What changed in this filing

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Item 1. Business

2022-02-02 compared with 2021-02-11 · 41 added, 41 removed, 354 unchanged (19% of the section changed)

9 unchanged sentences

All other trademarks and trade names appearing in this Form 10-K are the property of their respective owners.

We are a provider of communications systems-on-chip (SoC) solutions used in broadband, mobile and wireline infrastructure, data center, and industrial and multi-market applications.

We are a fabless integrated circuit design company whose products integrate all or substantial portions of a high-speed communication system, including radio frequency (RF), high-performance analog, mixed-signal, digital signal processing, security engines, data compression and networking layers, and power management.

In most cases, these products are designed on a single silicon-die using standard digital complimentary metal oxide semiconductor (CMOS) processes and conventional packaging technologies.

We are a provider of communications systems-on-chip, or SoC, solutions used in broadband, mobile and wireline infrastructure, data center, and industrial and multi-market applications.

We are a fabless integrated circuit design company whose products integrate all or substantial portions of a high-speed communication system, including radio frequency, or RF, high-performance analog, mixed-signal, digital signal processing, security engines, data compression and networking layers, and power management.

In most cases, these products are designed on a single silicon-die using standard digital complementary metal oxide semiconductor, or CMOS, processes and conventional packaging technologies.

We believe this approach enables our solutions to achieve superior power, performance and cost relative to our industry competition.

Our customers include electronics distributors, module makers, original equipment manufacturers (OEMs) and original design manufacturers (ODMs), which incorporate our products in a wide range of electronic devices.

Examples of such devices include cable Data Over Cable Service Interface Specifications (DOCSIS), fiber and DSL broadband modems and gateways;

Our customers include electronics distributors, module makers, original equipment manufacturers, or OEMs, and original design manufacturers, or ODMs, which incorporate our products in a wide range of electronic devices.

Examples of such devices include cable Data Over Cable Service Interface Specifications, or DOCSIS, fiber and DSL broadband modems and gateways;

Wi-Fi and wireline routers for home networking;

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• The rapid rise of social media and crowd-sourced real-time content;

• The proliferation of on-demand Over-The-Top (OTT) video services such as Netflix and Amazon Prime;

• The proliferation of on-demand Over-The-Top, or OTT, video services such as Netflix and Amazon Prime;

• Rapid growth in data center and cloud-based services such as Amazon Web Services, Google Search and Apps, and AI/machine learning;

• The “remote economy” accelerated by the COVID-19 pandemic, the shift to work-from-home, and increasing dependence on video conferencing services such as Zoom;

• The proliferation of “Internet of Things” (IoT), including internet-connected appliances within the home, manufacturing industries, and enterprises;

• The proliferation of “Internet of Things”, or IoT, including internet-connected appliances within the home, manufacturing industries, and enterprises;

• The advent and growth of broadband 4G/5G wireless mobile internet connectivity.

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These home data gateway modems or access devices are required to simultaneously receive, demodulate, and decode multiple signals, which are spread across several channels of frequency bandwidth over a wide frequency range and propagate on coaxial cable, copper, optical fiber or airwaves.

Further, each gateway distributes content throughout the home using a broadband communication transceiver and network processor SoC based on Wi-Fi, Ethernet, Multimedia over Coax (MoCA) and other wireline home data connectivity standards.

Further, each gateway distributes content throughout the home using a broadband communication transceiver and network processor SoC based on Wi-Fi, Ethernet, Multimedia over Coax, or MoCA, and other wireline home data connectivity standards.

As a result, the number of transceivers required in each home, whether for wireless or broadband wireline access and distribution, is greatly increased.

For example, cable multiple-system operators (MSOs) have ramped up deployments of multi-gigabit DOCSIS 3.1 home equipment and services, which “bond” multiple channels of frequency bands on a coaxial cable, to provide a higher aggregate “sum-of-the-channels” bandwidth to home subscribers.

For example, cable multiple-system operators, or MSOs, have ramped up deployments of multi-gigabit DOCSIS 3.1 home equipment and services, which “bond” multiple channels of frequency bands on a coaxial cable, to provide a higher aggregate “sum-of-the-channels” bandwidth to home subscribers.

For example, within the home, Wi-Fi 6 uses wider bandwidth channels and channel-bonding, as well as more sophisticated means of wireless spectrum sharing by users, to provide seamless whole-home coverage.

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Expensive, finite, fractured and non-contiguous 5G wireless spectrum is being utilized more efficiently by aggregating or bonding multiple non-contiguous channels of spectrum with highly complex radio transceivers in a wireless base-station radio unit.

These complex radio transceivers can also be configured in large antenna arrays to direct wireless signals more efficiently to specific users, also known as Massive Multiple-Input Multiple Output beamforming (MMIMO).

Beamforming vastly improves coverage (range), maximizes data rates (bandwidth), and creates

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This, in turn creates growth opportunities for interface products, and interface bridge products supporting multiple protocols.

We believe our interface product portfolio, which consists of serial interface, universal serial bus (USB), universal asynchronous receiver transmitter (UARTS), peripheral interconnect express (PCIe) devices, data converters and power management integrated chips (PMICs), addresses a broad and growing servable market across communications, industrial and multiple other end markets.

We believe our interface product portfolio, which consists of serial interface, universal serial bus, or USB, universal asynchronous receiver transmitter, or UARTS, peripheral interconnect express, or PCIe, devices, data converters and power management integrated chips, or PMICs, addresses a broad and growing servable market across communications, industrial and multiple other end markets.

The development of broadband, low power, integrated communication systems-on-chip solutions is at the heart of competitiveness across a range of different businesses spanning broadband wireline access, mobile data services, hyperscale cloud data centers, and cloud computation and storage markets.

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OEMs meet these stringent requirements via multiple narrow- or wide-band RF receivers, each of which is dedicated to the reception of a single frequency band.

An alternate, but highly challenging, approach involves Full Spectrum Capture (FSC TM ) receiver SoCs, which can receive and digitize the entire available RF frequency spectrum in the transmission medium.

An alternate, but highly challenging, approach involves Full Spectrum Capture, or FSC TM ,receiver SoCs, which can receive and digitize the entire available RF frequency spectrum in the transmission medium.

They can then select and aggregate the relevant frequency bands over which the data is spread using analog and mixed-signal digital co-processing techniques.

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In communications systems, performance is limited by the quality of the received/transmitted signal that can be supported throughout the channel bandwidth.

Signal-to-noise (SNR) ratio measures the strength of the desired signal relative to the sum of the noise and undesired signal energy in the same channel.

Signal-to-noise, or SNR, ratio measures the strength of the desired signal relative to the sum of the noise and undesired signal energy in the same channel.

High capacity 5G wireless cellular data networks operate across non-contiguous wireless spectrum bands, while wired coaxial cable and power-line networks require broadband RF transceivers supporting high SNR.

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◦ Form Factor:

Optical transceivers are required to conform to multi-source agreement (MSA) standardized form factors, which in turn determine the number of transceiver ports that can fit in the face plates of standard server, storage, and switch rack units.

Optical transceivers are required to conform to multi-source agreement, or MSA, standardized form factors, which in turn determine the number of transceiver ports that can fit in the face plates of standard server, storage, and switch rack units.

Standardization of transceiver form factors and rack unit face plates allows data center operators to upgrade network speeds of existing installations by simply replacing older optical transceivers and switches with newer faster ones, rather than having to overhaul installed fiber infrastructure and floorplan.

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This results in state-of-the-art performance, highest energy efficiency or lowest power, smallest form factor, and the lowest manufacturing cost of a target function.

For example, in cable DOCSIS3.1 data gateways, our single-chip Full Spectrum Capture (FSC) receivers digitize the entire cable spectrum and aggregate multiple frequency bands or channels using analog and digital signal co-processing to enable multi-gigabit data services.

For example, in cable DOCSIS3.1 data gateways, our single-chip FSC receivers digitize the entire cable spectrum and aggregate multiple frequency bands or channels using analog and digital signal co-processing to enable multi-gigabit data services.

There is a 100-fold reduction in power per unit bandwidth while increasing the total data throughput by an even greater factor.

1 unchanged sentence

• Advanced digital signal processing ASIC design and algorithms:

Our signal processing algorithm and digital ASIC design expertise is at the core of our ability to employ digital signal processing to enable breakthroughs in CMOS analog RF front-end design and vice-versa.

Our signal processing algorithm and digital application-specific integrated circuits, or ASIC, design expertise is at the core of our ability to employ digital signal processing to enable breakthroughs in CMOS analog RF front-end design and vice-versa.

For example, impairments introduced by analog systems such as power amplifiers and photonics devices are canceled using sophisticated digital signal processing algorithms to achieve superior signal quality, reduce power consumption, and improve the speed of operation.

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It allows us to address more complex customer problems that require a deeper understanding of the customer’s end product.

Our products not only integrate the entire physical layer (PHY), but also implement complete protocol stacks along with ready-for-use product level interface functionality and associated platform software.

Our products not only integrate the entire physical layer, or PHY, but also implement complete protocol stacks along with ready-for-use product level interface functionality and associated platform software.

We also provide the most efficient and cost-effective platform level power management IC solutions that regulate and monitor the power consumption for our chips and other circuits on the platform.

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A significant portion of our net revenue has historically been generated by a limited number of customers.

In the years ended December 31, 2020, 2019 and 2018, ten customers accounted for approximately 68%, 63% and 61% of our net revenue, respectively.

In the year ended December 31, 2020, two of our direct customers represented 28% of our net revenue.

years ended December 31, 2019 and 2018, one of our direct customers, CommScope Holding Company, Inc., or Commscope, represented 14% and 18%, respectively, of our net revenue.

In the years ended December 31, 2021, 2020 and 2019, ten customers accounted for approximately 69%, 68% and 63% of our net revenue,

respectively.

In the years ended December 31, 2021 and 2020, two of our direct customers represented 26% and 28% of our net revenue, respectively.

In the year ended December 31, 2019, one of our direct customers represented 14% of our net revenue.

Products shipped to Asia accounted for 83%, 82% and 84% of our net revenue in the years ended December 31, 2021, 2020 and 2019, respectively.

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Products shipped to China accounted for 12%, 17% and 14% of our net revenue in the years ended December 31, 2021, 2020 and 2019, respectively.

Products shipped to Vietnam accounted for 13% of our net revenue in the year ended December 31, 2021.

Although a large percentage of our products are shipped to Asia, we believe that a significant number of the systems designed by these customers and incorporating our semiconductor products are then sold outside Asia.

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To date, all of our sales have been denominated in United States dollars.

See Note 14 to our consolidated financial statements, included in Part IV, Item 15 of this Report for a discussion of total revenue by geographical region for the years ended December 31, 2020, 2019 and 2018.

Sales and Marketing

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We use third-party foundries and assembly and test contractors to manufacture, assemble and test our products.

We also rely on certain vendors to supply turnkey products, including, in particular, Intel Corporation for certain products we sell following our acquisition of Intel’s Home Gateway Platform Division in July 2020.

We also rely on certain vendors to supply turnkey products, including, in particular, Intel Corporation, for certain products we sell.

This outsourced manufacturing approach allows us to focus our resources on the design, sale and marketing of our products.

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Our key foundry partners include Global Foundries Inc.

in Singapore, Semiconductor Manufacturing International Corporation or SMIC in China, Taiwan Semiconductor Manufacturing Corporation

or TSMC in Taiwan, and United Microelectronics Corporation or UMC in Taiwan and Singapore.

We generally do not depend on a single source for the supply of our materials.

in Singapore, Semiconductor Manufacturing International Corporation or SMIC in China, Taiwan Semiconductor Manufacturing Corporation or TSMC in Taiwan, and United Microelectronics Corporation or UMC in Taiwan and Singapore.

We generally do not depend

on a single source for the supply of our materials.

Additionally, certain of the acquired products of the Wi-Fi and Broadband assets business are supplied to us under the terms of a supply agreement with Intel.

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In 2021, the Company’s U.S.

employees organized a fund-raising campaign to feed the hungry in local communities, which has increased as a result of closures and job losses during the COVID-19 pandemic.

Together with a matching corporate contribution from the Company, the campaign raised in excess of $60 thousand, benefiting Feeding America, a U.S.

hunger- relief organization.

employees organized a fund-raising campaign to stop the cycle of child abuse and help at-risk youth in the community.

Together with a matching corporate contribution from the Company, the campaign raised in excess of $50 thousand, benefiting Olive Crest, a U.S.

child abuse prevention and treatment charitable organization.

Research and Development

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Massachusetts;

Shanghai, Shenzhen, and Hong Kong in China;

Shanghai, and Shenzhen in China;

Taipei and Hsinchu in Taiwan;

Bangalore, India;

Bangalore and Chennai in India;

and Austria, Germany, Israel, Spain, and Canada.

We compete with both established and development-stage semiconductor companies that design, manufacture and market analog and mixed-signal broadband RF receivers, optical interconnects, high-performance interface, data and video

compression and encryption, and power management products.

Our competitors include companies with much longer operating histories, greater name recognition, access to larger customer bases and substantially greater financial, technical and operational resources, as well as smaller companies specializing in narrow markets, to internal or vertically integrated engineering groups within certain of our customers.

Our competitors include companies with much longer operating

histories, greater name recognition, access to larger customer bases and substantially greater financial, technical and operational resources, as well as smaller companies specializing in narrow markets, to internal or vertically integrated engineering groups within certain of our customers.

In addition, our industry is experiencing substantial consolidation.

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We consider our primary competitors to be companies with a proven track record of supporting market leaders and the technical capability to develop and bring to market competing broadband RF receiver and RF receiver SoC, modem, and optical interconnect products.

Our primary merchant semiconductor competitors include Silicon Laboratories, Inc., NXP Semiconductors N.V., MediaTek, Inc., Broadcom Ltd, Rafael Microelectronics, Inc., Inphi Corporation, 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.

(which recently entered into a definitive agreement to be acquired by Analog Devices), Monolithic Power Systems, Inc., Microchip Technology, Inc., Ambarella, Inc., and Infineon Technologies AG.

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, Monolithic Power Systems, Inc., Microchip Technology, Inc., Ambarella, Inc., and Infineon Technologies AG.

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.

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We also have 360 issued foreign patents and 83 other pending foreign patent applications, based on our issued patents and pending patent applications in the United States.

We are the owner of approximately 10 trademarks that have been registered and/or allowed for registration in the United States.

We own foreign counterparts (including approximately 36 foreign registrations) of certain of these registered trademarks in Canada, Chile, China, the EU, India, Israel, Japan, Korea, Singapore, and Taiwan.

We are the owner of approximately 12 trademarks that have been registered in the United States.

We own foreign counterparts (including approximately 43 foreign registrations) of certain of these registered trademarks in Canada, Chile, China, the EU, Germany, Great Britain, India, Israel, Japan, Korea, Singapore, and Taiwan.

We also claim common law rights in certain other trademarks that are not registered.

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Our workforce is represented by the following race/ethnicities:

53% Asian, 40% White or Middle Eastern, 7% Latinx or Hispanic origin, with 36% Asian and 64% White or Middle Eastern in senior management.

57% Asian, 36% White or Middle Eastern, 7% Latinx or Hispanic origin, with 35% Asian, 61% White or Middle Eastern and 4% two or more races in senior management.

Females represented 25% of our outside directors, 9% of senior management, 12% of our technical roles, and 17% of our total workforce.

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For more details regarding our executive compensation, refer to information incorporated by reference from the information set forth under the captions “Executive Compensation” and “Compensation Discussion and Analysis” in either an amendment to this Annual Report on Form 10-K or our 2022 Proxy Statement.

In 2020, our ongoing focus on workplace safety and compliance to applicable regulations has enabled us to preserve business continuity while ensuring a safe work environment during the COVID-19 pandemic, including work-from-home arrangements for a substantial portion of our workforce and reduced capacity for those that have returned to the office, adhering to local health authority guidelines.

We also comply with applicable laws and regulations regarding workplace safety and are subject to audits by entities such as the Occupational Safety and Health Administration (OSHA) in the United States.

We rely on third parties to manufacture our products and require our suppliers to maintain a safe work environment, as described in further detail under the below heading “Manufacturing.”

In 2021, our ongoing focus on workplace safety and compliance to applicable regulations has enabled us to preserve business continuity while ensuring a safe work environment during the COVID-19 pandemic, requiring masks plus vaccinations or weekly testing for those that have returned to in-person work in our offices, adhering to local health authority guidelines or work-from-home arrangements for the rest of our workforce.

We also comply with applicable laws and regulations regarding workplace safety and are subject to audits by entities such as the Occupational Safety and Health Administration, or OSHA, in the United States.

We rely on third parties to manufacture our products and require our suppliers to maintain a safe work environment, as described in further detail under the above heading “Manufacturing.”

The semiconductor industry is highly cyclical and is characterized by constant and rapid technological change, rapid product obsolescence and price erosion, evolving technical standards, short product life cycles and wide fluctuations in product supply and demand.

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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-K

Item 1. Business