What changed in this filing

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Item 1. Financial Statements

2024-02-02 compared with 2023-11-08 · 97 added, 119 removed, 392 unchanged (36% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEET S

September 30,

(In thousands, except share

3 unchanged sentences

Accounts receivable, net

Prepaid expenses and other current assets

Prepaid expenses and other current assets ($ 375 and $ 0 from a related party)

Total current assets

30 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATION S

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands, except per share amounts)

7 unchanged sentences

Interest income, net

Other expense, net

Other income (expense), net

Loss before income taxes

5 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands)

Net unrealized gain (loss) on available-for-sale investments

Net unrealized gain on available-for-sale investments

Total comprehensive loss

4 unchanged sentences

Stockholders'

Three months ended September 30, 2023

Three months ended December 31, 2023

(In thousands, except share amounts)

Balance, June 30, 2023

Issuance of common stock pursuant to an At-the-Market offering, net of offering costs of $ 389

Balance, September 30, 2023

Issuance of common stock under employee stock option plans

Stock-based compensation expense

Net unrealized gain on available-for-sale investments

Balance, December 31, 2023

Three months ended December 31, 2022

Balance, September 30, 2022

Comprehensive

Stockholders'

Three months ended September 30, 2022

(In thousands, except share amounts)

Balance, June 30, 2022

Issuance of common stock under employee stock option plans

Stock-based compensation expense

Net unrealized gain on available-for-sale investments

Balance, September 30, 2022

Balance, December 31, 2022

Comprehensive

Stockholders'

Six months ended September 30, 2023

Nine months ended December 31, 2023

(In thousands, except share amounts)

4 unchanged sentences

Net unrealized gain on available-for-sale investments

Balance, September 30, 2023

Comprehensive

Stockholders'

Six months ended September 30, 2022

(In thousands, except share amounts)

Balance, December 31, 2023

Nine months ended December 31, 2022

Balance, March 31, 2022

1 unchanged sentence

Stock-based compensation expense

Net unrealized loss on available-for-sale investments

Balance, September 30, 2022

Net unrealized gain on available-for-sale investments

Balance, December 31, 2022

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW S

Six Months Ended September 30,

Nine Months Ended December 31,

(In thousands)

40 unchanged sentences

However, these financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2023.

The consolidated results of operations for the six months ended September 30, 2023 are not necessarily indicative of the results to be expected for the entire fiscal year.

Reclassifications

Certain amounts in the fiscal 2022 condensed consolidated financial statements have been reclassified to conform to the fiscal 2023 presentation.

The consolidated results of operations for the nine months ended December 31, 2023 are not necessarily indicative of the results to be expected for the entire fiscal year.

Significant accounting policies

13 unchanged sentences

If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the marketable security is compared to the amortized cost basis of the marketable security.

If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded, limited by the amount that the fair value is less than the amortized cost basis.

If the present value of cash flows expected to be collected is less than the amortized

cost basis, a credit loss exists and an allowance for credit losses is recorded, limited by the amount that the fair value is less than the amortized cost basis.

Any other impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive loss.

5 unchanged sentences

Risk and uncertainties

The decline in the global economic environment due to, among other things, rising interest rates, worldwide inflationary pressures and significant fluctuations in energy prices has affected the business activities of the Company, its customers, suppliers, and other business partners in the fiscal year ended March 31, 2023 and into the six months ended September 30, 2023.

The decline in the global economic environment due to, among other things, higher interest rates, worldwide inflationary pressures and recent fluctuations in energy prices has affected the business activities of the Company, its customers, suppliers, and other business partners in the fiscal year ended March 31, 2023 and into the nine months ended December 31, 2023.

Our software development and certain regional sales activities for our APU product offerings occur in Israel.

3 unchanged sentences

We are closely monitoring developments in the evolving military conflict with Hamas that began on October 7, 2023 including potential impacts to our business, customers, employees and operations in Israel.

At this time, the impact on GSI Technology are uncertain and subject to change given the volatile nature of the situation, but adverse changes in the military conditions in Israel could harm our business and our stock price could decline.

The Company believes that during the next 12 months disruptions in the capital markets as a result of rising interest rates, worldwide inflationary pressures, significant fluctuations in energy prices and the decline in the global economic environment could impact general economic activity and demand in the Company’s end markets.

At this time, the impact on GSI Technology is uncertain and subject to change given the volatile nature of the situation, but adverse changes in the military conditions in Israel could harm our business and our stock price could decline.

The Company believes that during the next 12 months disruptions in the capital markets as a result of higher interest rates, worldwide inflationary pressures, recent fluctuations in energy prices and the decline in the global economic environment could impact general economic activity and demand in the Company’s end markets.

Additionally, fluctuations in customer demand due to previous buffer stock purchases during the semiconductor supply shortage may negatively impact near-term revenues.

3 unchanged sentences

Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.

For trade and other receivables, loans, and other financial instruments, the Company will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable.

Credit losses relating to available-for-sale debt securities will also be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities.

For trade and other receivables, loans, and other financial instruments, the Company is required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable.

Credit losses relating to available-for-sale debt securities are recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities.

ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

5 unchanged sentences

(2) identification of the performance obligations in the contract;

(3) determination of the transaction price;

(3) determination of the

transaction price;

(4) allocation of the transaction price to the performance obligations in the contract;

13 unchanged sentences

The Company records revenue net of sales tax, value added tax, excise tax and other taxes collected concurrent with product sales.

The impact of such taxes on products sales is immaterial.

The impact of such taxes on product sales is immaterial.

The Company warrants its products to be free of defects generally for a period of three years .

The Company estimates its warranty costs based on historical warranty claim experience and includes such costs in cost of revenues.

Warranty costs and the accrued warranty liability were not material as of September 30, 2023 and March 31, 2023.

Substantially all of the Company’s revenue is derived from sales of SRAM products, which represent approximately 98 % and 96 % of total revenues in the six months ended September 30, 2023 and 2022, respectively.

Warranty costs and the accrued warranty liability were not material as of and for the periods ended December 31, 2023 and March 31, 2023.

Substantially all of the Company’s revenue is derived from sales of SRAM products, which represent approximately 98 % and 97 % of total revenues in the nine months ended December 31, 2023 and 2022, respectively.

Nokia, the Company’s largest customer, purchases products directly from the Company and through contract manufacturers and distributors.

Based on information provided to the Company by its contract manufacturers and distributors, purchases by Nokia represented approximately 20 % and 14 % of the Company’s net revenues in the three months ended September 30, 2023 and 2022, respectively, and 27 % and 14 % of the Company’s net revenues in the six months ended September 30, 2023 and 2022, respectively.

Based on information provided to the Company by its contract manufacturers and distributors, purchases by Nokia represented approximately 15 % and 20 % of the Company’s net revenues in the three months ended December 31, 2023 and 2022, respectively, and 23 % and 16 % of the Company’s net revenues in the nine months ended December 31, 2023 and 2022, respectively.

See “Note 12 — Segment and Geographic Information” for revenue by shipment destination.

The following table presents the Company’s revenue disaggregated by customer type.

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands)

4 unchanged sentences

The following table sets forth the computation of basic and diluted net loss per share:

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands, except per share amounts)

8 unchanged sentences

The following shares of common stock underlying outstanding stock options and unissued ESPP shares, determined on a weighted average basis, were excluded from the computation of diluted net loss per share as they had an anti-dilutive effect:

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands)

2 unchanged sentences

NOTE 4—BALANCE SHEET DETAIL

September 30, 2023

December 31, 2023

March 31, 2023

3 unchanged sentences

Inventory at distributors

September 30, 2023

December 31, 2023

March 31, 2023

3 unchanged sentences

Allowances for credit losses

September 30, 2023

December 31, 2023

March 31, 2023

4 unchanged sentences

Other prepaid expenses and other current assets

September 30, 2023

December 31, 2023

March 31, 2023

6 unchanged sentences

Accumulated depreciation

Depreciation expense was $ 172,000 and $ 196,000 for the three months ended September 30, 2023 and 2022, respectively, and $ 388,000 and $ 393,000 for the six months ended September 30, 2023 and 2022, respectively.

The following tables summarize the components of intangible assets and related accumulated amortization balances at September 30, 2023 and March 31, 2023 (in thousands):

As of September 30, 2023

Depreciation expense was $ 155,000 and $ 195,000 for the three months ended December 31, 2023 and 2022, respectively, and $ 543,000 and $ 588,000 for the nine months ended December 31, 2023 and 2022, respectively.

The following tables summarize the components of intangible assets and related accumulated amortization balances at December 31, 2023 and March 31, 2023 (in thousands):

As of December 31, 2023

Intangible assets:

3 unchanged sentences

Product designs

Amortization of intangible assets included in cost of revenues was $ 58,000 and $ 59,000 for the three months ended September 30, 2023 and 2022, respectively, and $ 117,000 for each of the six months ended September 30, 2023 and 2022.

Amortization of intangible assets included in cost of revenues was $ 58,000 for each of the three months ended December 31, 2023 and 2022, respectively, and $ 175,000 for each of the nine months ended December 31, 2023 and 2022.

The Company reviews identifiable amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable.

Determination of recoverability is based on the lowest level of identifiable estimated undiscounted cash flows resulting from use of the asset and its eventual disposition.

Determination of recoverability is based on the lowest level of identifiable estimated undiscounted cash flows resulting from use of

the asset and its eventual disposition.

Measurement of any impairment loss is based on the excess of the carrying value of the asset over its fair value.

The Company identified a potential impairment indicator for the finite lived intangible assets and performed a recoverability test by comparing the sum of the estimated undiscounted future cash flows of the asset group to the carrying amount as of March 31, 2023.

The result of the recoverability test indicated that the sum of the expected future cash flows was greater than the carrying amount of the finite lived intangible assets.

Based on the uncertainty of forecasts inherent with a new product, events such as the failure to generate forecasted revenue from the APU product could result in a non-cash impairment charge in future periods.

As of September 30, 2023, the estimated future amortization expense of intangible assets in the table above is as follows (in thousands):

As of December 31, 2023, the estimated future amortization expense of intangible assets in the table above is as follows (in thousands):

Fiscal year ending March 31,

2024 (remaining six months)

September 30, 2023

2024 (remaining three months)

December 31, 2023

March 31, 2023

5 unchanged sentences

Outsourced design resources

Research and development mask set

Miscellaneous accrued expenses

On November 30, 2022, the Company announced cost reduction initiatives which included an approximate 15 % reduction in the Company’s global workforce.

The Company incurred $ 0.3 million in severance related charges during fiscal 2023 including $ 0.1 million recorded as cost of revenues and $ 0.2 million recorded as selling, general and administrative expenses.

There were no severance related charges in the three and six months ended September 30, 2023 and 2022.

The Company incurred $ 0.3 million in severance related charges during the three and nine months ended December 31, 2022 including $ 0.1 million recorded as cost of revenues and $ 0.2 million recorded as selling, general and administrative expenses.

There were no severance related charges in the three and nine months ended December 31, 2023.

NOTE 5—GOODWILL

3 unchanged sentences

The Company has one reporting unit.

The Company had a goodwill balance of $ 8.0 million as of both September 30, 2023 and March 31, 2023.

The Company had a goodwill balance of $ 8.0 million as of both December 31, 2023 and March 31, 2023.

The goodwill resulted from the acquisition of MikaMonu Group Ltd.

2 unchanged sentences

NOTE 6—INCOME TAXES

The current portion and long-term portion of the Company’s income tax liability related to unrecognized tax benefits was $ 0 at both September 30, 2023 and March 31, 2023.

Due to historical losses in the United States, the Company has a full valuation allowance on its United States federal and state deferred tax assets.

The current portion and long-term portion of the Company’s income tax liability related to unrecognized tax benefits was $ 0 at both December 31, 2023 and March 31, 2023.

Due to historical losses in the United States, the

Company has a full valuation allowance on its United States federal and state deferred tax assets.

Management continues to evaluate the realizability of deferred tax assets and the related valuation allowance.

3 unchanged sentences

Fiscal years 2013 through 2022 remain open to examination by federal tax authorities, and fiscal years 2012 through 2022 remain open to examination by California tax authorities.

Fiscal years 2020, 2021, 2022 and 2023 are subject to audit by the Israeli tax authorities.

For the six months ended September 30, 2023 and September 30, 2022, the Company incurred income tax expense of $ 84,000 and $ 97,000 on net losses before income taxes of ($ 9.1 million) and ($ 7.1 million), respectively.

Fiscal years 2020 through 2023 are subject to audit by the Israeli tax authorities.

For the nine months ended December 31, 2023 and December 31, 2022, the Company incurred income tax expense of $ 155,000 and $ 181,000 on net losses before income taxes of ($ 15.6 million) and ($ 11.8 million), respectively.

The provision was calculated using the annualized effective tax rate method.

The Company’s estimated annual effective income tax rate, including discrete items, was approximately ( 1.53 %) and ( 1.69 %) as of September 30, 2023 and 2022, respectively.

The annual effective tax rates as of September 30, 2023 and 2022 vary from the United States statutory income tax rate primarily due to valuation allowances in the United States, whereby pre-tax losses do not result in the recognition of corresponding income tax benefits or foreign tax differential.

The Company’s estimated annual effective income tax rate, including discrete items, was approximately ( 1.44 %) and ( 2.16 %) as of December 31, 2023 and 2022, respectively.

The annual effective tax rates as of December 31, 2023 and 2022 vary from the United States statutory income tax rate primarily due to valuation allowances in the United States, whereby pre-tax losses do not result in the recognition of corresponding income tax benefits or foreign tax differential.

NOTE 7—FINANCIAL INSTRUMENTS

5 unchanged sentences

The fair value of available-for-sale securities included in the Level 1 category is based on quoted prices that are readily and regularly available in an active market.

As of September 30, 2023, the Level 1 category included money market funds of $ 10.8 million, which were included in cash and cash equivalents on the Condensed Consolidated Balance Sheets.

As of December 31, 2023, the Level 1 category included money market funds of $ 9.6 million, which were included in cash and cash equivalents on the Condensed Consolidated Balance Sheets.

Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date;

2 unchanged sentences

The fair value of available-for-sale securities included in the Level 2 category is based on the market values obtained from an independent pricing service that were evaluated using pricing models that vary by asset class and may incorporate available trade, bid and other market information and price quotes from well-established independent pricing vendors and broker-dealers.

As of September 30, 2023, the Level 2 category included short-term investments of $ 651,000 , which were comprised of government securities.

As of December 31, 2023, there were no Level 2 category short-term investments.

Valuations based on inputs that are unobservable and involve management judgment and the reporting entity’s own assumptions about market participants and pricing.

As of September 30, 2023, the

Company’s Level 3 financial instruments measured at fair value on the Condensed Consolidated Balance Sheets consisted of the contingent consideration liability related to the acquisition of MikaMonu.

As of December 31, 2023, the Company’s Level 3 financial instruments measured at fair value on the Condensed Consolidated Balance Sheets consisted of the contingent consideration liability related to the acquisition of MikaMonu.

The fair value of the contingent consideration liability was initially determined as of the acquisition date using unobservable inputs.

1 unchanged sentence

Significant increases (decreases) to the estimated amount and timing of future cash flows or the probability of achievement of the forecast would result in a significantly higher (lower) fair value measurement.

Conversely, a significant increase or (decrease) in the risk-adjusted discount rate would result in a significantly (lower) higher fair value measurement.

Conversely, a significant increase or (decrease) in the risk-adjusted discount rate would result in a significantly

(lower) higher fair value measurement.

Generally, changes used in the assumptions for future cash flows and probability of achievement of the forecast would be accompanied by a directionally similar change in the fair value measurement and expense.

1 unchanged sentence

Subsequent to the acquisition date, at each reporting period, the contingent consideration liability is re-measured to fair value with changes recorded in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

During the most recent re-measurement of the contingent consideration liability as of September 30, 2023, the Company used a risk-adjusted discount rate of approximately 15.9 % to adjust the probability-weighted cash flows to their present value using probabilities ranging from 25 % to 70 % for the remaining contingent events.

The contingent consideration liability is included in contingent consideration, non-current on the Condensed Consolidated Balance Sheets at September 30, 2023 and March 31, 2023 in the amount of $ 728,000 and $ 1.1 million, respectively.

During the most recent re-measurement of the contingent consideration liability as of December 31, 2023, the Company used a risk-adjusted discount rate of approximately 15.6 % to adjust the probability-weighted cash flows to their present value using probabilities ranging from 25 % to 70 % for the remaining contingent events.

The contingent consideration liability is included in contingent consideration, non-current on the Condensed Consolidated Balance Sheets at December 31, 2023 and March 31, 2023 in the amount of $ 495,000 and $ 1.1 million, respectively.

The fair value of financial assets measured on a recurring basis is as follows (in thousands):

3 unchanged sentences

and Liabilities

September 30, 2023

December 31, 2023

Money market funds

9 unchanged sentences

Contingent consideration

The following table sets forth the changes in fair value of contingent consideration for the six months ended September 30, 2023 and 2022, respectively:

Six Months Ended September 30,

The following table sets forth the changes in fair value of contingent consideration for the nine months ended December 31, 2023 and 2022, respectively:

Nine Months Ended December 31,

(In thousands)

7 unchanged sentences

Investments in available-for-sale securities are reported at fair value with unrecognized gains (losses), net of tax, as a component of accumulated other comprehensive loss in the Condensed Consolidated Balance Sheets.

The Company had money market funds of $ 10.8 million and $ 7.8 million at September 30, 2023 and March 31, 2023, respectively, included in cash and cash equivalents on the Condensed Consolidated Balance Sheets.

The Company had money market funds of $ 9.6 million and $ 7.8 million at December 31, 2023 and March 31, 2023, respectively, included in cash and cash equivalents on the Condensed Consolidated Balance Sheets.

The Company monitors its investments for impairment periodically and records appropriate reductions in carrying values when declines are determined to be other-than-temporary.

The following table summarizes the Company’s available-for-sale investments.

September 30, 2023

(In thousands)

Short-term investments:

Supranational obligations

Total short-term investments

There were no available-for-sale investments at December 31, 2023.

March 31, 2023

4 unchanged sentences

Total short-term investments

The following table shows the gross unrealized losses and fair value of the Company’s investments with unrealized losses that do not have an allowance for credit losses, aggregated by investment category and length of time that individual securities have been in a continuous loss position as of September 30, 2023 and March 31, 2023, respectively.

September 30, 2023

Less Than 12 Months

12 Months or Greater

(In thousands)

Supranational obligations

March 31, 2023

4 unchanged sentences

Supranational obligations

The Company’s investment portfolio consists of governmental securities that have a maximum maturity of three years .

All unrealized gains and losses are due to changes in interest rates and bond yields.

Subject to normal credit risks, the Company has the ability to realize the full value of all these investments upon maturity.

All available-for-sale investment securities are either fully insured or contractual terms of the investment do not permit the issuer to settle the security at a price less than the amortized cost of the investment.

The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investment before recovery of the amortized cost basis.

The deferred tax asset related to unrecognized gains and losses on short-term investments was $ 1,000 and $ 10,000 at September 30, 2023 and March 31, 2023, respectively.

As of September 30, 2023, contractual maturities of the Company’s available-for-sale investments were as follows:

(In thousands)

Maturing within one year

Maturing in one to three years

The Company classifies its short-term investments as “available-for-sale” as they are intended to be available for use in current operations.

The deferred tax asset related to unrecognized gains and losses on short-term investments was $ 10,000 at March 31, 2023.

NOTE 8—LEASES

5 unchanged sentences

Supplemental balance sheet information related to leases was as follows:

September 30, 2023

December 31, 2023

March 31, 2023

6 unchanged sentences

The following table provides the details of lease costs:

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands)

3 unchanged sentences

The following table provides other information related to leases:

Six Months Ended September 30,

Nine Months Ended December 31,

(In thousands)

7 unchanged sentences

Operating leases

The following table provides the maturities of the Company’s operating lease liabilities as of September 30, 2023:

The following table provides the maturities of the Company’s operating lease liabilities as of December 31, 2023:

Operating Lease

(In thousands)

2024 (remaining six months)

2024 (remaining three months)

Total undiscounted future cash flows

5 unchanged sentences

The Company is a party to a variety of agreements pursuant to which it may be obligated to indemnify the other party with respect to certain matters.

Typically, these obligations arise in the context of contracts entered into by the Company, under which the Company agrees to hold the other party harmless against losses arising from a breach of representations and covenants related to such matters as title to assets sold and certain intellectual property

In each of these circumstances, payment by the Company is conditioned on the other party making a claim pursuant to the procedures specified in the particular contract, which procedures typically allow the Company to challenge the other party’s claims.

3 unchanged sentences

NOTE 10—STOCK-BASED COMPENSATION

As of September 30, 2023, 3,076,860 shares of common stock were available for grant under the Company’s Amended and Restated 2016 Equity Incentive Plan.

The following table summarizes the Company’s stock option activities for the six months ended September 30, 2023:

As of December 31, 2023, 2,905,696 shares of common stock were available for grant under the Company’s Amended and Restated 2016 Equity Incentive Plan.

The following table summarizes the Company’s stock option activities for the nine months ended December 31, 2023:

Number of Shares

1 unchanged sentence

Balance at March 31, 2023

Balance at September 30, 2023

Balance at December 31, 2023

Options vested and exercisable

1 unchanged sentence

The following table summarizes stock-based compensation expense by line item in the Condensed Consolidated Statements of Operations, all relating to employee stock plans:

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands)

4 unchanged sentences

NOTE 11—RELATED PARTY TRANSACTION

The Company incurred non-recurring engineering service expense and production charges of approximately $ 0 and $ 140,000 during the three months ended September 30, 2023 and 2022, respectively, and $ 0 and $ 197,000 during the six months ended September 30, 2023 and 2022, respectively, from Wistron Neweb Corp (“WNC”) in connection with the manufacturing of single-APU PCIe boards, to be used in the Company’s in-place associative computing product.

The Company incurred engineering service expense and production charges of approximately $ 500,000 and $ 4,000 during the three months ended December 31, 2023 and 2022, respectively, and $ 500,000 and $ 201,000 during the nine months ended December 31, 2023 and 2022, respectively, from Wistron Neweb Corp (“WNC”) in connection with the manufacturing of single-APU PCIe boards, to be used in the Company’s in-place associative computing product.

Haydn Hsieh, a member of the Company’s board of directors, is the Chairman and Chief Strategy Officer of WNC.

The amount owed to WNC, of $ 0 and $ 8,000 at September 30, 2023 and March 31, 2023, respectively, is included in accounts payable in the Condensed Consolidated Balance Sheets.

The amount owed to WNC, of $ 394,000 and $ 8,000 at December 31, 2023 and March 31, 2023, respectively, is included in accounts payable in the Condensed Consolidated Balance Sheets.

NOTE 12—SEGMENT AND GEOGRAPHIC INFORMATION

2 unchanged sentences

The following is a summary of net revenues by geographic area based on the location to which product is shipped:

Three Months Ended September 30,

Six Months Ended September 30,

Three Months Ended December 31,

Nine Months Ended December 31,

(In thousands)

10 unchanged sentences

The Company applies IAS 20, by analogy, and recognizes the award as a reduction of research and development expenses based on a cost incurred method.

During the three and six months ended September 30, 2023, the Company recognized $ 260,000 as a reduction to research and development expense in the Condensed Consolidated Statements of Operations.

As of September 30, 2023, the Company had received total milestone payments of $ 297,000 under the Prototype Agreement.

During the three and nine months ended December 31, 2023, the Company recognized $ 175,000 and $ 435,000 , respectively, as a reduction to research and development expense in the Condensed Consolidated Statements of Operations.

As of December 31, 2023, the Company had received total milestone payments of $ 435,000 under the Prototype Agreement.

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-Q

Item 1. Financial Statements