18 unchanged sentences
The coronavirus that causes the serious disease COVID-19 (“coronavirus”), has and may continue to adversely affect our business, including revenues, suppliers, employees and facilities.
−Removed: As a global company with 90% of our 2021 sales in international markets, we have been and may continue to be, significantly impacted by the word wide coronavirus outbreak, which has affected all markets we serve.
−Removed: Thirty of our employees are based in Shanghai, China and we have a manufacturing facility there which manufactures some of our equipment and develops most of the adapters and algorithms for our equipment.
+Added: As a global company with approximately 93% of our 2022 sales in international markets, we have been and may continue to be, significantly impacted by the word wide coronavirus outbreak, which has affected all markets we serve.
+Added: Twenty seven of our employees are based in Shanghai, China and we have a manufacturing facility there which manufactures some of our equipment and develops most of the adapters and algorithms for our equipment.
Although our facilities in Shanghai, Redmond and Germany are currently operating, they could be closed for an extended period of time due to outbreaks of new variants of coronavirus.
Additionally, we source other components from China and other countries that are used to manufacture our equipment in China and in our Redmond, Washington facility and these components may not be readily available.
−Removed: Many of our Redmond based employees and executives are working from home or hybrid schedules and we limit visitors to our facilities.
+Added: Many of our Redmond based employees and executives are working from home or under hybrid schedules and we limit visitors to our facilities.
All of our facilities are subject to restrictions and closure by governmental entities.
2 unchanged sentences
The coronavirus has and continues to impact key tradeshows and travel plans for our employees.
−Removed: Because of the coronavirus, we are not able to visit many of our customers and prospects.
+Added: Because of the coronavirus, we have experienced limitations on visiting many of our customers and prospects.
Many tradeshows, marketing activities and conferences have been canceled, postponed or made virtual.
+Added: However, we are experiencing reduced limitations on visiting customers and resumption of in person events.
TARIFFS AND TRADE ISSUES
35 unchanged sentences
Concentration in automotive electronics and our orders related to automotive electronics customers has been dominant in recent years at 61% in 2022, 58% in 2021 and 53% in 2020.
−Removed: As we have been concentrated on automotive electronics customers, any decrease in demand from these customers (for example, many had plant shut downs during the second quarter of 2020 or experienced semiconductor part shortages during 2021) may materially impact our results, as it will take some time to transition our product line to other markets.
+Added: As we have been concentrated on automotive electronics customers, any decrease in demand from these customers may materially impact our results, as it will take some time to transition our product line to other markets.
Quality standards and business requirements by our automotive electronics customers, driven in turn by their automotive manufacturer customers, may demand processes and certifications at a higher level than we currently are structured to provide.
40 unchanged sentences
THIRD PARTY RELATIONSHIPS
−Removed: If we do not develop, enhance and retain our relationships with security partners, our business may be adversely affected and we may not be able to timely develop new and cost effective managed and secure programming solutions.
−Removed: We may be required to complement our skills and expertise with partners’ expertise.
−Removed: Some of these partners are operating with more limited capital and/or management expertise than established firms or recently acquired firms that may have different priorities.
−Removed: Other partners are very large companies where prioritizing work with us may be difficult in light of competing priorities.
−Removed: We may need to develop alternate suppliers, sales channels, and business strategies.
−Removed: In 2020 and 2021, we significantly reduced our dependence on third parties for our SentriX platform.
If we do not develop and enhance our relationships with semiconductor manufacturers, our business may be adversely affected.
2 unchanged sentences
These working relationships enable us to keep our programming systems product lines up to date and provide end-users with broad and current programmable device support.
−Removed: As technology changes occur that could limit the effectiveness of pre-placement programming, particularly for very small high-density NAND, e-MMC and UFS devices, certain semiconductor manufacturers may not recommend or may not continue recommending our programming systems for these devices.
+Added: As technology changes occur that could limit the effectiveness of pre-placement programming, particularly for very small high-density NAND, eMMC and UFS devices, certain semiconductor manufacturers may not recommend or may not continue recommending our programming systems for these devices.
Our business may be adversely affected if our relationships with semiconductor manufacturers deteriorate or if semiconductor manufacturers are not willing to closely work with us on security deployment.
12 unchanged sentences
Over estimation of demand or excessive minimum order quantities will lead to excess inventories that may become obsolete.
−Removed: Part shortages, especially semiconductor parts in 2021, impact availability, lead times, and pricing that may be disruptive to our production plans, lead times, margins and may result in lost sales.
+Added: Part shortages, especially semiconductor parts in 2021 and 2022, impact availability, lead times, and pricing that may be disruptive to our production plans, lead times, margins and may result in lost sales.
Some of our sockets, parts, subassemblies and boards are currently manufactured to our specifications by third-party foreign contract manufacturers and we are sourcing certain parts or options from foreign manufacturers, particularly in China.
22 unchanged sentences
International sales may fluctuate due to various factors, including:
−Removed: the impact of the coronavirus or other viruses;
−Removed: fluctuations in foreign currency exchange rates because 90% of our sales are to international markets, volatile exchange rates may also impact our competitiveness and margins;
+Added: the impact of COVID-19, the coronavirus and variants of it, or other viruses;
+Added: fluctuations in foreign currency exchange rates because 93% of our sales are to international markets, volatile exchange rates may also impact our competitiveness and margins, especially where we have subsidiary operations;
economic uncertainty related to the European energy cost increases;
migration of manufacturing to low cost geographies;
−Removed: unexpected changes in regulatory requirements, including Brexit;
+Added: unexpected changes in regulatory requirements;
tariffs and taxes;
6 unchanged sentences
war, civil unrest, political and economic instability, including the Russian invasion of Ukraine;
+Added: ability to protect our intellectual property in multiple patent jurisdictions;
+Added: ability to move cash freely from subsidiaries.
Because we have customers located throughout the world, we have significant foreign receivables, although none are based in Russia or Ukraine.
33 unchanged sentences
changes in accounting rules, tax or other legislation;
−Removed: adverse movements in exchange rates, interest rates or tax rates;
+Added: adverse movements in exchange rates, interest rates, inflation or tax rates;
cyclical and seasonal nature of demand for our customers’ products;
61 unchanged sentences
While we have policies and procedures in place designed to prevent corruption and bribery, because our business is significantly international, violations of the Foreign Corrupt Practices Act (FCPA) could have a significant adverse effect on our business due to the disruption and distraction of an investigation, financial penalties and criminal penalties.
−Removed: Government regulations regarding the use of “conflict” minerals could adversely affect our prospects and results of operations.
+Added: Government regulations regarding the use of "conflict" minerals and potential climate and ESG requirements could adversely affect our prospects and results of operations.
Regulatory requirements regarding disclosure of our use of “conflict” minerals mined from the Democratic Republic of Congo and adjoining countries could affect the sourcing and availability of minerals used in the manufacture of certain products.
6 unchanged sentences
We may need to incur additional costs and invest additional resources, including management’s time, in order to comply with the new regulations and anticipated additional reporting and disclosure obligations.
+Added: Climate focused regulations and related disclosures are a similar evolving regulatory area and we may be required to invest in systems, processes and personnel to address new requirements in the ESG area.
+Added: These could require significant costs, work and reputational risk for failing to meet requirements,
Unresolved Staff Comments
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.