14 unchanged sentences
If SOI or new silicon-based technologies gain more widespread market acceptance, or are used in more applications, our sales of specialty material based substrates could be reduced and our business and operating results could be significantly and adversely affected.
−Removed: The recent outbreak of a contagious disease may affect our business operations and financial performance.
−Removed: Currently, a contagious disease originating in Wuhan, China called the coronavirus or COVID-19, has spread to other cities in China and to many other countries including the United States.
+Added: The continuing spread of COVID-19 has affected our business operations and financial performance.
+Added: The continuing spread of COVID-19 has impacted our operations and financial performance.
+Added: To date, we believe we have limited the impact on our company.
This outbreak has triggered references to the SARS outbreak, which occurred in 2003 and affected our business operations.
−Removed: Any severe occurrence of an outbreak of a contagious disease such as the COVID-19, SARS, Avian Flu or Ebola may cause us or the government to temporarily close our manufacturing operations in China.
+Added: Any severe occurrence of an outbreak of a contagious disease such as COVID-19, SARS, Avian Flu or Ebola may cause us or the government to temporarily close our manufacturing operations in China.
In January 2020, virtually all companies in China were ordered to remain closed after the traditional Lunar New Year holiday ended, including our subsidiaries in China.
−Removed: If there is a reoccurrence of the COVID-19 pandemic in China, the Chinese government may require companies to close again.
+Added: If there is a renewed surge of the COVID-19 pandemic in China, the Chinese government may require companies to close again.
If one or more of our key suppliers is required to close for an extended period, we might not have enough raw material inventories to continue manufacturing operations.
−Removed: In addition, while we possess management skills among our China-based staff that enable us to maintain our manufacturing operations with minimal on-site supervision from our U.S.‑based staff, our business could also be harmed if travel to or from China and the United States is restricted or
−Removed: inadvisable for an extended period of time or our key China-based employees are unable to work.
−Removed: If our manufacturing operations were closed for a significant period, we could lose revenue and market share, which would depress our financial performance and could be difficult to recapture.
−Removed: Finally, if one of our key customers is required to close for an extended period, we might not be able to ship product to them and as result our revenue would decline.
−Removed: Further, they might default on their obligations to us.
+Added: In addition, travel restrictions between China and the U.S.
+Added: have disrupted our normal movement to and from China and this has impacted our efficiency.
+Added: Also, the outbreak has affected transportation and reduced the availability of air transport, caused port closures, and increased border controls and closures.
+Added: If our manufacturing operations were
+Added: closed for a significant period or we experience difficulty in shipping our products, we could lose revenue and market share, which would depress our financial performance and could be difficult to recapture.
+Added: If one of our key customers is required to close for an extended period this may delay the placement of new orders.
+Added: As a result, our revenue would decline.
+Added: Further, customers might default on their obligations to us.
+Added: In the first quarter of 2020 we observed an increase in our accounts receivable and believe this is the result of businesses slowing down and a general cautiousness due to the COVID-19 pandemic.
Such events would negatively impact our financial performance.
Our gross margin has fluctuated historically and may decline due to several factors.
−Removed: Our gross margin has fluctuated from period to period as a result of increases or decreases in total revenue, unit volume, shifts in product mix, shifts in the cost of raw materials, costs related to the relocation of our gallium arsenide and germanium production lines, including costs related to the hiring additional manufacturing employees at our new locations, tariffs imposed by the U.S.
+Added: Our gross margin has fluctuated from period to period as a result of increases or decreases in total revenue, unit volume, shifts in product mix, shifts in the cost of raw materials, costs related to the relocation of our gallium arsenide and germanium production lines, including costs related to hiring additional manufacturing employees at our new locations, tariffs imposed by the U.S.
government, the introduction of new products, decreases in average selling prices for products, utilization of our manufacturing capacity, fluctuations in manufacturing yields and our ability to reduce product costs.
19 unchanged sentences
As a result, in February 2014, we announced a restructuring plan with respect to our wafer manufacturing company, Beijing Tongmei Xtal Technology Co., Ltd.
−Removed: (“Tongmei”), in order to better align manufacturing capacity with demand.
+Added: (“Tongmei”), in order to better align manufacturing capacity with demand.
Under the restructuring plan, we recorded a charge of approximately $907,000 in the first quarter of 2014.
If we receive fewer customer orders than forecasted or if our customers delay or cancel orders, we may not be able to reduce our manufacturing costs in the short-term and our gross margins would be negatively affected.
−Removed: lead times required by our customers are shrinking, which reduces our ability to forecast orders and properly balance our capacity utilization.
+Added: In addition, lead times required by our customers are shrinking, which reduces our ability to forecast orders and properly balance our capacity utilization.
If we have low product yields, the shipment of our products may be delayed and our product cost and operating results may be adversely impacted.
12 unchanged sentences
In addition, we may modify our process to meet a customer specification, but this can impact our yields.
−Removed: If our yields decrease, our revenue could decline if we are unable to produce products to our customers’
−Removed: requirements.
+Added: If our yields decrease, our revenue could decline if we are unable to produce products to our customers’ requirements.
At the same time, our manufacturing costs could remain fixed, or could increase.
8 unchanged sentences
The Beijing city government is moving its offices into the area where our original manufacturing facility is currently located and is in the process of moving thousands of government employees into this area.
−Removed: The government has constructed showcase tower buildings and overseen the establishment of new apartment complexes, retail stores and restaurants.
+Added: The government has
+Added: constructed showcase tower buildings and overseen the establishment of new apartment complexes, retail stores and restaurants.
An amusement park is being constructed within a few miles of our facility.
−Removed: To create room and upgrade the
−Removed: district, the city instructed virtually all existing manufacturing companies, including AXT, to relocate all or some of their manufacturing lines.
+Added: To create room and upgrade the district, the city instructed virtually all existing manufacturing companies, including AXT, to relocate all or some of their manufacturing lines.
We were instructed to move our gallium arsenide manufacturing line out of the area.
2 unchanged sentences
To mitigate our risks and maintain our production schedule, we moved our gallium arsenide equipment in stages.
−Removed: By December 31, 2019, we have ceased all crystal growth for gallium arsenide in our original manufacturing facility in Beijing and have transferred 100% of our ingot production to our new manufacturing facility in Kazuo, a city approximately 250 miles from Beijing.
+Added: By December 31, 2019, we ceased all crystal growth for gallium arsenide in our original manufacturing facility in Beijing and transferred 100% of our ingot production to our new manufacturing facility in Kazuo, a city approximately 250 miles from Beijing.
We have transferred our wafer processing equipment for gallium arsenide to our new manufacturing facility in Dingxing, a city approximately 75 miles from Beijing.
−Removed: Our key focus is now transferring volume production of the wafer processing steps for gallium arsenide to Dingxing.
−Removed: Some of our larger, more sophisticated customers want to perform a site qualification and subsequently, develop a plan to ramp up production at Dingxing.
+Added: Our key focus now is transferring volume production of the wafer processing steps for gallium arsenide to Dingxing.
+Added: This process is ongoing.
+Added: Some of our larger, more sophisticated customers want to perform a site qualification and subsequently, work with us to ramp up production at Dingxing.
The new facilities are intended to give us the long-term capacity and a new level of technological sophistication in our manufacturing capabilities to support the major trends that we believe are likely to drive demand for our products in the years ahead.
4 unchanged sentences
Any loss of sales could have a material adverse effect on our revenue, our results of operations and our financial condition.
−Removed: We expect many of the key employees who are employed at our current manufacturing facility to relocate to the new sites or commute under a program we are developing.
−Removed: There can be no assurances that the key employees will relocate.
−Removed: A loss of key employees or our inability to hire qualified employees could disrupt our production, which could materially and adversely impact our results of operations and our financial condition.
−Removed: Although we expect many of our employees to relocate to our new facilities, certain employees may choose not to relocate.
−Removed: If we are unable to continue to employ those employees in our original manufacturing facility, we may be required to terminate those employees and could incur severance costs.
−Removed: If the government does not assist us in this matter it could materially and adversely impact our results of operations and our financial condition.
+Added: Some of our key employees are relocating to our new manufacturing sites.
+Added: Travel restrictions within China resulting from COVID-19 have impacted their relocation and hindered commuting.
+Added: Certain employees may choose not to relocate.
+Added: If we are unable to continue to employ those key employees in our original manufacturing facility, we may be required to terminate those employees and could incur severance costs.
+Added: If the Chinese government does not assist us in this matter it could materially and adversely impact our results of operations and our financial condition.
+Added: Further, a loss of key employees or our inability to hire qualified employees could disrupt our production, which could materially and adversely impact our results of operations and our financial condition.
The Chinese government has in the past imposed temporary restrictions on manufacturing facilities, such as the restrictions imposed on polluting factories for the 2008 Olympics and the 2014 Asian Pacific Economic Cooperation event.
18 unchanged sentences
Wafer processing equipment for gallium arsenide has been moved to Dingxing, a city approximately 75 miles from Beijing.
−Removed: Our key focus is now transferring volume production of the wafer processing steps for gallium arsenide to Dingxing.
−Removed: Some of our larger, more sophisticated customers want to perform a site qualification and subsequently make a plan to ramp up at Dingxing.
+Added: Our key focus now is transferring volume production of the wafer processing steps for gallium arsenide to Dingxing.
+Added: This process is ongoing.
+Added: Some of our larger, more sophisticated customers want to perform a site qualification and subsequently work with us to ramp up production at Dingxing.
Customer qualification of the Dingxing site requires us to continue to diligently address the many details that arise at both of the new sites.
8 unchanged sentences
Approximately 10% of our revenue derives from importing our wafers into the United States.
+Added: In the six months ended June 30, 2020 we paid approximately $470,000 in tariffs.
In the year 2019, we paid approximately $735,000 in tariffs.
3 unchanged sentences
Government agencies in China may be encouraging and supporting the founding of new companies, the addition of new products in existing companies and more vertical integration within companies.
−Removed: These factors could eventually result in lower revenue from sales of our wafer substrates in China.
+Added: These factors have resulted in lower revenue from sales of our wafer substrates in China.
Our operations and financial results depend on worldwide economic and political conditions and their impact on levels of business spending, which has deteriorated significantly in many countries and regions.
Uncertainties in the political, financial and credit markets may cause our customers to postpone deliveries.
−Removed: The recent outbreak of COVID-19 virus is an additional cause of uncertainty.
+Added: The recent outbreak of the COVID-19 virus is an additional cause of uncertainty.
Delays in the placement of new orders and extended uncertainties may reduce future sales of our products and services.
4 unchanged sentences
Future tightening of credit markets and concerns regarding the availability of credit may make it more difficult for our customers to raise capital, whether debt or equity, to finance their purchases of capital equipment or of the products we sell.
−Removed: Delays in our customers’
−Removed: ability to obtain such financing, or the unavailability of such financing, would adversely affect our product sales and revenues and, therefore, harm our business and operating results.
−Removed: We cannot predict the timing, duration of or effect on our business of any future economic downturn or the timing or strength of any subsequent recovery.
+Added: Delays in our customers’ ability to obtain such financing, or the unavailability of such financing, would adversely affect our product sales and revenues and, therefore, harm our business and operating results.
+Added: predict the timing, duration of or effect on our business of any future economic downturn or the timing or strength of any subsequent recovery.
If any of our facilities are damaged by occurrences such as fire, explosion, power outage or natural disaster, we might not be able to manufacture our products.
29 unchanged sentences
Further, in several quarters over the past three years, one of our consolidated subsidiaries incurred a lower of cost or net realizable value inventory write down, which negatively impacted our consolidated gross margin.
+Added: In March 2019, we ceased to consolidate this company.
In the first quarter of 2019, we incurred an impairment charge of $1.1 million for a germanium materials company in China in which we have a 25% ownership interest, writing down our investment to zero value.
16 unchanged sentences
Further, the central government encourages employees to report to the appropriate regulatory agencies possible safety or environmental violations, but there may not be actual violations.
−Removed: Regular use in the normal course of business of hazardous chemicals or hazardous elements or a company’s failure to meet the ever-tightening standards for control of hazardous chemicals or hazardous elements could result in orders to shut down permanently, fines or other severe measures.
+Added: Regular use in the normal course of business of hazardous chemicals or hazardous elements or a company’s failure to meet the ever-tightening standards for control of hazardous chemicals or hazardous elements could result in orders to shut down permanently, fines or other severe measures.
Any such orders directed at one of our joint venture companies could result in impairment charges if the company is forced to close its business, cease operations or incurs fines or operating losses, which would have a material adverse effect on our financial results.
1 unchanged sentence
Further, if any of our joint venture companies or investment partners with which our joint ventures share facilities is deemed to have violated applicable laws, rules or regulations governing the use, storage, discharge or
−Removed: disposal of hazardous chemicals, the operations of that joint venture could be adversely affected and we could be subject to substantial liability for clean-up efforts, personal injury, fines or suspension or termination of our joint venture’s operations.
+Added: disposal of hazardous chemicals, the operations of that joint venture could be adversely affected and we could be subject to substantial liability for clean-up efforts, personal injury, fines or suspension or termination of our joint venture’s operations.
Employees working for our joint ventures or any of the other investment partners could bring litigation against us as a result of actions taken at the joint venture or investment partner facilities, even though we are not directly controlling those operations.
24 unchanged sentences
We face a risk that experienced computer programmers and hackers may be able to penetrate our network security and misappropriate or compromise our confidential and proprietary information, potentially without being detected.
−Removed: Our employees working remotely as a result of the current COVID-19 crisis increases our vulnerability in this regard.
+Added: Our employees working remotely as a result of the current COVID-19 pandemic increases our vulnerability in this regard.
Computer programmers and hackers also may be able to develop and deploy viruses, worms, and other malicious software programs that attack our information technology infrastructure.
−Removed: The costs to us to eliminate or alleviate cyber or other security problems, bugs, viruses,
−Removed: worms, malicious software programs and security vulnerabilities could be significant, and our efforts to address these problems may not be successful and could result in interruptions and delays that may impede our sales, manufacturing, distribution, accounting or other critical functions.
+Added: The costs to us to eliminate or alleviate cyber or other security problems, bugs,
+Added: viruses, worms, malicious software programs and security vulnerabilities could be significant, and our efforts to address these problems may not be successful and could result in interruptions and delays that may impede our sales, manufacturing, distribution, accounting or other critical functions.
Breaches of our security measures could create system disruptions or cause shutdowns or result in the accidental loss, inadvertent disclosure or unapproved dissemination of proprietary information or sensitive or confidential data about us.
28 unchanged sentences
New customers typically place orders with us for our substrate products three months to a year or more after our initial contact with them.
−Removed: The sale of our products is subject to our customers’
−Removed: lengthy internal evaluation and approval processes.
+Added: The sale of our products is subject to our customers’ lengthy internal evaluation and approval processes.
During this time, we may incur substantial expenses and expend selling, marketing and management efforts while the customers evaluate our products.
16 unchanged sentences
A downturn can result in lower unit volumes and rapid erosion of average selling prices.
−Removed: The semiconductor industry has experienced significant downturns, often in connection with, or in anticipation of, maturing product cycles of both semiconductor companies’
−Removed: and their customers’
−Removed: products or a decline in general economic conditions.
+Added: The semiconductor industry has experienced significant downturns, often in connection with, or in anticipation of, maturing product cycles of both semiconductor companies’ and their customers’ products or a decline in general economic conditions.
This may adversely affect our results of operations and the value of our business.
4 unchanged sentences
The rate of changes in demand, including end demand, is high, and the effect of these changes upon us occurs quickly, exacerbating the volatility of these cycles.
−Removed: These changes have affected the timing and amounts of customers’
−Removed: purchases and investments in new technology.
+Added: These changes have affected the timing and amounts of customers’ purchases and investments in new technology.
These industry cycles create pressure on our revenue, gross margin and net income.
18 unchanged sentences
Further, the costs involved in researching, developing and engineering new products could be greater than anticipated.
−Removed: If we fail to offer new products or product enhancements or fail to achieve higher quality products, we may not generate sufficient revenue to offset our development costs and other expenses or meet our customers’
−Removed: requirements.
+Added: If we fail to offer new products or product enhancements or fail to achieve higher quality products, we may not generate sufficient revenue to offset our development costs and other expenses or meet our customers’ requirements.
We have made and may continue to make strategic investments in raw materials suppliers, which may not be successful and may result in the loss of all or part of our investment.
44 unchanged sentences
Any future unexpected changes in demand or increases in costs of production that cause us to take additional charges for un-saleable, obsolete or excess inventory, or to reduce inventory values, would adversely affect our results of operations.
−Removed: Financial market volatility and adverse changes in the domestic, global, political and economic environment could have a significant adverse impact on our business, financial condition and operating results.
−Removed: We are subject to the risks arising from adverse changes and uncertainty in domestic and global economies.
−Removed: Uncertain global economic and political conditions or low or negative growth in China, Europe or the United States, along with volatility in the financial markets, increasing national debt and fiscal concerns in various regions, pose challenges to our industry.
−Removed: Currently China’s economy is slowing and this could impact our financial performance.
−Removed: In addition, tariffs, trade restrictions, trade wars and Brexit are creating an unstable environment and can disrupt or restrict commerce.
−Removed: Although we remain well-capitalized, the cost and availability of funds may be adversely affected by illiquid credit markets.
−Removed: Volatility in U.S.
−Removed: and international markets and economies may adversely affect our liquidity, financial condition and profitability.
−Removed: Another severe or prolonged economic downturn could result in a variety of risks to our business, including:
−Removed: increased volatility in our stock price;
−Removed: increased volatility in foreign currency exchange rates;
−Removed: delays in, or curtailment of, purchasing decisions by our customers or potential customers;
−Removed: increased credit risk associated with our customers or potential customers, particularly those that may operate in industries most affected by the economic downturn;
−Removed: impairment of our tangible or intangible assets.
−Removed: In the past, most recently in the fourth quarter of 2018 and continuing in 2019, we experienced delays in customer purchasing decisions and disruptions in a normal volume of customer orders that we believe were in part due to the uncertainties in the global economy, resulting in an adverse impact on consumer spending.
−Removed: During challenging and uncertain economic times and in tight credit markets, many customers delay or reduce technology purchases.
−Removed: Should similar events occur again, our business and operating results could be significantly and adversely affected.
The effect of terrorist threats and actions on the general economy could decrease our revenue.
20 unchanged sentences
Approximately 10% of our revenue derives from importing our wafers into the United States.
+Added: For the six months ended June 30, 2020 we paid approximately $470,000 in tariffs.
In the year 2019 we paid approximately $735,000 in tariffs.
4 unchanged sentences
The economic and political conditions between China and the United States, in our view, create an unstable business environment.
−Removed: Trade restrictions against China have resulted in a greater determination within China to be self-sufficient and produce more goods domestically.
+Added: Trade restrictions against China have resulted in a greater determination within China to be self-
+Added: sufficient and produce more goods domestically.
Government agencies in China may be encouraging and supporting the founding of new companies, the addition of new products in existing companies and more vertical integration within companies.
−Removed: These factors could eventually result in lower revenue from sales of our wafer substrates in China.
+Added: These factors have resulted in lower revenue from sales of our wafer substrates in China.
Further, the continued threats of tariffs and other trade restrictions could have a generally disruptive impact on the global economy and, therefore, negatively impact our sales.
5 unchanged sentences
Any such changes could directly and materially adversely impact our financial results and general business condition.
−Removed: The recent outbreak of a contagious disease may affect our business operations and financial performance.
−Removed: Currently, a contagious disease originating in Wuhan, China called the coronavirus or COVID-19, has spread to other cities in China and to many other countries including the United States.
+Added: The continuing spread of COVID-19 has affected our business operations and financial performance.
+Added: The continuing spread of COVID-19 has impacted our operations and financial performance.
+Added: To date, we believe we have limited the impact on our company.
This outbreak has triggered references to the SARS outbreak, which occurred in 2003 and affected our business operations.
−Removed: Any severe occurrence of an outbreak of a contagious disease such as the COVID-19, SARS, Avian Flu or Ebola may cause us or the government to temporarily close our manufacturing operations in China.
+Added: Any severe occurrence of an outbreak of a contagious disease such as COVID-19, SARS, Avian Flu or Ebola may cause us or the government to temporarily close our manufacturing operations in China.
In January 2020, virtually all companies in China were ordered to remain closed after the traditional Lunar New Year holiday ended, including our subsidiaries in China.
−Removed: If there is a reoccurrence of the COVID-19 pandemic in China, the Chinese government may require companies to close again.
+Added: If there is a renewed surge of the COVID-19 pandemic in China, the Chinese government may require companies to close again.
If one or more of our key suppliers is required to close for an extended period, we might not have enough raw material inventories to continue manufacturing operations.
−Removed: In addition, while we possess management skills among our China-based staff that enable us to maintain our manufacturing operations with minimal on-site supervision from our U.S.‑based staff, our business could also be harmed if travel to or from China and the United States is restricted or inadvisable for an extended period of time or our key China-based employees are unable to work.
−Removed: If our manufacturing operations were closed for a significant period, we could lose revenue and market share, which would depress our financial performance and could be difficult to recapture.
−Removed: Finally, if one of our key customers is required to close for an extended period, we might not be able to ship product to them and as result our revenue would decline.
−Removed: Further, they might default on their obligations to us.
+Added: In addition, travel restrictions between China and the U.S.
+Added: have disrupted our normal movement to and from China and this has impacted our efficiency.
+Added: Also, the outbreak has affected transportation and reduced the availability of air transport, caused port closures, and increased border controls and closures.
+Added: If our manufacturing operations were closed for a significant period or we experience difficulty in shipping our products, we could lose revenue and market share, which would depress our financial performance and could be difficult to recapture.
+Added: If one of our key customers is required to close for an extended period this may delay the placement of new orders.
+Added: As a result, our revenue would decline.
+Added: Further, customers might default on their obligations to us.
+Added: In the first quarter of 2020 we observed an increase in our accounts receivable and believe this is the result of businesses slowing down and a general cautiousness due to the COVID-19 pandemic.
Such events would negatively impact our financial performance.
+Added: Financial market volatility and adverse changes in the domestic, global, political and economic environment could have a significant adverse impact on our business, financial condition and operating results.
+Added: We are subject to the risks arising from adverse changes and uncertainty in domestic and global economies.
+Added: Uncertain global economic and political conditions or low or negative growth in China, Europe or the United States, along with volatility in the financial markets, increasing national debt and fiscal concerns in various regions, pose challenges to our industry.
+Added: Currently China’s economy is slowing and this could impact our financial performance.
+Added: In addition, tariffs, trade restrictions, trade wars and Brexit are creating an unstable environment and can disrupt or restrict commerce.
+Added: Although we remain well-capitalized, the cost and availability of funds may be adversely affected by illiquid credit markets.
+Added: Volatility in U.S.
+Added: and international markets and economies may adversely affect our liquidity, financial condition and profitability.
+Added: Another severe or prolonged economic downturn could result in a variety of risks to our business, including:
+Added: ● increased volatility in our stock price;
+Added: ● increased volatility in foreign currency exchange rates;
+Added: ● delays in, or curtailment of, purchasing decisions by our customers or potential customers;
+Added: ● increased credit risk associated with our customers or potential customers, particularly those that may operate in industries most affected by the economic downturn;
+Added: ● impairment of our tangible or intangible assets.
+Added: In the past, most recently in the fourth quarter of 2018 and continuing in 2019, we experienced delays in customer purchasing decisions and disruptions in a normal volume of customer orders that we believe were in part due to the uncertainties in the global economy, resulting in an adverse impact on consumer spending.
+Added: During challenging and uncertain economic times and in tight credit markets, many customers delay or reduce technology purchases.
+Added: Should similar events occur again, our business and operating results could be significantly and adversely affected.
We derive a significant portion of our revenue from international sales, and our ability to sustain and increase our international sales involves significant risks.
29 unchanged sentences
dollar could increase the price of our products in non-U.S.
−Removed: markets and make our products more expensive than competitors’
−Removed: products in these markets.
+Added: markets and make our products more expensive than competitors’ products in these markets.
We are subject to foreign exchange gains and losses that materially impact our income statement.
21 unchanged sentences
● nationalization of foreign-owned assets, including intellectual property.
−Removed: Uncertainty regarding the United States’
−Removed: foreign policy under the current administration could disrupt our business.
+Added: Uncertainty regarding the United States’ foreign policy under the current administration could disrupt our business.
We manufacture our substrates in China and, in 2019, approximately 90% of our sales were to customers located outside of the United States.
Further, we have partial ownership of raw material companies in China as part of our supply chain.
−Removed: The United States’
−Removed: current foreign policy has created uncertainty and caution in the international business community, resulting in disruptions in manufacturing, import/export, trade tariffs, sales, investments and other business activity.
+Added: The United States’ current foreign policy has created uncertainty and caution in the international business community, resulting in disruptions in manufacturing, import/export, trade tariffs, sales, investments and other business activity.
Such disruptions have had an adverse impact on our financial performance and could continue in the future.
11 unchanged sentences
If we are unable to continue to achieve customer qualifications for our products, or if we are unable to control product quality, customers may not increase purchases of our products, our China facilities will become underutilized, and we will be unable to achieve revenue growth.
−Removed: Changes in China’s political, social, regulatory or economic environments may affect our financial performance.
−Removed: Our financial performance may be affected by changes in China’s political, social, regulatory or economic environments.
+Added: Changes in China’s political, social, regulatory or economic environments may affect our financial performance.
+Added: Our financial performance may be affected by changes in China’s political, social, regulatory or economic environments.
The role of the Chinese central and local governments in the Chinese economy is significant.
15 unchanged sentences
To create room and upgrade the district, the city instructed virtually all existing manufacturing companies, including AXT, to relocate all or some of their manufacturing lines.
−Removed: We were instructed to move our gallium arsenide manufacturing.
+Added: were instructed to move our gallium arsenide manufacturing.
For reasons of manufacturing efficiency we elected to also move our germanium manufacturing line.
−Removed: Some of our larger, more sophisticated customers want to perform a site qualification and subsequently make a plan to ramp up production at Dingxing.
+Added: By December 31, 2019, we ceased all crystal growth for gallium arsenide in our original manufacturing facility in Beijing and transferred 100% of our ingot production to our new manufacturing facility in Kazuo, a city approximately 250 miles from Beijing.
+Added: We have transferred our wafer processing equipment for gallium arsenide to our new manufacturing facility in Dingxing, a city approximately 75 miles from Beijing.
+Added: Our key focus now is transferring volume production of the wafer processing steps for gallium arsenide to our new manufacturing facility in Dingxing.
+Added: This is an ongoing process.
+Added: Some of our larger, more sophisticated customers want to perform a site qualification and subsequently work with us to ramp up production at Dingxing.
Customer qualification of the Dingxing site requires us to continue to diligently address the many details that arise at both of the new sites.
10 unchanged sentences
Various taxing agencies in China are increasingly focused on tax reform and other legislative action to increase tax revenue.
−Removed: In addition to risks regarding income tax we have in the past been retroactively assessed value added taxes (“VAT”
−Removed: or sales tax) and such VAT assessments could occur again in the future.
+Added: In addition to risks regarding income tax we have in the past been retroactively assessed value added taxes (“VAT” or sales tax) and such VAT assessments could occur again in the future.
If there are power shortages in China, we may have to temporarily close our China operations, which would adversely impact our ability to manufacture our products and meet customer orders, and would result in reduced revenue.
7 unchanged sentences
We may utilize our cash balances for relocation, expansion, or to offset a business downturn resulting in the decline of our existing cash, cash equivalents and investment balances, and if we need additional capital, those funds may not be available on acceptable terms, or at all.
−Removed: Our liquidity is affected by many factors including among others, the relocation of our gallium arsenide manufacturing operations, the extent to which we pursue on-going capital expenditures, the build out of the sites at Dingxing and Kazuo, the level of our production, the level of profits or losses, and other factors related to the
−Removed: uncertainties of the industry and global economies.
−Removed: Our capital expenditures and any negative cash flow effects of these other factors will draw down our cash reserves, which could adversely affect our financial condition, require us to incur debt, reduce our value and possibly impinge our ability to raise debt and equity funding in the future, at a time when we might need to raise additional cash or elect to raise additional cash.
+Added: Our liquidity is affected by many factors including among others, the relocation of our gallium arsenide manufacturing operations, the extent to which we pursue ongoing capital expenditures, the build out of the sites at Dingxing and Kazuo, the level of our production, the level of profits or losses, and other factors related to the uncertainties of the industry and global economies.
+Added: Our capital expenditures and any negative cash flow effects of these
+Added: other factors will draw down our cash reserves, which could adversely affect our financial condition, require us to incur debt, reduce our value and possibly impinge our ability to raise debt and equity funding in the future, at a time when we might need to raise additional cash or elect to raise additional cash.
Accordingly, there can be no assurance that events will not require us to seek additional capital or, if required, that such capital would be available on terms acceptable to us, if at all.
6 unchanged sentences
● fluctuation of our manufacturing yields;
−Removed: decreases in the prices of our or our competitors’
+Added: ● decreases in the prices of our or our competitors’ products;
● fluctuations in demand for our products;
41 unchanged sentences
We have utilized all state net operating losses, primarily in the state of California, as of December 31, 2019.
−Removed: Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership change,”
−Removed: the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes, such as research tax credits, to offset its post-change income and taxes may be limited.
−Removed: In general, an “ownership change”
−Removed: occurs if there is a cumulative change in our ownership by “5% shareholders”
−Removed: that exceeds 50 percentage points over a rolling three-year period.
+Added: Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership change,” the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes, such as research tax credits, to offset its post-change income and taxes may be limited.
+Added: In general, an “ownership change” occurs if there is a cumulative change in our ownership by “5% shareholders” that exceeds 50 percentage points over a rolling three-year period.
Similar rules may apply under state tax laws.
7 unchanged sentences
We may incur expenses to defend ourselves against such claims or enter into cross license agreements that require us to pay royalty payments to resolve such claims.
−Removed: For example, in 2020, we and a competitor entered into the Cross License Agreement, which has a term that begins on January 1, 2020 and expires on December 31, 2029.
+Added: For example, in 2020, we and a competitor entered into the Cross License Agreement, which has a term that began on January 1, 2020 and expires on December 31, 2029.
We have in the past been involved in lawsuits alleging patent infringement, and could in the future be involved in similar litigation.
37 unchanged sentences
The Beijing municipal authority accepted our permit application in May 2015, but has not yet issued to us the requisite permit while we continue to show good faith in relocating our gallium arsenide production.
−Removed: If our application is denied in the future before we complete customer qualifications and ramp wafer processing volume, then our gallium arsenide production could be disrupted, which could materially and adversely impact our results of operations and our financial condition.
+Added: If our application is denied in the future before we complete customer qualifications and ramp up wafer processing production, then our gallium arsenide production could be disrupted, which could materially and adversely impact our results of operations and our financial condition.
We could be subject to suits for personal injuries caused by hazardous materials.
5 unchanged sentences
Litigation is inherently uncertain and while we would expect to defend ourselves vigorously, it is possible that our business, financial condition, results of operations or cash flows could be affected in any particular period by litigation pending and any additional litigation brought against us.
−Removed: In addition, future litigation could divert management’s attention from our business and operations, causing our business and financial results to suffer.
+Added: In addition, future litigation could divert management’s attention from our business and operations, causing our business and financial results to suffer.
We could incur defense or settlement costs in excess of the insurance covering these litigation matters, or that could result in significant judgments against us or cause us to incur costly settlements, in excess of our insurance limits.
3 unchanged sentences
(1) we fail to maintain effective internal control over financial reporting;
−Removed: or (2) our management does not timely assess the adequacy of such internal control, we could be subject to regulatory sanctions and the public’s perception of us may be adversely impacted.
+Added: or (2) our management does not timely assess the adequacy of such internal control, we could be subject to regulatory sanctions and the public’s perception of us may be adversely impacted.
We need to continue to improve or implement our systems, procedures and controls.
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.