What changed in this filing

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Item 1A. Risk Factors

2025-04-23 compared with 2024-10-23 · 218 added, 177 removed, 855 unchanged (32% of the section changed)

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• We face intense competition and expect competition to increase in the future, which could have a material adverse effect on our revenue, revenue growth rate, if any, and market share.

• Changes in trade policies among the United States and other countries, in particular the escalation and imposition of new and higher tariffs, could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own products.

Increased tariffs or the imposition of other barriers to international trade could decrease demand and have a material adverse effect on our revenues and operating results.

• Global economic conditions, including factors such as high inflation or a potential recession, could continue to adversely affect our business, financial condition, and results of operations.

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The impact of excess inventory in the channel has continued to influence our customers’ expected demand for certain of our products and negatively impact our revenue.

• Our business, financial condition and results of operations could continue to be adversely affected by military conflicts, geopolitical and economic tensions among or with countries in which we conduct business, including between the United States and China, Israel (and its conflicts with Iran and Lebanon), and among other countries.

• Our business, financial condition and results of operations could continue to be adversely affected by escalating trade wars, military conflicts, and other geopolitical and economic tensions among or with countries in which we conduct business, including between the United States and China, Israel (and its conflicts with Iran and Lebanon), and among other countries.

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For example, as more entities are added to restricted export control lists, or as semiconductor technology exports to other countries are further controlled, our need to seek authorization from the U.S.

government may impact our ability to do business and/or the speed with which we can deliver, if at all.

government may impact our ability to do business.

• We also are subject to risks associated with international geopolitical and military conflicts.

• Changes in trade policies among the United States and other countries, in particular the imposition of new or higher tariffs, could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own products.

Increased tariffs or the imposition of other barriers to international trade could decrease demand and have a material adverse effect on our revenues and operating results.

• We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology or if such authorizations are revoked.

In addition, we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations.

• We depend on a limited number of customers for a substantial portion of our revenue, and the loss of, or a significant reduction in orders from major customers has had and could continue to have a material adverse effect on our revenue and operating results.

• We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology related to the development or production of our products or if such authorizations are revoked, and we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations.

• We depend on a limited number of 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 has had and could continue to have a material adverse effect on our revenue and operating results.

• Any legal proceedings or claims against us or potential violations of applicable regulations could be costly and time-consuming to defend and could harm our reputation regardless of the outcome.

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• If we fail to penetrate new applications and markets, our revenue, revenue growth rate, if any, and financial condition could be materially and adversely affected.

• A significant portion of our revenue is attributable to demand for our products in markets for broadband 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.

• We may be unable to make the substantial productive research and development investments that are required to remain competitive in our business.

• A significant portion of our revenue is attributable to demand for our products in markets for broadband solutions, and development delays and consolidation trends among cable and satellite Pay-TV and broadband operators has adversely affected and could continue to adversely affect our future revenues and operating results.

• We may be unable to make the substantial and productive research and development investments that are required to remain competitive in our business.

• The complexity of our products could result in unforeseen delays or expenses caused by undetected defects or bugs, which could reduce the market acceptance of our new products, damage our reputation with current or prospective customers and adversely affect our operating costs.

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In addition, high interest rates may make it more difficult for us, our customers, and our distributors to obtain financing and service our respective interest and debt obligations, which in turn has an impact on customer demand for our products and our distributors’ business.

• We are subject to governmental laws, regulations and other legal obligations related to privacy, data protection, and cybersecurity.

Our inability to comply with such obligations may negatively impact our business.

• We are subject to governmental laws, regulations and other legal obligations related to privacy, data protection, and cybersecurity, and any inability of us to comply with such obligations may negatively impact our business.

• Our products must conform to industry standards in order to be accepted by end users in our markets.

• We may, from time to time, make additional business acquisitions or investments, which involve significant risks.

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Risks Relating to Intellectual Property

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Additionally, on August 31, 2023, a Silicon Motion stockholder filed a class action complaint against us and certain of our current officers alleging that we materially misrepresented the likelihood the merger would close, and a similar individual action was filed by a different Silicon Motion stockholder on June 13, 2024.

Other potential plaintiffs may file additional lawsuits related to the previously contemplated merger.

Other plaintiffs have filed additional lawsuits related to the previously contemplated merger.

See Part II, Item 1 (Legal Proceedings) of this report for more information on the Silicon Motion arbitration and the class action lawsuit.

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We expect that we may not be able to obtain financing on favorable terms if at all or raise additional capital for any such payments.

Even if we are able to finance such payments through the incurrence of additional indebtedness, any material increase in our indebtedness would adversely affect our operating results and cash-

flows as we satisfy our underlying interest and principal payment obligations.

Issuing additional shares of our common stock, if material, will result in dilution of existing shares outstanding.

Even if we are able to finance such payments through the incurrence of additional indebtedness, any material increase in our indebtedness would adversely affect our operating results and cash-flows as we satisfy our underlying interest and principal payment obligations.

Issuing additional shares of our common stock, if

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material, will result in dilution of existing shares outstanding.

Any loan agreement is also expected to contain financial and operational covenants that would 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.

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• high interest rates may make it more difficult for us, our customers, and our distributors to obtain financing and service our respective interest and debt obligations, which in turn has an impact on customer demand for our products as well as the business of our distributors;

• we could be subject to substantial variable interest rate risk because our interest rate under term loans typically varies based on a fixed margin over an indexed rate (such as for the Initial Term Loan under the June 23, 2021 Credit Agreement) or an adjusted base rate.

If interest rates were to continue to increase substantially, and we incur additional indebtedness, it would adversely affect our operating results and could affect our ability to service the indebtedness;

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Agreement) or an adjusted base rate.

If interest rates were to increase substantially, and we incur additional indebtedness, it would adversely affect our operating results and could affect our ability to service the indebtedness;

• 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;

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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.

Some of our targeted customers for our optical interconnect solutions are module makers who are vertically integrated, where we compete with internally supplied components, and we compete with much larger analog and mixed-signal catalog competitors in the multi-market high-performance analog markets.

Some of our targeted customers for our high speed interconnect solutions are module makers who are vertically integrated, where we compete with internally supplied components, and we compete with much larger analog and mixed-signal catalog competitors in the multi-market high-performance analog markets.

Our ability to compete successfully depends on factors both within and outside of our control, including industry and general economic trends.

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Many of our competitors have substantially greater financial and other resources with which to withstand similar adverse economic or market conditions in the future.

Moreover, the competitive landscape is changing as a result of intense

consolidation within our industry as some of our competitors have merged with or been acquired by other competitors, and other competitors have begun to collaborate with each other, which could result in significant changes to the competitive landscape.

In addition, changes in government trade policies, including the imposition of tariffs and export restrictions, as well as actions by government agencies, could limit our ability to sell our products to certain customers and adversely affect our ability to compete successfully.

Moreover, the competitive landscape is changing as a result of intense consolidation within our industry as some of our competitors have merged with or been acquired by other competitors, and other competitors have begun to collaborate with each other, which could result in significant changes to the competitive

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In addition, changes in government trade policies, including the imposition of escalated tariffs and export restrictions, as well as actions by government agencies, could limit our ability to sell our products to certain customers and adversely affect our ability to compete successfully.

These developments may materially and adversely affect our current and future target markets and our ability to compete successfully in those markets.

In addition, we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations ” below.

See the risk factors “We also are subject to risks associated with international geopolitical and military conflicts ” and “We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology related to the development or production of our products or if such authorizations are revoked, and we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations ” below.

Changes in trade policies among the United States and other countries, in particular the escalation and imposition of new and higher tariffs, could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own products.

Increased tariffs or the imposition of other barriers to international trade could decrease demand and have a material adverse effect on our revenues and operating results.

The United States has recently imposed or proposed new or higher tariffs on a large number of products exported by U.S.

trading partners, including China, Europe, Canada, Mexico, and many others.

In response, many of those trading partners, including China, have imposed or proposed new or higher tariffs on American products.

We have experienced and are continuing to experience weakening demand in China, and continuing changes in U.S.

and foreign government trade policies and a heightened risk of further increased tariffs that impose barriers to international trade could further decrease international demand.

Our business and operating results are substantially dependent on international trade.

Many of our manufacturers sell products incorporating our integrated circuits into international markets.

Although our products are not currently subject to the latest tariffs proposed or imposed by the United States and China, such tariffs proposed or imposed 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.

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.

We believe that sustained increases in tariffs on imported goods, further increases in tariffs on imported goods, or the failure to resolve current international trade disputes could further decrease demand and have a material adverse effect on our business and operating results.

Furthermore, compliance with export controls and implementation of additional tariffs may increase compliance costs and further affect our business and operating results.

Global economic conditions, including factors such as high inflation or a potential recession, could continue to adversely affect our business, financial condition, and results of operations.

Inflation and uncertainty in customer demand and the worldwide economy has continued, and we have experienced and could continue to experience volatility in our sales and revenues in the future.

Inventory oversupply could potentially lead to more inventory write-downs, including charges for any excess or obsolete inventory which could negatively impact our gross margins.

The continued inventory oversupply could potentially lead to more inventory write-downs, including charges for any excess or obsolete inventory which could negatively impact our gross margins.

Our products are incorporated in numerous consumer devices, and demand for such products is ultimately driven by consumer demand for products such as televisions, personal computers, automobiles, and cable modems.

Many of these purchases are discretionary.

Global economic volatility and economic volatility in the specific markets in which the devices that incorporate our products are ultimately sold, including the impacts of current high rates of inflation and a potential recession, can cause extreme difficulties for our customers and third-party vendors in accurately forecasting and planning future business activities.

Global economic volatility and economic volatility in the specific markets in which the devices that incorporate our products are ultimately sold, including the impacts of inflation and a potential recession, can cause extreme difficulties for our customers and third-party vendors in accurately forecasting and planning future business activities.

If banks and financial institutions with whom we have banking relationships enter receivership or become insolvent in the future, we may be unable to access, and we may lose, some or all of our existing cash, cash equivalents and investments to the extent those funds are not insured or otherwise protected by the FDIC.

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Furthermore, during inflationary economic times, our customers may face challenges in gaining timely access to sufficient credit, which could impact their ability to make timely payments to us.

These events, together with economic volatility that may face the broader economy and, in particular, the semiconductor and communications industries, may adversely affect, our business, particularly to the extent that consumers decrease their discretionary spending for devices deploying our products.

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deploying our products.

However, the magnitude of such volatility on our business and its duration is uncertain and cannot be reasonably estimated at this time.

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

The current downturn, which was aggravated by certain factors such as high interest rates and excess channel inventory, has resulted in, or any future downturns may result in, diminished product demand, production overcapacity, high inventory levels and accelerated erosion of our average selling prices.

Furthermore, any future upturn in the semiconductor

industry could result in increased competition for access to third-party foundry and assembly capacity.

The macroeconomic factors which have reduced customer demand has been aggravated by certain factors such as high interest rates and excess channel inventory, and has resulted in, and any future downturns may result in, diminished product demand, production overcapacity, high inventory levels and accelerated erosion of our average selling prices.

Furthermore, any future upturn in the semiconductor industry could result in increased competition for access to third-party foundry and assembly capacity.

We are dependent on the availability of this capacity to manufacture and assemble all of our products.

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The impact of excess inventory in the channel has continued to influence our customers’ expected demand for certain of our products and negatively impact our revenue.

Our net revenue decreased from $567.9 million in the nine months ended September 30, 2023, to $268.4 million in the nine months ended September 30, 2024, and the decline in net revenue could continue in future periods.

Among other factors, the decrease is as a result of macroeconomic conditions impacting customer demand;

for example, the broadband market which has experienced slower than expected recovery.

Our net revenue increased slightly from $95.3 million in the three months ended March 31, 2024, to $95.9 million in the three months ended March 31, 2025, but has declined in previous periods.

Prior to 2023, our net revenues grew to $1.1 billion for the year ended December 31, 2022.

Among other factors, the decline in revenue is as a result of macroeconomic conditions impacting customer demand;

for example, the broadband market which has experienced slower than expected recovery.

We currently expect that revenue will fluctuate in the future, from period-to-period, consistent with the cyclical nature of our industry, and we could experience further decline in revenue in the future due to current macroeconomic conditions impacting customer demand for various products.

Further, the impact of excess inventory in the channel has continued to influence our customers’ expected demand for some of our products and negatively affected our revenue.

In addition, in July 2024, we initiated the 2024 Workforce Reduction and in the first half of 2024, we completed notifications to remaining affected employees regarding the 2023 Workforce Reductions.

We may not realize, in full or in part, the anticipated benefits, savings and improvements from the reductions of our workforce if our revenue continues to decline.

We have initiated and implemented workforce reductions in the past two years, and incurred related restructuring costs in anticipation of realizing cost savings in the future.

We may not realize, in full or in part, the anticipated benefits, savings and improvements from the reductions of our workforce if our revenue and profits decline beyond our current projections.

If we are unable to realize the expected operational efficiencies and cost savings from reductions of our workforce, our operating results and financial condition would be adversely affected.

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Please refer to the Risk Factor entitled “ Our revenue and operating results are subject to substantial quarterly and annual fluctuations and have fluctuated in the past and may fluctuate significantly due to a number of factors that could adversely affect our business and our stock price ” for a discussion of factors contributing to variances in our operating results or rates of growth, if any.

If we are unable to resume adequate revenue growth and manage our operating expenses, our financial results could suffer and our stock price could decline.

If we are unable to resume adequate revenue growth while managing our operating expenses, our financial results could suffer and our stock price could decline.

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To manage any future growth successfully, we believe we must effectively, among other things:

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If we are unable to resume and manage our growth effectively, we may not be able to take advantage of market opportunities or develop new products and we may fail to satisfy customer requirements, maintain product quality, execute our business plan, or respond to competitive pressures.

Our business, financial condition and results of operations could continue to be adversely affected by military conflicts, geopolitical and economic tensions among or with countries in which we conduct business, including between the United States and China, Israel (and its conflicts with Iran and Lebanon), and among other countries.

Our business, financial condition and results of operations could continue to be adversely affected by escalating trade wars, military conflicts, and other geopolitical and economic tensions among or with countries in which we conduct business, including between the United States and China, Israel (and its conflicts with Iran and Lebanon), and among other countries.

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We sell our products throughout the world.

Products shipped to Asia accounted for 72% of our net revenue in the nine months ended September 30, 2024.

In addition, as of September 30, 2024, approximately 77% of our employees are located outside of the United States.

Products shipped to Asia accounted for 78% of our net revenue in the three months ended March 31, 2025.

In addition, as of March 31, 2025, approximately 76% of our employees are located outside of the United States.

The majority of our products are manufactured, assembled and tested in Asia, and our major distributors are located in Asia.

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.

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.

These factors include:

• changes in political, regulatory, legal or economic conditions, including as a result of the upcoming U.S.

presidential election;

• geopolitical conflicts and tensions, especially between the United States and China, that could destabilize trading relationships and economic activity;

• restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments and trade protection measures, including export controls and restrictions, duties and quotas and customs duties and tariffs;

• geopolitical conflicts and tensions, especially the escalating trade war between the United States and China, that could destabilize trading relationships and economic activity;

• restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments and trade protection measures, including export controls, sanctions, and trade restrictions, or the imposition of quotas and increased customs duties and tariffs;

• disruptions of capital and trading markets;

• changes in import and/or export control restrictions and regulations by governments, such as changes to licensing requirements or other anti-diversion enforcement measures, as a result of ongoing armed conflict and geopolitical tensions among the United States, China, Russia, Ukraine, Iran, Israel, Lebanon, and other countries or due to a change in administration from the upcoming U.S.

presidential election;

• changes in political, regulatory, legal or economic conditions;

• transportation delays;

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• public health emergencies, such as another outbreak of COVID-19 or other communicable disease;

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• currency fluctuations relating to our international operating activities;

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We also are subject to risks associated with international geopolitical and military conflicts.

Our business has been impacted and may continue to be impacted by geopolitical conditions such as international trade wars (including between the United States and China), the military conflict in Israel, including the escalation in its conflicts with Iran and Lebanon, the Russia-Ukraine conflict, and increased political tensions in Russia, Europe, the Middle East and Asia.

Currently, significant uncertainty surrounds the future trade relationships among the United States, China, and Russia.

Our business has been impacted and may continue to be impacted by geopolitical conditions, including an escalating international trade war between the United States and other countries (particularly between the United States and China), the military conflict in Israel, including its conflicts with Iran and Lebanon, the Russia-Ukraine conflict, and increased political tensions in Europe, the Middle East and Asia.

Currently, significant uncertainty surrounds the future trade relationships among the United States, China, and other countries.

government continues to make significant changes in U.S.

trade policies that could negatively affect our business, and there may be further changes in U.S.

trade policy if there is a change in administration as a result of the upcoming U.S.

presidential election.

Additionally, policies made by other countries, such as China and Russia or their allies, could also negatively impact our business.

trade policy.

Additionally, retaliatory policies adopted by other countries, including China, could also negatively impact our business.

The trade and tariff policies of the United States, and of other countries with respect to the United States, remains fluid.

In a number of cases, compliance with these policies has required us to take actions adverse to our business.

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We obtained export licenses for certain transactions with these entities.

As noted above, such export licenses can be revoked or BIS could choose not to renew such licenses and we have been required by BIS to pause, delay or halt licensed activities under such licenses at certain times and could continue to do so in the future, which negatively impacts our revenue.

Also, as described in more detail in the risk factor, “ We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology related to the development or production of our products or if such authorizations are revoked, and we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations ”, Semiconductor Manufacturing International Corporation, or SMIC, was added to the BIS Entity list in December 2020.

As noted above, such export licenses can be revoked or BIS could choose not to renew such licenses which would halt the currently approved licensed activities.

In September 2020, we further restricted business operations with additional entities affiliated with Huawei when the BIS again amended the EAR to add such entities to the Entity List.

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BIS also announced restrictions on exports to (1) companies headquartered in China or whose ultimate parent company is headquartered in China or Macau, and (2) end users in certain countries of concern, in order to prevent diversion of controlled products or technology to China.

In 2024, BIS announced new control criteria for integrated circuits and will be instituting additional restrictions on provision of those controlled items starting in April 2024.

The United States government has also continued to add Chinese entities to the Entity List.

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The BIS continues to add many new entities to the Entity List and Unverified List.

As noted above and in the risk factor,

“ Changes in trade policies among the United States and other countries, in particular the imposition of new or higher tariffs

could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own

Increased tariffs or the imposition of other barriers to international trade could decrease demand and have a

material adverse effect on our revenues and operating results ” below, our ability to manufacture, sell or distribute products or technology will be limited if BIS further amends the EAR to add restrictions against parties who are or may be our customers.

As noted above, our ability to manufacture, sell or distribute products or technology will be limited if BIS further amends the EAR to add restrictions against parties who are or may be our customers.

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We are required to obtain special licenses to conduct business with entities on the Entity List and to conduct additional diligence and recordkeeping, including obtaining user statements from entities on the Unverified List.

Failure to obtain any required license would likely result in a loss of business and a corresponding negative impact on our financial position and results of operations.

Failure to obtain any required license could result in fines or other penalties, a loss of business, and a corresponding negative impact on our financial position and results of operations.

We cannot predict what actions may ultimately be taken with respect to trade relations between the United States and China or other countries, which products may be subject to such actions or what actions may be taken by other countries in retaliation.

In addition, there may be further changes in U.S.

trade policy if there is a change in administration as a result of the upcoming U.S.

presidential election.

In response to the United States tightening export controls on China, China has instituted restrictions of its own that affect U.S.

companies and may impact us and related entities.

We have experienced weakening demand in China, and such future developments related to U.S.-China relations may also have an impact on our supply chain.

trade policy.

In response to the United States imposing high tariffs and tightening export controls on China, China has instituted tariffs and restrictions of its own that affect U.S.

companies and would likely impact us and related entities.

We have experienced and are continuing to experience weakening demand in China, and such future developments related to U.S.-China relations may also have further impact on our supply chain.

Additionally, the geopolitical developments in relations between Taiwan and China could affect the supply of our products from Taiwan, including from Taiwan Semiconductor Manufacturing Company, Limited, or TSMC.

Such developments could

include restriction on the export of products from Taiwan to China and/or restriction on the import of Taiwanese-origin products into China.

We believe direct impacts of the U.S.

and European economic sanctions against Russia and the military conflict in Ukraine are currently limited to volatility in the prices of metals used by our outsourced semiconductor assembly and test, or OSAT, supply chain, in particular around the supply of palladium, for which Russia is the top producer in the world, as well as increased fuel costs, which has global impact on transportation costs, including the shipping and delivery of our products.

Such developments could include restriction on the export of products from Taiwan to China and/or restriction on the import of Taiwanese-origin products into China.

We believe we have experienced impacts of the U.S.

and European economic sanctions against Russia and the military conflict in Ukraine, including volatility in the prices of metals used by our outsourced semiconductor assembly and test, or OSAT, supply chain, in particular around the supply of palladium, for which Russia is the top producer in the world, as well as increased fuel costs, which has global impact on transportation costs, including the shipping and delivery of our products.

However, the magnitude of such price volatility on our business and its duration is uncertain and cannot be reasonably estimated at this time.

We currently do not sell product in Russia, or sell product to distributors for resale in Russia.

The ongoing military conflict in Israel, and the recent escalation in Israel’s conflicts with Iran and Lebanon, have resulted in our employees located in Israel having to perform military service and/or being negatively impacted by violence or political instability, which could interrupt business and increase costs associated with relocating employees, engaging with alternative third-party contractors or hiring additional employees outside of Israel.

The ongoing military conflict in Israel and Gaza, and Israel’s conflicts with Iran and Lebanon, have resulted in our employees located in Israel having to perform military service and/or being negatively impacted by violence or political instability, which could interrupt business and increase costs associated with relocating employees, engaging with alternative third-party contractors or hiring additional employees outside of Israel.

The United States has also imposed additional sanctions on Iran in response to attacks on Israel by Iran.

As the conflict and its escalation continues, we cannot provide assurances that our business will not be impacted in the future.

As the conflict continues, we cannot provide assurances that our business will not be impacted in the future.

We cannot provide assurances that we will not face disruptions of distribution arrangements in the future, including through the imposition of governmental prohibitions on selling our products to particular customers, further sanctions on Russia or other countries, and/or increases in costs of certain raw materials and transportation that will also adversely affect our revenues and operating results.

Loss of a key distributor or customer under similar circumstances could have a material adverse effect on our business, revenues and operating results.

Changes in trade policies among the United States and other countries, in particular the imposition of new or higher tariffs, could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own products.

Increased tariffs or the imposition of other barriers to international trade could decrease demand and have a material adverse effect on our revenues and operating results.

The United States has imposed or proposed new or higher tariffs on certain products exported by a number of U.S.

trading partners, including China, Europe, Canada, and Mexico.

In response, many of those trading partners, including China, have imposed or proposed new or higher tariffs on American products.

We have experienced weakening demand in China, and continuing changes in government trade policies (including as a result of any change in administration due to the upcoming U.S.

presidential election) create a heightened risk of further increased tariffs that impose barriers to international trade and could further decrease international demand.

Our business and operating results are substantially dependent on international trade.

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.

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.

We believe that increases in tariffs on imported goods or the failure to resolve current international trade disputes could further decrease demand and have a material adverse effect on our business and operating results.

Furthermore, compliance with export controls and implementation of additional tariffs may increase compliance costs and further affect our business and operating results.

We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology related to the development or production of our products or if such authorizations are revoked, and we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations.

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The addition of new entities to restricted party lists can further increase the scope of export restrictions applicable to our business.

The United States has also announced measures intended to further restrict the export of certain advanced semiconductor products and technology, as well as products that incorporate those advanced semiconductor products, to the People’s Republic of China, or China, and/or certain companies located in China due to national security and human rights concerns, including the imposition of new license requirements for certain semiconductor technologies.

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security and human rights concerns, including the imposition of new license requirements for certain semiconductor technologies.

Additional restrictions related to advanced semiconductor products and computing resources were released in January 2025 and have a scheduled compliance date beginning in May 2025.

Failure to obtain required export licenses for our products or the placement of one or more of our customers on any restricted parties lists could significantly reduce our revenue and harm our business.

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On June 8, 2023, BIS closed out its review of our voluntary self-disclosure without monetary or other penalties and with the issuance of a “warning letter.”

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We depend on a limited number of 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 has had and could continue to have a material adverse effect on our revenue and operating results.

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

Revenue is also generated from sales of intellectual property and consideration under intellectual property agreements.

Our customers primarily include electronics distributors, module makers, OEMs and ODMs, which incorporate our products in a wide range of electronic devices.

Revenue has also been generated from sales of intellectual property and consideration under intellectual property agreements.

The recipients of such intellectual property are also referred to as the Company’s customers.

In the nine months ended September 30, 2024, one customer accounted for 13% of our net revenue, and our ten largest customers collectively accounted for 64% of our net revenue, of which distributor customers accounted for 15% of our net revenue.

In the nine months ended September 30, 2024, we have continued to experience a decrease in customer demand, and consequently a reduction in orders, primarily due to macroeconomic factors, including slower than expected recovery in sales, and excess inventory in the channel following the industry-wide supply shortage in 2021 and 2022.

In the three months ended March 31, 2025, two customers accounted for 28% of our net revenue, and our ten largest customers collectively accounted for 66% of our net revenue.

In the three months ended March 31, 2025, we have continued to experience a decrease in customer demand and consequently a reduction in orders for certain of our products, primarily due to macroeconomic factors, including slower than expected recovery in sales, and excess inventory in the channel following the industry-wide supply shortage in 2021 and 2022.

Such factors may continue to hamper significant recovery of our revenues and diminish our efforts to return to growth in our revenues.

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.

In the future, these customers may decide, as they have at times before, not to purchase our products at all, may purchase fewer products than they did in the past, or may defer or cancel purchases or otherwise alter their purchasing patterns.

While we are entitled to consideration under intellectual property sales agreements, which consideration has been and could be material, we may not receive such consideration in the future.

While we are entitled to consideration under intellectual property sales agreements, which consideration has previously been and could in the future be material, we may not receive such consideration in the future.

Factors that could affect our revenue from these large customers include the following:

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• technological changes in our markets could lead to substantial volatility in our revenues based on product transitions, and particularly in our broadband markets, we face risks based on changes in the way consumers are accessing and using broadband and cable services, which would affect operator demand for our products;

• any decrease in revenue generated by the recipient of intellectual property under certain intellectual property sale agreements, including due to any inability to enforce our intellectual property rights as described in the section “Risks Relating to Intellectual Property” under the risk factor “ We utilize a significant amount of intellectual property in our business.

• any material decrease in revenue generated by the recipient of intellectual property under certain intellectual property sale agreements, including due to any inability to enforce our intellectual property rights as described in the section “Risks Relating to Intellectual Property” under the risk factor “ We utilize a significant amount of intellectual property in our business.

If we are unable to protect our intellectual property, our business could be adversely affected.

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The loss of a key customer, a reduction in sales to any key customer or our inability to attract new significant customers could seriously impact our revenue and materially and adversely affect our results of operations.

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A significant portion of our revenues are from sales of product to distributors, who then resell our product.

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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 material 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 and may further change as a result of any change in administration from the upcoming U.S.

presidential election.

Products shipped to mainland China accounted for less than 10% of our net revenue during the nine months ended September 30, 2024, compared to 12% during the nine months ended September 30, 2023.

Our current and future operating results could be materially and adversely affected by limitations on our ability to sell to one or more Chinese customers, as described in the section “Risks Related to Our Business” under the risk factors “We are also subject to risks associated with international geopolitical and military conflict” and “We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology related to the development or production of our products or if such authorization are revoked, and we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations” , and by tariffs and other trade barriers that have or may be implemented by governmental authorities.

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.

Products shipped to mainland China accounted for less than 10% of our net revenue during the three months ended March 31, 2025 and during the three months ended March 31, 2024.

• “Changes in trade policies among the United States and other countries, in particular the escalation and imposition of new and higher tariffs, could place pressure on our average selling prices as our customers seek to offset the impact of increased tariffs on their own products.

Increased tariffs or the imposition of other barriers to international trade could decrease demand and have a material adverse effect on our revenues and operating results”;

• “We also are subject to risks associated with international geopolitical and military conflicts”;

• “We will lose sales if we are unable to obtain or retain government authorization to export certain of our products or technology related to the development or production of our products or if such authorizations are revoked, and we will be subject to legal and regulatory consequences if we do not comply with applicable export control laws and regulations” .

Any legal proceedings or claims against us or potential violations of applicable regulations could be costly and time-consuming to defend and could harm our reputation regardless of the outcome.

In addition to the legal proceedings referenced in Part II, Item 1 (Legal Proceedings) of this report, we are subject to legal proceedings, claims, and/or inquiries that arise in the ordinary course of business, including intellectual property, product liability, employment, class action, customer claims, whistleblower and other litigation claims, and governmental and other regulatory investigations and proceedings regarding potential violations of applicable law, and we may not be successful in resolving such proceedings or inquiries.

In addition, we have implemented a reduction in force and the attendant layoffs has resulted and could result in the risk of claims being made by or on behalf of affected employees.

In addition, we have implemented reductions in force and the attendant layoffs has resulted and could result in the risk of claims being made by or on behalf of affected employees.

Such matters can be time-consuming, divert management’s attention and resources, cause us to incur significant expenses or liability, or require us to change our business practices.

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We rely on our information technology systems for the effective operation of our business and for the secure maintenance and storage of confidential data relating to our business and third-party businesses.

In June 2020, we announced a security incident resulting from a Maze ransomware attack affecting certain but not all operational systems within our information technology infrastructure.

Because we did not satisfy the attacker’s monetary demands, on June 15, 2020, the attacker released online certain proprietary information obtained from our network.

In response, our internal information technology team, supplemented by a leading cyber defense firm, took steps aimed at containing and assessing this incident, including implementing enhanced security controls aimed at protecting our information technology systems.

Since that event, security breaches and incidents, computer malware and computer hacking attacks have continued to become more prevalent and sophisticated.

These threats are constantly evolving, making it increasingly difficult to successfully defend against or implement adequate preventive measures.

Security threats are constantly evolving, making it increasingly difficult to successfully defend against or implement adequate preventive measures.

We experience cyber-attacks of varying degrees on our technology infrastructure and systems and notwithstanding our defensive measures, experienced programmers, hackers, state actors, or others may be able to penetrate our security controls through attacks such as phishing, impersonating authorized users, ransomware, viruses, worms and other malicious software programs, software supply chain attacks, exploitation of design flaws, bugs and other security weaknesses and vulnerabilities, covert introduction of malware to computers and networks, including those using techniques that change frequently or may be disguised or difficult to detect, or designed to remain dormant until a triggering event or that may continue undetected for an extended period of time.

Geopolitical tensions or conflicts may create heightened risk of cyber-attacks and attackers have used artificial intelligence and machine learning to launch more automated, targeted and coordinated attacks against targets.

Businesses we acquire may increase the scope and complexity of our information technology systems, and this may increase our risk exposure to cyber-attack when there are difficulties integrating diverse legacy systems that support operations for the acquired businesses.

Our information technology infrastructure also includes products and services provided

by third parties, and these providers can experience breaches of their systems and products, or provide inadequate updates or support, which can impact the security of our systems and our proprietary or confidential information.

Our information technology infrastructure also includes products and services provided by third parties, and these providers can experience breaches of their systems and products, or provide inadequate updates or support, which can impact the security of our systems and our proprietary or confidential information.

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A cybersecurity incident or other compromise of our information technology systems could result in unauthorized publication or misuse of confidential business or proprietary information belonging to us, a customer, supplier, employee or other third party, including personal data, result in violations of privacy or other laws, expose us to a risk of litigation, cause us to incur direct losses if attackers initiate wire transfers or access our bank or investment accounts, or damage our reputation.

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Our inability to do so would cause our revenue and gross margins to decline.

In addition, under certain of our agreements with key distributors,

we provide protection for reductions in selling prices of the distributors’ inventory, which could have a material adverse effect on our operating results if the selling prices for those products fell dramatically.

In addition, under certain of our agreements with key distributors, we provide protection for reductions in selling prices of the distributors’ inventory, which could have a material adverse effect on our operating results if the selling prices for those products fell dramatically.

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If we fail to penetrate new applications and markets, our revenue, revenue growth rate, if any, and financial condition could be materially and adversely affected.

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We have further expanded our product offerings to include 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 SoCs, 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.

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 interconnects for data center, metro, and long-haul optical modules, and telecommunications wireless infrastructure products.

Each of these markets presents distinct and substantial risks.

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If we fail to penetrate these or other new markets upon which we target our resources, our revenue and revenue growth rate, if any, likely will decrease over time and our financial condition could suffer.

A significant portion of our revenue is attributable to demand for our products in markets for broadband 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.

For the nine months ended September 30, 2024 and 2023, revenue directly attributable to broadband applications accounted for approximately 32% and 30% of our net revenue, respectively.

We have experienced a decrease in broadband net revenue of $82.5 million for the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, and negative impact to our revenues is expected to continue in the fourth quarter of 2024 and possibly beyond due to slower than expected recovery in this market.

Delays in the development of, or unexpected developments in, the broadband markets, including international macroeconomic headwinds, has had and is expected to continue to have an adverse effect on order activity by OEMs in these markets for the fourth quarter of 2024 and possibly thereafter and, as a result, on our business, revenue, operating results and financial condition.

A significant portion of our revenue is attributable to demand for our products in markets for broadband solutions, and development delays and consolidation trends among cable and satellite Pay-TV and broadband operators has adversely affected and could continue to adversely affect our future revenues and operating results.

For the three months ended March 31, 2025 and 2024, revenue directly attributable to broadband applications accounted for approximately 43% and 35% of our net revenue, respectively.

We have experienced an increase in broadband net revenue of $7.8 million for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024 as this market recovers from macroeconomic conditions.

However, delays in the development of, or unexpected developments in, the broadband markets has previously had, and could in the future have an adverse effect on order activity by OEMs in these markets and as a result, on our business, revenue, operating results and financial condition.

In addition, consolidation trends among Pay-TV and broadband operators may continue, which could delay or lead to cancellations of major spending programs and have a material adverse effect on our future operating results and financial condition.

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Many of our products originated with our research and development efforts, which we believe have provided us with a significant competitive advantage.

For nine months ended September 30, 2024, and 2023, our research and development expense was $173.9 million and $204.3 million, respectively.

While we have decreased our research and development spending to meet evolving demand, we expect our research and development expenses to increase in future years when we return to expanding our product portfolio and enhancing existing products.

For three months ended March 31, 2025, and 2024, our research and development expense was $55.5 million and $64.8 million, respectively.

We have decreased our research and development spending, including via workforce reductions, to meet evolving demand, and as a result, we cancelled certain projects.

However, we expect our research and development expenses to increase in future years when we return to expanding our product portfolio and enhancing existing products.

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.

We are committed to investing in new product development internally in order to stay competitive in our markets and plan to maintain research and development and design capabilities for new solutions in advanced semiconductor process nodes such as 16nm and 5nm and beyond, as well as to address challenges of capturing and processing high quality broadband communications and high-speed optical interconnect signals.

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communications and high-speed optical interconnect signals.

However, we do not know whether we will have sufficient resources to maintain the level of investment in research and development required to remain competitive as semiconductor process nodes continue to shrink and become increasingly complex.

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Our revenue and operating results have fluctuated in the past and are likely to fluctuate in the future.

For example, our revenue declined from $567.9 million for the nine months ended September 30, 2023, to $268.4 million for the nine months ended September 30, 2024 and revenue could continue to decline.

These fluctuations may occur on a quarterly and on an annual basis and are due to a number of factors, many of which are beyond our control.

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• our ability to develop, introduce, and market new products and technologies on a timely basis;

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• size and timing of any consideration received under our intellectual property sale agreements;

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• the effects of competitive pricing pressures, including decreases in average selling prices of our products.

If our growth rate continues to slow, seasonal or cyclical variations in our operations may become more pronounced over time and may materially affect our business, financial condition, results of operations and prospects.

If our growth rate slows, seasonal or cyclical variations in our operations may become more pronounced over time and may materially affect our business, financial condition, results of operations and prospects.

These factors are difficult to forecast, and these, as well as other factors, could materially adversely affect our quarterly or annual operating results.

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Our failure to anticipate or timely develop new or enhanced products or technologies in response to technological shifts has resulted, and could in the future, result in decreased revenue and our competitors winning more competitive bid processes, known as “design wins.” In particular, we may experience difficulties with product design, manufacturing, marketing or certification that could delay or prevent our development, introduction or marketing of new or enhanced products.

If we fail or are slow to introduce new or enhanced products that meet the needs of our customers or penetrate new markets in a timely fashion, as has happened previously or in the future, we will lose market share and our operating results will be adversely affected.

In particular, we believe that we will need to develop new products in part to respond to changing dynamics and trends in our end user markets, including (among other trends) consolidation among cable and satellite operators, potential industry shifts away from the hardware devices and other technologies that incorporate certain of our products, advances in artificial intelligence, and changes in consumer television viewing habits and how consumers access and receive broadcast content and digital broadband services.

If we fail or are slow to introduce new or

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enhanced products that meet the needs of our customers or penetrate new markets in a timely fashion, as has happened previously or in the future, we will lose market share and our operating results will be adversely affected.

In particular, we believe that we will need to develop new products in part to respond to changing dynamics and trends in our end user markets, including (among other trends) advances in artificial intelligence, potential industry shifts away from the hardware devices and other technologies that incorporate certain of our products, changes in consumer television viewing habits and how consumers access and receive broadcast content and digital broadband services, and consolidation among cable and satellite operators.

We cannot predict how these trends will continue to develop or how or to what extent they may affect our future revenues and operating results.

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For example, we 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 SoCs, ASICs, and FPGAs used in next-generation communication and artificial intelligence systems.

Our limited operating experience in new markets or potential markets we may enter, combined with the rapidly evolving nature of our markets in general, substantial uncertainty concerning how these markets may develop and other factors beyond our control reduces our ability to accurately forecast quarterly or annual revenue.

If our revenue does not increase particularly in new markets, we could continue to incur significant losses due to our higher expense levels if we are not able to decrease our expenses in a timely manner to offset any shortfall in current or future revenue.

Our limited operating experience in new markets such as data center markets or potential markets we may enter, combined with the rapidly evolving nature of our markets in general, substantial uncertainty concerning how these markets may develop and other factors beyond our control reduces our ability to accurately forecast quarterly or annual revenue.

If our revenue does not increase particularly in new markets, we could continue to incur significant losses due to our higher expense levels if we are not able to continue to decrease our expenses in a timely manner to offset any shortfall in current or future revenue.

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Our customers require our products and our third-party contractors to undergo a lengthy and expensive qualification process which does not assure product sales.

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If we were unable to generate revenue after incurring substantial expenses to develop any of our products, our business would suffer.

Our business is subject to various international and U.S.

laws and governmental regulations, and compliance with these laws and regulations may cause us to incur significant expenses.

Our business is subject to various international, U.S.

and state laws and governmental regulations, and compliance with these laws and regulations may cause us to incur significant expenses.

A failure to maintain compliance with applicable laws and regulations could result in a material adverse effect on our business and operating results, and we could be subject to civil or criminal penalties.

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Although our policies, procedures, and controls are designed to detect and prevent potential violations and maintain ongoing compliance with applicable laws, we cannot assure you that we have been or will be at all times in compliance with such laws and regulations.

If we violate or fail to comply with any of them, a range of consequences could result, including fines, import/export restrictions, sales limitations, criminal and civil liabilities or other penalties or sanctions.

If we violate or fail to comply with any of them, a range of consequences could result, including fines, import/export restrictions, sales limitations, criminal and civil liabilities or other

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penalties or sanctions.

The costs of complying with these laws (including the costs of any investigations, remediation, auditing and monitoring) could adversely affect our current or future business.

As indicated elsewhere in this report, we do a substantial portion of our business in Asia, including in Hong Kong, a special administrative region of the People’s Republic of China, or China.

As indicated elsewhere in this report, we do a substantial portion of our business in Asia, including in Hong Kong, a special administrative region of the People’s Republic of China.

Since October 2022, the United States has taken steps to restrict the export of certain advanced semiconductor products and technology to China as well as a number of specific Chinese companies, due to national security and human rights concerns.

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If we fail to adequately address any of these rules or regulations, our business could be harmed.

In addition, climate change and new or revised rules and regulations related thereto, including regulations with respect to greenhouse gas emissions and regulations enacted by the SEC and recent legislation enacted in California, may impact our business in numerous ways.

In addition, climate change and new or revised rules and regulations related thereto, including regulations with respect to greenhouse gas emissions enacted in California and proposed regulations by the SEC which currently remain subject to a stay, may impact our business in numerous ways.

Climate change and its effects could lead to further increases in raw material prices or their reduced availability due to, for example, increased frequency and severity of extreme weather events and any supply chain disruptions resulting therefrom, and could cause increased incidence of disruption to the production and distribution of our products and an adverse impact on consumer demand and spending.

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If our suppliers have difficulty obtaining raw materials and natural resources due to extreme weather impacts, this could increase the cost associated with extraction of raw materials or limit the supply available for our key suppliers to manufacture our products, driving the cost up for us and/or threaten our upstream supply chain.

In recent months, there have been substantial legislative and regulatory developments on climate-related issues, including proposed, issued and implemented legislation and rulemakings that would require companies to assess and/or disclose climate metrics, risks, opportunities, policies and practices.

In recent months, there have been substantial legislative and regulatory developments on climate-related issues, including proposed, issued and implemented legislation and rule makings that would require companies to assess and/or disclose climate metrics, risks, opportunities, policies and practices.

For example, on March 6, 2024, the SEC adopted rules mandating climate-related disclosures that would require increased climate change-related disclosure in our periodic reports and other filings with the SEC for fiscal year 2025 and beyond, which were stayed on April 4, 2024.

The potential impact to us of these legislative and regulatory developments is uncertain at this time, although we expect that the emerging legal and regulatory requirements on climate-related issues will result in additional compliance and may require us to spend or add significant resources and divert management attention.

The potential impact to us of these legislative and regulatory developments is uncertain at this time, although we expect that the emerging legal and regulatory requirements on climate-related issues could result in additional compliance and may require us to spend or add significant resources and divert management attention.

We cannot be sure that we will be able to successfully adapt our operations in response to any climate-related changes or comply with any increased reporting obligations in a cost-effective manner, and our business, financial condition and results of operations could be materially and adversely affected.

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If we fail to comply with these requirements in the manufacture or distribution of our products, we could be required to pay civil penalties, face criminal prosecution and, in some cases, be prohibited from distributing our products in commerce until the products or component substances are brought into compliance.

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If we are unable to attract, train and retain qualified personnel and senior management, our business, financial condition, results of operations and prospects could suffer.

Our future success depends on our ability to retain, attract and motivate qualified personnel, including our management, sales and marketing and finance teams, and especially our design and technical staff.

In July 2024, we initiated the 2024 Workforce Reduction, and previously, in March and October 2023, we initiated the 2023 Workforce Reductions, to align our

operational needs with the changes in macroeconomic conditions and the demand environment.

These workforce reductions may yield unintended consequences, such as attrition beyond our intended reduction in workforce and reduced employee morale, which may cause our employees who were not affected by the reduction in workforce to seek alternate employment.

We have initiated and implemented workforce reductions over the past two years to align our operational needs with the changes in macroeconomic conditions and the demand environment.

These workforce reductions have yielded unintended consequences, such as attrition beyond our intended reductions in workforce and reduced employee morale, which has caused a small number of our employees who were not affected by the reductions in workforce to seek alternate employment.

Employees whose positions were eliminated or those who determine to seek alternate employment may seek employment with our competitors.

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We are fortunate that certain members of our senior management team have long tenures with us, but recently we also have been required to recruit new members of senior management.

With respect to recruitment and retention of senior management, we need to ensure that our compensation programs provide sufficient recruitment and retention incentives as well as incentives to achieve our long-term strategic business and financial objectives.

With respect to recruitment and retention of senior management, we need to ensure that our compensation programs, including equity compensation, provide sufficient recruitment and retention incentives as well as incentives to achieve our long-term strategic business and financial objectives.

Over the past several years, as a result of industry-wide supply chain issues and inventory build, we have experienced a drop in revenue and a corresponding decline in our stock price.

The decline in our stock price impacted the retention and incentive value of our previous employee equity awards and eroded the effectiveness of our outstanding equity grants as a retention tool.

In response, and to mitigate elevated retention risk across key technical and engineering functions, in 2024, we issued an out-of-cycle equity grant to employees.

This was a necessary step to maintain workforce stability and preserve stockholder value, but led to an increase in our burn rate and reduced the shares available under our equity incentive plans.

We currently are seeking stockholder approval of an amendment of the MaxLinear, Inc.

Amended and Restated 2010 Equity Incentive Plan, or the Amended Plan, to reallocate the 3,657,565 shares available for grant as of March 26, 2025 under the MaxLinear, Inc.

Inducement Equity Incentive Plan, or Inducement Plan, which is only available to grant equity awards to new employees, to the Amended Plan so that the reallocated shares would be available to grant equity awards to existing employees.

The Inducement Plan will terminate upon approval of the Amended Plan.

If stockholders do not approve the reallocation of shares to the Amended Plan, the existing equity incentive plans will continue, and given that the Inducement Plan can only be used to grant equity to new employees, the existing shares reserved for issuance under the current equity incentive plans may be insufficient to grant meaningful 2025 compensation to our employees to achieve our personnel objectives as our equity needs have shifted from hiring-related inducement grants to retention-focused awards.

We expect competition for individuals with our required skill sets, particularly technical and engineering skills, to remain intense even in weak global macroeconomic environments.

The loss of any member of our senior management team or other key personnel could harm our ability to implement our business strategy and respond to the rapidly changing market conditions in which we operate.

As of September 30, 2024, our aggregate indebtedness was $125.0 million, and we are subject to a variable amount of interest on the principal balance of our credit agreements and could continue to be adversely impacted by high interest rates in the future.

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As of March 31, 2025, our aggregate indebtedness was $125.0 million, and we are subject to a variable amount of interest on the principal balance of our credit agreements and could continue to be adversely impacted by high interest rates in the future.

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.

As of September 30, 2024, our aggregate indebtedness was $125.0 million from an initial secured term B loan facility, or the Initial Term Loan under the June 23, 2021 Credit Agreement.

The June 23, 2021 Credit Agreement also provides for a revolving credit facility of up to $100.0 million, or the Revolving Facility, which remains undrawn as of September 30, 2024.

As of March 31, 2025, our aggregate indebtedness was $125.0 million from an initial secured term B loan facility, or the Initial Term Loan under the June 23, 2021 Credit Agreement.

The June 23, 2021 Credit Agreement also provides for a revolving credit facility of up to $100.0 million, or the Revolving Facility, which remains undrawn as of March 31, 2025.

The credit agreement also permits us 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” (as defined in such agreement), 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.

The June 23, 2021 Credit Agreement was amended on June 29, 2023 to implement a benchmark replacement.

The June 23, 2021 Credit Agreement was amended on June 29, 2023 to implement a benchmark replacement (with SOFR replacing LIBOR).

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 Term SOFR plus a fixed applicable margin of 2.25% or an Adjusted Base Rate plus a fixed applicable margin of 1.25%, at our option.

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Such obligations, including the guaranties, are secured by substantially all of our assets and those of the subsidiary guarantors.

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 at a variable rate, and principal under the term loans.

In addition, the Revolving Facility provisions under the June 23, 2021 Credit Agreement include financial covenants such as an initial maximum secured net leverage ratio of 3.50 to 1.00, which temporarily increases to 3.75 to 1.00 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.

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• we are subject to variable interest rate risk because our interest rate under the Initial Term Loan under the June 23, 2021 Credit Agreement varies based on a fixed margin of 2.25% per annum over an adjusted Term SOFR 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 Term SOFR rate, and we are also subject to commitment fees ranging from 0.175% to 0.25% on the undrawn portion of the Revolving Facility.

If interest rates were to continue to increase substantially, it would adversely affect our operating results and could affect our ability to service our indebtedness;

If interest rates were to increase substantially, it would adversely affect our operating results and could affect our ability to service our indebtedness;

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• 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;

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and international laws and regulations, including oversight by various regulatory or other governmental bodies.

Regulators in the United States are increasingly scrutinizing personal data transfers.

For example, on December 27, 2024 the Department of Justice issued a final rule to implement Executive Order 14117 of February 28, 2024 (“Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern”) implementing a new framework to protect the privacy of personal data shared between the U.S.

and Europe, which may, in effect, impact privacy laws with “countries of concern” such as China or Russia.

If we fail to comply with such regulation, it might impact our business to satisfy any fines or additional actions to remain compliant.

Many foreign countries and governmental bodies, including China, the European Union and other relevant jurisdictions where we conduct business, have laws and regulations concerning the collection and use of personal data, and other data obtained from their residents or by businesses operating within their jurisdictions that are currently more restrictive than those in the U.S.

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The CCPA gives California residents the right to access, delete and opt out of certain sharing of their information, and imposes penalties for failure to comply.

California has adopted a new law, the California Privacy Rights Act of 2020 that substantially expands the CCPA and was effective as of January 1, 2023.

California has adopted a new law, the California Privacy Rights Act of 2020, or CPRA, that substantially expands the CCPA and was effective as of January 1, 2023.

Additionally, other U.S.

states continue to propose and enact privacy and security-focused legislation.

In addition, governments around the world continue to enact laws relating to privacy and data security.

In addition, governments around the world continue to enact laws relating to privacy

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and data security.

For example, in 2021, the National People’s Congress passed the Data Security Law of the People’s Republic of China, or the Data Security Law and the Personal Information Protection Law of the People’s Republic of China, or PIPL.

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Because the interpretation and application of many such laws and regulations, remain uncertain and continue to evolve, it is possible that these laws and regulations may be interpreted and applied in a manner that is inconsistent with our data management practices or the features of our products or solutions, and we could face fines, lawsuits, regulatory investigations, and other claims and penalties, and we could be required to fundamentally change our products or our business practices, all of which could have a material adverse effect on our business.

could result in additional cost and liability to us, damage our reputation, inhibit sales and have a material adverse effect on our business, results of operations, and financial condition.

Any inability, or perceived inability, to adequately address privacy and data protection concerns, or to comply with applicable laws, regulations, policies, industry standards, contractual obligations or other legal obligations, even if unfounded, could result in additional cost and liability to us, damage our reputation, inhibit sales and have a material adverse effect on our business, results of operations, and financial condition.

Our products must conform to industry standards in order to be accepted by end users in our markets.

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We may, from time to time, make additional business acquisitions or investments, which involve significant risks.

We have completed multiple acquisitions in the past nine years.

We have completed multiple acquisitions in the past decade.

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.

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• a limitation on our ability to use our net operating loss carryforwards;

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• the diversion of management’s time and attention from operating our business to acquisition integration challenges;

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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.

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.

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.

Some of the risks that may affect our ability to successfully integrate acquired businesses include those associated with:

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Any adverse determination in litigation resulting from acquisitions could have a material adverse effect on our business and operating results.

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Risks Relating to Intellectual Property

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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.

For example, we were involved in a litigation with Bell Semiconductor, which has since been settled pursuant to a Settlement and Patent License Agreement.

For example, we were involved in a litigation with Bell Semiconductor, which was settled pursuant to a Settlement and Patent License Agreement.

In addition, from time to time, we receive correspondence from competitors and other third parties 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.

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Claims of this sort also could harm our relationships with our customers or distributors and might deter future customers from doing business with us.

In order to maintain our relationships with existing customers and secure business from new customers, we

have been required from time to time to provide additional assurances beyond our standard terms.

In order to maintain our relationships with existing customers and secure business from new customers, we have been required from time to time to provide additional assurances beyond our standard terms.

If any of our current or future proceedings result in an adverse outcome, we could be required to:

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• our intellectual property rights will provide competitive advantages to us;

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• our ability to assert our intellectual property rights against potential competitors or to settle current or future disputes will not be limited by our agreements with third parties or obligations, if any, to standards organizations;

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We cannot assure you that these contractual protections and security measures will not be breached, that we will have adequate remedies for any such breach or that our suppliers, employees or consultants will not assert rights to intellectual property arising out of such contracts.

For example, as described in Part II, Item 1 (Legal Proceedings), Comcast shared our proprietary designs with our direct competitor.

For example, as described in Part II, Item 1 Legal Proceedings - Comcast Litigation, Comcast shared our proprietary designs with our direct competitor.

Comcast then worked with our competitor to develop the FDX-amplifier technology.

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We are unable to predict whether these license agreements can be obtained or renewed or the technology can be replaced on acceptable terms, or at all.

When we originally settled a trademark dispute with Analog Devices International Unlimited Company (ADIUC) and its predecessor, Linear Technology Corporation, we agreed not to register the “MAXLINEAR” mark or any other marks containing the term “LINEAR”.

When we originally settled a trademark dispute with Analog Devices International Unlimited Company, or ADIUC, and its predecessor, Linear Technology Corporation, we agreed not to register the “MAXLINEAR” mark or any other marks containing the term “LINEAR”.

Pursuant to the original settlement agreement, we agreed not to use the “MAXLINEAR” mark on our products.

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We have filed trademark applications to register the “MAXLINEAR” mark, but prior to approval of the applications and registration of the mark in the relevant jurisdictions, our ability to effectively prevent third parties from using the “MAXLINEAR” mark in connection with similar products or technology will be based on our common law rights in the mark, which may make enforcement challenging.

If we are unable to protect our trademarks in certain jurisdictions, we may experience difficulties in achieving and maintaining brand recognition and customer loyalty in such jurisdictions.

If we are unable to protect our trademarks in certain

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jurisdictions, we may experience difficulties in achieving and maintaining brand recognition and customer loyalty in such jurisdictions.

We face risks related to security vulnerabilities in our products.

We regularly become aware of security vulnerabilities with respect to our products as well as intellectual property that we purchase or license from third parties for use in our products.

Our products are used in application areas that create new or increased cybersecurity and privacy risks, including applications that gather and process large amounts of data, such as the cloud, Internet of Things, or artificial intelligence, and critical infrastructure, payment card applications, and automotive applications.

Our products are used in application areas that create new or increased cybersecurity and privacy risks, including applications that gather and process large amounts of data, such as the cloud or Internet of Things, or artificial intelligence, and critical infrastructure, payment card applications, and automotive applications.

Security features in our products cannot make our products entirely secure, and security vulnerabilities identified in our products have resulted in, and are expected to continue to result in, attempts by third parties to identify and exploit additional vulnerabilities.

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We and such third parties make prioritization decisions about which vulnerabilities to address, which can delay, limit, or prevent development or deployment of a mitigation and harm our reputation.

Subsequent events or new information can develop that changes our assessment of the

impact of a security vulnerability, which can cause certain claims or customer satisfaction considerations, as well as result in litigation or regulatory inquiries or actions over these matters.

Subsequent events or new information can develop that changes our assessment of the impact of a security vulnerability, which can cause certain claims or customer satisfaction considerations, as well as result in litigation or regulatory inquiries or actions over these matters.

Security vulnerabilities and/or mitigation techniques can result in adverse performance or power effects, reboots, system instability or unavailability, loss of functionality, non-compliance with standards, data loss or corruption, unpredictable system behavior, decisions by customers, regulators and end users to limit or change the applications in which they use our products or product features, and/or the misappropriation of data by third parties.

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We do not have long-term supply contracts with most of 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.

Currently we do not have long-term supply contracts with most of our other third-party vendors, including but, not limited to Advanced Semiconductor Engineering, or ASE, TSMC, and United Microelectronics Corporation, or UMC.

Currently we do not have long-term supply contracts with most of our other third-party vendors, including but, not limited to TSMC, and United Microelectronics Corporation, or UMC.

Certain products are supplied to us by Intel on a turnkey basis at agreed upon prices under terms of a supply agreement with an initial term of five years, which will expire in July 2025.

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Intel can also terminate its supply agreement with us under certain circumstances.

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As a result, we rely on third-party foundry wafer fabrication, including sole sourcing for many components or products.

Currently, a large portion of our products are manufactured by ASE, TSMC, and UMC, at foundries located in Taiwan, Singapore, and China.

Currently, a large portion of our products are manufactured by TSMC, and United Microelectronics Corporation, or UMC, at foundries located in Taiwan, Singapore, and China.

We also use third-party contractors for all of our assembly and test operations.

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• costs to switch to alternate sources of supply for certain products and/or delays in sales of such products, if a supplier does not continue to supply certain products;

• our use of foundry partners who are currently subject to BIS restrictions, such as SMIC, to manufacture certain of our products may be impaired if one or more of the following were to occur:

• our use of foundry partners who are currently subject to BIS restrictions, to manufacture certain of our products may be impaired if one or more of the following were to occur:

(1) we are unable to obtain U.S.

export licenses authorizing its interactions and technology exchanges with these foundry partners or if there are delays in obtaining such licenses, or (2) if BIS increases export control restrictions to Chinese foundries without the ability for us to obtain a U.S.

export licenses

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authorizing its interactions and technology exchanges with these foundry partners or if there are delays in obtaining such licenses, or (2) if BIS increases export control restrictions to Chinese foundries without the ability for us to obtain a U.S.

export license, or (3) U.S.

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The risk of earthquakes in these geographies is significant due to the proximity of major earthquake fault lines, and Taiwan in particular is also subject to typhoons and other Pacific storms, and more recently, a drought impacting the water supply which chip manufacturers rely upon to fabricate chip products.

Earthquakes, fire, flooding, drought, or other natural disasters in Taiwan or the Pacific Rim region, or political unrest, war, labor strikes, work stoppages or public health crises, such as the outbreak of COVID-19, in countries where our contractors’ facilities are located could result in the disruption of our product shipments, foundry, assembly, or test capacity.

Earthquakes, wildfires and other fires, flooding, drought, or other natural disasters in Taiwan or the Pacific Rim region, or political unrest, war, labor strikes, work stoppages or public health crises, such as the outbreak of COVID-19, in countries where our contractors’ facilities are located could result in the disruption of our product shipments, foundry, assembly, or test capacity.

If such disruption were to recur over a prolonged period, it could have a material impact on our revenues and our business.

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We currently sell a significant portion of our products to customers through our distributors, who maintain their own inventories of our products.

Sales to distributors accounted for approximately 42%, and 47% of our net revenue in the nine months ended September 30, 2024, and 2023, respectively.

Sales to distributors accounted for approximately 37%, and 36% of our net revenue in the three months ended March 31, 2025, and 2024, 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.

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We rely on third-party vendors to provide critical services, including, among other things, services related to accounting, billing, compliance, internal audit, human resources, information technology, network development, network monitoring, in-licensing and intellectual property that we cannot or do not create or provide ourselves.

We depend on these vendors to ensure that our corporate infrastructure will consistently meet our business requirements and legal obligations.

We depend on these vendors to ensure

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that our corporate infrastructure will consistently meet our business requirements and legal obligations.

The ability of these third-party vendors to successfully provide reliable and high quality services is subject to technical and operational uncertainties that are beyond our control.

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The operation of our products could be impaired if errors occur in the third-party technology we use, including as a result of information technology failures from cyber-attacks on or security breaches of third parties.

It may be more difficult for

us to correct any errors in a timely manner if at all because the development and maintenance of the technology is not within our control.

It may be more difficult for us to correct any errors in a timely manner if at all because the development and maintenance of the technology is not within our control.

There can be no assurance that these third parties will continue to make their technology, or improvements to the technology, available to us, or that they will continue to support and maintain their technology.

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The trading price of our common stock is highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control.

For example, in the nine months ended September 30, 2024, the trading price of our common stock ranged from a low of $11.08 to a high of $26.59.

For example, in the three months ended March 31, 2025, the trading price of our common stock ranged from a low of $10.21 to a high of $25.73.

These factors include those discussed in this “Risk Factors” section of this report and others such as:

• geopolitical changes impacting our business and markets, including with respect to China and Taiwan and the trade war between the United States and China;

• any developments related to our terminated merger with Silicon Motion;

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• changes in laws or regulations applicable to our products, including export controls;

• geopolitical changes impacting our business and markets, including with respect to China and Taiwan and the upcoming U.S.

presidential election;

• actual or anticipated changes in our growth rate relative to our competitors;

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• actions by institutional or activist stockholders;

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• acquisitions may not be accretive and may cause dilution to our earnings per share;

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• establish that our Board of Directors is divided into three classes, Class I, Class II and Class III, with each class serving staggered terms;

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• provide that our directors may be removed only for cause;

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• specify that no stockholder is permitted to cumulate votes at any election of directors;

• require supermajority votes of the holders of our common stock to amend specified provisions of our charter documents.

• require super majority votes of the holders of our common stock to amend specified provisions of our charter documents.

These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board of Directors, which is responsible for appointing the members of our management.

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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.

As of September 30, 2024, we had approximately 84.4 million shares of common stock outstanding.

As of March 31, 2025, we had approximately 86.4 million shares of common stock outstanding.

All shares of our common stock are freely tradable without restrictions or further registration under the Securities Act unless held by our “affiliates,” as that term is defined under Rule 144 of the Securities Act.

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A number of our facilities and those of our contract manufacturers are located in areas with above average seismic activity and/or which have experienced more frequent, more extreme and less predictable weather conditions.

For example, the risk of an earthquake in the Pacific Rim region, including Taiwan, or Southern California is significant due to the proximity of major earthquake fault lines, and Taiwan in particular is also subject to typhoons and other Pacific storms, and more recently, a drought impacting the water supply which chip manufacturers rely upon to fabricate chip products.

For example, the risk of an earthquake in the Pacific Rim region, including

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Taiwan, or Southern California is significant due to the proximity of major earthquake fault lines, and Taiwan in particular is also subject to typhoons and other Pacific storms, and drought impacting the water supply which chip manufacturers rely upon to fabricate chip products.

Further, wildfire risks have increased in California and our offices and/or personnel could be impacted by damages, losses, power outages including safety shutoffs, and/or mandatory evacuations.

We have experienced higher insurance costs and may experience a decrease in available coverage in such areas and an increased likelihood of damage, power outages and catastrophic loss to these facilities, which would likely disrupt our operations, delay production, shipments and revenue and result in significant expenses to repair or replace the facility.

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Our corporate headquarters is located in Southern California.

Our operations and financial condition could be seriously harmed in the event of a major

earthquake, fire, flooding, drought, or other natural disasters in Taiwan or the Pacific Rim region, or political unrest, war, labor strikes, work stoppages or public health crises, such as the outbreak of COVID-19, or other natural or man-made disaster in countries where our contractors’ facilities are located.

Our operations and financial condition could be seriously harmed in the event of a major earthquake, fire, flooding, drought, or other natural disasters in Taiwan or the Pacific Rim region, or political unrest, war, labor strikes, work stoppages or public health crises, such as the outbreak of COVID-19, or other natural or man-made disaster in countries where our contractors’ facilities are located.

Such catastrophes could result in the disruption of our product shipments, foundry, assembly, or test capacity.

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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 a material adverse effect on the trading price and trading volume of our common stock.

As of September 30, 2024, our balance sheet reflected goodwill of $318.6 million and other intangible assets of $58.0 million.

As of March 31, 2025, our balance sheet reflected goodwill of $318.6 million and other intangible assets of $51.6 million.

Consequently, we could recognize material impairment charges in the future.

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This has increased our effective tax rate and our cash tax payable since 2022.

Further, following the enactment of the Tax Act, most of our income is now subject to U.S.

taxation, with a large portion taxed under the Global Intangible Low-Taxed Income, or GILTI, regime.

Starting in 2026, the GILTI deduction will decrease from 50% to 37.5%, leading to a higher effective tax rate on our income.

If the requirement to capitalize Section 174 expenditures is not modified, it may impact our effective tax rate and our cash tax liability for taxable years during which we are required to capitalize such expenditures.

The CHIPS and Science Act, or CHIPS Act, enacted on August 9, 2022, provides a tax credit to semiconductor manufacturing activities within the United States.

Because we currently outsource our manufacturing, we do not expect to be entitled to such tax incentives.

Further, the Inflation Reduction Act, or IRA, enacted on August 16, 2022, imposes a 1% non-deductible excise tax on repurchases of stock that are made by U.S.

publicly traded corporations on or after January 1, 2023.

The IRA also imposes a 15% alternative minimum tax on corporations with an average of at least $1 billion of adjusted financial statement income over a three-year period.

The application of tax laws and related regulations is subject to legal and factual interpretation, judgment and uncertainty.

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or international tax laws change in a manner that increases our tax obligation, it could result in a material adverse impact on our results of operations and our financial position.

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In addition, many countries are implementing legislation and other guidance to align their international tax rules with the Organisation for Economic Co-operation and Development’s, or OECD, Base Erosion and Profit Shifting recommendations and action plan that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules, and nexus-based tax incentive practices.

The OECD is also continuing discussions surrounding fundamental changes in allocation of profits among tax jurisdictions in which companies do business, as well as the implementation of a global minimum tax (namely the “Pillar One” and “Pillar Two” proposals).

The European Union and other countries (including those in which we operate) have enacted or committed to enact global minimum taxes, which may adversely impact our provision for income taxes, existing tax incentives, net income and cash flows.

Some countries intend to implement laws based on Pillar Two proposals, which may adversely impact our provision for income taxes, existing tax incentives, net income and cash flows.

As a result of this heightened scrutiny, prior decisions by tax authorities regarding treatments and positions of corporate income taxes could be subject to enforcement activities, and legislative investigation and inquiry, which could also result in changes in tax policies or prior tax rulings.

Any such changes may also result in the taxes we previously paid being subject to change.

Our income tax provision is subject to volatility and our ability to use our deferred tax assets to offset future taxable income may be limited since we are subject to tax examinations, which may adversely impact our future effective tax rate and operating results.

Our income tax provision is subject to volatility and our ability to use our deferred tax assets to offset future taxable income may be limited, which may adversely impact our future effective tax rate and operating results.

Excess tax benefits associated with employee stock-based compensation are included in income tax expense.

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On a periodic basis we evaluate our deferred tax assets for realizability.

Based upon our review of all positive and negative evidence, as of September 30, 2024, we continue to have a valuation allowance on state deferred tax assets, certain federal deferred tax assets, and certain foreign deferred tax assets in jurisdictions where we have cumulative losses or otherwise are not expected to utilize certain tax attributes.

During the quarter ended December 31, 2024, we recorded a full valuation allowance against our Singapore deferred tax assets.

Based upon our review of all positive and negative evidence, as of March 31, 2025, we continue to have a valuation allowance on state deferred tax assets, certain federal deferred tax assets, and certain foreign deferred tax assets in jurisdictions where we have cumulative losses or otherwise are not expected to utilize certain tax attributes.

The impact of releasing some or all of such valuation allowance in a future period could be material in the period in which such release occurs.

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Any future changes in the deferred tax asset realizability assertion may require a valuation allowance to reduce our deferred tax assets, which would increase our tax expense in the period the allowance is recognized and affect our results of operations.

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Our corporate income tax liability could materially increase if tax incentives we have negotiated in Singapore cease to be effective or applicable or if we are challenged on our use of such incentives.

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Recent Repurchases of Equity Securities

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DEFAULTS UPON SENIOR SECURITIES

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors