10 unchanged sentences
Risk Factor Summary
−Removed: Risks Relating to our Acquisitions
−Removed: • Our actual financial and operating results could differ materially from any expectations or guidance provided by us concerning future results, including with respect to any cost savings and other potential synergies.
−Removed: • We have incurred material secured term loan indebtedness which adversely affects our operating results and cash-flows and contains covenants that could adversely affect our operational freedom and ability to pursue strategic transactions.
Risks Related to Our Business
• Impacts of the COVID-19 pandemic and global semiconductor chip shortage could adversely affect our business, financial condition, and results of operations.
+Added: • Our business, financial condition and results of operations could be adversely affected by political and economic conditions and other factors related to our international operations.
• We face intense competition expected to increase in the future, which could have an adverse effect on our revenue, revenue growth rate, if any, and market share.
16 unchanged sentences
• We are subject to the cyclical nature of the semiconductor industry.
−Removed: • Our business, financial condition and results of operations could be adversely affected by political and economic conditions and other factors related to our international operations.
• Our business is subject to various governmental regulations, and if we fail to maintain compliance, we may be forced to recall products and cease their manufacture and distribution, and we could be subject to civil or criminal penalties.
+Added: • We have incurred material secured term loan indebtedness which adversely affects our operating results and cash-flows and contains covenants that could adversely affect our operational freedom and ability to pursue strategic transactions.
Risks Relating to Intellectual Property
12 unchanged sentences
• Our share price may be volatile as a result of various factors.
−Removed: Risks Relating to our Acquisitions
−Removed: Our actual financial and operating results could differ materially from any expectations or guidance provided by us concerning future results, including (without limitation) expectations or guidance with respect to the financial impact of any cost savings and other potential synergies.
−Removed: We currently expect to realize material synergies as a result of our acquisitions of the Home Gateway Platform Division of Intel Corporation, or Intel, which we refer to as the Wi-Fi and Broadband assets business, and NanoSemi, Inc., or NanoSemi, and as a result, we currently believe that the acquisitions will, in aggregate, be accretive to our free cash-flow and non-GAAP earnings per share, excluding upfront non-recurring charges and amortization of purchased intangible assets.
−Removed: The expectations and guidance we have provided with respect to the potential financial impact of the acquisitions are subject to numerous assumptions, however, including assumptions derived from our diligence efforts concerning the status of and prospects for the acquired businesses and assumptions relating to the near-term prospects for the semiconductor industry generally and the markets for the products of the acquired businesses in particular.
−Removed: Assumptions that could affect currently anticipated results relate to numerous matters, including (without limitation) the following:
−Removed: • projections of the acquired businesses’ future revenues;
−Removed: • the anticipated financial performance of products of the acquired businesses and products currently in development;
−Removed: • anticipated cost savings and other synergies associated with the acquisitions, including potential revenue synergies;
−Removed: • our capital structure after the acquisitions;
−Removed: • the amount of goodwill and intangibles that resulted from the acquisitions;
−Removed: • our ability to maintain, develop, and deepen relationships with customers of the acquired businesses;
−Removed: • other financial and strategic risks of the acquisitions, including the possible impact of reduced liquidity of MaxLinear resulting from deal-related cash outlays, the credit risk associated from the debt facilities described below, and continued uncertainty arising from the COVID-19 pandemic.
−Removed: We cannot provide any assurances with respect to the accuracy of our assumptions, including our assumptions with respect to future revenues or revenue growth rates, if any, of the acquired businesses, and we cannot provide assurances with
−Removed: respect to our ability to realize the cost savings that we currently anticipate.
−Removed: Risks and uncertainties that could cause our actual results to differ materially from currently anticipated results include, but are not limited to, risks relating to our ability to realize incremental revenues from the acquisitions in the amounts that we currently anticipate;
−Removed: and numerous risks and uncertainties that affect the semiconductor industry generally and the markets for our products and those of the acquired businesses specifically.
−Removed: We believe the continuing pandemic enhances certain of these risks and presents additional uncertainty in our ability to achieve the financial and strategic objectives of the acquisitions.
−Removed: Any failure to realize the financial benefits we currently anticipate from the acquisitions would have a material adverse impact on our future operating results and financial condition and could materially and adversely affect the trading price or trading volume of our common stock.
−Removed: In June 2021, we incurred approximately $350.0 million of secured term loan indebtedness, the proceeds of which we used to repay the remaining outstanding principal on $175.0 million of incremental secured term loan indebtedness which we had used in part to fund our $150.0 million acquisition of the Wi-Fi and Broadband assets business in July 2020 and the remaining outstanding principal on $425.0 million of secured term loan indebtedness which we had used to fund a previous acquisition.
−Removed: As of June 30, 2021, our aggregate indebtedness was $350.0 million.
−Removed: Such indebtedness adversely affects our operating results and cash-flows as we satisfy our underlying interest and principal payment obligations and contains financial and operational covenants that could adversely affect our operational freedom or ability to pursue strategic transactions that we would otherwise consider to be in the best interests of stockholders, including obtaining additional indebtedness to finance such transactions.
−Removed: As of June 30, 2021, our aggregate indebtedness was $350.0 million from an initial term loan under the June 23, 2021 Credit Agreement.
−Removed: The June 23, 2021 Credit Agreement also provides for the Revolving Facility of up to $100.0 million, which remains undrawn as of June 30, 2021.
−Removed: The credit agreement also permits the Company to request incremental loans in an aggregate principal amount not to exceed the sum of an amount equal to the greater of (x) $175.0 million and (y) 100% of consolidated EBITDA, plus the amount of certain voluntary prepayments, plus an unlimited amount that is subject to pro forma compliance with certain first lien net leverage ratio, secured net leverage ratio and total net leverage ratio tests.
−Removed: The Initial Term Loan under the June 23, 2021 Credit Agreement has a seven-year term expiring in June 2028 and bears interest at either an Adjusted LIBOR plus a fixed applicable margin of 2.25% or an Adjusted Base Rate plus a fixed applicable margin of 1.25%, at our option.
−Removed: Commencing on September 30, 2021, the Initial Term Loan under the June 23, 2021 Credit Agreement will amortize in equal quarterly installments equal to 0.25% of the original principal amount, with the balance payable on June 23, 2028.
−Removed: The Company is subject to commitment fees ranging from 0.175% to 0.25% on the undrawn portion of the revolving facility, and any outstanding loans under the revolving facility will bear interest at either an Adjusted LIBOR plus a margin of 1.00% to 1.75% or an Adjusted Base Rate plus a margin of 0% to 0.75%.
−Removed: The Company’s obligations under the June 23, 2021 Credit Agreement are required to be guaranteed by certain of its domestic subsidiaries meeting materiality thresholds set forth in the credit agreement.
−Removed: Such obligations, including the guaranties, are secured by substantially all of the assets of the Company and the subsidiary guarantors.
−Removed: We had previously carried long term debt on our balance sheet from two acquisitions.
−Removed: We have repaid all of the total principal of debt from the prior acquisitions and have financed the remainder of our operations principally through working capital generated from operations as well as sales and issuances of our equity securities.
−Removed: MaxLinear previously financed the acquisition of the Wi-Fi and Broadband assets business in July 2020 with a portion of proceeds from a secured incremental term loan facility in an aggregate principal amount of approximately $175.0 million and the acquisition of Exar in part with a secured initial term loan facility in an aggregate principal amount of approximately $425.0 million.
−Removed: Our material incremental indebtedness adversely affects our operating expenses through increased interest payment obligations and adversely affects our ability to use cash generated from operations as we repay interest and principal under the term loans.
−Removed: In addition, the revolving credit facility provisions under the June 23, 2021 Credit Agreement include financial covenants such as an initial maximum secured net leverage ratio of 3.5 to 1, which temporarily increases to 3.75 to 1 following the consummation of certain material permitted acquisitions, and operational covenants that may adversely affect our ability to engage in certain activities, including obtaining additional financing, granting liens, undergoing certain fundamental changes, or making investments or certain restricted payments, and selling assets, and similar transactions, without obtaining the consent of the lenders, which may or may not be forthcoming.
−Removed: The initial secured term loan under the June 23, 2021 Credit Agreement is only subject to operational covenants.
−Removed: Lastly, our borrowing costs can be affected by periodic credit ratings from independent rating agencies.
−Removed: Such ratings are largely based on our performance, which may be measured by credit metrics such as leverage and interest coverage ratios.
−Removed: Accordingly, outstanding indebtedness could adversely affect our operational freedom or ability to pursue strategic transactions that we would otherwise consider to be in the best interests of stockholders, including obtaining additional indebtedness to finance such transactions.
−Removed: Specifically, our indebtedness has important consequences to investors in our common stock, including the following:
−Removed: • we are subject to substantial variable interest rate risk because our interest rate under Initial Term Loan under the June 23, 2021 Credit Agreement varies based on a fixed margin of 2.25% per annum over an adjusted LIBOR rate or 1.25% per annum over an adjusted base rate and our interest rate for any outstanding principal under the revolving credit facility varies based a margin of 0% to 0.75% over adjusted base rate or a margin of 1.00% to 1.75% over an adjusted LIBOR rate, and we are also subject to commitment fees ranging from 0.175% to 0.25% on the undrawn portion of the revolving facility.
−Removed: If interest rates were to increase substantially, it would adversely affect our operating results and could affect our ability to service our indebtedness;
−Removed: • a portion of our cash flows is dedicated to the payment of interest and when applicable, principal, on our indebtedness and other obligations and will not be available for use in our business;
−Removed: • our level of indebtedness could limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we operate;
−Removed: • our high degree of indebtedness may make us more vulnerable to changes in general economic conditions and/or a downturn in our business, thereby making it more difficult for us to satisfy our obligations.
−Removed: If we fail to make required debt payments, or if we fail to comply with financial or other covenants in our debt service agreements, which include a maximum leverage ratio, we would be in default under the terms of these agreements.
−Removed: Subject to customary cure rights, any default would permit the holders of the indebtedness to accelerate repayment of this debt and could cause defaults under other indebtedness that we have, any of which could have a material adverse effect on the trading price of our common stock.
−Removed: We have recorded additional goodwill and other intangible assets in connection with the acquired businesses.
−Removed: Goodwill and other acquired intangible assets could become impaired and adversely affect our future operating results.
−Removed: The acquisitions of the Wi-Fi and Broadband assets business and NanoSemi are accounted for as business combinations under the acquisition method of accounting by MaxLinear in accordance with accounting principles generally accepted in the United States.
−Removed: Under the acquisition method of accounting, the assets and liabilities of acquired businesses are recorded, as of completion, at their respective fair values and added to our assets and liabilities.
−Removed: Our reported financial condition and results of operations reflect the balances and results of the acquired businesses but are not restated retroactively to reflect the historical financial position or results of operations of acquired businesses for periods prior to the acquisitions.
−Removed: As a result, comparisons of future results against prior period results will be more difficult for investors.
−Removed: Under the acquisition method of accounting, the total purchase price is allocated to net tangible assets and identifiable intangible assets of acquired businesses based on their fair values as of the date of completion of the acquisition.
−Removed: The excess of the purchase price over those fair values is recorded as goodwill.
−Removed: Our acquisitions have resulted in the creation of goodwill and recording of a large amount of intangible assets based upon the application of the acquisition method of accounting.
−Removed: To the extent the value of goodwill or other intangible assets become impaired, we may be required to incur material charges relating to such impairment.
−Removed: We conduct our annual goodwill and indefinite-lived intangible asset impairment analysis on October 31 each year, or more frequently if we believe indicators of impairment exist.
−Removed: In addition, there can be no guarantee that acquired intangible assets, particularly in-process research and development, will generate revenues or profits that we include in our forecast that is the basis for their fair values as of the acquisition date.
−Removed: Any such impairment charges relating to goodwill or other intangible assets could have a material impact on our operating results in future periods, and the announcement of a material impairment could have an adverse effect on the trading price and trading volume of our common stock.
−Removed: As of June 30, 2021, our balance sheet reflected goodwill of $302.8 million and other intangible assets of $175.0 million.
−Removed: Consequently, we could recognize material impairment charges in the future.
−Removed: In addition to our acquisitions of the Wi-Fi and Broadband assets business and NanoSemi, we may, from time to time, make additional business acquisitions or investments, which involve significant risks.
−Removed: We have completed multiple acquisitions in the past four years.
−Removed: We may also enter into alliances or make investments in other businesses to complement our existing product offerings, augment our market coverage or enhance our technological capabilities.
−Removed: Any such transactions could result in:
−Removed: • issuances of equity securities dilutive to our existing stockholders;
−Removed: • substantial cash payments;
−Removed: • the incurrence of substantial debt and assumption of unknown liabilities;
−Removed: • large one-time write-offs;
−Removed: • amortization expenses related to intangible assets;
−Removed: • a limitation on our ability to use our net operating loss carryforwards;
−Removed: • the diversion of management's time and attention from operating our business to acquisition integration challenges;
−Removed: • stockholder or other litigation relating to the transaction;
−Removed: • adverse tax consequences;
−Removed: • the potential loss of key employees, customers and suppliers of the acquired businesses.
−Removed: Integrating acquired organizations and their products and services, including the integration of completed acquisitions, may be expensive, time-consuming and a strain on our resources and our relationships with employees, customers, distributors and suppliers, and ultimately may not be successful.
−Removed: The benefits or synergies we may expect from the acquisition of complementary or supplementary businesses may not be realized to the extent or in the time frame we initially anticipate.
−Removed: Some of the risks that may affect our ability to successfully integrate acquired businesses include those associated with:
−Removed: • failure to successfully further develop the acquired products or technology;
−Removed: • conforming the acquired company’s standards, policies, processes, procedures and controls with our operations;
−Removed: • coordinating new product and process development, especially with respect to highly complex technologies;
−Removed: • loss of key employees or customers of the acquired business;
−Removed: • hiring additional management and other critical personnel;
−Removed: • in the case of foreign acquisitions, the need to integrate operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries;
−Removed: • increasing the scope, geographic diversity and complexity of our operations;
−Removed: • consolidation of facilities, integration of the acquired businesses' accounting, human resource and other administrative functions and coordination of product, engineering and sales and marketing functions;
−Removed: • the geographic distance between the businesses;
−Removed: • liability for activities of the acquired businesses before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities;
−Removed: • litigation or other claims in connection with the acquired businesses, including claims for terminated employees, customers, former stockholders or other third parties.
−Removed: We have in the past been and may in the future be party to ligation related to acquisitions.
−Removed: Any adverse determination in litigation resulting from acquisitions could have a material adverse effect on our business and operating results.
Risks Related to Our Business
3 unchanged sentences
On March 11, 2020, the World Health Organization declared a global pandemic regarding COVID-19.
−Removed: COVID-19 pandemic has reached all of the countries and states in which we operate, including in California where our headquarters and central engineering team are located, as well as Spain, India, Singapore, Taiwan, Canada, Japan, South Korea, Hong Kong, Israel, Germany, and Austria, where additional engineering, sales, and administrative personnel are located.
+Added: The COVID-19 pandemic has reached all of the countries and states in which we operate, including in California where our headquarters and central engineering team are located, as well as Spain, India, Singapore, Taiwan, Canada, Japan, South Korea, Hong Kong, Israel, Germany, and Austria, where additional engineering, sales, and administrative personnel are located.
In many of these jurisdictions, local authorities have instituted stay-at-home or shelter-in-place orders.
To protect the health and safety of our employees, we adopted social distancing policies including suspending employee travel and implementing remote work arrangements for substantially all of our workforce worldwide.
−Removed: As of June 30, 2021, some of our workforce have returned to the office at reduced capacity adhering to local health authority guidelines and we are encouraging our employees to get COVID-19 vaccines as they become available.
+Added: As of September 30, 2021, much of our workforce has received COVID-19 vaccinations and subsequently, most of our employees have returned to the office at full or reduced capacity adhering to local health authority guidelines.
While we experienced some negative impact to our net revenue and gross profits in the first half of 2020 due to several industry-wide dynamics related to COVID-19, including supply constraints described above, as well as certain customer push-out requests, since then, we have been benefiting from the work-from-home environment that is driving an increase in demand for certain of our products.
9 unchanged sentences
• Disruptions in product shipments from travel and shipping restrictions imposed in response to local outbreaks;
−Removed: • Slow down in the pace of integration of our acquisitions resulting from remote work arrangements and/or governmental closures beyond our control;
+Added: • Governmental closures beyond our control;
• Reduced ability to accurately predict our future revenue and budget future expenses;
−Removed: • Inefficiencies, delays and additional costs in design win, product development, production and fulfillment which may be exacerbated by remote work arrangements;
+Added: • Inefficiencies, delays and additional costs in design win, product development, production and fulfillment which may be exacerbated by measures against the spread of COVID-19;
• Accounts receivable collection issues should any of our limited and significant customers experience liquidity concerns;
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• Decreased availability of capital or access thereto in the United States and from other jurisdictions in which we operate;
−Removed: • Increased data security risks from remote working arrangements of our employees and those of our customers and vendors.
+Added: • Increased data security risks from remote working arrangements of our customers and vendors.
Although we currently expect that our present cash and cash equivalent balances and cash flows that are generated from operations will be sufficient to meet our operating requirements for at least the next twelve months, a material adverse impact from COVID-19 and global semiconductor chip shortages could result in a need to raise additional capital or incur additional indebtedness to fund strategic initiatives or operating activities, particularly if we pursue additional acquisitions.
1 unchanged sentence
If we are unable to raise additional funds when needed, we may not be able to sustain our operations or execute our strategic plans.
+Added: Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business and other factors related to our international operations.
+Added: We sell our products throughout the world.
+Added: Products shipped to Asia accounted for 83% of our net revenue in the nine months ended September 30, 2021.
+Added: In addition, as of September 30, 2021, approximately 72% of our employees are located outside of the United States.
+Added: The majority of our products are manufactured, assembled and tested in Asia, and all of our major distributors are located in Asia.
+Added: Multiple factors relating to our international operations and to particular countries in which we operate could have a material adverse effect on our business, financial condition and results of operations.
+Added: These factors include:
+Added: • changes in political, regulatory, legal or economic conditions;
+Added: • restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments and trade protection measures, including export duties and quotas and customs duties and tariffs;
+Added: • disruptions of capital and trading markets;
+Added: • changes in import or export licensing requirements;
+Added: • transportation delays;
+Added: • civil disturbances or political instability;
+Added: • geopolitical turmoil, including terrorism, war or political or military coups;
+Added: • public health emergencies, including the COVID-19 pandemic;
+Added: • differing employment practices and labor standards;
+Added: • limitations on our ability under local laws to protect our intellectual property;
+Added: • local business and cultural factors that differ from our customary standards and practices;
+Added: • nationalization and expropriation;
+Added: • changes in tax laws;
+Added: • currency fluctuations relating to our international operating activities;
+Added: • difficulty in obtaining distribution and support.
+Added: In addition to a significant portion of our wafer supply coming from Taiwan, Singapore, and China, substantially all of our products undergo packaging and final testing in Taiwan, Singapore, China, South Korea, and Thailand.
+Added: Any conflict or uncertainty in these countries, including due to natural disaster or public health or safety concerns, could have a material adverse effect on our business, financial condition and results of operations.
+Added: In addition, if the government of any country in which our products are manufactured or sold sets technical standards for products manufactured in or imported into their country that are not widely shared, it may lead some of our customers to suspend imports of their products into that country, require manufacturers in that country to manufacture products with different technical standards and disrupt cross-border manufacturing relationships which, in each case, could have a material adverse effect on our business, financial condition and results of operations.
+Added: We also are subject to risks associated with international political conflicts involving the U.S.
+Added: and potentially other governments.
+Added: In recent years, diplomatic and trade relationships between the U.S.
+Added: government and China have been frayed.
+Added: Events in Hong Kong have also prompted other governments such as that of the United Kingdom to reconsider its trade and business relationships with China and with certain Chinese companies.
+Added: Difficulties in these relationships have in a number of cases required us to take actions adverse to our business to comply with governmental restrictions on business and trade with China.
+Added: In May 2019 and subsequently, we ceased business operations that were prohibited with entities affiliated with Huawei Technologies Co., Ltd., or Huawei and certain other entities, when the Bureau of Industry and Security at the U.S.
+Added: Department of Commerce, or BIS, amended the Export Administration Regulations, or EAR, to add such entities to the Restricted Entity List for acting contrary to the national security or foreign policy interests of the United States.
+Added: In September 2020, we further ceased business operations that were prohibited with additional entities affiliated with Huawei when the BIS again amended the EAR to add such entities to the Restricted Entity List.
+Added: We are required to obtain special licenses to conduct business with Restricted Entities, and in 2021 the BIS continues to add entities which may be potential customers on the Restricted Entity List.
+Added: Similarly, we ceased business operations with entities affiliated with ZTE Corp.
+Added: when the BIS imposed an export licensing requirement, which was subsequently suspended through March 28, 2017.
+Added: Such suspension was lifted as of March 29, 2017, however on April 17, 2018 the U.S.
+Added: Department of Commerce imposed a seven-year export ban on ZTE, which was subsequently lifted as of July 13, 2018.
+Added: Although we have not had significant sales to ZTE and certain other entities, we did have increasing sales to Huawei in the prior year, and we believe the imposition of governmental prohibitions on selling our products to Huawei will adversely affect our revenues and operating results in the near term.
+Added: We cannot provide assurances that similar disruptions of distribution arrangements in the future or the imposition of governmental prohibitions on selling our products to particular customers will not also adversely affect our revenues and operating results.
+Added: Loss of a key distributor or customer under similar circumstances could have an adverse effect on our business, revenues and operating results.
We face intense competition and expect competition to increase in the future, which could have an adverse effect on our revenue, revenue growth rate, if any, and market share.
6 unchanged sentences
As our products are integrated into a variety of communications and industrial platforms, our competitors range from large, international merchant semiconductor companies offering a wide range of semiconductor products to smaller companies specializing in narrow markets, to internal or vertically integrated engineering groups within certain of our customers.
−Removed: Our primary merchant semiconductor competitors include Silicon Laboratories, Inc., NXP Semiconductors N.V., MediaTek, Inc., Broadcom Ltd, Rafael Microelectronics, Inc., Marvell Technology Group Ltd., M/A-COM Technology Solutions Holdings, Inc., Semtech Corporation, Qorvo Inc., Texas Instruments Incorporated, HiSilicon Technologies Co., Ltd., Analog Devices, Inc., Renesas Electronics Corporation, Maxim Integrated Products, Inc.
−Removed: (which entered into a definitive agreement to be acquired by Analog Devices), Monolithic Power Systems, Inc., Microchip Technology, Inc., Ambarella, Inc., and Infineon Technologies AG.
+Added: Our primary merchant semiconductor competitors include Silicon Laboratories, Inc., NXP Semiconductors N.V., MediaTek, Inc., Broadcom Ltd, Rafael Microelectronics, Inc., Marvell Technology Group Ltd., M/A-COM Technology Solutions Holdings, Inc., Semtech Corporation, Qorvo Inc., Texas Instruments Incorporated, HiSilicon Technologies Co., Ltd., Analog Devices, Inc., Renesas Electronics Corporation, Analog Devices, Monolithic Power Systems, Inc., Microchip Technology, Inc., Ambarella, Inc., and Infineon Technologies AG.
It is quite likely that competition in the markets in which we participate will increase in the future as existing competitors improve or expand their product offerings.
In addition, it is quite likely that a number of other public and private companies are in the process of developing competing products for our current and target markets.
−Removed: Because our products often are building block semiconductors which provide functions that in some cases can be integrated into more complex integrated circuits, we also face competition from manufacturers of integrated circuits, some of which may be existing customers or platform partners that develop their own integrated circuit products.
+Added: Because our products often are building block semiconductors which provide functions that in some cases can be
+Added: integrated into more complex integrated circuits, we also face competition from manufacturers of integrated circuits, some of which may be existing customers or platform partners that develop their own integrated circuit products.
If we cannot offer an attractive solution for applications where our competitors offer more fully integrated products, we may lose significant market share to our competitors.
7 unchanged sentences
We depend on a limited number of customers, that have undergone or are undergoing consolidation and who themselves are dependent on a consolidating set of service provider customers, for a substantial portion of our revenue, and the loss of, or a significant reduction in orders from one or more of our major customers could have a material adverse effect on our revenue and operating results.
−Removed: In the six months ended June 30, 2021, our top two customers accounted for 27% of our net revenue, and our ten largest customers collectively accounted for 70% of our net revenue, of which distributor customers accounted for 28% of our net revenue.
+Added: In the nine months ended September 30, 2021, our top two customers accounted for 26% of our net revenue, and our ten largest customers collectively accounted for 69% of our net revenue, of which distributor customers accounted for 27% of our net revenue.
We expect that our operating results for the foreseeable future will continue to show a substantial percentage of sales dependent on a relatively small number of customers.
14 unchanged sentences
Our agreements with certain of these distributors provide protection against price reduction on their inventories of our products.
−Removed: The loss of certain distributors could have a material adverse effect on our business and results of operations, and price reductions associated with their inventories of our products could have a substantial adverse effect on our operating results in the event of a dramatic decline in selling prices for these products.
+Added: The loss of certain distributors could have a material adverse effect on our business and results of operations, and price reductions
+Added: associated with their inventories of our products could have a substantial adverse effect on our operating results in the event of a dramatic decline in selling prices for these products.
In addition, the current situation relating to trade with China and governmental and regulatory concerns relating to specific Chinese companies continue to remain fluid and unpredictable.
1 unchanged sentence
A significant portion of our revenue is attributable to demand for our products in markets for broadband (previously connected home) solutions, and development delays and consolidation trends among cable and satellite Pay-TV and broadband operators could adversely affect our future revenues and operating results.
−Removed: For the six months ended June 30, 2021 and 2020, revenue directly attributable to broadband (previously connected home) applications accounted for approximately 57% and 39% of our net revenue, respectively.
+Added: For the nine months ended September 30, 2021 and 2020, revenue directly attributable to broadband (previously connected home) applications accounted for approximately 56% and 46% of our net revenue, respectively.
Delays in the development of, or unexpected developments in the broadband markets could have an adverse effect on order activity by original equipment manufacturers in these markets and, as a result, on our business, revenue, operating results and financial condition.
3 unchanged sentences
Our product offerings also include broadband data access, power management and interface technologies which are ubiquitous functions in new and existing markets such as wireless and wireline communications infrastructure, broadband access, industrial, enterprise network, and automotive applications.
−Removed: We have further expanded our product offerings to include Wi-Fi, ethernet and broadband gateway processor systems-on-chip, or SoCs, and intellectual property that utilizes patented machine learning techniques to improve signal integrity and power efficiency in SoCs, application-specific integrated circuits, or ASICs, and field-programmable gate arrays, or FPGAs, used in next-generation communication and artificial intelligence
+Added: We have further expanded our product offerings to include Wi-Fi, ethernet and broadband gateway processor systems-on-chip, or SoCs, and intellectual property that utilizes patented machine learning techniques to improve signal integrity and power efficiency in SoCs, application-specific integrated circuits, or ASICs, and field-programmable gate arrays, or FPGAs, used in next-generation communication and artificial intelligence systems.
Our future revenue growth, if any, will depend in part on our ability to further penetrate into, and expand beyond, these markets with analog, digital and mixed-signal solutions targeting the markets for Wi-Fi and broadband, high-speed optical interconnects for data center, metro, and long-haul optical modules, telecommunications wireless infrastructure, and cable DOCSIS 3.1 network infrastructure products.
12 unchanged sentences
Many of our products originated with our research and development efforts, which we believe have provided us with a significant competitive advantage.
−Removed: For the six months ended June 30, 2021 and 2020, our research and development expense was $137.6 million and $53.7 million, respectively.
+Added: For the nine months ended September 30,
+Added: 2021 and 2020, our research and development expense was $205.1 million and $109.5 million, respectively.
We monitor such expenditures as part of our strategy of devoting focused research and development efforts on the development of innovative and sustainable product platforms.
5 unchanged sentences
We may not sustain our current growth rate, and we may not be able to manage future growth effectively.
−Removed: Our net revenue increased from $127.2 million in the six months ended June 30, 2020 to $414.7 million in the six months ended June 30, 2021 due to the results of the acquired businesses and market strength attributed to the work-from-home environment that is driving an increase in demand for certain of our products, particularly those from our acquisition of the Wi-Fi and Broadband assets business.
+Added: Our net revenue increased from $283.9 million in the nine months ended September 30, 2020 to $644.5 million in the nine months ended September 30, 2021 due to market strength attributed to the work-from-home environment that is driving an increase in demand for certain of our products, particularly those from our acquisition of the Wi-Fi and Broadband assets business.
The COVID-19 pandemic could result in increased volatility in our sales and revenues.
18 unchanged sentences
We maintain product liability insurance, but this insurance is limited in amount and subject to significant deductibles.
−Removed: There is no guarantee that our insurance will be available or adequate to protect against all claims.
+Added: There is no guarantee that our insurance will be available
+Added: or adequate to protect against all claims.
We also may incur costs and expenses relating to a recall of one of our customers’ products containing one of our devices.
1 unchanged sentence
Costs or payments made in connection with warranty and product liability claims and product recalls could materially affect our financial condition and results of operations.
−Removed: Average selling prices of our products could decrease rapidly, which would have a material adverse effect on our revenue and gross margins.
+Added: Despite a relatively short-term positive pricing environment, average selling prices of our products could decrease rapidly, which would have a material adverse effect on our revenue and gross margins.
We may experience substantial period-to-period fluctuations in future operating results due to the erosion of our average selling prices.
−Removed: From time to time, we have reduced the average unit price of our products due to competitive pricing pressures, new product introductions by us or our competitors, and for other reasons, and we expect that we will have to do so again in the future.
+Added: From time to time, we have reduced the average unit price of our products due to competitive pricing pressures, new product introductions by us or our competitors, and for other reasons, and we expect that we will have to do so again in the future, despite a relatively short-term positive pricing environment.
In particular, we believe that industry consolidation has provided a number of larger semiconductor companies with substantial market power, which has had an adverse impact on selling prices in some of our markets.
9 unchanged sentences
As the source of our technological and product innovations, our design and technical personnel represent a significant asset.
−Removed: The loss of the services of one or more of our key employees, especially our key design and technical personnel, or our inability to retain, attract and motivate qualified
−Removed: design and technical personnel, could have a material adverse effect on our business, financial condition and results of operations.
+Added: The loss of the services of one or more of our key employees, especially our key design and technical personnel, or our inability to retain, attract and motivate qualified design and technical personnel, could have a material adverse effect on our business, financial condition and results of operations.
If we fail to develop and introduce new or enhanced products on a timely basis, our ability to attract and retain customers could be impaired and our competitive position could be harmed.
7 unchanged sentences
We believe that we will need to continue to make substantial investments in research and development in an attempt to ensure a product roadmap that anticipates these types of changes;
−Removed: however, we cannot provide any assurances that we will accurately predict the direction in which our markets will evolve or that we will be able to develop, market, or sell new products that respond to such changes successfully or in a timely manner, if at all.
+Added: however, we cannot provide any assurances that we will
+Added: accurately predict the direction in which our markets will evolve or that we will be able to develop, market, or sell new products that respond to such changes successfully or in a timely manner, if at all.
We are subject to order and shipment uncertainties, and differences between our estimates of customer demand and product mix and our actual results could negatively affect our inventory levels, sales and operating results.
13 unchanged sentences
Our operating history had previously focused on developing integrated circuits for specific terrestrial, cable and satellite television, and broadband voice and data applications, satellite set-top and gateway boxes and outdoor units and physical medium devices for the optical interconnect markets, and as part of our strategy, we seek to expand our addressable market into new product categories.
−Removed: For example, we expanded into the markets for the wired whole-home broadband connectivity market and entered the markets for wireless telecommunications infrastructure and power management and interface technologies
−Removed: which are ubiquitous functions in wireless and wireline communications infrastructure, broadband access, industrial, enterprise network, and automotive applications.
+Added: For example, we expanded into the markets for the wired whole-home broadband connectivity market and entered the markets for wireless telecommunications infrastructure and power management and interface technologies which are ubiquitous functions in wireless and wireline communications infrastructure, broadband access, industrial, enterprise network, and automotive applications.
We have also expanded into the markets for Wi-Fi, Ethernet and Broadband Gateway Processor SoCs and intellectual property that utilizes patented machine learning techniques to improve signal integrity and power efficiency in systems-on-chip, or SoCs, application-specific integrated circuits, or ASICs, and field-programmable gate arrays, or FPGAs, used in next-generation communication and artificial intelligence systems.
28 unchanged sentences
The typical time from early engagement by our sales force to actual product introduction runs from nine to twelve months for the consumer market, to as much as 18 to 24 months for the satellite markets, and 36 months or longer for industrial, wired and wireless infrastructure markets.
−Removed: The delays inherent in these lengthy sales cycles increase the risk that a customer will decide to cancel, curtail, reduce or delay its product plans,
−Removed: causing us to lose anticipated sales.
+Added: The delays inherent in these lengthy sales cycles increase the risk that a customer will decide to cancel, curtail, reduce or delay its product plans, causing us to lose anticipated sales.
In addition, any delay or cancellation of a customer’s plans could materially and adversely affect our financial results, as we may have incurred significant expense and generated no revenue.
37 unchanged sentences
A significant downturn or upturn could have a material adverse effect on our business and operating results.
−Removed: Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business and other factors related to our international operations.
−Removed: We sell our products throughout the world.
−Removed: Products shipped to Asia accounted for 82% of our net revenue in the six months ended June 30, 2021.
−Removed: In addition, as of June 30, 2021, approximately 72% of our employees are located outside of the United States.
−Removed: The majority of our products are manufactured, assembled and tested in Asia, and all of our major distributors are located in Asia.
−Removed: Multiple factors relating to our international operations and to particular countries in which we operate could have a material adverse effect on our business, financial condition and results of operations.
−Removed: These factors include:
−Removed: • changes in political, regulatory, legal or economic conditions;
−Removed: • restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments and trade protection measures, including export duties and quotas and customs duties and tariffs;
−Removed: • disruptions of capital and trading markets;
−Removed: • changes in import or export licensing requirements;
−Removed: • transportation delays;
−Removed: • civil disturbances or political instability;
−Removed: • geopolitical turmoil, including terrorism, war or political or military coups;
−Removed: • public health emergencies, including the COVID-19 pandemic;
−Removed: • differing employment practices and labor standards;
−Removed: • limitations on our ability under local laws to protect our intellectual property;
−Removed: • local business and cultural factors that differ from our customary standards and practices;
−Removed: • nationalization and expropriation;
−Removed: • changes in tax laws;
−Removed: • currency fluctuations relating to our international operating activities;
−Removed: • difficulty in obtaining distribution and support.
−Removed: In addition to a significant portion of our wafer supply coming from Taiwan, Singapore, and China, substantially all of our products undergo packaging and final testing in Taiwan, Singapore, China, South Korea, and Thailand.
−Removed: Any conflict or uncertainty in these countries, including due to natural disaster or public health or safety concerns, could have a material adverse effect on our business, financial condition and results of operations.
−Removed: In addition, if the government of any country in which our products are manufactured or sold sets technical standards for products manufactured in or imported into their country that are not widely shared, it may lead some of our customers to suspend imports of their products into that country, require manufacturers in that country to manufacture products with different technical standards and disrupt cross-border manufacturing relationships which, in each case, could have a material adverse effect on our business, financial condition and results of operations.
−Removed: We also are subject to risks associated with international political conflicts involving the U.S.
−Removed: and potentially other governments.
−Removed: In recent years, diplomatic and trade relationships between the U.S.
−Removed: government and China have
−Removed: Events in Hong Kong have also prompted other governments such as that of the United Kingdom to reconsider its trade and business relationships with China and with certain Chinese companies.
−Removed: Difficulties in these relationships have in a number of cases required us to take actions adverse to our business to comply with governmental restrictions on business and trade with China.
−Removed: In May 2019 and subsequently, we ceased business operations that were prohibited with entities affiliated with Huawei Technologies Co., Ltd., or Huawei and certain other entities, when the Bureau of Industry and Security at the U.S.
−Removed: Department of Commerce, or BIS, amended the Export Administration Regulations, or EAR, to add such entities to the Restricted Entity List for acting contrary to the national security or foreign policy interests of the United States.
−Removed: In September 2020, we further ceased business operations that were prohibited with additional entities affiliated with Huawei when the BIS again amended the EAR to add such entities to the Restricted Entity List.
−Removed: We are required to obtain special licenses to conduct business with Restricted Entities, and in 2021 the BIS continues to add entities which may be potential customers on the Restricted Entity List.
−Removed: Similarly, we ceased business operations with entities affiliated with ZTE Corp.
−Removed: when the BIS imposed an export licensing requirement, which was subsequently suspended through March 28, 2017.
−Removed: Such suspension was lifted as of March 29, 2017, however on April 17, 2018 the U.S.
−Removed: Department of Commerce imposed a seven-year export ban on ZTE, which was subsequently lifted as of July 13, 2018.
−Removed: Although we have not had significant sales to ZTE and certain other entities, we did have increasing sales to Huawei in the prior year, and we believe the imposition of governmental prohibitions on selling our products to Huawei will adversely affect our revenues and operating results in the near term.
−Removed: We cannot provide assurances that similar disruptions of distribution arrangements in the future or the imposition of governmental prohibitions on selling our products to particular customers will not also adversely affect our revenues and operating results.
−Removed: Loss of a key distributor or customer under similar circumstances could have an adverse effect on our business, revenues and operating results.
Our business is subject to various governmental regulations, and compliance with these regulations may cause us to incur significant expenses.
21 unchanged sentences
We depend on companies that provide other components of the devices to support prevailing industry standards.
−Removed: Many of these companies are significantly larger and more
−Removed: influential in driving industry standards than we are.
+Added: Many of these companies are significantly larger and more influential in driving industry standards than we are.
Some industry standards may not be widely adopted or implemented uniformly, and competing standards may emerge that may be preferred by our customers or end users.
7 unchanged sentences
Our pursuit of necessary technological advances may require substantial time and expense.
+Added: In June 2021, we incurred approximately $350.0 million of secured term loan indebtedness, the proceeds of which we used to repay the remaining outstanding principal on $175.0 million of incremental secured term loan indebtedness which we had used in part to fund our $150.0 million acquisition of the Wi-Fi and Broadband assets business in July 2020 and the remaining outstanding principal on $425.0 million of secured term loan indebtedness which we had used to fund a previous acquisition.
+Added: As of September 30, 2021, our aggregate indebtedness was $330.0 million.
+Added: Such indebtedness adversely affects our operating results and cash-flows as we satisfy our underlying interest and principal payment obligations and contains financial and operational covenants that could adversely affect our operational freedom or ability to pursue strategic transactions that we would otherwise consider to be in the best interests of stockholders, including obtaining additional indebtedness to finance such transactions.
+Added: As of September 30, 2021, our aggregate indebtedness was $330.0 million from an initial term loan under the June 23, 2021 Credit Agreement.
+Added: The June 23, 2021 Credit Agreement also provides for the Revolving Facility of up to $100.0 million, which remains undrawn as of September 30, 2021.
+Added: The credit agreement also permits the Company to request incremental loans in an aggregate principal amount not to exceed the sum of an amount equal to the greater of (x) $175.0 million and (y) 100% of consolidated EBITDA, plus the amount of certain voluntary prepayments, plus an unlimited amount that is subject to pro forma compliance with certain first lien net leverage ratio, secured net leverage ratio and total net leverage ratio tests.
+Added: The Initial Term Loan under the June 23, 2021 Credit Agreement has a seven-year term expiring in June 2028 and bears interest at either an Adjusted LIBOR plus a fixed applicable margin of 2.25% or an Adjusted Base Rate plus a fixed applicable margin of 1.25%, at our option.
+Added: Commencing on September 30, 2021, the Initial Term Loan under the June 23, 2021 Credit Agreement will amortize in equal quarterly installments equal to 0.25% of the original principal amount, with the balance payable on June 23, 2028.
+Added: The Company is subject to commitment fees ranging from 0.175% to 0.25% on the undrawn portion of the revolving facility, and any outstanding loans under the revolving facility will bear interest at either an Adjusted LIBOR plus a margin of 1.00% to 1.75% or an Adjusted Base Rate plus a margin of 0% to 0.75%.
+Added: The Company’s obligations under the June 23, 2021 Credit Agreement are required to be guaranteed by certain of its domestic subsidiaries meeting materiality thresholds set forth in the credit agreement.
+Added: Such obligations, including the guaranties, are secured by substantially all of the assets of the Company and the subsidiary guarantors.
+Added: Our material indebtedness adversely affects our operating expenses through increased interest payment obligations and adversely affects our ability to use cash generated from operations as we repay interest and principal under the term loans.
+Added: In addition, the revolving credit facility provisions under the June 23, 2021 Credit Agreement include financial covenants such as an initial maximum secured net leverage ratio of 3.5 to 1, which temporarily increases to 3.75 to 1 following the consummation of certain material permitted acquisitions, and operational covenants that may adversely affect our ability to engage in certain activities, including obtaining additional financing, granting liens, undergoing certain fundamental changes, or making investments or certain restricted payments, and selling assets, and similar transactions, without obtaining the consent of the lenders, which may or may not be forthcoming.
+Added: The initial secured term loan under the June 23, 2021 Credit Agreement is only subject to operational covenants.
+Added: Lastly, our borrowing costs can be affected by periodic credit ratings from independent rating agencies.
+Added: Such ratings are largely based on our performance, which may be measured by credit metrics such as leverage and interest coverage ratios.
+Added: Accordingly, outstanding indebtedness could adversely affect our operational freedom or ability to pursue strategic transactions that we would otherwise consider to be in the best interests of stockholders, including obtaining additional indebtedness to finance such transactions.
+Added: Specifically, our indebtedness has important consequences to investors in our common stock, including the following:
+Added: • we are subject to substantial variable interest rate risk because our interest rate under Initial Term Loan under the June 23, 2021 Credit Agreement varies based on a fixed margin of 2.25% per annum over an adjusted LIBOR rate or 1.25% per annum over an adjusted base rate and our interest rate for any outstanding principal under the revolving credit facility varies based a margin of 0% to 0.75% over adjusted base rate or a margin of 1.00% to 1.75% over an adjusted LIBOR rate, and we are also subject to commitment fees ranging from 0.175% to 0.25% on the undrawn portion of the revolving facility.
+Added: If interest rates were to increase substantially, it would adversely affect our operating results and could affect our ability to service our indebtedness;
+Added: • a portion of our cash flows is dedicated to the payment of interest and when applicable, principal, on our indebtedness and other obligations and will not be available for use in our business;
+Added: • our level of indebtedness could limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we operate;
+Added: • our high degree of indebtedness may make us more vulnerable to changes in general economic conditions and/or a downturn in our business, thereby making it more difficult for us to satisfy our obligations.
+Added: If we fail to make required debt payments, or if we fail to comply with financial or other covenants in our debt service agreements, which include a maximum leverage ratio, we would be in default under the terms of these agreements.
+Added: Subject to customary cure rights, any default would permit the holders of the indebtedness to accelerate repayment of this debt and could cause defaults under other indebtedness that we have, any of which could have a material adverse effect on the trading price of our common stock.
Risks Relating to Intellectual Property
3 unchanged sentences
Third parties have in the past and may in the future assert against us and our customers and distributors their patent and other intellectual property rights to technologies that are important to our business.
−Removed: In particular, from time to time, we receive correspondence from competitors seeking to engage us in discussions concerning potential claims against us, and we receive correspondence from customers seeking indemnification for potential claims related to infringement claims asserted against down-stream users of our products.
+Added: In particular, from time to time, we receive correspondence from competitors
+Added: seeking to engage us in discussions concerning potential claims against us, and we receive correspondence from customers seeking indemnification for potential claims related to infringement claims asserted against down-stream users of our products.
We investigate these requests as received and could be required to enter license agreements with respect to third party intellectual property rights or indemnify third parties, either of which could have an adverse effect on our future operating results.
43 unchanged sentences
The agreement does not affect our ability to use our registered trademark “MxL”, which we use on our products.
−Removed: Due to our agreement not to register the “MAXLINEAR” mark, our ability to effectively prevent third parties from using the “MAXLINEAR” mark in
−Removed: connection with similar products or technology may be affected.
+Added: Due to our agreement not to register the “MAXLINEAR” mark, our ability to effectively prevent third parties from using the “MAXLINEAR” mark in connection with similar products or technology may be affected.
If we are unable to protect our trademarks, we may experience difficulties in achieving and maintaining brand recognition and customer loyalty.
8 unchanged sentences
The cost and operational consequences of implementing further data protection measures either as a response to specific breaches or as a result of evolving risks could be significant.
−Removed: In addition, our inability to use or access our information systems at critical points in time could adversely affect the timely and efficient operation of our business.
+Added: In addition, our inability to use or access our information systems at critical points in time
+Added: could adversely affect the timely and efficient operation of our business.
Any delayed sales, significant costs or lost customers resulting from these technology failures could adversely affect our business, operations and financial results.
16 unchanged sentences
Currently, the majority of our products are manufactured by Global Foundries, Semiconductor Manufacturing International Corporation, or SMIC, Taiwan Semiconductor Manufacturing Corp, or TSMC, and United Microelectronics Corporation, or UMC, at foundries located in Taiwan, Singapore, and China.
−Removed: We also rely on Intel Corporation for certain products under a supply agreement as described in the risk factor “ Failure to integrate the acquired businesses with our business and operations successfully in the expected time-frame or otherwise may adversely affect MaxLinear’s operating results and financial condition.
+Added: We also rely on Intel Corporation, or Intel, for certain products on a turnkey basis under a supply agreement with an initial term of five years.
Foundries and other third-parties we rely upon are currently experiencing bottlenecks caused by a sudden increase in demand for electronics containing semiconductor chips and stockpiling of chips by certain firms in China blacklisted by the U.S., resulting in a global semiconductor chip shortage impacting our industry.
18 unchanged sentences
If such disruption were to recur over a prolonged period, it could have a material impact on our revenues and our business.
−Removed: Any disruption resulting from similar events on a larger scale or over a prolonged period could cause significant delays in shipments of our products until we are able to resume such shipments, or
−Removed: shift our manufacturing, assembly, or test from the affected contractor to another third-party vendor, if needed.
+Added: Any disruption resulting from similar events on a larger scale or over a prolonged period could cause significant delays in shipments of our products until we are able to resume such shipments, or shift our manufacturing, assembly, or test from the affected contractor to another third-party vendor, if needed.
There can be no assurance that alternative capacity could be obtained on favorable terms, if at all.
2 unchanged sentences
We currently sell a large portion of our products to customers through our distributors, who maintain their own inventories of our products.
−Removed: Sales to distributors accounted for approximately 45% and 63% of our net revenue in the six months ended June 30, 2021 and 2020, respectively.
+Added: Sales to distributors accounted for approximately 46% and 54% of our net revenue in the nine months ended September 30, 2021 and 2020, respectively.
Upon shipment of product to these distributors, title to the inventory transfers to the distributor and the distributor is invoiced, generally with 30 to 60 day terms.
7 unchanged sentences
We do not have any long-term supply contracts with our contract manufacturers or suppliers, and any disruption in our supply of products or materials could have a material adverse effect on our business, revenue and operating results.
−Removed: We currently do not have long-term supply contracts with any of our third-party vendors, including but, not limited to Global Foundries, SMIC, TSMC, and UMC.
+Added: While certain products are supplied to us by Intel on a turnkey basis under the terms of a supply agreement with an initial term of five years, currently we do not have long-term supply contracts with any other third-party vendors, including but, not limited to Global Foundries, SMIC, TSMC, and UMC.
We make substantially all of our purchases on a purchase order basis, and our contract manufacturers are not required to supply us products for any specific period or in any specific quantity.
3 unchanged sentences
It is possible that foundry customers that are larger and better financed than we are, or that have long-term agreements with our foundry, may induce our foundry to reallocate capacity to them.
−Removed: This reallocation could impair our ability to secure the supply of components that we need.
+Added: reallocation could impair our ability to secure the supply of components that we need.
We generally place orders for products with some of our suppliers approximately four to five months prior to the anticipated delivery date, with order volumes based on our forecasts of demand from our customers.
10 unchanged sentences
Any failure of our corporate infrastructure could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Upon expiration or termination of any of our agreements with third-party
−Removed: vendors, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete.
+Added: Upon expiration or termination of any of our agreements with third-party vendors, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete.
Additionally, we incorporate third-party technology into and with some of our products, and we may do so in future products.
7 unchanged sentences
We use our cash and cash equivalents for general corporate purposes, including working capital and for repayment of outstanding long-term debt.
−Removed: We used a portion of these assets to acquire the Wi-Fi and Broadband assets business and NanoSemi in the third quarter of 2020.
+Added: In the nine months ended September 30, 2021, we used a portion of cash assets to make $35 million in previously deferred payments to acquire NanoSemi.
We may also, in the future, use a portion of our assets to acquire other complementary businesses, products, services or technologies.
35 unchanged sentences
• general economic and market conditions, including the global COVID-19 pandemic.
−Removed: Furthermore, the stock markets recently have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies.
+Added: Furthermore, the stock markets have experienced extreme price and volume fluctuations that have affected the market prices of equity securities of many companies.
These fluctuations often have been unrelated or disproportionate to the operating performance of those companies.
7 unchanged sentences
If one or more of the analysts who cover us downgrade our shares or change their opinion of our shares, our share price would likely decline.
−Removed: If one or more of these
−Removed: analysts cease coverage of our Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.
+Added: If one or more of these analysts cease coverage of our Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.
Future sales of our common stock in the public market could cause our share price to decline.
Sales of a substantial number of shares of our common stock in the public market, or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities.
−Removed: As of June 30, 2021, we had approximately 76.5 million shares of common stock outstanding.
+Added: As of September 30, 2021, we had approximately 76.7 million shares of common stock outstanding.
All shares of common stock are freely tradable without restrictions or further registration under the Securities Act of 1933, as amended, or the Securities Act, unless held by our “affiliates,” as that term is defined under Rule 144 of the Securities Act.
12 unchanged sentences
Many of these purchases are discretionary.
−Removed: Global economic volatility and economic volatility in the specific markets in which the devices that incorporate our products are ultimately sold can cause extreme difficulties for our customers and third-party vendors in accurately forecasting and planning future business activities.
+Added: Global economic volatility and economic volatility in the specific markets in which the devices that incorporate our products are ultimately sold can cause extreme difficulties for our customers and third-party
+Added: vendors in accurately forecasting and planning future business activities.
This unpredictability could cause our customers to reduce spending on our products, which would delay and lengthen sales cycles.
8 unchanged sentences
Our business and operating results are substantially dependent on international trade.
−Removed: Many of our manufacturers sell products incorporating our semiconductors into international markets.
+Added: Many of our manufacturers sell products incorporating our integrated circuits into international markets.
Tariffs on our customers’ products may adversely affect our gross profit margins in the future due to the potential for increased pressure on our selling prices by customers seeking to offset the impact of tariffs on their own products.
−Removed: tariffs could make our OEM and ODM customers’ products less attractive relative to products offered by their competitors, which may not be subject to similar tariffs.
+Added: In addition, tariffs could make our OEM and ODM customers’ products less attractive relative to products offered by their competitors, which may not be subject to similar tariffs.
Some OEM and ODMs in our industry have already implemented short-term price adjustments to offset such tariffs and transitioned their production and supply chain to locations outside of China.
8 unchanged sentences
Our operations and financial condition could be seriously harmed in the event of a major earthquake, fire, or other natural or man-made disaster.
+Added: We have recorded goodwill and other intangible assets in connection with business acquisitions.
+Added: Goodwill and other acquired intangible assets could become impaired and adversely affect our future operating results.
+Added: We account for business acquisitions as business combinations under the acquisition method of accounting in accordance with accounting principles generally accepted in the United States.
+Added: Under the acquisition method of accounting, the total purchase price is allocated to net tangible assets and identifiable intangible assets of acquired businesses based on their fair values as of the date of completion of the acquisition.
+Added: The excess of the purchase price over those fair values is recorded as goodwill.
+Added: Our acquisitions have resulted in the creation of goodwill and recording of a large amount of intangible assets based upon the application of the acquisition method of accounting.
+Added: To the extent the value of goodwill or other intangible assets become impaired, we may be required to incur material charges relating to such impairment.
+Added: We conduct our annual goodwill and indefinite-lived intangible asset impairment analysis on October 31 each year, or more frequently if we believe indicators of impairment exist.
+Added: Our reported financial condition and results of operations reflect the balances and results of the acquired businesses but are not restated retroactively to reflect the historical financial position or results of operations of acquired businesses for periods prior to the acquisitions.
+Added: As a result, comparisons of future results against prior period results will be more difficult for investors.
+Added: In addition, there can be no guarantee that acquired intangible assets, particularly in-process research and development, will generate revenues or profits that we include in our forecast that is the basis for their fair values as of the acquisition date.
+Added: Any such impairment charges relating to goodwill or other intangible assets could have a material impact on our operating results in future periods, and the announcement of a material impairment could have an adverse effect on the trading price and trading volume of our common stock.
+Added: As of September 30, 2021, our balance sheet reflected goodwill
+Added: of $302.8 million and other intangible assets of $163.9 million.
+Added: Consequently, we could recognize material impairment charges in the future.
Unanticipated changes in our tax rates or unanticipated tax obligations could affect our future results.
15 unchanged sentences
Realization of our deferred tax assets is dependent primarily upon future taxable income in the applicable jurisdiction.
−Removed: Based upon our review of all positive and negative evidence, we concluded that a full valuation allowance should continue to be recorded against our state and certain federal and foreign net deferred tax assets at June 30, 2021.
+Added: Based upon our review of all positive and negative evidence, we concluded that a full valuation allowance should continue to be recorded against our state and certain federal and foreign net deferred tax assets at September 30, 2021.
On a periodic basis we evaluate our deferred tax assets for realizability.
4 unchanged sentences
If we fail to satisfy the conditions for receipt of these tax incentives, or to the extent U.S.
−Removed: or other tax authorities challenge our operation under these favorable tax incentive programs or our intercompany transfer pricing agreements, our taxable income could be taxed at higher federal or foreign statutory rates and
−Removed: our income tax liability and expense could materially increase beyond our projections.
+Added: or other tax authorities challenge our operation under these favorable tax incentive programs or our intercompany transfer pricing agreements, our taxable income could be taxed at higher federal or foreign statutory rates and our income tax liability and expense could materially increase beyond our projections.
Each of our Singapore tax incentives is separate and distinct from the others, and may be granted, withheld, extended, modified, truncated, complied with or terminated independently without any effect on the other incentives.
9 unchanged sentences
We assumed an obligation associated with certain defined benefit retirement plans, including a pension plan, which cover certain employees of the Wi-Fi and Broadband assets business and generally provide benefits based on negotiated amounts for each year of service.
−Removed: These plans were underfunded by $3.2 million as of June 30, 2021 based on current projections and plan assets.
+Added: These plans were underfunded by $3.2 million as of September 30, 2021 based on current projections and plan assets.
We have never managed defined benefit plans in our operating history.
15 unchanged sentences
A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
−Removed: Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be
−Removed: considered relative to their costs.
+Added: Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs.
Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
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.