What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-11-02 compared with 2022-08-04 · 100 added, 71 removed, 182 unchanged (48% of the section changed)

57 unchanged sentences

Recent Results

Our net revenues were $184.0 million and $180.1 million for the three months ended June 30, 2022 and 2021, respectively, and $366.1 million and $353.8 million for the six months ended June 30, 2022 and 2021, respectively.

The increases for the three- and six-month periods were driven primarily by higher sales in the industrial and consumer end markets, reflecting higher demand as well as market-share gains for our products in a broad range of applications including consumer appliances and industrial applications such as home-and-building automation, electronic utility meters, battery-operated tools and broad-based industrial applications.

Revenues from communications applications decreased year-over-year in the three- and six-month periods reflecting weaker demand from customers serving Chinese smartphone OEMs compared to stronger demand in the prior year periods as customers attempted to capitalize on economic sanctions affecting the mobile-phone business of a key competitor.

We believe that demand for our products has been negatively affected by measures implemented in China to contain the spread of the COVID-19 virus, and is likely also being affected by a shift in consumer spending in favor of services rather than goods, as well as reduced consumer spending overall in response to inflation.

As a result, we expect our third-quarter revenues to decline compared to our second-quarter revenues.

Our top ten customers, including distributors that resell to original equipment manufacturers, or OEMs, and merchant power supply manufacturers, accounted for 77% of net revenues in both the three and six months ended June 30, 2022, and 80% in both the corresponding periods of 2021.

In the three and six months ended June 30, 2022 and 2021, two customers, distributors of our products, each accounted for more than 10% of our net revenues .

International sales accounted for 96% of our net revenues in both the three and six months ended June 30, 2022, and 98% in both of the corresponding periods of 2021.

Our gross margin was 58.1% and 50.7% in the three months ended June 30, 2022 and 2021, respectively, and 56.7% and 49.7% in the six months ended June 30, 2022 and 2021, respectively.

Our net revenues were $160.2 million and $176.8 million for the three months ended September 30, 2022 and 2021, respectively, and $526.4 million and $530.6 million for the nine months ended September 30, 2022 and 2021, respectively.

We believe that demand for our products has been negatively affected by an array of macroeconomic and geopolitical factors including reduced consumer spending in response to inflation, a shift in consumer spending toward travel and services, the conflict in Ukraine, the weaker housing market, particularly in China, and restrictions on economic activity in China aimed at controlling the spread of COVID-19.

The decrease in revenues for the three-month period was driven by the communications, consumer and computer end markets, reflecting weaker demand for cellphones, computers and appliances;

the decreases in these markets were partially offset by increased sales into the industrial end-market reflecting growth across a broad range of industrial applications such as wind-power systems, electronic utility meters, battery-operated tools and broad-based industrial applications.

The decrease in revenues for the nine-month period was driven by lower sales into the communications end-market reflecting weaker demand from customers serving the cellphone market;

the decrease in the communications end-market was partially offset by increased sales in the other markets, primarily the industrial end-market, reflecting growth across a broad range of industrial applications such as wind-power systems and broad-based industrial applications.

Our top ten customers, including distributors that resell to original equipment manufacturers, or OEMs, and merchant power supply manufacturers, accounted for 72% and 75% of net revenues in the three and nine months ended September 30, 2022, respectively, and 76% and 79% in the corresponding periods of 2021, respectively.

International sales accounted for 95% and 96% of our net revenues in the three and nine months ended September 30, 2022, respectively, and 97% and 98% in the corresponding periods of 2021, respectively.

Our gross margin was 57.4% and 51.9% in the three months ended September 30, 2022 and 2021, respectively, and 56.9% and 50.4% in the nine months ended September 30, 2022 and 2021, respectively.

Our gross margin increased primarily due to favorable end-market mix, with a greater percentage of revenues coming from higher-margin end markets, as well as manufacturing efficiencies.

Total operating expenses were $46.7 million and $46.3 million in the three months ended June 30, 2022 and 2021, respectively, and $96.4 million and $90.6 million for the six months ended June 30, 2022 and 2021, respectively.

The increase in operating expenses for the three and six months ended June 30, 2022 was due primarily to our litigation settlement with Opticurrent LLC, higher salary and related expenses driven by increased headcount, and product development expenses offset by lower stock-based compensation expense and receipt of a distribution from the bankruptcy liquidation of SemiSouth Laboratories, Inc., of which we were a creditor as a result of investments made in SemiSouth in 2011.

Total operating expenses were $43.7 million and $46.1 million in the three months ended September 30, 2022 and 2021, respectively, and $140.0 million and $136.7 million for the nine months ended September 30, 2022 and 2021, respectively.

The decrease in operating expenses for the three months ended September 30, 2022 was due primarily to lower stock-based compensation expense partially offset by higher salary and related expenses driven by increased headcount and product development expenses.

The increase in operating expenses for the nine months ended September 30, 2022 was due primarily to our litigation settlement with Opticurrent LLC, higher salary and related expenses driven by increased headcount, and product development expenses, partially offset by lower stock-based compensation expense and receipt of a distribution from the bankruptcy liquidation of SemiSouth Laboratories, Inc., of which we were a creditor as a result of investments made in SemiSouth in 2011.

COVID-19 Pandemic

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These disruptions have not materially affected our results due to a variety of mitigation measures including higher-than-normal inventories of wafers and finished goods in the early stages of the pandemic, safety stocks of certain key inputs and multiple sources for components for most of our products.

Although there are signs of improvement in the US and many areas around the world, the potential for disruptions caused by ongoing mitigation efforts remains a risk for our supply chain and the results of our business;

of our business;

for instance, we believe that recent lockdowns in China have had a negative impact on demand for our products.

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Cost of revenues

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General and administrative

Other operating expenses, net

Other operating expenses

Total operating expenses

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Provision for income taxes

Comparison of the three and six months ended June 30, 2022 and 2021

Comparison of the three and nine months ended September 30, 2022 and 2021

Net revenues.

Net revenues consist of revenues from product sales, which are calculated net of returns and allowances.

Net revenues for the three and six months ended June 30, 2022, were $184.0 million and $366.1 million, respectively, and $180.1 million and $353.8 million for the corresponding periods of 2021, respectively.

The increases for the three- and six-month periods were driven primarily by higher sales into the industrial and consumer end markets, reflecting higher demand as well as market-share gains for our products in a broad range of applications including consumer appliances and industrial applications such as home-and-building automation, electronic utility meters, battery-operated tools and broad-based industrial applications.

Revenues from communications applications

decreased year-over-year in the three- and six-month periods reflecting weaker demand from customers serving Chinese smartphone OEMs compared to stronger demand in the prior year periods, as customers attempted to capitalize on economic sanctions affecting the mobile-phone business of a key competitor.

Our revenue mix by end market for the three and six months ended June 30, 2022 and 2021, was as follows:

Net revenues for the three and nine months ended September 30, 2022 were $160.2 million and $526.4 million, respectively, and $176.8 million and $530.6 million for the corresponding periods of 2021, respectively.

services, the conflict in Ukraine, the weaker housing market, particularly in China, and restrictions on economic activity in China aimed at controlling the spread of COVID-19.

The decrease in revenues for the three-month period was driven by the communications, consumer and computer end markets, reflecting weaker demand for cellphones, computers and appliances;

The decrease in revenues for the nine-month period was driven by lower sales into the communications end-market reflecting weaker demand from customers serving the cellphone market;

Our revenue mix by end market for the three and nine months ended September 30, 2022 and 2021 was as follows:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Communications

International sales, consisting of sales outside of the United States of America based on “bill to” customer locations, were $176.4 million and $351.7 million in the three and six months ended June 30, 2022, respectively, and $176.3 million and $345.9 million, respectively, in the corresponding periods of 2021.

International sales, consisting of sales outside of the United States of America based on “bill to” customer locations, were $151.8 million and $503.5 million in the three and nine months ended September 30, 2022, respectively, and $171.7 million and $517.7 million, in the corresponding periods of 2021, respectively.

Although power converters using our products are distributed to end markets worldwide, most are manufactured in Asia.

As a result, sales to this region represented 76% and 78% of our net revenues in the three and six months ended June 30, 2022, respectively, and 85% in both the corresponding periods of 2021.

As a result, sales to this region represented 68% and 75% of our net revenues in the three and nine months ended September 30, 2022, respectively, and 80% and 83% in the corresponding periods of 2021, respectively.

We expect international sales, and sales to the Asia region in particular, to continue to account for a large portion of our net revenues in the future.

Sales to distributors accounted for 73% and 74% in the three and six months ended June 30, 2022, respectively, and 76% and 77%, respectively, in the corresponding periods of 2021.

Sales to distributors accounted for 65% and 71% in the three and nine months ended September 30, 2022, respectively, and 72% and 75% in the corresponding periods of 2021, respectively.

Direct sales to OEMs and power-supply manufacturers accounted for the remainder.

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Honestar Technologies Co., Ltd.

Salcomp Group

*Total customer revenue was less than 10% of net revenues.

No other customers accounted for 10% or more of our net revenues in these periods.

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Gross margin is gross profit divided by net revenues.

The table below compares gross profit and gross margin for the three and six months ended June 30, 2022 and 2021:

The table below compares gross profit and gross margin for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions)

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Research and development (“R&D”) expenses consist primarily of employee-related expenses, including stock-based compensation, and expensed material and facility costs associated with the development of new technologies and new products.

We also record R&D expenses for prototype wafers related to

new products until such products are released to production.

The table below compares R&D expenses for the three and six months ended June 30, 2022 and 2021:

We also record R&D expenses for prototype wafers related to new products until such products are released to production.

The table below compares R&D expenses for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions)

Headcount (at period end)

R&D expenses increased for the three and six months ended June 30, 2022, as compared to the corresponding periods of 2021, primarily due to higher salary and related expenses driven by increased headcount and increased product development expenses.

R&D expenses increased for the three and nine months ended September 30, 2022, as compared to the corresponding periods of 2021, primarily due to higher salary and related expenses driven by increased headcount and increased product development expenses.

These increases were partially offset by reduced stock-based compensation expense related to performance-based awards.

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Sales and marketing (“S&M”) expenses consist primarily of employee-related expenses, including stock-based compensation, commissions to sales representatives, amortization of intangible assets and facilities expenses, including expenses associated with our regional sales and support offices.

The table below compares S&M expenses for the three and six months ended June 30, 2022 and 2021:

The table below compares S&M expenses for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions)

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Headcount (at period end)

S&M expenses increased in the three and six months ended June 30, 2022, as compared to the corresponding periods of 2021, due to higher salary and related expenses stemming from higher headcount and increased travel and tradeshow related expenses.

S&M expenses decreased in the three months ended September 30, 2022, due to reduced stock-based compensation expense related to performance-based awards, lower commissions and lower amortization of acquired intangibles as certain intangible assets are now fully amortized;

these factors were partially offset by higher salary expense stemming from higher headcount, as well as increased travel and tradeshow related expenses.

S&M expenses increased in the nine months ended September 30, 2022, as compared to the corresponding period of 2021, due to higher salary and related expenses stemming from higher headcount and increased travel and tradeshow related expenses partially offset by reduced stock-based compensation expense related to performance-based awards, lower commissions and lower amortization of acquired intangibles.

General and administrative expenses.

General and administrative (“G&A”) expenses consist primarily of employee-related expenses, including stock-based compensation expenses, for administration, finance, human resources and general management, as well as consulting, professional services, legal and audit expenses.

The table below compares G&A expenses for the three and six months ended June 30, 2022 and 2021:

The table below compares G&A expenses for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions)

Headcount (at period end)

G&A expenses decreased for the three and six months ended as compared to the corresponding periods of 2021, due to lower stock-based compensation expense related to performance-based awards.

G&A expenses decreased for the three and nine months ended September 30, 2022 as compared to the corresponding periods of 2021, due to lower stock-based compensation expense related to performance-based awards, partially offset by higher expenses for professional and legal services.

Other operating expenses, net.

Other operating expenses, net were $1.1 million in the three and six months ended June 30, 2022.

This amount consisted of a $2.9 million expense stemming from the settlement of our litigation with Opticurrent LLC (refer to Note 12, Legal Proceedings and Contingencies , in our Notes to Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1, of this Quarterly Report on Form 10-Q), offset by receipt of a $1.7 million distribution related to SemiSouth Laboratories, Inc.’s bankruptcy liquidation of which we were a creditor as a result of investments made in SemiSouth in 2011.

Other operating expenses, net were $1.1 million in the nine months ended September 30, 2022 .

This amount consisted of a $2.9 million expense stemming from the settlement of our litigation with Opticurrent LLC (refer to Note 12, Legal Proceedings and Contingencies , in our Notes to Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1, of this Quarterly Report on Form 10-Q), partially offset by receipt of a $1.7 million distribution related to SemiSouth Laboratories, Inc.’s bankruptcy liquidation of which we were a creditor as a result of investments made in SemiSouth in 2011.

Other income .

Other income consists primarily of interest income earned on cash and cash equivalents, marketable securities and other investments, and the impact of foreign exchange gains or losses.

The table below compares other income for the three and six months ended June 30, 2022 and 2021:

The table below compares other income for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions)

Other income increased for the three and six months ended June 30, 2022 as compared to the corresponding periods of 2021, primarily due to gains on foreign currency exchange.

Other income increased for the three and nine months ended September 30, 2022 as compared to the corresponding periods of 2021, primarily due to higher interest income and gains on foreign currency exchange.

Provision for income taxes .

Provision for income taxes represents federal, state and foreign taxes.

The table below compares income-tax expense for the three and six months ended June 30, 2022 and 2021:

The table below compares income-tax expense for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(dollars in millions)

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Accordingly, the interim effective tax rate may not be reflective of the annual estimated effective tax rate.

Our effective tax rates for the three and six months ended June 30, 2022, were 8.1% and 9.2%, respectively, and 7.2% and 4.9%, respectively, in the corresponding periods of 2021.

Our effective tax rates for the three and nine months ended September 30, 2022 were 6.9% and 8.5%, respectively, and 8.2% and 6.1% for the corresponding periods of 2021, respectively.

The effective tax rate in these periods was lower than the statutory federal income-tax rate of 21% due to the geographic distribution of our world-wide earnings in lower-tax jurisdictions and the impact of federal research tax credits.

Additionally, in the three months ended June 30, 2022 and 2021, our effective tax rate was favorably impacted by the recognition of excess tax benefits related to share-based payments.

In the six months ended June 30, 2022 and 2021, our effective tax rate was favorably impacted by discrete items associated with the release of unrecognized tax benefits and recognition of excess tax benefits related to share-based payments.

Additionally, in the three months ended September 30, 2022 and 2021, our effective tax rate was favorably impacted by the recognition of excess tax benefits related to share-based payments.

In the nine months ended September 30, 2022 and 2021, our effective tax rate was favorably impacted by discrete items associated with the release of unrecognized tax benefits and recognition of excess tax benefits related to share-based payments.

These benefits were partially offset by U.S.

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Liquidity and Capital Resources

As of June 30, 2022, we had $327.6 million in cash, cash equivalents and short-term marketable securities, a decrease of approximately $202.8 million from $530.4 million as of December 31, 2021.

As of June 30, 2022, we had working capital, defined as current assets less current liabilities, of $410.9 million, a decrease of approximately $203.6 million from $614.5 million as of December 31, 2021.

As of September 30, 2022, we had $363.2 million in cash, cash equivalents and short-term marketable securities, a decrease of $167.1 million from $530.4 million as of December 31, 2021.

As of September 30, 2022, we had working capital, defined as current assets less current liabilities, of $453.2 million, a decrease of approximately $161.3 million from $614.5 million as of December 31, 2021.

We have a Credit Agreement with Wells Fargo Bank, National Association (the "Credit Agreement") that provides us with a $75.0 million revolving line of credit to use for general corporate purposes with a $20.0 million sub-limit for the issuance of standby and trade letters of credit.

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all advances under the revolving line of credit will become due on such date, or earlier in the event of a default.

No advances were outstanding under the agreement as of June 30, 2022.

No advances were outstanding under the agreement as of September 30, 2022.

Cash From Operating Activities

Operating activities generated $141.4 million of cash in the six months ended June 30, 2022.

Operating activities generated $191.2 million of cash in the nine months ended September 30, 2022.

Net income for this period was $148.0 million;

we also incurred depreciation, non-cash stock-based compensation expense, premium amortization on marketable securities and intangibles amortization of $17.2 million, $12.7 million, $1.9 million and $1.3 million, respectively.

Sources of cash also included a $13.2 million decrease in accounts receivable due to the timing of collections, a $5.6 million increase in accounts payable (excluding payables related to property and equipment) and a

$4.1 million decrease in prepaid expenses and other assets.

These sources of cash were partially offset by a $12.0 million increase in inventories and a $2.5 million decrease in taxes payable and accrued liabilities.

Operating activities generated $125.0 million of cash in the six months ended June 30, 2021.

we also incurred depreciation, non-cash stock-based compensation expense,

amortization of premiums on marketable securities and amortization of intangibles of $26.1 million, $15.7 million, $2.6 million and $1.9 million, respectively.

Sources of cash also included a $24.6 million decrease in accounts receivable due to decreased customer shipments and $8.4 million decrease in prepaid expenses and other assets.

These sources of cash were partially offset by a $20.8 million increase in inventories due to softening demand during the year, a $5.9 million decrease in accounts payable (excluding payables related to property and equipment) due to timing of payments and a $3.9 million decrease in taxes payable and accrued liabilities.

Operating activities generated $183.7 million of cash in the nine months ended September 30, 2021.

Net income for this period was $123.7 million;

we also incurred non-cash stock-based compensation expense, depreciation, intangibles amortization, and deferred income taxes of $17.7 million, $15.3 million, $1.9 million, and $1.2 million, respectively.

Sources of cash also included a $13.2 million decrease in inventory reflecting strong demand for the period and a $8.1 million increase in accounts payable (excluding payables related to property and equipment) due to the timing of payments.

These sources of cash were partially offset by a $5.5 million increase in accounts receivable due to increased customer shipments, a $4.5 million increase in prepaid expenses and other assets, primarily due to prepaid income taxes, and a $4.4 million decrease in taxes payable and accrued liabilities.

we also incurred non-cash stock-based compensation expense, depreciation, amortization of intangibles and loss on disposal of property and equipment of $27.3 million, $23.4 million, $2.7 million and $2.2 million, respectively.

Sources of cash also included an $11.1 million decrease in inventory reflecting strong demand for the period and a $6.6 million increase in accounts payable (excluding payables related to property and equipment) due to the timing of payments.

These sources of cash were partially offset by a $6.2 million decrease in taxes payable and accrued liabilities, a $5.0 million increase in prepaid expenses and other assets, primarily due to prepaid income taxes, and a $3.0 million increase in accounts receivable due to increased customer shipments.

Cash From Investing Activities

Our investing activities in the six months ended June 30, 2022, generated $78.1 million of cash, primarily consisting of $104.8 million from sales and maturities of marketable securities, net of purchases, offset by $27.9 million for purchases of property and equipment, primarily production-related machinery and equipment, partially offset by proceeds of $1.2 million from the sale of an office building.

Our investing activities in the six months ended June 30, 2021, resulted in a $47.9 million net use of cash, primarily consisting of $28.7 million for the purchase of marketable securities, net of sales and maturities, and $19.3 million for purchases of property and equipment, primarily production-related machinery and equipment as well as construction of a new office building in Switzerland.

Our investing activities in the nine months ended September 30, 2022 generated $101.5 million of cash, primarily consisting of $133.8 million from sales and maturities of marketable securities, net of purchases, and by proceeds of $1.2 million from the sale of an office building, partially offset by $33.4 million for purchases of property and equipment, primarily production-related machinery and equipment.

Our investing activities in the nine months ended September 30, 2021 resulted in a $128.1 million net use of cash, primarily consisting of $97.9 million for the purchase of marketable securities, net of sales and maturities, and $30.3 million for purchases of property and equipment, primarily production-related machinery and equipment as well as construction of a new office building in Switzerland.

Cash From Financing Activities

Our financing activities in the six months ended June 30, 2022, resulted in a $310.2 million net use of cash, consisting of $292.3 million for the repurchase of our common stock and $20.9 million for the payment of dividends to stockholders, partially offset by $3.1 million from the issuance of shares through our employee stock purchase plan.

Our financing activities in the six months ended June 30, 2021, resulted in a $38.4 million net use of cash, consisting of $26.4 million for the repurchase of our common stock and $15.7 million for the payment of dividends to stockholders, partially offset by $3.7 million from the issuance of common stock, including the exercise of employee stock options and the issuance of shares through our employee stock purchase plan.

Our financing activities in the nine months ended September 30, 2022 resulted in a $317.4 million net use of cash, consisting of $292.3 million for the repurchase of our common stock and $31.2 million for the payment of dividends to stockholders, partially offset by $6.2 million from the issuance of shares through our employee stock purchase plan.

Our financing activities in the nine months ended September 30, 2021 resulted in a $52.0 million net use of cash, consisting of $36.2 million for the repurchase of our common stock and $23.6 million for the payment of dividends to stockholders, partially offset by $7.7 million from the issuance of common stock, including the exercise of employee stock options and the issuance of shares through our employee stock purchase plan.

In January 2021, our board of directors raised the quarterly cash dividend by an additional $0.02 per share with the declaration of four cash dividends of $0.13 per share to be paid to stockholders of record at the end of each quarter in 2021.

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In January 2022, our board of directors raised the quarterly cash dividend by an additional $0.03 per share with the declaration of four cash dividends of $0.18 per share (in lieu of the $0.15 per share announced in October 2021) to be paid to stockholders of record at the end of each quarter in 2022.

A dividend payout of $10.7 million and $10.3 million occurred on March 31, 2022 and June 30, 2022, respectively.

A dividend payout of $10.7 million, $10.3 million and $10.3 million occurred on March 31, 2022, June 30, 2022 and September 30, 2022, respectively.

The declaration of any future cash dividend is at the discretion of the board of directors and will depend on our financial condition, results of operations, capital requirements, business conditions and other factors, as well as a determination that cash dividends are in the best interests of our stockholders.

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As of December 31, 2021 , we had $67.3 million remaining under our stock-repurchase program .

In January, February and April 2022, our board of directors authorized the use of an additional $100 million, $50 million and $75 million, respectively, for the repurchase of our common stock, with repurchases to be executed according to pre-defined price/volume guidelines.

In the six months ended June 30, 2022, we repurchased 3.5 million shares of our common stock for $292.3 million, leaving no funds authorized as of June 30, 2022.

Authorization of future repurchase programs is at the discretion of the board of directors and will depend on our financial condition, results of operations, capital requirements, business conditions and other factors.

defined price/volume guidelines.

In the nine months ended September 30, 2022 , we repurchased 3.5 million shares of our common stock for $292.3 million, leaving no funds authorized as of September 30, 2022.

In October 2022, our board of directors authorized the use of an additional $100 million for the repurchase of our common stock, with repurchases to be executed according to pre-defined price/volume guidelines.

Authorization of future repurchase programs is at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, business conditions and other factors;

the program has no expiration date.

Contractual Commitments

As of June 30, 2022, we had a contractual obligation related to income tax, which consisted primarily of unrecognized tax benefits of approximately $22.3 million.

As of September 30, 2022 we had a contractual obligation related to income tax, which consisted primarily of unrecognized tax benefits of approximately $22.9 million.

A portion of the tax obligation is classified as long-term income taxes payable and a portion is recorded in deferred tax assets in our condensed consolidated balance sheet.

As of June 30, 2022, there were no material changes in our contractual commitments from those reported in our Annual Report on Form 10-K for the year ended December 31, 2021.

As of September 30, 2022, there were no material changes in our contractual commitments from those reported in our Annual Report on Form 10-K for the year ended December 31, 2021.

Other Information

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federal taxes.

Accordingly, as of June 30, 2022, our worldwide cash and marketable securities are available to fund capital allocation needs, including capital and internal investments, acquisitions, stock repurchases and/or dividends without incurring additional U.S.

Accordingly, as of September 30, 2022, our worldwide cash and marketable securities are available to fund capital allocation needs, including capital and internal investments, acquisitions, stock repurchases and/or dividends without incurring additional U.S.

federal income taxes.

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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 2. Management’s Discussion and Analysis