taipei, Hong Kong, Shenzhen, Shanghai, Qingdao, SuZhou, Tokyo, Seoul, Heilbronn, and Sunnyvale, California, complemented by our applications centers in Sunnyvale and Shanghai.

In addition, our distributors and sales representatives assist us in our sales and marketing efforts by identifying potential customers, creating additional demand and promoting our products, in which case we may pay a sales commission.

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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:

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 the following steps:

• identification of a customer design opportunity;

• qualification of the design opportunity by our FAEs through comparison of the power requirements against our product portfolio;

• provision of a product sample to the end customer to be included in the customer's pre-production model with the goal of being included in the final bill of materials;

• placement by the customer, or through its distributor, of a full production order as the end customer increases to full volume production.

• delivery of a product sample to the end customer to be included in the customer's pre-production model with the goal of being included in the final bill of materials;

• placement by the customer, or through its distributor, of a full production order as the end customer transitions to full volume production.

The power semiconductor industry is characterized by fragmentation with many competitors.

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Our key competitors in power discretes and power ICs are primarily headquartered in the United States, Japan, Europe, China and Taiwan.

Our major competitors in power discretes include Infineon Technologies AG, MagnaChip Semiconductor Corporation, ON Semiconductor Corp., STMicroelectronics N.V., Toshiba Corporation, Diodes Incorporated and Vishay Intertechnology, Inc.

Our major competitors for our power ICs include Global Mixed-mode Technology Inc., Monolithic Power Systems, Inc., ON Semiconductor Corp., Richtek Technology Corp., Semtech Corporation, Texas Instruments Inc.

Our major competitors in power discretes include Infineon Technologies AG, ON Semiconductor Corp., STMicroelectronics N.V., Toshiba Corporation, Diodes Incorporated and Vishay Intertechnology, Inc.

Our major competitors for our power ICs include Monolithic Power Systems, Inc., ON Semiconductor Corp., Richtek Technology Corp., Semtech Corporation, Texas Instruments Inc.

and Vishay Intertechnology, Inc.

Our ability to compete depends on a number of factors, including:

• our success in expanding and diversifying our serviceable markets, and our ability to develop technologies and product solutions for these markets;

• our capability to quickly develop and introduce proprietary technology and best-in-class products;

• the performance and cost-effectiveness of our products relative to that of our competitors;

• our ability and capacity to manufacture, package and deliver products in large volume on a timely basis at a competitive price;

• our success in utilizing new and proprietary technologies to offer products and features previously not available in the marketplace;

• our ability to recruit and retain analog semiconductor designers and application engineers;

• our ability to protect our intellectual property.

• success in expanding and diversifying our serviceable markets, and our ability to develop technologies and product solutions for these markets;

• capability to quickly develop and introduce proprietary technology and best-in-class products;

• performance and cost-effectiveness of our products relative to that of our competitors;

• ability and capacity to manufacture, package and deliver products in large volume on a timely basis at a competitive price;

• success in utilizing new and proprietary technologies to offer products and features previously not available in the marketplace;

• ability to recruit and retain analog semiconductor designers and application engineers;

• ability to protect our intellectual property.

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.

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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 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 seasonality is affected by a number of factors, including global and regional economic conditions as well as the PC market condition, 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 sales are made primarily pursuant to standard purchase orders from distributors and direct customers.

The amount of backlog to be shipped during any period depends on various factors, and all orders are subject to cancellation or modification, usually with no penalty to customers.

The amount of backlog to be shipped during any period depends on different factors, and all orders are subject to cancellation or modification,

usually with no penalty to customers.

The quantities actually purchased by customers, as well as shipment schedules, are frequently revised to reflect changes in both the customers’ requirements and in manufacturing availability.

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Research and development

Because we view technology as a competitive advantage, we invest significant time and capital in research and development to address the technology intensive needs of our end customers.

We view technology as a competitive advantage, and we invest significant time and capital in research and development to address the technology-intensive needs of our end customers.

Our research and development expenditures for the fiscal years of 2023, 2022 and 2021 were $88.1 million, $71.3 million and $63.0 million, respectively.

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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, Taiwan, and China.

We have research and development teams in Silicon Valley (Sunnyvale, California), Oregon, Texas, Arizona, Korea, 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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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.

We believe that our efforts to develop innovative packaging technologies will continue to provide new and cost-effective solutions with higher power density to our customers.

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

Our efforts to develop innovative packaging technologies continues to provide new and cost-effective solutions with higher power density to our customers.

During the fiscal year ended June 30, 2023, we continued our diversification strategies by developing new silicon and packaging platforms to expand our SAM and offer higher performance products.

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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 Fab as well as the third-party foundries that fabricate our wafers.

Our process engineers work closely with our design team to deploy and implement our proprietary manufacturing processes at our Oregon Fab, the Chongqing Fab 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.

New products and new technology platforms:

We also invest significantly in the development of new technology platforms and introduction of new products.

Because power management affects all electronic systems, we believe that developing a wide portfolio of products enables us to target new applications in addition to expanding our share of power management needs served within existing applications.

As a technology company, we will continue our significant investment in research and development in our low voltage, medium voltage, and high voltage power discretes, IGBT and power modules and power ICs by developing new technology platforms and new products that allow for better product performance, more efficient packages and higher levels of integration.

We invest significantly in the development of new technology platforms and introduction of new products.

As a technology company, we will continue our significant investment in research and development in our low voltage, medium voltage, and high voltage power discretes, IGBT and power modules and power ICs by developing new technology platforms and new products that allow for improved product performance, higher efficiency packages and higher levels of integration.

The manufacture of our products is divided into two major steps:

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We allocate our wafer production between our in-house facility and third-party foundries.

During the past three years, we have gradually reduced our reliance on third-party foundries and increased allocation of capacity to our Oregon Fab and Chongqing Fab.

We recently entered into a new agreement with the JV Company pursuant to which the JV Company agrees to provide us with a guaranteed supply of a fixed number of wafers until December 2023.

During the past three years, we have gradually reduced our reliance on third-party foundries and increased allocation of capacity to our Oregon Fab and Chongqing JV Fab.

We entered into an agreement with the JV Company for the Chongqing Fab, pursuant to which the JV Company agrees to provide us with a monthly wafer production capacity guarantee, subject to future increase when the JV Company’s production capacity reaches certain specified levels.

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

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Our manufacturing operations in China and our manufacturing facility in Oregon are certified to the ISO9001 and IATF16949:2016.

These Quality Management System certifications are in recognition of our quality assurance standards.

Both ISO9001 and IATF16949:2016 are sets of criteria and procedures established by International Organization of Standardization for developing a fundamental quality management system and focusing on continuous improvement, defect prevention and the reduction of variation and waste.

These Quality Management System certifications represent a recognition of our high quality assurance standards.

Both ISO9001 and IATF16949:2016 are sets of criteria and procedures established by the International Organization of Standardization for developing a fundamental quality management system and focusing on continuous improvement, defect prevention and the reduction of variation and waste.

Our products are also in compliance with Restrictions on the use of Hazardous Substances, or RoHS 3.0.

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and Giant Semiconductor Corporation, to use selected third-party technology for the development of our products, although we do not believe our business is dependent to any significant degree on any individual third-party license agreement.

We have 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 multi-phase controller products, which have been offered previously by STMicro.

This license agreement allows us to develop a new digital power business that will design and offer a full suite of advance digital power controller products.

In February 2023, we entered into a license agreement with a customer to license our proprietary SiC technology and to provide 24-months of engineering and development services for a total fee of $45 million, consisting of upfront fees and fees upon the achievement of specified engineering services and product milestones.

While we focus our patent efforts in the United States, we file corresponding foreign patent applications in other jurisdictions, such as China and Taiwan, when filing is justified by cost and strategic importance.

The patents are increasingly important to remain competitive in our industry, and a strong patent portfolio will facilitate the entry of our products into new markets.

The patents are increasingly

important to remain competitive in our industry, and a strong patent portfolio will facilitate the entry of our products into new markets.

As of June 30, 2023, we had 918 patents issued in the United States, of which 911 were based on our research and development efforts and 7 were acquired, and these patents are set to expire between 2023 and 2041.

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We are committed to providing a work 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 contribute to the growth of our employees, as more than 50% of our managerial positions are filled through promotions of existing employees.

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, tuition reimbursement, 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 for quality of life with performance results.

We believe that these efforts contribute to the growth and well-being of our employees, as more than 50% of our managerial positions are filled through promotions of existing employees.

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.

We value feedback from our employees and promote an open-door policy which encourages employees to have regular conversations with their managers to share feedback and express concerns.

We also solicit employee feedback informally through regular employee interactions such as one on one or functional team staff meetings.

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

As part of the 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.

As part of the AOS tradition, we organize regular and seasonal social events, such as team building activities, annual appreciation picnics, 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 dedicated and happy employees who form the core of our human capital resource.

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

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.

To recruit new talent, we reach out to a broad range of sources, including employee referrals, on-line advertising, recruitment agencies, and other social media platforms 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 applicable diversity laws.

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

Our Nominating and Corporate Governance Committee leads the effort in recruiting qualified directors to serve on our Board.

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

We commit to a fair and living wage for all employees.

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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.

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.

We have an established Employee Recognition Award program which is regularly utilized to recognize the outstanding achievements of employees and teams that go above and beyond to achieve AOS business goals.

In addition, we have engaged nationally-recognized outside independent 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 company.

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.

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 the COVID-19 virus, we also implemented and sponsored bi-weekly on-site COVID-19 testing beginning in January 2021 for essential employees who were authorized to work in our Sunnyvale lab facilities.

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 Equipments, strict visitor controls, frequent sanitization of shuttle buses, temperature checking prior to boarding the shuttles and at the factory entrances, and regular self-audits.

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

From March 28, 2022 to June 1, 2022, our Songjiang factory was locked down in compliance with the local government’s COVID-19 prevention order.

The site was locked down with 885 employees who were not allowed to leave the factory.

No one from outside of the factory was permitted to enter, including cleaning crews.

A steering committee chaired by the General Manager of the factory and with certain management members from production, facilities and administration was formed on-site immediately to direct the logistics and measures necessary to ensure the safety and wellbeing of our employees onsite, and to provide adequate electricity, water supplies, food, bedding and sanitary supplies.

In addition, the committee also ensured that needs were met regarding government contacts, COVID-19 testing, isolation and transfer of sick employees, cleaning and disinfection of public places and restrooms, and trash disposal.

All of these requirements were facilitated internally by volunteers within the facilities due to the lock-down.

Many of our employees devoted themselves to meet these challenges.

The quick actions of the steering committee and our dedicated volunteers with their selfless and heroic acts were indispensable for our on-site employees’ survival during the lock-down.

The Company endeavored to provide all support necessary, ranging from material, monetary to psychological assistance.

All personnel on-site received special allowances in addition to their regular compensation to compensate for their hardship.

Employees who volunteered also received special appreciation bonuses to recognize their self-less and critical contributions.

Thanks to our on-site employees and the Company’s combined efforts, when our Songjiang factory received a green light to resume production, despite the on-going city-wide lock-down in Shanghai where most citizens were still restricted in their residences, we were able to resume partial production to deliver products critical to our customers.

While the COVID-19 global health emergency has ended, COVID-19 and other infectious diseases remain a threat to the health and safety of employees.

As such, we continue to monitor and follow requirements and guidance related to COVID-19 prevention in the workplace published by applicable public health agencies in various jurisdictions in which we operate.

In addition, we have policies and procedures in place to respond to COVID-19 infection in the workplace including isolation requirements for employees infected with COVID-19 and close contact individuals.

We believe policies and procedures help to ensure the health and safety of our employees.

Environmental matters

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Name Age Position

77 Chairman of the Board and Chief Executive Officer

Chang 45 President

Chang 46 Chief Executive Officer and Director

78 Executive Chairman and Chairman of the Board

Yifan Liang 59 Chief Financial Officer and Corporate Secretary

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59 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.

Chang has extensive experience in both technology development and business operations in the power semiconductor industry.

Chang has served as our Chief Executive Officer since March 2023 and as a director since November 2022.

Chang previously served as the Company’s President from January 2021 to February 2023.

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 the Company’s business strategies, product and technology development, sales and marketing functions, manufacturing operation and supply chain management, and other managerial responsibilities.

Chang received his B.A.

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

from Santa Clara University.

Chang, Ph.D ., is the founder of our company and serves as our Executive Chairman.

Chang served as Chief Executive Officer from the founding of our company until March 2023.

Prior to establishing our company, Dr.

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in electrical engineering from the University of Missouri.

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.

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Prior to joining us, Mr.

Liang held various positions at

PricewaterhouseCoopers LLP, or PwC, from 1995 to 2004, including Audit Manager in PwC’s San Jose office.

Liang held various positions at PricewaterhouseCoopers LLP, or PwC, from 1995 to 2004, including Audit Manager in PwC’s San Jose office.

Liang received his B.S.

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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