What changed in this filing

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Item 1A. Risk Factors

2024-08-30 compared with 2024-05-31 · 71 added, 45 removed, 762 unchanged (13% of the section changed)

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• risks related to our ability to maintain a competitive cost structure for our manufacturing, assembly, testing and packaging processes and our reliance on third parties to produce our products;

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• risks related to our ability to scale our business;

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Any litigation could result in substantial costs and a diversion of management’s attention and resources that are needed to successfully maintain and grow our business.

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CHANGES IN PRODUCT DEMAND CAN ADVERSELY AFFECT OUR FINANCIAL RESULTS

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If we lose or experience a significant reduction in sales to any of these key customers, if any of these key customers experience a significant decline in market share, or if any of these customers experience significant financial difficulties, our revenue may decrease substantially and our results of operations and financial condition may be harmed.” See also, “Adverse changes in the political, regulatory and economic policies of governments in connection with trade with China and Chinese customers have reduced the demand for our products and damaged our business” for additional risks related to export restrictions that may impact certain customers in the 5G, Cloud and AI markets.

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Our sales are concentrated in a few large customers.

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To the extent one or more of our large customers experience financial challenges, bankruptcy or insolvency, this could have a material adverse effect on our sales and our ability to collect on receivables, which could harm our financial condition and results of operations.

See also, “ Management’s Discussion and Analysis of Financial Condition and Results of Operations - Sales and Customer Composition ”.

See also, “ Management’s Discussion and Analysis of Financial Condition and Results of Operations - Sales and Customer Composition ” for information for the current quarterly reporting period.

If we are unable to increase the number of large customers in key markets, then our operating results in the foreseeable future would be expected to continue to depend on sales to a relatively small number of customers, as well as the ability of these customers to sell products that incorporate our products.

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Given their dependence on semiconductor products to operate their data centers and to ensure continuity of supply and reduce direct costs, some large customers may begin developing their own semiconductor solutions with the use of generally available intellectual property licensed from third parties which could result in a loss of business for Marvell.

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We are subject to order and shipment uncertainties.

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For example, customers now expect us to provide turnkey solutions and commit to future roadmaps that have technical risks.

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Some of our competitors may be better situated to meet changing customer needs and secure design wins.

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In addition, our more recently introduced products tend to have higher associated costs because of initial overall development and production expenses.

Therefore, over time, we may not be able to maintain or improve our gross margins.

Therefore, over time, we may not be able to maintain or improve our gross margin.

Our financial results could suffer if we are unable to offset any reductions in our average selling prices by other cost reductions through efficiencies, introduction of higher margin products and other means.

To attract new customers or retain existing customers, we may offer certain price concessions to certain customers, which could cause our average selling prices and gross margins to decline.

To attract new customers or retain existing customers, we may offer certain price concessions to certain customers, which could cause our average selling prices and gross margin to decline.

In the past, we have reduced the average selling prices of our products in anticipation of future competitive pricing pressures, new product introductions by us or by our competitors and other factors.

We expect to continue to have to reduce prices of existing products in the future.

Moreover, because of the wide price differences across the markets we serve, the mix and types of performance capabilities of our products sold may affect the average selling prices of our products and have a substantial impact on our revenue and gross margin.

We may enter new markets in which a significant amount of competition exists, and this may require us to sell our products with lower gross margins than we earn in our established businesses.

If we are successful in growing revenue in these markets, our overall gross margin may decline.

We may enter new markets in which a significant amount of competition exists, and this may require us to sell our products with lower gross margin than we earn in our established businesses.

If we are successful in growing revenue in these markets, our overall margin may decline.

Fluctuations in the mix and types of our products may also affect the extent to which we are able to recover the fixed costs and investments associated with a particular product, and as a result may harm our financial results.

Additionally, because we do not operate our own manufacturing, assembly, testing or packaging facilities, we are not able to reduce our costs as rapidly as companies that operate their own facilities and our costs may even increase, which could also reduce our gross margins.

Our gross margin could also be impacted, for example, by the following factors:

Our margin could also be impacted, for example, by the following factors:

increased costs (including increased costs caused by tariffs, inflation, higher interest rates, or supply chain constraints);

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In addition, we are subject to risks from fluctuating market prices of certain components, which are incorporated into our products or used by our suppliers to manufacture our products.

Supplies of these components may from time to time become restricted, or general market factors and conditions such as inflation or supply chain constraints have in the past affected and may in the future affect pricing of such commodities.

Supplies of these components may from time to time become restricted, or general market factors and conditions such as inflation or supply chain constraints have in the past affected, currently affect and may in the future affect pricing of such commodities.

For example, during the first few quarters of fiscal 2023 supply shortages in the semiconductor industry of multi-layer complex substrates, IC packaging capacity and fab constraints resulted in increased lead times, inability to meet demand, and increased costs.

Any increase in the price of components used in our products will adversely affect our gross margins.

Any increase in the price of components used in our products will adversely affect our margin.

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We may enter into new markets, including markets with different business models, as a result of our acquisitions or for other reasons that may reduce our gross margin and operating margin.

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Most of our products are manufactured by third-party foundries located in Taiwan, and other sources are located in China, Germany, South Korea, Singapore and the United States.

In addition, substantially all of our third-party assembly, testing and packaging facilities are located in China, Malaysia, Singapore, Taiwan and Canada.

Because of the geographic concentration of most of these third-party foundries, as well as our assembly, testing and packaging subcontractors, we are exposed to the risk that their operations may be disrupted by regional events including, for example, droughts, earthquakes (particularly in Taiwan and elsewhere in the Pacific Rim close to fault lines), tsunamis or typhoons, severe storms, power outages, or by actual or threatened public health emergencies such as the COVID-19 pandemic and future pandemics, or by political, social or economic instability, or by geopolitical tensions and conflicts.

In addition, most of our third-party assembly, testing and packaging facilities are located in China, Malaysia, Singapore, Taiwan and Canada.

Because of the geographic concentration of most of these third-party foundries, as well as most of our assembly, testing and packaging subcontractors, we are exposed to the risk that their operations may be disrupted by regional events including, for example, droughts, earthquakes (particularly in Taiwan and elsewhere in the Pacific Rim close to fault lines), tsunamis or typhoons, severe storms, power outages, or by actual or threatened public health emergencies such as the COVID-19 pandemic and future pandemics, or by political, social or economic instability, or by geopolitical tensions and conflicts.

For example, we were impacted by COVID outbreaks in Asia in the first half of fiscal 2023 that resulted in closed factories, clogged ports and a shortage of workers as officials imposed lockdowns and mass testing requirements.

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to build more foundries locally and the U.S.

government is providing funds or other incentives for certain companies to do so, we do not expect that such foundries will be available to us to produce advanced technologies any time soon, if ever.

government is providing funds or other incentives for certain companies to do so, we do not expect that such foundries will be available to us to produce certain types of advanced technologies any time soon, if ever.

If we need to utilize alternate manufacturing facilities, either in Taiwan or elsewhere, we could experience significant expenses and delays in product shipments, which could harm our results of operations.

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No Guarantee of Capacity or Supply

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We have in the past including in the first few quarters of fiscal 2023, and may in the future, experience a number of industry-wide supply constraints affecting the type of high complexity products we provide for data infrastructure.

These supply constraints have impacted, and are expected in the future to impact, the kitting process for our products.

These supply constraints have impacted, and in the future may impact, the kitting process for our products.

These supply challenges have in the past, and may in the future, limit our ability to fully satisfy demand for some of our products.

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Accordingly, if one of our foundries is unable to provide us with components as needed, it would be difficult for us to transition the manufacture of our products to other foundries, and we could experience significant delays in securing sufficient supplies of those components.

Any disruption to our or foundry partners could result in a material decline in our revenue, net income and cash flow.

Any disruption to our foundry partners could result in a material decline in our revenue, net income and cash flow.

In addition, our assembly, testing and packaging partners may be single sourced and it may be difficult for us to transition to other manufacturing partners for these services.

In order to secure sufficient capacity when demand is high and to mitigate the risks described in the foregoing paragraph, we have entered into, and in the future may enter into, various arrangements with certain manufacturing partners or other suppliers that could be costly and harm our results of operations, such as nonrefundable deposits with, or loans to, such parties in exchange for capacity commitments, or contracts that commit us to purchase specified quantities of components over extended periods.

We may not be able to make such arrangements in a timely fashion or at all, and any arrangements may be costly, reduce our financial flexibility, and not be on terms favorable to us.

We may not be able to make such arrangements in the future in a timely fashion or at all, and any arrangements may be costly, reduce our financial flexibility, and not be on terms favorable to us.

Moreover, if we are able to secure capacity, we may be obligated to use all of that capacity or incur penalties.

These penalties may be expensive and could harm our financial results.

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During the first few quarters of fiscal 2023, supply shortages in the semiconductor industry of multi-layer complex substrates, IC packaging capacity, and specific wafer process node constraints resulted in increased lead times, inability to meet demand, and increased costs .

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Moreover, even if we are able to achieve higher levels of design integration, such integration may have a short-term adverse impact on our results of operations, as we may reduce our revenue by integrating the functionality of multiple chips into a single chip.

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We rely on our customers to design our products into their systems, and the nature of the design process requires us to incur expenses prior to customer commitments to use our products or recognizing revenues associated with those expenses which may adversely affect our financial results.

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Additionally, failure of our customers to agree to pay for NRE costs or failure to pay enough to cover the costs we incur in connection with NREs, or non-payment of previously agreed NRE costs due to us, can harm our financial results.

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If we are unable to develop and introduce new and enhanced products that achieve market acceptance in a timely and cost-effective manner, our results of operations and competitive position will be harmed.

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Recalls of our customers’ products in certain end-markets, such as with our automotive and base station customers, may cause us to incur significant costs.

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In addition, despite our testing procedures, we cannot ensure that errors will not be found in new products or releases after commencement of commercial shipments in the future.

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While we don’t expect these announced restrictions to materially impact us, any export restrictions reducing our ability to manufacture our products can adversely impact our revenues, profits and results of operations.

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Concerns that semiconductors are necessary for national security, manufacturing and critical infrastructure, as well as concerns of their potential use to restrict human rights, has led to increased U.S.

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persons with respect to activities that are not subject to the Export Administration Regulations (“EAR”), which differs from the agency’s historical approach of controlling items that are subject to the EAR, and the regulations published in October 2023 impose additional licensing requirements for exports to China (and certain other countries) of integrated circuits exceeding certain performance thresholds.

Export restrictions reducing our sales of products to China, have in the past and can adversely impact our revenues, profits and results of operations.

Export restrictions reducing our sales of products to China, have in the past and may in the future adversely impact our revenues, profits and results of operations.

In addition to direct impacts on our products there may be indirect impacts to our business that we cannot easily quantify such as the fact that export restrictions may also impact some of our other customers’ products that incorporate ours as a component, or that may cause customers to develop their own products or solutions instead of purchasing from us or to acquire products or solutions from our competitors or other third-party sources.

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Conversely, we may have insufficient inventory or be unable to obtain the supplies or contract manufacturing capacity to meet demand, which would result in lost revenue opportunities and potential loss of market share as well as damaged customer relationships.”

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Changes to U.S.

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For example, on May 14, 2024, the Biden administration announced new tariffs on certain goods to encourage China to eliminate what the administration believes to be unfair trade practices regarding technology transfer, intellectual property, and innovation.

The administration is directing increases in tariffs on $18 billion of imports from China across certain strategic sectors including semiconductors.

As a result, the tariff rate on semiconductors will increase from 25% to 50% by 2025.

Any new tariffs and other changes in U.S.

The administration is directing increases in tariffs on a significant amount of imports from China across certain strategic sectors including semiconductors.

As a result, the tariff rate on certain types of semiconductors will increase from 25% to 50% by 2025.

This new tariff is not expected to have a direct impact on the Company, however, any new tariffs and other changes in U.S.

trade policy could trigger retaliatory actions by affected countries, and certain foreign governments have instituted or are considering imposing trade sanctions on certain U.S.

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In addition, many of our customers have operations located outside of the United States, primarily in Asia, which further exposes us to foreign risks.

Sales shipped to customers with operations in Asia represented approximately 73% and 69% of our net revenue in the three months ended May 4, 2024 and April 29, 2023, respectively.

Sales shipped to customers with operations in Asia represented approximately 77% and 68% of our net revenue in the three months ended August 3, 2024 and July 29, 2023, respectively.

We also have substantial operations outside of the United States.

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Foreign Corrupt Practices Act and other anti-corruption laws and regulations;

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• difficulties in staffing, managing or closing foreign operations;

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Any failure of, or delay in, these efforts could negatively impact performance and financial results.

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Recent, current and potential future acquisitions, strategic investments, divestitures, mergers or joint ventures may subject us to significant risks, any of which could harm our business.

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When we decide to sell assets or a business, we may have difficulty selling on acceptable terms in a timely manner or at all.

These circumstances could delay the achievement of our strategic objectives or cause us to incur additional expense, or we may sell a business at a price or on terms that are less favorable than we had anticipated, resulting in a loss on the transaction.

These circumstances could delay the achievement of our strategic objectives or cause us to incur additional expense, or we may sell a business or other assets at a price or on terms that are less favorable than we had anticipated, resulting in a loss on the transaction.

If we do enter into agreements with respect to acquisitions, divestitures, or other transactions, these transactions, or parts of these transactions, may fail to be completed due to factors such as:

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Our indebtedness could adversely affect our financial condition and our ability to raise additional capital to fund our operations and limit our ability to react to changes in the economy or our industry.

As of May 4, 2024, we had a total of $4.2 billion debt outstanding, which consisted of $3.5 billion of senior notes outstanding and $678.1 million outstanding under our 2026 Term Loan.

As of August 3, 2024, we had a total of $4.2 billion debt outstanding, which consisted of $3.5 billion of senior notes outstanding and $656.2 million outstanding under our 2026 Term Loan.

We also had $1.0 billion of availability under our 2023 Revolving Credit Facility.

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Our indebtedness could have important consequences to us including:

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Any of the foregoing could materially and adversely affect our financial condition and results of operations.

Adverse changes to our debt ratings could negatively affect our ability to raise additional capital.

We receive debt ratings from the major credit rating agencies in the United States.

Factors that may impact our credit ratings include debt levels, planned asset purchases or sales and near-term and long-term production growth opportunities.

Liquidity, asset quality, cost structure, reserve mix and commodity pricing levels could also be considered by the rating agencies.

The applicable margins with respect to the loans incurred under the Credit Agreements will vary based on the applicable public ratings assigned to the indebtedness by Moody's Investors Service, Inc., Standard & Poor's Financial Services LLC, Fitch’s and any successor to each such rating agency business.

A ratings downgrade could adversely impact our ability to access debt markets in the future and increase the cost of current or future debt and may adversely affect our share price.

The Credit Agreements and the Notes Indentures impose restrictions on our business.

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If we are unable to generate sufficient cash flow from operations or to borrow sufficient funds in the future to service our debt, we may be required to sell assets, reduce capital expenditures, refinance all or a portion of our existing debt (including the Notes) or obtain additional financing.

In addition, if our credit ratings are downgraded, the cost of current or future borrowings under our Credit Agreements may rise and our ability to obtain additional financing or refinance our existing debt may be negatively affected.

We cannot assure you that we will be able to refinance our debt, sell assets or borrow more money on terms acceptable to us, if at all.

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In addition, a material default on our indebtedness could suspend our eligibility to register securities using certain registration statement forms under SEC guidelines that permit incorporation by reference of substantial information regarding us, potentially hindering our ability to raise capital through the issuance of our securities and increasing our costs of registration.

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We may, under certain circumstances, be required to repurchase the Notes at the option of the holder.

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These laws implement new tax provisions and provide for various incentives and tax credits.

The IRA applies to tax years beginning after December 31, 2022 and introduces a 15% corporate alternative minimum tax for corporations whose average annual adjusted financial statement income for any consecutive three-tax-year period preceding the tax year exceeds $1 billion and a 1% excise tax on certain stock repurchases made by publicly traded U.S.

The IRA applies to tax years beginning after December 31, 2022 and introduces a 15% alternative minimum tax for corporations whose average annual adjusted financial statement income for any consecutive three-tax-year period preceding the tax year exceeds $1 billion and a 1% excise tax on certain stock repurchases made by publicly traded U.S.

corporations after December 31, 2022.

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No legislation in Singapore has been enacted at this time regarding Pillar Two or the aforementioned tax credits, and the effects of any future legislation on us are not currently estimable, but if enacted, could be material to our financial results, earnings, and cash flows.

On July 29, 2024, the Israeli Ministry of Finance announced that it intends to implement Qualified Domestic Minimum Top-up Tax (“QDMTT”) in Israel from 2026 onward.

Israel plans on examining the adoption of the Income Inclusion Rule (“IIR”) and the Under-taxed Payment Rule (“UTPR”) after implementation period for the Israeli QDMTT mechanism has passed.

No legislation in Israel has been enacted at this time regarding Pillar Two and the effects of any future legislation on us are not currently determinable.

We will continue to monitor countries’ laws with respect to the OECD model rules and the Pillar Two global minimum tax.

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Because of increasing focus by government taxing authorities on multinational companies, the tax laws of certain countries in which we do business could change on a prospective or retroactive basis, and any such changes could increase our liabilities for taxes, interest and penalties, and could materially adversely impact our financial results, including our earnings and cash flows.

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In prior years, we entered into incentive agreements in certain foreign jurisdictions that provide for reduced tax rates in such jurisdictions if certain criteria are met.

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We are exposed to potential impairment charges on certain assets.

We had approximately $11.6 billion of goodwill and $3.7 billion of acquired intangible assets on our unaudited condensed consolidated balance sheet as of May 4, 2024.

We had approximately $11.6 billion of goodwill and $3.5 billion of acquired intangible assets on our unaudited condensed consolidated balance sheet as of August 3, 2024.

Under generally accepted accounting principles in the United States, we are required to review our intangible assets including goodwill for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable.

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For example, if the operations of any businesses that we have acquired declines significantly, we could incur significant intangible asset impairment charges.

During fiscal 2024, we made changes to our business to streamline our organization and optimize resources, which resulted in recognition of $131.1 million of restructuring related charges including $28.6 million of impairment and asset write-offs.

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We have determined that our business operates as a single operating segment and has a single reporting unit for the purpose of goodwill impairment testing.

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See also, “We have been named as a party to several legal proceedings and may be named in additional ones in the future, including litigation involving our patents and other intellectual property, which could subject us to liability, require us to indemnify our customers, require us to obtain or renew licenses, require us to stop selling our products or force us to redesign our products.”

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We have been issued a significant number of U.S.

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anti-corruption;

anti-trust, foreign exchange controls and cash repatriation restrictions;

foreign exchange controls and cash repatriation restrictions;

conflict minerals;

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Environmental legislation, such as the EU Directive on Restriction of Hazardous Substances (“RoHS”), the EU Waste Electrical and Electronic Equipment Directive (“WEEE Directive”) and China’s regulation on Management Methods for Controlling Pollution Caused by Electronic Information Products, may increase our cost of doing business internationally and impact our revenues from the EU, China and other countries with similar environmental legislation as we endeavor to comply with and implement these requirements.

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Increasingly regulators (including the U.S.

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We are a party to certain contracts with the U.S.

government or its subcontractors.

government, federal prime contractors, and federal subcontractors.

Our contracts with the U.S.

government or its subcontractors are subject to various procurement regulations and other requirements relating to their formation, administration and performance.

These regulations and requirements include supply chain restrictions that may prohibit the sourcing of materials, supplies, or services from foreign entities including those located in or organized in China.

We may be subject to audits and investigations relating to our government contracts, and any violations could result in various civil and criminal penalties and administrative sanctions, including termination of contracts, refunding or suspending of payments, forfeiture of profits, payment of fines, and suspension or debarment from future government business.

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Any of these risks related to contracting with the U.S.

government or its subcontractors could adversely impact our future sales and operating results.

government, federal prime contractors, and federal subcontractors could adversely impact our future sales and operating results.

New technology trends, such as AI, require us to keep pace with evolving regulations and industry standards.

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We have been named as a party to several legal proceedings and may be named in additional ones in the future, including litigation involving our patents and other intellectual property, which could subject us to liability, require us to indemnify our customers, require us to obtain or renew licenses, require us to stop selling our products or force us to redesign our products.

We are currently, and have been in the past, named as a party to several lawsuits, government inquiries or investigations and other legal proceedings (referred to as “litigation”), and we may be named in additional litigation in the future.

We are currently, and have been in the past, named as a party to several lawsuits, government inquiries or investigations and other legal proceedings (collectively referred to as “litigation”), and we may be named in additional litigation in the future.

Please see “Note 5 – Commitments and Contingencies” of our Notes to Unaudited Condensed Consolidated Financial Statements set forth in Part I, Item 1 of this Quarterly Report on Form 10-Q for a more detailed description of any material litigation matters in which we may be currently engaged.

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In particular, litigation involving patents and other intellectual property is widespread in the high-technology industry and is particularly prevalent in the semiconductor industry, where a number of companies and other entities aggressively bring numerous infringement claims to assert their patent portfolios.

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however, we cannot guarantee that those risk mitigation measures will be effective.

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We have not experienced a material information security breach in the last three years, and as a result, we have not incurred any net expenses from such a breach.

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Since the techniques used to obtain unauthorized access or to sabotage systems change frequently and are often not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventive measures.

Our business also requires us to share confidential information with manufacturing partners, suppliers, customers and other third parties.

Our business also requires us to work with and in some cases to share confidential information with manufacturing partners, suppliers, customers and other third parties.

Although we take steps to secure our confidential information that is provided to third parties, such measures may not always be effective.

Data breaches, losses or other unauthorized access to, or releases of, confidential information have in the past occurred with these third parties and material data breaches, losses or other unauthorized access to, or releases of, our confidential information may in the future occur in connection with third party breaches that could materially adversely affect our reputation, financial condition and operating results and could result in liability or penalties under data privacy laws.

In addition, we may be subject to losses of access to all or part our systems as a result of our use of third-party services or software, which losses may not always be the result of malicious activity, and we cannot guarantee that any such future outages will not materially impact the Company.

To the extent that any system failure, accident or security breach results in material disruptions or interruptions to our operations, or those of our customers, suppliers and manufacturing and other business partners, or the theft, loss or disclosure of, or damage to our data or confidential information, including our intellectual property, our reputation, business, results of operations and/or financial condition could be materially adversely affected.

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This external assessment provides us and our Audit Committee with a comprehensive evaluation of our security posture.

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Our information security team plays a pivotal role in managing our cybersecurity risk.

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Furthermore, we conduct tabletop exercises periodically.

These simulations allow us to test our response strategies across various business functions, allowing preparedness for real-world incidents.

These simulations allow us to test our response strategies across various business functions, increasing preparedness for real-world incidents.

When risks are identified through our processes, we analyze their potential impact on the Company and assess the likelihood of occurrence.

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Further, we invest in regular, ongoing cybersecurity training for our team.

The CSO reports such cybersecurity threats and incidents to the Audit Committee.

The CSO reports cybersecurity threats and incidents to the Audit Committee.

These reports may be included in, or in addition to, his regular quarterly reports to the Audit Committee.

In addition, pursuant to our internal procedures, in the event of a significant cybersecurity incident, members of senior management will report such threats and incidents in a timely manner directly to the Audit Committee and, when appropriate, to the full Board of Directors.

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GENERAL RISK FACTORS

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In addition, if we are unable to fulfill our customer commitments in a timely manner, we may also lose future business relationships or otherwise experience negative consequences.

Despite layoffs in the technology sector, competitors for talent increasingly seek to hire our employees and executive officers (for example, our former Chief Financial Officer was hired by another semiconductor company in fiscal 2023), and the increased availability of work-from-home arrangements has both intensified and expanded competition.

Despite recent layoffs in the technology sector, competitors for talent increasingly seek to hire our employees and executive officers (for example, our former Chief Financial Officer was hired by another semiconductor company in fiscal 2023), and the increased availability of work-from-home arrangements has both intensified and expanded competition.

As a result, during the last few years, we have increased our efforts to recruit and retain talent.

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In addition, as a result of our hybrid work environment, we expect to face challenges in retention of personnel who prefer to only work from home.

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There can be no assurance that we will continue to declare cash dividends or effect stock repurchases in any particular amount or at all, and statutory requirements may require us to defer payment of declared dividends or suspend stock repurchases.

In May 2012, we declared our first quarterly cash dividend and in October 2018, we announced that our Board of Directors had authorized a $700.0 million addition to our previously existing $1.0 billion stock repurchase program.

An aggregate of $1.5 billion of shares of stock have been repurchased under that program as of May 4, 2024.

An aggregate of $1.7 billion worth of shares of our common stock have been repurchased under that program as of August 3, 2024.

In the first quarter of fiscal 2025, our Board of Directors increased the repurchase program mentioned above and authorized an additional $3.0 billion to that repurchase program.

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A reduction in, a delay of, or elimination of our dividend payments or stock repurchases could have a negative effect on our stock price.

As of May 4, 2024, there was $3.1 billion remaining available for future stock repurchases under the prior authorization.

As of August 3, 2024, there was $3.0 billion remaining available for future stock repurchases under the prior authorization.

Our indemnification obligations and limitations of our director and officer liability insurance may have a material adverse effect on our financial condition, results of operations and cash flows.

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Additionally, to the extent there is coverage of these claims, the insurers also may seek to deny or limit coverage in some or all of these matters.

Furthermore, the insurers could become insolvent and unable to fulfill their obligation to defend, pay or reimburse us for insured claims.

Furthermore, our insurers could become insolvent and unable to fulfill their obligation to defend, pay or reimburse us for insured claims.

Due to these coverage limitations, we may incur significant unreimbursed costs to satisfy our indemnification obligations, which may have a material adverse effect on our financial condition, results of operations or cash flows.

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In addition to global and domestic macroeconomic effects, during fiscal 2022 and fiscal 2023 the COVID-19 pandemic and related adverse public health measures caused disruption to our global operations and sales.

Our third-party manufacturing partners, suppliers, distributors, sub-contractors and customers were disrupted by worker absenteeism, quarantines and restrictions on their employees’ ability to work;

Our third-party manufacturing partners, suppliers, distributors, and customers were disrupted by worker absenteeism, quarantines and restrictions on their employees’ ability to work;

office and factory closures;

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and other travel or health-related restrictions.

Although the pandemic related restrictions above have ceased in most places, resurgences of COVID-19 in various regions and appearances of new variants of the virus, has resulted, and may continue to result, in their full or partial reinstitution.

Although the pandemic related restrictions above have ceased in most places, resurgences of COVID-19 in various regions and appearances of new variants of the virus, has resulted in the past, and may result in the future in their full or partial reinstitution.

In addition, although many countries have vaccinated large segments of their population, during fiscal 2023, the COVID-19 pandemic continued to disrupt business activities, trade, and supply chains in many countries.

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Adverse developments affecting the financial services industry, including events or risks involving liquidity, defaults or non-performance by financial institutions, could have a material adverse effect on our business, financial condition or results of operations.

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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-Q

Item 1A. Risk Factors