POWER INTEGRATIONS INC 10-K

Item 8. Financial Statements and Supplementary Data. REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Power Integrations, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Power Integrations, Inc. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 6, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Inventories – Provision for Excess and Obsolete Inventory – Refer to Notes 2 and 3 to the financial statements Critical Audit Matter Description The Company's inventories are recorded at standard cost, which approximates actual cost on a first-in, first-out basis, not in excess of net realizable value. The Company routinely evaluates quantities and values of inventories and records a provision for excess and obsolete inventories to reduce its recorded inventory balance to its estimated net realizable value. Management’s assumptions regarding the inventory quantities considered to be excess and obsolete are determined by analyzing historical usage, demand forecasts, current economic trends, and historical write-offs. We identified the determination of excess and obsolete inventories within work-in-process and finished goods inventories as a critical audit matter due to the significant assumptions made by management when determining the excess and obsolete inventory quantities and the resulting provision. This required a high degree of auditor judgement and an increased extent of effort when performing audit procedures to evaluate the reasonableness of management’s excess and obsolete provision for work-in-process and finished goods inventories. 38 Table of Contents How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to management’s assumptions used in determining the excess and obsolete provision for work-in-process and finished goods inventories included the following, among others: * We tested the effectiveness of the control over the determination of the provision for excess and obsolete inventories, including work-in-process and finished goods inventories. * We selected a sample of products from work-in-process and finished goods inventories as of December 31, 2024, and evaluated management's ability to accurately estimate forecasted demand by comparing the respective products usage for the year ended December 31, 2025, to estimates made in the prior year. * We selected a sample of products from work-in-process and finished goods inventories and evaluated the reasonableness of management's provision for work-in-process and finished goods inventories by considering recent usage, historical usage, contracts and communications with customers, expected product lifecycles, macroeconomic conditions, and inquiries with sales personnel. * We considered the existence of contradictory evidence based on reading of internal communications to management and the board of directors, Company press releases, and analyst reports, as well as our observations and inquiries as to changes within the business. ​ /s/ DELOITTE & TOUCHE LLP San Jose, California February 6, 2026 We have served as the Company’s auditor since 2005. ​ ​ ​ 39 Table of Contents POWER INTEGRATIONS, INC. CONSOLIDATED BALANCE SHEETS ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ December 31, (in thousands) ​ ​ ​ 2025 ​ 2024 ASSETS ​ ​ ​ ​ CURRENT ASSETS: ​ ​ ​ ​ Cash and cash equivalents ​ $ 58,755 ​ $ 50,972 Short-term marketable securities ​ 190,755 ​ 249,023 Accounts receivable, net ​ 18,254 ​ 27,172 Inventories ​ 166,887 ​ 165,612 Prepaid expenses and other current assets ​ 23,678 ​ 21,260 Total current assets ​ 458,329 ​ 514,039 PROPERTY AND EQUIPMENT, net ​ 146,536 ​ 149,562 INTANGIBLE ASSETS, net ​ 7,244 ​ 8,075 GOODWILL ​ 95,271 ​ 95,271 DEFERRED TAX ASSETS ​ 35,594 ​ 36,485 OTHER ASSETS ​ 29,233 ​ 25,394 Total assets ​ $ 772,207 ​ $ 828,826 LIABILITIES AND STOCKHOLDERS’ EQUITY ​ ​ ​ ​ CURRENT LIABILITIES: ​ ​ ​ ​ Accounts payable ​ $ 33,963 ​ $ 29,789 Accrued payroll and related expenses ​ 13,840 ​ 13,987 Taxes payable ​ 962 ​ 961 Other accrued liabilities ​ 21,596 ​ 10,580 Total current liabilities ​ 70,361 ​ 55,317 LONG-TERM INCOME TAXES PAYABLE ​ 3,663 ​ 3,871 OTHER LIABILITIES ​ 25,338 ​ 19,866 Total liabilities ​ 99,362 ​ 79,054 COMMITMENTS AND CONTINGENCIES (Notes 11, 12 and 14) ​ ​ ​ ​ STOCKHOLDERS’ EQUITY: ​ ​ ​ ​ Common stock, $ 0.001 par value ​ ​ ​ ​ Authorized - 140,000 shares ​ ​ ​ ​ Shares issued and outstanding - 55,339 and 56,837 shares in 2025 and 2024, respectively ​ 20 ​ 22 Additional paid-in capital ​ — ​ 18,734 Accumulated other comprehensive loss ​ ( 1,105 ) ​ ( 3,023 ) Retained earnings ​ 673,930 ​ 734,039 Total stockholders’ equity ​ 672,845 ​ 749,772 Total liabilities and stockholders’ equity ​ $ 772,207 ​ $ 828,826 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 40 Table of Contents POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF INCOME ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands, except per share amounts) ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 NET REVENUE ​ $ 443,504 ​ $ 418,973 ​ $ 444,538 COST OF REVENUE ​ 201,855 ​ 194,222 ​ 215,582 GROSS PROFIT ​ 241,649 ​ 224,751 ​ 228,956 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ OPERATING EXPENSES: ​ ​ ​ ​ ​ ​ Research and development ​ 101,116 ​ 100,790 ​ 96,067 Sales and marketing ​ 67,952 ​ 67,825 ​ 64,598 General and administrative ​ 42,701 ​ 38,207 ​ 33,232 Other operating expenses ​ ​ 19,686 ​ ​ — ​ ​ — Total operating expenses ​ 231,455 ​ 206,822 ​ 193,897 INCOME FROM OPERATIONS ​ 10,194 ​ 17,929 ​ 35,059 OTHER INCOME ​ 10,785 ​ 12,825 ​ 10,848 INCOME BEFORE INCOME TAXES ​ 20,979 ​ 30,754 ​ 45,907 PROVISION (BENEFIT) FOR INCOME TAXES ​ ( 1,114 ) ​ ( 1,480 ) ​ ( 9,828 ) NET INCOME ​ $ 22,093 ​ $ 32,234 ​ $ 55,735 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ EARNINGS PER SHARE: ​ ​ ​ ​ ​ ​ Basic ​ $ 0.39 ​ $ 0.57 ​ $ 0.97 Diluted ​ $ 0.39 ​ $ 0.56 ​ $ 0.97 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ SHARES USED IN PER SHARE CALCULATION: ​ ​ ​ ​ ​ ​ Basic ​ 56,063 ​ 56,820 ​ 57,195 Diluted ​ 56,324 ​ 57,130 ​ 57,622 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 41 Table of Contents POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Net income ​ $ 22,093 ​ $ 32,234 ​ $ 55,735 Other comprehensive income (loss), net of tax: ​ ​ ​ ​ ​ ​ Foreign currency translation adjustments, net of $ 0 tax in 2025, 2024 and 2023 ​ 991 ​ ( 512 ) ​ ( 420 ) Unrealized gain on marketable securities, net of ($ 7 ), ($ 195 ) and $ 0 tax in 2025, 2024 and 2023, respectively ​ 1,058 ​ 437 ​ 5,579 Unrealized actuarial gain (loss) on pension benefits, net of tax of $ 21 , $ 266 and ($ 130 ) in 2025, 2024 and 2023, respectively ​ ( 131 ) ​ ( 1,486 ) ​ 723 Total other comprehensive income (loss) ​ 1,918 ​ ( 1,561 ) ​ 5,882 TOTAL COMPREHENSIVE INCOME ​ $ 24,011 ​ $ 30,673 ​ $ 61,617 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 42 Table of Contents POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-In ​ Comprehensive ​ Retained ​ Stockholders’ (In thousands) Shares Amount Capital Loss Earnings Equity BALANCE AT JANUARY 1, 2023 56,961 ​ $ 24 ​ $ — ​ $ ( 7,344 ) ​ $ 762,536 ​ $ 755,216 Issuance of common stock under employee stock option and stock award plans 476 ​ — ​ — ​ — ​ — ​ — Repurchase of common stock ( 784 ) ​ ( 1 ) ​ ( 34,765 ) ​ — ​ ( 20,583 ) ​ ( 55,349 ) Issuance of common stock under employee stock purchase plan 85 ​ — ​ 6,237 ​ — ​ — ​ 6,237 Stock-based compensation expense related to employee stock awards — ​ — ​ 26,624 ​ — ​ — ​ 26,624 Stock-based compensation expense related to employee stock purchases — ​ — ​ 1,904 ​ — ​ — ​ 1,904 Payment of dividends to stockholders — ​ — ​ — ​ — ​ ( 44,008 ) ​ ( 44,008 ) Unrealized actuarial gain on pension benefits — ​ — ​ — ​ 723 ​ — ​ 723 Unrealized gain on marketable securities — ​ — ​ — ​ 5,579 ​ — ​ 5,579 Foreign currency translation adjustment — ​ — ​ — ​ ( 420 ) ​ — ​ ( 420 ) Net income — ​ — ​ — ​ — ​ 55,735 ​ 55,735 BALANCE AT DECEMBER 31, 2023 56,738 ​ 23 ​ — ​ ( 1,462 ) ​ 753,680 ​ 752,241 Issuance of common stock under employee stock option and stock award plans 410 ​ — ​ — ​ — ​ — ​ — Repurchase of common stock ( 402 ) ​ ( 1 ) ​ ( 22,042 ) ​ — ​ ( 5,838 ) ​ ( 27,881 ) Issuance of common stock under employee stock purchase plan 91 ​ — ​ 5,700 ​ — ​ — ​ 5,700 Stock-based compensation expense related to employee stock awards — ​ — ​ 33,404 ​ — ​ — ​ 33,404 Stock-based compensation expense related to employee stock purchases — ​ — ​ 1,672 ​ — ​ — ​ 1,672 Payment of dividends to stockholders — ​ — ​ — ​ — ​ ( 46,037 ) ​ ( 46,037 ) Unrealized actuarial loss on pension benefits — ​ — ​ — ​ ( 1,486 ) ​ — ​ ( 1,486 ) Unrealized gain on marketable securities — ​ — ​ — ​ 437 ​ — ​ 437 Foreign currency translation adjustment — ​ — ​ — ​ ( 512 ) ​ — ​ ( 512 ) Net income — ​ — ​ — ​ — ​ 32,234 ​ 32,234 BALANCE AT DECEMBER 31, 2024 56,837 ​ ​ 22 ​ ​ 18,734 ​ ​ ( 3,023 ) ​ 734,039 ​ 749,772 Issuance of common stock under employee stock option and stock award plans 416 ​ — ​ — ​ — ​ — ​ — Repurchase of common stock ( 2,028 ) ​ ( 2 ) ​ ( 64,025 ) ​ — ​ ( 34,758 ) ​ ( 98,785 ) Issuance of common stock under employee stock purchase plan 114 ​ — ​ 5,326 ​ — ​ — ​ 5,326 Stock-based compensation expense related to employee stock awards — ​ — ​ 38,271 ​ — ​ ( 274 ) ​ 37,997 Stock-based compensation expense related to employee stock purchases — ​ — ​ 1,694 ​ — ​ — ​ 1,694 Payment of dividends to stockholders — ​ — ​ — ​ — ​ ( 47,170 ) ​ ( 47,170 ) Unrealized actuarial loss on pension benefits — ​ — ​ — ​ ( 131 ) ​ — ​ ( 131 ) Unrealized gain on marketable securities — ​ — ​ — ​ 1,058 ​ — ​ 1,058 Foreign currency translation adjustment — ​ — ​ — ​ 991 ​ — ​ 991 Net income — ​ — ​ — ​ — ​ 22,093 ​ 22,093 BALANCE AT DECEMBER 31, 2025 55,339 ​ $ 20 ​ $ — ​ $ ( 1,105 ) ​ $ 673,930 ​ $ 672,845 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 43 Table of Contents POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 CASH FLOWS FROM OPERATING ACTIVITIES: ​ ​ ​ ​ ​ ​ Net income ​ $ 22,093 ​ $ 32,234 ​ $ 55,735 Adjustments to reconcile net income to net cash provided by operating activities: ​ ​ ​ ​ ​ ​ Depreciation ​ 27,195 ​ 33,303 ​ 35,203 Amortization of intangibles ​ 831 ​ 1,279 ​ 2,173 Loss (gain) on disposal of property and equipment ​ ( 108 ) ​ 240 ​ 100 Stock-based compensation expense ​ 39,690 ​ 35,076 ​ 28,528 Accretion of discount on marketable securities ​ ( 1,135 ) ​ ( 1,637 ) ​ ( 351 ) Deferred income taxes ​ 898 ​ ( 8,352 ) ​ ( 9,247 ) Decrease in accounts receivable allowance for credit losses ​ ( 342 ) ​ ( 245 ) ​ ( 454 ) Change in operating assets and liabilities: ​ ​ ​ ​ ​ ​ Accounts receivable ​ 9,260 ​ ( 12,253 ) ​ 6,616 Inventories ​ ( 1,275 ) ​ ( 2,448 ) ​ ( 27,744 ) Prepaid expenses and other assets ​ 635 ​ 4,001 ​ ( 1,183 ) Accounts payable ​ 3,253 ​ 3,454 ​ ( 5,435 ) Taxes payable and accrued liabilities ​ 10,523 ​ ( 3,471 ) ​ ( 18,182 ) Net cash provided by operating activities ​ 111,518 ​ 81,181 ​ 65,759 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ CASH FLOWS FROM INVESTING ACTIVITIES: ​ ​ ​ ​ ​ ​ Purchases of property and equipment ​ ( 24,396 ) ​ ( 17,286 ) ​ ( 20,884 ) Proceeds from sale of property and equipment ​ ​ 150 ​ ​ — ​ ​ — Purchases of marketable securities ​ ( 64,484 ) ​ ( 105,716 ) ​ ( 191,211 ) Proceeds from sales and maturities of marketable securities ​ 124,937 ​ 106,602 ​ 197,942 Acquisition (Note 15) ​ ​ — ​ ​ ( 9,520 ) ​ ​ — Net cash provided by (used in) investing activities ​ 36,207 ​ ( 25,920 ) ​ ( 14,153 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ CASH FLOWS FROM FINANCING ACTIVITIES: ​ ​ ​ ​ ​ ​ Issuance of common stock under employee stock plans ​ 5,326 ​ 5,700 ​ 6,237 Repurchase of common stock ​ ( 98,098 ) ​ ( 27,881 ) ​ ( 55,278 ) Payments of dividends to stockholders ​ ( 47,170 ) ​ ( 46,037 ) ​ ( 44,008 ) Proceeds from draw on line of credit ​ 13,000 ​ — ​ — Payments on line of credit ​ ( 13,000 ) ​ — ​ — Net cash used in financing activities ​ ( 139,942 ) ​ ( 68,218 ) ​ ( 93,049 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ​ 7,783 ​ ( 12,957 ) ​ ( 41,443 ) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ​ 50,972 ​ 63,929 ​ 105,372 CASH AND CASH EQUIVALENTS AT END OF PERIOD ​ $ 58,755 ​ $ 50,972 ​ $ 63,929 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: ​ ​ ​ ​ ​ ​ Unpaid property and equipment ​ $ 2,927 ​ $ 2,693 ​ $ 2,747 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: ​ ​ ​ ​ ​ ​ Cash paid for income taxes, net ​ $ 3,031 ​ $ 4,784 ​ $ 13,769 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 44 Table of Contents POWER INTEGRATIONS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. THE COMPANY: Power Integrations, Inc. (“Power Integrations” or the “Company”), incorporated in California on March 25, 1988, and reincorporated in Delaware in December 1997, designs, develops, manufactures and markets analog and mixed-signal integrated circuits (“ICs”) and other electronic components and circuitry used in high-voltage power conversion. The Company’s products are used in power converters that convert electricity from a high-voltage source to the type of power required for a specified downstream use. In most cases, this conversion entails, among other functions, converting alternating current (“AC”) to direct current (“DC”) or vice versa, reducing or increasing the voltage, and regulating the output voltage and/or current according to the customer’s specifications. ​ A large percentage of the Company’s products are ICs used in AC-DC power supplies, which convert the high-voltage AC from a wall outlet to the low-voltage DC required by most electronic devices. Power supplies incorporating the Company’s products are used with all manner of electronic products including mobile phones, computing and networking equipment, appliances, electronic utility meters, battery-powered tools, industrial controls, and “home-automation,” or “internet of things” applications such as networked thermostats, power strips and other building-automation and security devices. The Company also supplies high-voltage LED drivers, which are AC-DC ICs specifically designed for lighting applications that utilize light-emitting diodes, and motor-drivers ICs for brushless DC (“BLDC”) motors used in consumer appliances, HVAC systems, ceiling fans and a variety of industrial applications. The Company also offers high-voltage gate drivers—either standalone ICs or circuit boards containing ICs, electrical isolation components and other circuitry—used to operate high-voltage switches such as insulated-gate bipolar transistors (“IGBTs”) and silicon-carbide (“SiC”) MOSFETs. These combinations of switches and drivers are used for power conversion in high-power applications (i.e., power levels ranging from approximately 100 kilowatts up to gigawatts) such as industrial motors, solar- and wind-power systems, electric vehicles and high-voltage DC transmission systems. ​ 2. SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS: Significant Accounting Policies and Estimates Segment Reporting The Company is organized and operates as one reportable segment, the design, development, manufacture and marketing of integrated circuits and related components for use primarily in high-voltage power conversion. The Company’s chief operating decision maker, the Chief Executive Officer, reviews financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries after elimination of all intercompany transactions and balances. Estimates The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, allowances for receivables, inventories, litigation and income taxes. These estimates are based on historical facts and various other factors, which the Company believes to be reasonable at the time the estimates are made. However, as the effects of future events cannot be determined with precision, actual results could differ significantly from management’s estimates. Revenue Recognition The Company applies the provisions of Accounting Standards Codification (“ASC”) 606-10, Revenue from Contracts with Customers , and all related appropriate guidance. The Company recognizes revenue under the core principle to depict the transfer of control to the Company’s customers in an amount reflecting the consideration the Company expects to be entitled. In order to achieve that core principle, the Company applies the following five-step approach: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, 45 Table of Contents (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied. Product revenue consists of sales to original equipment manufacturers, or OEMs, merchant power supply manufacturers and distributors. The Company considers customer purchase orders, which in some cases are governed by master sales agreements, to be the contracts with a customer. In situations where sales are to a distributor, the Company has concluded that its contracts are with the distributor as the Company holds a contract bearing enforceable rights and obligations only with the distributor. As part of its consideration of the contract, the Company evaluates certain factors including the customer’s ability to pay (or credit risk). For each contract, the Company considers the promise to transfer products, each of which is distinct, to be the identified performance obligations. In determining the transaction price the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which the Company expects to be entitled. As the Company’s standard payment terms are less than one year, the Company has elected the practical expedient under ASC 606-10-32-18 to not assess whether a contract has a significant financing component. The Company allocates the transaction price to each distinct product based on their relative standalone selling price. The product price as specified on the purchase order is considered the standalone selling price as it is an observable input which depicts the price as if sold to a similar customer in similar circumstances. Revenue is recognized when control of the product is transferred to the customer (i.e., when the Company’s performance obligation is satisfied), which typically occurs at shipment. Further, in determining whether control has transferred, the Company considers if there is a present right to payment and legal title, along with risks and rewards of ownership having transferred to the customer. Frequently, the Company receives orders for products to be delivered over multiple dates that may extend across several reporting periods. The Company invoices for each delivery upon shipment and recognizes revenue for each distinct product delivered, assuming transfer of control has occurred. As scheduled delivery dates are within one year, under the optional exemption provided by ASC 606-10-50-14 revenue allocated to future shipments of partially completed contracts are not disclosed. The Company has also elected the practical expedient under ASC 340-40-25-4 to expense commissions when incurred as the amortization period of the commission asset the Company would have otherwise recognized is less than one year. Sales to international customers that are shipped from the Company’s facility outside of the United States are pursuant to EX Works, or EXW, shipping terms, meaning that control of the product transfers to the customer upon shipment from the Company’s foreign warehouse. Sales to international customers that are shipped from the Company’s facility in California are pursuant to Delivered at Frontier, or DAF, shipping terms. As such, control of the product passes to the customer when the shipment reaches the destination country and revenue is recognized upon the arrival of the product in that country. Shipments to customers in the Americas are pursuant to Free on Board, or FOB, point of origin shipping terms meaning that control is passed to the customer upon shipment. Sales to most distributors are made under terms allowing certain price adjustments and limited rights of return (known as “stock rotation”) of the Company’s products held in their inventory or upon sale to their end customers. Revenue from sales to distributors is recognized upon the transfer of control to the distributor. Frequently, distributors need to sell at a price lower than the standard distribution price in order to win business. At the time the distributor invoices its customer or soon thereafter, the distributor submits a “ship-and-debit” price adjustment claim to the Company to adjust the distributor’s cost from the standard price to the pre-approved lower price. After the Company verifies that the claim was pre-approved, a credit memo is issued to the distributor for the ship-and-debit claim. In determining the transaction price, the Company considers ship-and-debit price adjustments to be variable consideration. Such price adjustments are estimated using the expected value method based on an analysis of actual ship-and-debit claims, at the distributor and product level, over a period of time considered adequate to account for current pricing and business trends. Historically, actual price adjustments for ship-and-debit claims have not materially differed from those estimated and included when determining the transaction price. Stock rotation rights grant the distributor the ability to return certain specified amounts of inventory. Stock rotation adjustments are an additional form of variable consideration and are also estimated using the expected value method based on historical return rates. Historically, distributor stock rotation adjustments have not been material. Sales to certain distributors are made under terms that do not include rights of return or price concessions after the product is shipped to the distributor. Accordingly, upon application of steps one through five above, product revenue is recognized upon shipment and transfer of control. The Company generally provides an assurance warranty that its products will substantially conform to the published specifications for twelve months from the date of shipment. The Company’s liability is limited to either a credit equal to the purchase price or replacement of the defective part. Returns under warranty have historically been immaterial. As such, the Company does not record a specific warranty reserve or consider activities related to such warranty, if any, to be a separate performance obligation. 46 Table of Contents Inventories Inventories (which consist of costs associated with the purchases of wafers from domestic and offshore foundries and of packaged components from offshore assembly manufacturers, as well as internal labor and overhead associated with the testing of both wafers and packaged components). Inventory is recorded at standard cost, which approximates actual cost computed on a first-in, first-out basis, not in excess of net realizable value. The Company routinely evaluates quantities and values of inventories and records a provision for excess and obsolete inventories to reduce its recorded inventory balance to its estimated net realizable value. In order to determine the provision management considers historical usage, forecasted demand, current economic trends and historical write-offs. Stock-based compensation The Company applies the provisions of ASC 718-10, Share-Based Payment to recognize the fair value of stock-based compensation in the financial statements over the requisite service period of the individual grants. The Company uses estimates of volatility, expected term, risk-free interest rate, dividend yield and forfeitures in determining the fair value of these awards and the amount of compensation expense to recognize. Changes in the estimated forfeiture rate could result in changes to current compensation charges for historical grants. For awards with performance conditions, the Company recognizes compensation expense when it becomes probable that the performance target will be achieved. A probability assessment is performed on a quarterly basis and requires significant assumptions and estimates made by management related to the projected achievement of the performance targets, which generally consist of non-GAAP operating earnings, strategic goals and revenue. Changes in the probability assessment of achieving the performance targets are accounted for in the period of change by recording a cumulative catch-up adjustment as if the new estimate had been applied since the service inception date. If the actual performance targets achieved differ significantly from those projected by management, additional compensation expense may be recorded for the performance-based awards due to the cumulative catch-up adjustment, which could have an adverse impact on our results of operations. Income Taxes Income-tax expense is an estimate of current income taxes payable or refundable in the current fiscal year based on reported income before income taxes. Deferred income taxes reflect the effect of temporary differences and carry-forwards that are recognized for financial reporting and income tax purposes. The Company accounts for income taxes under the provisions of ASC 740, Income Taxe s. Under the provisions of ASC 740, deferred tax assets and liabilities are recognized based on the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, utilizing the tax rates that are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company limits the deferred tax assets recognized related to certain officers’ compensation to amounts that it estimates will be deductible in future periods based upon Internal Revenue Code Section 162(m). The Company also recognizes valuation allowances to reduce any deferred tax assets to the amount that it estimates will more likely than not be realized based on available evidence and management’s judgment. In the event that the Company determines, based on available evidence and management judgment, that all or part of the net deferred tax assets will not be realized in the future, it would record a valuation allowance in the period the determination is made. In addition, the calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of complex tax laws. Resolution of these uncertainties in a manner inconsistent with the Company’s expectations could have a material impact on the Company’s results of operations and financial position. The Company recognizes interest and penalties related to income tax matters as income tax expense. The U.S. tax rules require U.S. tax on foreign earnings, known as net Controlled Foreign Corporations tested income (formerly known as global intangible low taxed income, or GILTI). Under U.S. GAAP, we are allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions as a current-period expense when incurred (the “period cost method”) or (2) factoring such amounts into a company’s measurement of its deferred taxes (the “deferred method”). We selected the deferred method of accounting and recorded the associated basis differences anticipated to influence prospective income inclusion calculations. 47 Table of Contents Business Combinations The Company applies the provisions of ASC 805, Business Combinations (“ASC 805”), in accounting for acquisitions. ASC 805 requires that the Company evaluates whether a transaction pertains to an acquisition of assets, or to an acquisition of a business. A business is defined as an integrated set of assets and activities that is capable of being conducted and managed for the purpose of providing a return to investors. Asset acquisitions are accounted for by allocating the cost of the acquisition to the individual assets and liabilities assumed on a relative fair value basis; whereas the acquisition of a business requires the Company to recognize separately from goodwill the assets acquired and the liabilities assumed at the acquisition date fair values. Goodwill is measured as the excess of consideration transferred over the net acquisition date fair values of the assets acquired and the liabilities assumed. While the Company uses its best estimates and assumptions to accurately value assets acquired and liabilities assumed as well as any contingent consideration, where applicable, the estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the business acquisition date, the Company may record certain adjustments to the assets acquired and liabilities assumed with the corresponding adjustment to goodwill. Upon the conclusion of a business acquisition’s measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated statements of operations. All acquisition-related costs are accounted for as expenses in the period in which they are incurred. Goodwill and Intangible Assets Goodwill and the Company’s domain name are evaluated in accordance with ASC 350-10, Goodwill and Other Intangible Assets, and an impairment analysis is conducted on an annual basis, or sooner if indicators exist for a potential impairment. In accordance with ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets , long-lived assets, such as property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Cash and Cash Equivalents The Company considers cash invested in highly liquid financial instruments with maturities of three months or less at the date of purchase to be cash equivalents. Marketable Securities The Company generally holds securities until maturity; however, they may be sold under certain circumstances including, but not limited to, when necessary for the funding of acquisitions and other strategic investments. As a result, the Company classifies its investment portfolio as available-for-sale. The Company classifies all investments with a maturity date greater than three months at the date of purchase as short-term marketable securities in its consolidated balance sheet. As of December 31, 2025 and 2024, the Company’s marketable securities consisted primarily of commercial paper, corporate bonds, government securities and/or other high-quality commercial securities. Employee Benefits Plan The Company sponsors a 401(k) tax-deferred savings plan for all employees in the United States who meet certain eligibility requirements. Participants may contribute up to the amount allowable as a deduction for federal income tax purposes. The Company is not required to contribute; however, the Company contributes a certain percentage of employee annual salaries on a discretionary basis, not to exceed an established threshold. The Company provided for a contribution of approximately $ 2.1 million in each of 2025, 2024 and 2023. Retirement Benefit Obligations (Pension) The Company recognizes the over-funded or under-funded status of a defined benefit pension or post-retirement plan as an asset or liability in the accompanying consolidated balance sheets. Actuarial gains and losses are recorded in accumulated other comprehensive loss, a component of stockholders’ equity, and are amortized as a component of net periodic cost over the remaining estimated service period of participants. 48 Table of Contents Foreign Currency Risk and Foreign Currency Translation As of December 31, 2025, the Company’s primary transactional currency was U.S. dollars; in addition, the Company holds cash in Swiss francs and euros to fund the operations of the Company’s Swiss subsidiary. The foreign exchange rate fluctuation between the U.S. dollar versus the Swiss franc and euro is recorded in other income in the consolidated statements of income. Gains and losses arising from the remeasurement of non-functional currency balances are recorded in other income in the accompanying consolidated statements of income. The Company recognized foreign exchange losses of $ 0.3 million, $ 0.3 million, and $ 0.4 million in 2025, 2024 and 2023, respectively. The functional currencies of the Company’s other subsidiaries are the local currencies. Accordingly, all assets and liabilities are translated into U.S. dollars at the current exchange rates as of the applicable balance sheet date. Revenue and expenses are translated at the average exchange rate prevailing during the period. Cumulative gains and losses from the translation of the foreign subsidiaries’ financial statements have been included accumulated other comprehensive loss in stockholders’ equity. Warranty The Company generally warrants that its products will substantially conform to the published specifications for 12 months from the date of shipment. The Company’s liability is limited to either a credit equal to the purchase price or replacement of the defective part. Returns under warranty have historically been immaterial, and as a result, the Company does not record a specific warranty reserve. Advertising Advertising costs are expensed as incurred and amounted to $ 1.1 million, $ 1.5 million and $ 1.3 million in 2025, 2024 and 2023, respectively. Research and Development Research and development costs are expensed as incurred. Indemnifications The Company sells products to its distributors under contracts, collectively referred to as Distributor Sales Agreements (“DSA”). Each DSA contains the relevant terms of the contractual arrangement with the distributor, and generally includes certain provisions for indemnifying the distributor against losses, expenses, and liabilities from damages that may be awarded against the distributor in the event the Company’s products are found to infringe upon a patent, copyright, trademark, or other proprietary right of a third party (Customer Indemnification). The DSA generally limits the scope of and remedies for the Customer Indemnification obligations in a variety of industry-standard respects, including, but not limited to, limitations based on time and geography, and a right to replace an infringing product. The Company also, from time to time, has granted a specific indemnification right to individual customers. The Company believes its internal development processes and other policies and practices limit its exposure related to such indemnifications. In addition, the Company requires its employees to sign a proprietary information and inventions agreement, which assigns the rights to its employees’ development work to the Company. To date, the Company has not had to reimburse any of its distributors or customers for any losses related to these indemnifications and no material claims were outstanding as of December 31, 2025. For several reasons, including the lack of prior indemnification claims and the lack of a monetary liability limit for certain infringement cases, the Company cannot determine the maximum amount of potential future payments, if any, related to such indemnifications. Adoption of New Accounting Standards In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) : Improvements to Income Tax Disclosures (“ASU 2023-09”), which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual 49 Table of Contents periods beginning after December 15, 2024. The Company adopted the new standard on a prospective basis in fiscal year 2025 for annual reporting periods. Refer to Note 11. Provision ( Benefit) for Income Taxes . ​ Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) which requires additional disclosure of certain costs and expenses, including inventory purchases, employee compensation, selling expense and depreciation expense within the notes to financial statements. The guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact that the updated standard will have on its financial statement disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40) which amends certain aspects of the accounting for and disclosure of software costs. The guidance is effective for annual reporting beginning after December 15, 2027, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact that the updated standard will have on its financial statement disclosures. ​ 3. COMPONENTS OF THE COMPANY’S CONSOLIDATED BALANCE SHEETS: Accounts Receivable ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ December 31, (In thousands) ​ 2025 ​ 2024 Accounts receivable trade ​ $ 54,177 ​ $ 57,308 Allowance for ship and debit ​ ( 33,601 ) ​ ( 26,446 ) Allowance for stock rotation and rebate ​ ( 2,228 ) ​ ( 3,254 ) Allowance for credit losses ​ ​ ( 94 ) ​ ​ ( 436 ) Total ​ $ 18,254 ​ $ 27,172 ​ The Company maintains an allowance for estimated credit losses resulting from the inability of customers to make required payments. This allowance is established using estimates formulated by the Company’s management based upon factors such as the composition of the accounts receivable aging, historical losses, changes in payment patterns, customer creditworthiness, and current economic trends. Receivables determined to be uncollectible are written off and deducted from the allowance. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for Credit Losses ​ ​ Year Ended ​ ​ December 31, (In thousands) ​ 2025 ​ ​ ​ 2024 Beginning balance ​ $ ( 436 ) ​ $ ( 681 ) Provision for credit loss expense ​ ( 215 ) ​ ( 1,475 ) Receivables written off ​ — ​ — Recoveries ​ 557 ​ 1,720 Ending balance ​ $ ( 94 ) ​ $ ( 436 ) ​ Inventories ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ December 31, (In thousands) ​ 2025 ​ 2024 Raw materials ​ $ 101,366 ​ $ 101,414 Work-in-process ​ 27,905 ​ 27,271 Finished goods ​ 37,616 ​ 36,927 Total ​ $ 166,887 ​ $ 165,612 ​ Inventories consist of costs associated with the purchases of wafers from domestic and offshore foundries and of packaged components from offshore assembly manufacturers, as well as internal labor and overhead associated with the testing of both wafers and packaged components. Inventories are recorded at standard cost, which approximates actual cost computed on a first-in, first-out basis, not in excess of net realizable value. The Company routinely evaluates quantities and values of inventories and records a 50 Table of Contents provision for excess and obsolete inventories to reduce its recorded inventory balance to its estimated net realizable value. Historically these write-downs have not been material. The bulk of our inventory is held in wafers, which combined with the fungibility of our products across customers and applications results in a lower risk of obsolescence. ​ Property and Equipment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ December 31, (In thousands) ​ 2025 ​ 2024 Land ​ $ 22,201 ​ $ 22,157 Construction-in-progress ​ 8,609 ​ 12,166 Building and improvements ​ 100,936 ​ 93,248 Machinery and equipment ​ 289,190 ​ 280,345 Computer software and hardware and office furniture and fixtures ​ 77,162 ​ 72,862 Total ​ 498,098 ​ 480,778 Less: Accumulated depreciation ​ ( 351,562 ) ​ ( 331,216 ) Property and equipment, net ​ $ 146,536 ​ $ 149,562 ​ Depreciation expense for property and equipment for fiscal years ended December 31, 2025, 2024 and 2023, was approximately $ 27.2 million, $ 33.3 million and $ 35.2 million, respectively, and was determined using the straight-line method over the following useful lives: ​ ​ ​ ​ ​ ​ Building and improvements ​ ​ 4 - 40 years Machinery and equipment ​ 2 - 8 years Computer software and hardware and office furniture and fixtures ​ 4 - 7 years ​ Total property and equipment (excluding accumulated depreciation) located in the United States at December 31, 2025, 2024 and 2023, was approximately $ 216.3 million, $ 209.7 million and $ 203.6 million, respectively. In 2025, 2024 and 2023, approximately 16 %, 15 % and 15 % of total property and equipment (excluding accumulated depreciation) was held by one of the Company’s subcontractors in Malaysia. No other country held 10% or more of total property and equipment in the periods presented. In 2024 and 2023, approximately 10 % and 11 %, respectively, of total property and equipment (excluding accumulated depreciation) was held in Thailand by one of the Company’s subcontractors. Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss), net of taxes, for the three years ended December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized Gains ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ and Losses on ​ ​ ​ ​ Foreign ​ ​ ​ ​ ​ Available-for-Sale ​ Defined Benefit ​ Currency ​ ​ ​ (In thousands) ​ Securities ​ Pension Items ​ Items ​ Total Balance at January 1, 2023 ​ $ ( 5,323 ) ​ $ 862 ​ $ ( 2,883 ) ​ $ ( 7,344 ) Other comprehensive income (loss) before reclassifications ​ 5,579 ​ 811 ​ ( 420 ) ​ 5,970 Amounts reclassified from accumulated other comprehensive loss ​ — ​ ( 88 ) (1) — ​ ( 88 ) Other comprehensive income (loss) ​ 5,579 ​ 723 ​ ( 420 ) ​ 5,882 Balance at December 31, 2023 ​ 256 ​ 1,585 ​ ( 3,303 ) ​ ( 1,462 ) Other comprehensive income (loss) before reclassifications ​ 437 ​ ( 1,319 ) ​ ( 512 ) ​ ( 1,394 ) Amounts reclassified from accumulated other comprehensive loss ​ — ​ ( 167 ) (1) — ​ ( 167 ) Other comprehensive income (loss) ​ 437 ​ ( 1,486 ) ​ ( 512 ) ​ ( 1,561 ) Balance at December 31, 2024 ​ 693 ​ 99 ​ ( 3,815 ) ​ ( 3,023 ) Other comprehensive income (loss) before reclassifications ​ 1,058 ​ ( 123 ) ​ 991 ​ 1,926 Amounts reclassified from accumulated other comprehensive loss ​ — ​ ( 8 ) (1) — ​ ( 8 ) Other comprehensive income (loss) ​ 1,058 ​ ( 131 ) ​ 991 ​ 1,918 Balance at December 31, 2025 ​ $ 1,751 ​ $ ( 32 ) ​ $ ( 2,824 ) ​ $ ( 1,105 ) (1) This component of accumulated other comprehensive income (loss) is included in the computation of net periodic pension cost for the years ended December 31, 2025, 2024 and 2023. ​ 51 Table of Contents 4. FAIR VALUE MEASUREMENTS: ASC 820-10, Fair Value Measurements , clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, ASC 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices for identical assets in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which requires the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The Company’s cash equivalents and investment instruments are classified within Level 1 or Level 2 of the fair-value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. The type of instrument valued based on quoted market prices in active markets primarily includes money market securities. This type of instrument is generally classified within Level 1 of the fair-value hierarchy. The types of instruments valued based on other observable inputs (Level 2 of the fair-value hierarchy) include investment-grade corporate bonds and commercial paper. Such types of investments are valued by using a multi-dimensional relational model, the inputs are primarily benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data including market research publications. The Company does not hold any instruments that would be classified within Level 3 of the fair-value hierarchy. The fair value hierarchy of the Company’s cash equivalents and marketable securities at December 31, 2025 and 2024, was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurement at ​ ​ December 31, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Active Markets for ​ Significant Other ​ ​ ​ ​ ​ Identical Assets ​ Observable Inputs (In thousands) ​ Total Fair Value ​ (Level 1) ​ (Level 2) Commercial paper ​ $ 5,555 ​ $ — ​ $ 5,555 Corporate securities ​ ​ 189,258 ​ ​ — ​ ​ 189,258 Money market funds ​ 3,559 ​ 3,559 ​ — U.S. government securities ​ ​ 999 ​ ​ — ​ ​ 999 Total ​ $ 199,371 ​ $ 3,559 ​ $ 195,812 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurement at ​ ​ December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Active Markets for ​ Significant Other ​ ​ ​ ​ ​ Identical Assets ​ Observable Inputs (In thousands) ​ Total Fair Value ​ (Level 1) ​ (Level 2) Commercial paper ​ $ 2,048 ​ $ — ​ $ 2,048 Corporate securities ​ ​ 249,023 ​ ​ — ​ ​ 249,023 Money market funds ​ 567 ​ 567 ​ — U.S. government securities ​ ​ 750 ​ ​ — ​ ​ 750 Total ​ $ 252,388 ​ $ 567 ​ $ 251,821 ​ The Company did not transfer any investments between Level 1 and Level 2 of the fair value hierarchy in the years ended December 31, 2025 and 2024. 52 Table of Contents 5. MARKETABLE SECURITIES: Amortized cost and estimated fair market value of marketable securities classified as available-for-sale (excluding cash equivalents) at December 31, 2025, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Gross Unrealized ​ Estimated Fair (In thousands) ​ ​ ​ Cost ​ ​ ​ Gains ​ ​ ​ Losses ​ ​ ​ Market Value Investments due in 3 months or less: ​ ​ ​ ​ ​ ​ ​ ​ Commercial paper ​ $ 1,498 ​ $ — ​ $ — ​ $ 1,498 Corporate securities ​ ​ 8,152 ​ ​ 8 ​ ​ — ​ ​ 8,160 Total ​ 9,650 ​ 8 ​ — ​ 9,658 Investments due in 4-12 months: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ ​ 32,256 ​ 267 ​ — ​ 32,523 Total ​ 32,256 ​ 267 ​ — ​ 32,523 Investments due in 12 months or greater: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ 146,910 ​ 1,665 ​ ( 1 ) ​ 148,574 Total ​ ​ 146,910 ​ 1,665 ​ ​ ( 1 ) ​ 148,574 Total marketable securities ​ $ 188,816 ​ $ 1,940 ​ $ ( 1 ) ​ $ 190,755 ​ Accrued interest receivable was $ 2.3 million at December 31, 2025 and was recorded within prepaid expenses and other current assets on the consolidated balance sheet. Amortized cost and estimated fair market value of marketable securities classified as available-for-sale (excluding cash equivalents) at December 31, 2024, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Gross Unrealized ​ Estimated Fair (In thousands) ​ ​ ​ Cost ​ ​ ​ Gains ​ ​ ​ Losses ​ ​ ​ Market Value Investments due in 3 months or less: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ $ 10,972 ​ $ 4 ​ $ ( 3 ) ​ $ 10,973 Total ​ 10,972 ​ 4 ​ ( 3 ) ​ 10,973 Investments due in 4-12 months: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ 87,346 ​ 159 ​ ( 19 ) ​ 87,486 Total ​ 87,346 ​ 159 ​ ( 19 ) ​ 87,486 Investments due in 12 months or greater: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ 149,817 ​ 860 ​ ( 113 ) ​ 150,564 Total ​ 149,817 ​ 860 ​ ( 113 ) ​ 150,564 Total marketable securities ​ $ 248,135 ​ $ 1,023 ​ $ ( 135 ) ​ $ 249,023 ​ Accrued interest receivable was $ 2.8 million at December 31, 2024 and was recorded within prepaid expenses and other current assets on the consolidated balance sheet. ​ 53 Table of Contents As of December 31, 2025 and 2024 the Company had no marketable securities classified as available-for-sale (excluding cash equivalents) in a continuous unrealized loss position for which an allowance for credit losses was recorded. The following tables summarize marketable securities classified as available-for-sale (excluding cash equivalents) in a continuous unrealized loss position for which an allowance for credit losses was not recorded at December 31, 2025 and December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months ​ 12 Months or Longer ​ Total ​ ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ Fair Market ​ Unrealized ​ Fair Market ​ Unrealized ​ Fair Market ​ Unrealized (In thousands) ​ Value ​ Losses ​ Value ​ Losses ​ Value ​ Losses December 31, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ $ 500 ​ $ ( 1 ) ​ $ — ​ $ — ​ $ 500 ​ $ ( 1 ) Total marketable securities ​ $ 500 ​ $ ( 1 ) ​ $ — ​ $ — ​ $ 500 ​ $ ( 1 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months ​ 12 Months or Longer ​ Total ​ ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ Fair Market ​ Unrealized ​ Fair Market ​ Unrealized ​ Fair Market ​ Unrealized (In thousands) ​ Value ​ Losses ​ Value ​ Losses ​ Value ​ Losses December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ $ 33,777 ​ $ ( 116 ) ​ $ 13,244 ​ $ ( 19 ) ​ $ 47,021 ​ $ ( 135 ) Total marketable securities ​ $ 33,777 ​ $ ( 116 ) ​ $ 13,244 ​ $ ( 19 ) ​ $ 47,021 ​ $ ( 135 ) ​ The Company does not intend to sell and it is unlikely that it will be required to sell the securities prior to their anticipated recovery. The weighted average interest rate of investments at December 31, 2025 and 2024, was approximately 4.86 % and 5.08 %, respectively. In the years ended December 31, 2025 and 2024, no unrealized losses on marketable securities were recognized in income. ​ 6. GOODWILL AND INTANGIBLE ASSETS: Goodwill increased during the year ended December 31, 2024, due to the Company’s acquisition of Odyssey Semiconductor Technologies (“Odyssey”) (refer to Note 15, Acquisition , for details on the Company’s Odyssey acquisition). Changes in the carrying amount of goodwill as of the December 31, 2025 and 2024 are as follows: ​ ​ ​ ​ (in thousands) ​ Goodwill Balance at January 1, 2024 ​ $ 91,849 Goodwill acquired during the period ​ ​ 3,422 Balance at December 31, 2024 ​ ​ 95,271 Goodwill acquired during the period ​ ​ - Ending balance at December 31, 2025 ​ $ 95,271 The $ 3.4 million of goodwill acquired in 2024, resulted from the purchase of Odyssey (see Note 15, Acquisition , for further details). Intangible assets consist primarily of developed technology, in-process research and development, acquired licenses and domain name, and are reported net of accumulated amortization. In July 2024, the Company acquired the assets of Odyssey, a U.S. company and developer of vertical gallium-nitride (“GaN”) transistor technology, resulting in the addition of in-process research and development of $ 4.9 million. The Company amortizes the cost of all intangible assets over the estimated useful life of the developed technology and technology licenses, which range from two to twelve years , with the exception of $ 4.9 million of in-process research and development which will commence amortization once development is completed and products are available for sale as well as $ 1.3 million paid to acquire an internet domain name. The Company does not expect the amortization of its in-process research and development to begin in 2026. The Company acquired the rights to the internet domain name www.power.com , the Company’s primary domain name; the cost to acquire the domain name has been recorded as an intangible asset and will not be amortized as it has an indefinite useful life. 54 Table of Contents Amortization of acquired intangible assets was approximately $ 0.8 million, $ 1.3 million and $ 2.2 million in the years ended December 31, 2025, 2024 and 2023, respectively. The Company does not believe there is any significant residual value associated with the following intangible assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2025 ​ December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ (In thousands) ​ Gross ​ Amortization ​ Net ​ Gross ​ Amortization ​ Net Domain name ​ $ 1,261 ​ $ — ​ $ 1,261 ​ $ 1,261 ​ $ — ​ $ 1,261 In-process research and development ​ ​ 4,930 ​ ​ — ​ ​ 4,930 ​ ​ 4,930 ​ ​ — ​ ​ 4,930 Developed technology ​ 37,960 ​ ( 37,081 ) ​ 879 ​ 37,960 ​ ( 36,492 ) ​ 1,468 Technology licenses ​ 1,926 ​ ( 1,752 ) ​ 174 ​ 1,926 ​ ( 1,510 ) ​ 416 Total intangible assets ​ $ 46,077 ​ $ ( 38,833 ) ​ $ 7,244 ​ $ 46,077 ​ $ ( 38,002 ) ​ $ 8,075 The estimated future amortization expense related to definite-lived intangible assets at December 31, 2025, is as follows: ​ ​ ​ ​ ​ ​ ​ ​ Estimated ​ ​ Amortization Fiscal Year ​ (In thousands) 2026 ​ $ 687 2027 ​ 365 Total* ​ $ 1,052 * Total excludes $ 4.9 million of in-process research and development which will be amortized upon completion of development over the estimated useful life of the technology. ​ ​ ​ 7. STOCK PLANS AND SHARE BASED COMPENSATION: Stock Plans As of December 31, 2025, the Company had three stock-based compensation plans (the “Plans”) which are described below. 2025 Inducement Award Plan The 2025 Inducement Award Plan (“Inducement Plan”) was adopted by the board of directors on November 14, 2025. The Inducement Plan provides for the grant of RSU awards, PSU awards and performance cash awards. No other forms of equity-based awards, including stock options and stock appreciation rights, may be granted. The plan is intended to be used in connection with the recruiting and inducement of senior management and employees. Each award under the Inducement Plan is intended to qualify as an employment inducement grant under the Inducement Listing Rule or to otherwise qualify under the exception relating to plans or arrangements relating to an acquisition or merger under NASDAQ Listing Rule 5635(c)(3) and the official guidance thereunder. Pursuant to Rule 5635(c)(4) of the NASDAQ Listing Rules, the Company did not seek stockholder’s approval. As of December 31, 2025, 0.1 million awards have been issued, net of forfeitures or cancellations, and approximately 0.3 million shares of common stock remain available for future grant under the Inducement Plan. On January 27, 2026, the Talent and Compensation Committee of the board of directors approved the Amended and Restated 2025 Inducement Award Plan, reserving an additional 0.5 million shares of the Company’s common stock, or 0.9 million shares of the Company’s common stock in the aggregate, for issuance pursuant to equity awards granted under the Inducement Plan. 2016 Incentive Award Plan The 2016 Incentive Award Plan (“2016 Plan”) was adopted by the board of directors on March 17, 2016 and approved by the stockholders on May 13, 2016. The 2016 Plan provides for the grant of RSU awards, PSU awards and PRSU awards. No other forms of equity-based awards, including stock options and stock appreciation rights, may be granted under the 2016 Plan. As of December 31, 2025, 4.4 million awards have been issued, net of forfeitures or cancellations, and approximately 2.6 million shares of common stock remain available for future grant under the 2016 Plan. 55 Table of Contents 1997 Employee Stock Purchase Plan Under the 1997 Employee Stock Purchase Plan (“Purchase Plan”), eligible employees may apply accumulated payroll deductions, which may not exceed 15 % of an employee’s compensation, to the purchase of shares of the Company’s common stock at periodic intervals. The purchase price of stock under the Purchase Plan is equal to 85 % of the lower of (i) the fair market value of the Company’s common stock on the first day of each offering period, or (ii) the fair market value of the Company’s common stock on the purchase date (as defined in the Purchase Plan). Each offering period consists of one purchase period of approximately six months duration. An aggregate of 7.5 million shares of common stock were reserved for issuance to employees under the Purchase Plan. As of December 31, 2025, of the shares reserved for issuance, 7.1 million shares had been purchased and 0.4 million shares were reserved for future issuance under the Purchase Plan. Shares Reserved As of December 31, 2025, the Company had approximately 3.5 million shares of common stock reserved for future grant under all stock plans. Stock-Based Compensation The Company applies the provisions of ASC 718-10, Stock Compensation . Under the provisions of ASC 718-10, the Company recognizes the fair value of stock-based compensation in its financial statements over the requisite service period of the individual grants, which generally equals a four-year vesting period. The Company uses estimates of volatility, expected term, risk-free interest rate, dividend yield and forfeitures in determining the fair value of these awards and the amount of compensation expense to recognize. The Company uses the straight-line method to amortize all stock awards granted over the requisite service period of the award. The following table summarizes the stock-based compensation expense recognized in accordance with ASC 718-10 for the years ended December 31, 2025, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Cost of revenue ​ $ 1,998 ​ $ 2,090 ​ $ 1,692 Research and development ​ 10,235 ​ 12,587 ​ 10,939 Sales and marketing ​ 6,460 ​ 8,064 ​ 6,888 General and administrative ​ 12,563 ​ 12,335 ​ 9,009 Other operating expenses ​ ​ 8,434 ​ ​ — ​ ​ — Total stock-based compensation expense ​ $ 39,690 ​ $ 35,076 ​ $ 28,528 ​ The following table summarizes total compensation expense related to unvested awards not yet recognized, net of expected forfeitures, and the weighted average period over which it is expected to be recognized as of December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized Compensation ​ ​ ​ Weighted Average ​ ​ Expense for Unvested ​ Remaining Recognition ​ ​ Awards ​ Period ​ ​ (In thousands) ​ (In years) Long-term performance-based awards ​ $ 5,278 1.74 Restricted stock units ​ 43,058 2.65 Purchase plan ​ 171 0.08 Total unrecognized compensation expense ​ $ 48,507 ​ ​ Stock-based compensation expense in the year ended December 31, 2025, was approximately $ 39.7 million, comprising approximately $ 22.8 million related to restricted stock units, $ 8.4 million related to the modification of outstanding equity awards held by the Company’s former chief executive officer, $ 6.9 million related to performance-based awards and long-term performance-based awards and $ 1.6 million related to the Company’s employee stock purchase plan. Stock-based compensation expense in the year ended December 31, 2024, was approximately $ 35.1 million, comprising approximately $ 25.7 million related to restricted stock units, $ 7.7 million related to performance-based awards and long-term performance-based awards and $ 1.7 million related to the Company’s employee stock purchase plan. 56 Table of Contents Stock-based compensation expense in the year ended December 31, 2023, was approximately $ 28.5 million, comprising approximately $ 23.4 million related to restricted stock units, $ 3.2 million related to performance-based awards and long-term performance-based awards and $ 1.9 million related to the Company’s employee stock purchase plan. In connection with his retirement in July 2025, the Company’s former chief executive officer, Balu Balakrishnan, entered into a transition agreement and a consulting agreement with the Company. Pursuant to these agreements, Mr. Balakrishnan’s outstanding equity awards continue to vest subject to his continuous service and the applicable award agreements. The vast majority of these awards are subject to performance criteria established at the time of grant and will only be earned if such criteria are met at the conclusion of the applicable performance periods. As the services to be performed by Mr. Balakrishnan under the transition agreement and the consulting agreement do not qualify as “substantive services” under ASC 718-10 , the continued vesting of the outstanding equity awards represents a modification of the original awards. As a result, in the year ended December 31, 2025, the Company recognized stock-based compensation in the amount of $ 8.4 million in other operating expenses on the consolidated statements of income related to the accounting modification in July 2025 and subsequent changes in performance criteria measurement. Further subsequent changes in performance criteria measurement could result in an adjustment to expense in future periods. Employee Stock Purchase Plan The fair value of employees’ stock purchase rights under the Purchase Plan was estimated using the Black-Scholes model with the following weighted-average assumptions used during the three years ended December 31, 2025, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ 2025 ​ 2024 ​ 2023 Risk-free interest rates ​ 4.21 % ​ ​ 5.15 % ​ ​ 5.15 % Expected volatility rates ​ 46 % ​ ​ 36 % ​ ​ 37 % Expected dividend yield ​ 1.58 % ​ ​ 1.15 % ​ ​ 0.90 % Expected term of purchase rights (in years) ​ 0.50 ​ ​ 0.50 ​ ​ 0.49 Weighted-average estimated fair value of purchase rights ​ $ 14.81 ​ ​ $ 18.27 ​ ​ $ 23.75 ​ ​ PSU Awards Under the performance-based awards program, the Company grants awards in the performance year in an amount equal to twice the target number of shares to be issued if the maximum performance metrics are met. The number of shares that are released at the end of the performance year can range from zero to 200 % of the target number depending on the Company’s performance. The performance metrics of this program are annual targets consisting of a combination of net revenue, non-GAAP operating income and strategic goals. As the net revenue, non-GAAP operating income and strategic goals are considered performance conditions, expense associated with these awards, net of estimated forfeitures, is recognized over the service period based on an assessment of the expected achievement of the performance targets. The fair value of these PSUs is determined using the fair value of the Company’s common stock on the date of the grant, reduced by the discounted present value of dividends expected to be declared before the awards vest. If the performance conditions are not achieved, no compensation cost is recognized and any previously recognized compensation is reversed. 57 Table of Contents A summary of PSU awards outstanding as of December 31, 2025, and activity during the three years then ended, is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ ​ ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ Remaining ​ Aggregate ​ ​ Shares ​ Grant Date Fair ​ Contractual Term ​ Intrinsic Value ​ ​ ​ ​ (In thousands) ​ ​ ​ Value Per Share ​ ​ ​ (In years) ​ ​ ​ (In thousands) Outstanding at January 1, 2023 34 ​ $ 79.94 ​ ​ ​ Granted 131 ​ $ 82.96 ​ ​ ​ Vested ( 34 ) ​ $ 79.94 ​ ​ ​ Forfeited or canceled ( 93 ) ​ $ 82.96 ​ ​ ​ Outstanding at December 31, 2023 38 ​ $ 82.95 ​ ​ ​ Granted 185 ​ $ 69.97 ​ ​ ​ Vested ( 38 ) ​ $ 82.94 ​ ​ ​ Forfeited or canceled ( 119 ) ​ $ 69.98 ​ ​ ​ Outstanding at December 31, 2024 66 ​ $ 69.95 ​ ​ ​ Granted 218 ​ $ 53.61 ​ ​ ​ Vested ( 66 ) ​ $ 69.95 ​ ​ ​ Forfeited or canceled ( 143 ) ​ $ 53.82 ​ ​ ​ Outstanding at December 31, 2025 75 ​ $ 53.21 — ​ $ 2,667 Outstanding and expected to vest at December 31, 2025 75 ​ ​ ​ — ​ $ 2,667 ​ In February 2025, it was determined that approximately 66,000 shares subject to the PSUs granted in 2024 vested in aggregate; the shares were released to the Company’s employees and executives in the first quarter of 2025. The grant-date fair value of PSU awards released, which were fully vested, in the years ended December 31, 2025, 2024 and 2023, was approximately $ 4.6 million, $ 3.2 million and $ 2.7 million, respectively. PRSU Awards (Long-term Performance Based) The Company’s PRSU program provides for the issuance of PRSUs which will vest based on the Company’s performance measured against the PRSU program’s established performance targets. PRSUs are granted in an amount equal to twice the target number of shares to be issued if the maximum performance metrics are met. The actual number of shares the recipient receives is determined at the end of a three-year performance period based on results achieved versus the Company’s performance goals, and may range from zero to 200 % of the target number. The performance goals for PRSUs granted in fiscal 2023, 2024 and 2025 were based on the Company’s compound annual growth rate (“CAGR”) of revenue as measured against the revenue CAGR of the analog semiconductor industry (“Relative Measure”) or the Company’s revenue growth over as compared to defined targets (“Absolute Measure”) in each case over the respective three-year performance period. Actual vesting of the PRSUs is calculated based on higher achievement under the Relative Measure or the Absolute Measure. Expense associated with these awards, net of estimated forfeitures, is recorded throughout the year based on an assessment of the expected achievement of the performance targets. If the performance conditions are not achieved, no compensation cost is recognized and any previously recognized compensation is reversed. 58 Table of Contents A summary of PRSU awards outstanding as of December 31, 2025, and activity during the three years then ended, is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ Aggregate ​ ​ ​ ​ Weighted-Average ​ Remaining ​ Intrinsic ​ ​ Shares ​ Grant Date Fair ​ Contractual Term ​ Value ​ ​ ​ ​ (In thousands) ​ ​ ​ Value Per Share ​ ​ ​ (In years) ​ ​ ​ (In thousands) Outstanding at January 1, 2023 236 ​ $ 77.82 ​ ​ ​ Granted 146 ​ $ 80.92 ​ ​ ​ Vested ( 23 ) ​ $ 49.68 ​ ​ ​ Forfeited or canceled ( 103 ) ​ $ 82.92 ​ ​ ​ Outstanding at December 31, 2023 256 ​ $ 80.08 ​ ​ ​ Granted 186 ​ $ 68.30 ​ ​ ​ Vested — ​ ​ — ​ ​ ​ Forfeited or canceled ( 125 ) ​ $ 78.34 ​ ​ ​ Outstanding at December 31, 2024 317 ​ $ 73.85 ​ ​ ​ Granted 307 ​ $ 52.56 ​ ​ ​ Vested — ​ ​ — ​ ​ ​ Forfeited or canceled ( 179 ) ​ $ 76.85 ​ ​ ​ Outstanding at December 31, 2025 445 ​ $ 57.97 1.64 ​ $ 15,829 Outstanding and expected to vest at December 31, 2025 259 ​ ​ ​ ​ 1.85 ​ $ 9,220 ​ In February 2025, it was determined that no shares subject to the PRSUs granted in 2022 vested, thus no shares were released to the Company’s executives. In February 2024, it was determined that no shares subject to the PRSUs granted in 2021 vested, thus no shares were released to the Company’s executives. The grant-date fair value of PRSU awards released, which were fully vested, in the year ended December 31, 2023, was approximately $ 1.1 million. RSU Awards RSUs granted to employees typically vest ratably over a four-year period and are converted into shares of the Company’s common stock upon vesting on a one-for-one basis subject to the employee’s continued service to the Company over that period. The fair value of RSUs is determined using the fair value of the Company’s common stock on the date of the grant, reduced by the discounted present value of dividends expected to be declared before the awards vest. Compensation expense is recognized on a straight-line basis over the requisite service period of each grant adjusted for estimated forfeitures. A summary of RSU awards outstanding as of December 31, 2025, and activity during the three years then ended, is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ Aggregate ​ ​ ​ ​ Weighted-Average ​ Remaining ​ Intrinsic ​ ​ Shares ​ Grant Date Fair ​ Contractual Term ​ Value ​ ​ ​ ​ (In thousands) ​ ​ ​ Value Per Share ​ ​ ​ (In years) ​ ​ ​ (In thousands) Outstanding at January 1, 2023 1,096 ​ $ 60.52 ​ ​ ​ Granted 335 ​ $ 80.97 ​ ​ ​ Vested ( 418 ) ​ $ 53.08 ​ ​ ​ Forfeited ( 32 ) ​ $ 73.29 ​ ​ ​ Outstanding at December 31, 2023 981 ​ $ 70.27 ​ ​ ​ Granted 440 ​ $ 67.09 ​ ​ ​ Vested ( 371 ) ​ $ 64.28 ​ ​ ​ Forfeited ( 121 ) ​ $ 72.87 ​ ​ ​ Outstanding at December 31, 2024 929 ​ $ 70.82 ​ ​ ​ Granted 612 ​ $ 44.28 ​ ​ ​ Vested ( 350 ) ​ $ 62.54 ​ ​ ​ Forfeited ( 179 ) ​ $ 35.53 ​ ​ ​ Outstanding at December 31, 2025 1,012 ​ $ 63.87 1.47 ​ $ 35,954 Outstanding and expected to vest at December 31, 2025 952 ​ ​ ​ 1.42 ​ $ 33,846 ​ The grant-date fair value of RSUs vested in the years ended December 31, 2025, 2024 and 2023, was approximately $ 21.9 million, $ 23.9 million and $ 22.2 million, respectively. 59 Table of Contents ​ 8. SIGNIFICANT CUSTOMERS AND GEOGRAPHIC NET REVENUE: Customer Concentration The Company’s top ten customers accounted for approximately 81 %, 79 % and 80 % of revenue in 2025, 2024 and 2023, respectively. A significant portion of these revenue are attributable to sales of the Company’s products to distributors of electronic components. These distributors sell the Company’s products to a broad, diverse range of end users, including OEMs and merchant power supply manufacturers. Similarly, merchant power-supply manufacturers sell power supplies incorporating the Company’s products to a broad range of OEMs. Sales to distributors in 2025, 2024 and 2023 were $ 304.6 million, $ 292.9 million and $ 307.4 million, respectively. Direct sales to OEMs and power-supply manufacturers accounted for the remainder. The following customers represented 10% or more of the Company’s net revenue for the respective years : ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, Customer ​ ​ ​ 2025 ​ 2024 ​ 2023 Avnet ​ 32 % ​ 30 % ​ 27 % Salcomp Group 11 % ​ * ​ ​ 10 % Honestar Technologies Co., Ltd. ​ * ​ ​ 11 % ​ 18 % * Total customer revenue was less than 10% of net revenue. No other customers accounted for 10% or more of the Company’s net revenue in the periods presented. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash investments and trade receivables. The Company does not have any off-balance-sheet credit exposure related to its customers. As of December 31, 2025 and 2024, 89 % and 87 % of accounts receivable were concentrated with the Company’s top ten customers, respectively. The following customers represented 10% or more of accounts receivable: ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, Customer ​ ​ ​ 2025 ​ 2024 Avnet ​ 32 % ​ 32 % Salcomp Group 18 % ​ 13 % Honestar Technologies Co., Ltd. ​ 11 % ​ 12 % ​ No other customers accounted for 10% or more of the Company’s accounts receivable in the periods presented. Geographic Net Revenue The Company markets its products globally through its sales personnel and a worldwide network of independent sales representatives and distributors. Geographic net revenue by region and country with 5% or more of the Company’s revenue during any of the periods presented, based on “bill to” customer locations were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Americas ​ $ 22,874 ​ $ 20,888 ​ $ 22,165 EMEA: ​ ​ ​ ​ ​ ​ ​ ​ ​ Germany ​ ​ 27,235 ​ ​ 22,047 ​ ​ 23,041 Other EMEA ​ ​ 22,994 ​ ​ 22,866 ​ ​ 27,820 APAC: ​ ​ ​ ​ ​ ​ ​ ​ ​ Hong Kong/China ​ 245,909 ​ ​ 238,477 ​ ​ 265,936 India ​ ​ 23,649 ​ ​ 27,820 ​ ​ 34,558 Korea ​ ​ 39,537 ​ ​ 37,790 ​ ​ 24,956 Taiwan ​ ​ 25,518 ​ ​ 22,202 ​ ​ 15,774 Other APAC ​ 35,788 ​ ​ 26,883 ​ ​ 30,288 Total net revenue ​ $ 443,504 ​ $ 418,973 ​ $ 444,538 ​ ​ ​ 60 Table of Contents 9. COMMON STOCK REPURCHASES AND CASH DIVIDENDS: Common Stock Repurchases From time to time the Company’s board of directors has authorized the use of funds to repurchase shares of the Company’s common stock. As of December 31, 2024, the Company had $ 48.1 million available under a stock-repurchase program announced in November 2024. After this authorization was exhausted in April 2025, the Company’s board of directors authorized the use of an additional $ 50.0 million for the repurchase of the Company’s common stock, with repurchases to be executed according to pre-defined price/volume guidelines. In 2025, 2024 and 2023, the Company purchased approximately 2.0 million shares, 0.4 million shares and 0.8 million shares, respectively, for approximately $ 98.1 million, $ 27.9 million and $ 55.3 million, respectively. As of December 31, 2025, the Company had exhausted their repurchase authorization. Any future repurchase program would be authorized at the discretion of the Company’s board of directors and will depend on the Company’s financial condition, results of operations, capital requirements, business conditions and other factors. Common Stock Dividends The following table presents the quarterly dividends declared per share of the Company’s common stock for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 First Quarter ​ $ 0.21 ​ $ 0.20 ​ $ 0.19 Second Quarter ​ $ 0.21 ​ $ 0.20 ​ $ 0.19 Third Quarter ​ $ 0.21 ​ $ 0.20 ​ $ 0.19 Fourth Quarter ​ $ 0.21 ​ $ 0.21 ​ $ 0.20 ​ The Company paid approximately $ 47.2 million, $ 46.0 million and $ 44.0 million in cash dividends during 2025, 2024 and 2023, respectively. In February 2023, the Company’s board of directors declared dividends of $ 0.19 per share to be paid to stockholders of record at the end of each quarter in 2023. In October 2023, the Company’s board of directors raised the cash dividend with the declaration of four cash dividends of $ 0.20 per share to be paid to stockholders of record at the end of the fourth quarter in 2023 (in lieu of the $ 0.19 per share announced in February 2023) and at the end of each quarter in 2024 . In October 2024, the Company’s board of directors raised the cash dividend with the declaration of five cash dividends of $ 0.21 per share to be paid to stockholders of record at the end of the fourth quarter in 2024 (in lieu of the $ 0.20 per share announced in October 2023) and at the end of each quarter in 2025 . In October 2025, the Company’s board of directors raised the quarterly cash dividend with the declaration of four cash dividends of $ 0.215 per share to be paid at the end of each quarter in 2026. ​ 10. EARNINGS PER SHARE: Basic earnings per share are calculated by dividing net income by the weighted-average shares of common stock outstanding during the period. Diluted earnings per share are calculated by dividing net income by the weighted-average shares of common stock and dilutive common equivalent shares outstanding during the period. Dilutive common equivalent shares included in this calculation consist of the assumed vesting of outstanding restricted stock units, the assumed issuance of awards under the stock purchase plan and contingently issuable performance-based awards, as computed using the treasury stock method. 61 Table of Contents A summary of the earnings per share calculation is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands, except per share amounts) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Basic earnings per share: ​ ​ ​ ​ ​ ​ Net income ​ $ 22,093 ​ $ 32,234 ​ $ 55,735 Weighted-average common shares ​ 56,063 ​ 56,820 ​ 57,195 Basic earnings per share ​ $ 0.39 ​ $ 0.57 ​ $ 0.97 Diluted earnings per share: (1) ​ ​ ​ ​ ​ ​ Net income ​ $ 22,093 ​ $ 32,234 ​ $ 55,735 Weighted-average common shares ​ 56,063 ​ 56,820 ​ 57,195 Effect of dilutive awards: ​ ​ ​ ​ ​ ​ Employee stock plans ​ 261 ​ 310 ​ 427 Diluted weighted-average common shares ​ 56,324 ​ 57,130 ​ 57,622 Diluted earnings per share ​ $ 0.39 ​ $ 0.56 ​ $ 0.97 (1) The Company includes the shares underlying performance-based awards in the calculation of diluted earnings per share if the performance conditions have been satisfied as of the end of the reporting period and excludes such shares when the necessary conditions have not been met. The Company has excluded the shares underlying the outstanding performance-based awards in the 2025, 2024 and 2023 calculations as the shares were not contingently issuable as of the end of the respective periods. In the years ended December 31, 2025, 2024 and 2023, no outstanding stock awards were determined to be anti-dilutive and excluded from the computation of diluted earnings per share. ​ 11. PROVISION (BENEFIT) FOR INCOME TAXES: Income Taxes The Company accounts for income taxes under the provisions of ASC 740, Income Taxes . Under the provisions of ASC 740, deferred tax assets and liabilities are recognized based on the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, utilizing the tax rates that are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. U.S. and foreign components of income before income taxes were: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 U.S. operations ​ $ ( 25,273 ) ​ $ ( 4,521 ) ​ $ 2,995 Foreign operations ​ 46,252 ​ 35,275 ​ 42,912 Total income before income taxes ​ $ 20,979 ​ $ 30,754 ​ $ 45,907 ​ The Company’s effective tax rate is impacted by the geographic distribution of the Company’s world-wide earnings in lower-tax jurisdictions, federal research tax credits and the recognition of excess tax benefits related to share-based payments. The rate was further reduced by the release of federal uncertain tax position caused by an expiration in the statute of limitations on these positions. These benefits were partially offset by foreign income subject to U.S. tax, known as Net Controlled Foreign Corporation Tested Income ("NCTI"). The Company’s primary jurisdiction where foreign earnings are derived is the Cayman Islands, which is a non-taxing jurisdiction. Income earned in other foreign jurisdictions was not material. The Company has not been granted any incentivized tax rates and does not operate under any tax holidays in any jurisdiction. The Company has adopted Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” on a prospective basis for the year ended December 31, 2025. See Note 2. Significant Accounting Policies - Adoption of New Accounting Standards for additional details on the adoption of ASU 2023-09. 62 Table of Contents The provision (benefit) for income taxes differs from the amount that would result by applying the applicable federal income tax rate to income before income taxes, as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 (In thousands) ​ Amount ​ Percent U.S. Federal Statutory Tax Rate $ 4,406 ​ 21.0 % State and Local Income Taxes, Net of Federal Income Tax Effect (a) ​ ​ ( 512 ) ​ ( 2.4 ) ​ Foreign tax effects ​ ​ ​ ​ ​ ​ Cayman ​ ​ ​ ​ ​ ​ Statutory tax rate difference between Cayman and United States ​ ​ ( 8,439 ) ​ ( 40.2 ) ​ Other foreign jurisdictions ​ ​ ( 440 ) ​ ( 2.1 ) ​ Enacted changes in tax laws or rates ​ ​ 1,002 ​ 4.8 ​ Effect of Cross-Border Tax Laws ​ ​ ​ ​ ​ ​ Global intangible low-taxed income ​ ​ 3,040 ​ 14.5 ​ Tax Credits ​ ​ ​ ​ ​ ​ Research and development tax credits ​ ​ ( 2,793 ) ​ ( 13.3 ) ​ Energy-related tax credits ​ ​ ( 1,258 ) ​ ( 6.0 ) ​ Nontaxable and Nondeductible Items ​ ​ ​ ​ ​ ​ Share-based payment awards ​ ​ 3,620 ​ 17.2 ​ Other ​ ​ 243 ​ 1.1 ​ Change in Unrecognized Tax Benefits ​ 17 ​ 0.1 ​ Total $ ( 1,114 ) ​ ( 5.3 ) % (a) State taxes in California made up the majority ( greater than 50% ) of the tax effect in this category. As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the components of the benefits for income taxes were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2024 ​ ​ ​ 2023 Current provision (benefit): ​ ​ ​ ​ Federal ​ $ 5,876 ​ $ ( 1,193 ) State ​ 3 ​ 3 Foreign ​ 1,392 ​ 1,331 ​ ​ 7,271 ​ 141 Deferred provision (benefit): ​ ​ ​ ​ Federal ​ ( 8,177 ) ​ ( 9,178 ) State ​ — ​ — Foreign ​ ( 574 ) ​ ( 791 ) ​ ​ ( 8,751 ) ​ ( 9,969 ) Total ​ $ ( 1,480 ) ​ $ ( 9,828 ) ​ 63 Table of Contents As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the statutory federal income tax rate as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ ​ ​ 2023 Provision (benefit) computed at Federal statutory rate 21.0 % 21.0 % Business tax credits ​ ( 14.6 ) ​ ​ ( 12.2 ) ​ Stock-based compensation ​ 6.4 ​ ​ ( 0.1 ) ​ Foreign income taxed at different rate ​ ( 21.0 ) ​ ​ ( 17.6 ) ​ GILTI inclusion ​ 2.4 ​ ​ 4.1 ​ Uncertain tax positions ​ ( 3.7 ) ​ ​ ( 18.6 ) ​ Valuation allowance ​ 5.3 ​ ​ 4.3 ​ Other ​ ( 0.6 ) ​ ​ ( 2.3 ) ​ Total ​ ( 4.8 ) % ​ ( 21.4 ) % ​ The components of the net deferred income tax assets (liabilities) were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, (In thousands) ​ 2025 ​ 2024 Deferred tax assets: ​ ​ ​ ​ R&D costs capitalized for tax purposes ​ $ 36,717 ​ $ 39,807 Other reserves and accruals ​ ​ 6,189 ​ ​ 3,598 Tax credit carry-forwards ​ 31,968 ​ 29,558 Stock compensation ​ 4,175 ​ 3,155 Capital losses ​ 140 ​ 140 Net operating loss ​ 1,761 ​ 2,268 Other ​ 366 ​ 421 Valuation allowance ​ ( 34,868 ) ​ ( 32,659 ) ​ ​ 46,448 ​ 46,288 Deferred tax liabilities: ​ ​ ​ ​ Fixed assets, Intangible and Goodwill ​ ( 10,865 ) ​ ​ ( 9,814 ) ​ ​ ( 10,865 ) ​ ( 9,814 ) Net deferred tax assets ​ $ 35,583 ​ $ 36,474 ​ In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities and projected future taxable income. In the event that the Company determines, based on available evidence and management judgment, that all or part of the net deferred tax assets will not be realized in the future, the Company would record a valuation allowance in the period the determination is made. In addition, the calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of complex tax laws. Resolution of these uncertainties in a manner inconsistent with the Company’s expectations could have a material impact on its results of operations and financial position. As of December 31, 2025, the Company continues to maintain a valuation allowance primarily as a result of its California, New Jersey and Canada deferred tax assets as the Company believes that it is not more likely than not that the deferred tax assets will be realized. As of December 31, 2025, the Company had utilized all its federal research and development tax credit carry-forwards. As of December 31, 2025, the Company had California research and development tax credit carry-forwards of approximately $ 46.0 million (there is no expiration of research and development tax credit carry-forwards for the state of California) and California net operating losses of $ 36.9 million, which will begin to expire in 2032 . As of December 31, 2025, the Company had Canadian scientific research and experimental development tax credit carry-forwards of approximately $ 3.9 million and New Jersey research and experimental development tax credit carry-forwards of approximately $ 1.0 million, which will start to expire in 2033 and 2026 , respectively. Tax law signed into law on December 22, 2017, generally allows companies to repatriate accumulated foreign earnings without incurring additional U.S. federal taxes beginning after December 31, 2017. Local foreign and U.S. states taxes may still be incurred upon repatriation. The Company has not provided for U.S. taxes on its undistributed earnings of foreign subsidiaries. The determination of the future tax consequences of the remittance of these earnings is not practicable. 64 Table of Contents The foregoing items could have a material effect on our business, cash flow, results of operations or financial conditions. Unrecognized Tax Benefits The Company applies the provisions of ASC 740-10, relating to accounting for uncertain income taxes. Reconciliation of the beginning and ending amount of unrecognized tax benefits: ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized (In thousands) ​ Tax Benefits Unrecognized tax benefits balance at January 1, 2023 ​ $ 23,386 Gross increase for tax positions of current year ​ 605 Gross decrease for tax positions of prior years ​ ​ — Statute of limitation release for tax positions of prior years ​ ( 7,602 ) Unrecognized tax benefits balance at December 31, 2023 ​ 16,389 Gross increase for tax positions of current year ​ 765 Gross decrease for tax positions of prior years ​ ​ ( 876 ) Statute of limitation release for tax positions of prior years ​ ( 1,103 ) Unrecognized tax benefits balance at December 31, 2024 ​ 15,175 Gross increase for tax positions of current year ​ 1,432 Gross decrease for tax positions of prior years ​ ​ — Statute of limitation release for tax positions of prior years ​ ( 1,281 ) Unrecognized tax benefits balance at December 31, 2025 ​ $ 15,326 ​ The Company’s total unrecognized tax benefits as of December 31, 2025, 2024 and 2023, were $ 15.3 million, $ 15.2 million and $ 16.4 million, respectively. An income tax benefit of $ 3.3 million, net of valuation allowance adjustments, would be recorded if fiscal year 2025 unrecognized tax benefits are recognized. The Company’s continuing practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had accrued interest and penalties of $ 0.5 million and $ 0.3 million as of December 31, 2025 and 2024, respectively, which have been recorded in long-term income taxes payable in the accompanying consolidated balance sheets. As of December 31, 2025, the Company’s tax returns continue to remain effectively subject to examination by U.S. federal authorities for the years after 2021. The Company has closed its audit with the California Franchise Tax Board for the tax years 2018 and 2019 without material change. The California Franchise Tax Board has started an audit for the tax years 2020 through 2022, which is currently ongoing. The amount of cash taxes paid by the Company is as follows: ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ ​ ​ 2025 Federal $ 1,668 State ​ ​ 58 Foreign ​ ​ China ​ 440 Germany ​ 218 Switzerland ​ 190 Other foreign* ​ 457 Income Taxes, net of amounts refunded ​ $ 3,031 ​ ​ * The amount of income taxes paid during the year does not meet the 5% disaggregation threshold. ​ ​ 12. LEASES AND COMMITMENTS: Facilities and Leases The Company owns its main executive, administrative, manufacturing and technical offices in San Jose, California. The Company also owns a research and development facility in New Jersey, a design center in Germany and a multipurpose office building in Switzerland. The Company’s leases consist of operating leases for administrative office spaces, research-and-development facilities and sales offices in various countries around the world. The Company determines whether an arrangement is a lease at inception. Some lease agreements contain lease and non-lease components, which are accounted for as a single lease component. Total lease expense was $ 4.4 million, $ 3.9 million and $ 3.6 million 65 Table of Contents for the years ended December 31, 2025, 2024 and 2023; short-term and variable lease expenses were not material during these periods. Balance sheet information related to leases was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, (In thousands) ​ Balance Sheet Classification ​ 2025 ​ 2024 Right-of-use assets ​ ​ ​ ​ ​ ​ ​ ​ Operating lease assets ​ Other assets ​ $ 19,427 ​ $ 16,076 ​ ​ ​ ​ ​ ​ ​ ​ ​ Lease liabilities ​ ​ ​ ​ ​ ​ Current operating lease liabilities ​ Other accrued liabilities ​ $ 2,984 ​ $ 2,929 Non-current operating lease liabilities ​ Other liabilities ​ 15,899 ​ 12,631 Total ​ ​ ​ $ 18,883 ​ $ 15,560 ​ Initial lease terms are determined at commencement and may include options to extend or terminate the lease when it is reasonably certain the Company will exercise the option. Remaining lease terms range from one to nine years , some of which include options to extend for up to six years , and some of which include options to terminate within one year . Leases with an initial term of twelve months or less are not recorded on the balance sheet. As the Company’s leases do not provide an implicit rate, the present value of future lease payments is determined using the Company’s incremental borrowing rate based on information available at commencement date. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, Lease term and discount rate ​ 2025 ​ 2024 Weighted average remaining lease term ​ 6.1 years ​ 5.8 years Weighted average discount rate 6.6 % ​ 6.7 % ​ Supplemental cash flows information related to leases was as follow: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2025 ​ 2024 Cash paid for amounts included in the measurement of lease liabilities: ​ ​ ​ ​ ​ ​ Operating cash flows from operating leases ​ $ 4,393 ​ $ 4,008 Right-of-use assets obtained in exchange for new operating lease obligations ​ $ 6,473 ​ $ 9,495 ​ Future minimum lease payments under all non-cancelable lease agreements as of December 31, 2025, are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, (In thousands) ​ 2025 2026 ​ $ 4,161 2027 ​ 4,163 2028 ​ 3,611 2029 ​ 3,183 2030 ​ ​ 2,999 Thereafter ​ 5,595 Total future minimum lease payments ​ 23,712 Less imputed interest ​ ( 4,829 ) Total ​ $ 18,883 ​ Purchase Obligations At December 31, 2025, the Company had no non-cancelable purchase obligations that were due beyond one year. 13. SEGMENT REPORTING: The Company is organized and operates as one operating and reportable segment; the design, development, manufacture and marketing of integrated circuits and related components for use primarily in high-voltage power conversion. This determination is based on the management approach which designates internal information regularly available to the Chief Operating Decision Maker (“CODM”) for making decisions and assessing performance as the source of determination of the Company’s reportable segments. The Company’s CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis for the purpose of making operating decisions and assessing financial performance. 66 Table of Contents The CODM uses net income as the measure of profit or loss to allocate resources and assess performance. The CODM regularly reviews net income as reported on the Company’s consolidated statements of income. Financial forecasts and budget to actual results used by the CODM to assess performance and allocate resources, as well as those used for strategic decisions related to headcount and capital expenditures are also reviewed on a consolidated basis. The CODM considers the impact on net income of the significant segment expenses in the table below when deciding whether to reinvest profits, propose dividends or share repurchase, or pursue strategic mergers and acquisitions. The measure of segment assets is reported on the balance sheet as total assets. The CODM does not review segment assets at a level other than that presented in the Company’s consolidated balance sheets. The table below presents the Company’s consolidated operating results including significant segment expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 NET REVENUE ​ $ 443,504 ​ $ 418,973 ​ $ 444,538 Less: ​ ​ ​ ​ ​ ​ ​ ​ ​ Stock-based compensation (1) ​ ​ 39,690 ​ ​ 35,076 ​ ​ 28,528 Amortization of acquisition-related intangible assets (2) ​ ​ 587 ​ ​ 1,034 ​ ​ 1,928 Cost of revenue (excluding 1 & 2) ​ ​ 199,270 ​ ​ 191,098 ​ ​ 211,962 Research and development (excluding 1) ​ ​ 90,881 ​ ​ 88,203 ​ ​ 85,128 Sales and marketing (excluding 1) ​ ​ 61,492 ​ ​ 59,761 ​ ​ 57,710 General and administrative (excluding 1) ​ ​ 30,138 ​ ​ 25,872 ​ ​ 24,223 Other operating expenses (excluding 1) ​ ​ 11,252 ​ ​ — ​ ​ — INCOME FROM OPERATIONS ​ ​ 10,194 ​ ​ 17,929 ​ ​ 35,059 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ OTHER INCOME ​ ​ 10,785 ​ ​ 12,825 ​ ​ 10,848 PROVISION (BENEFIT) FOR INCOME TAXES ​ ​ ( 1,114 ) ​ ​ ( 1,480 ) ​ ​ ( 9,828 ) NET INCOME ​ $ 22,093 ​ $ 32,234 ​ $ 55,735 ​ The table below presents other segment information: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (In thousands) ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Depreciation ​ $ 27,195 ​ $ 33,303 ​ $ 35,203 Amortization of intangibles ​ $ 831 ​ $ 1,279 ​ $ 2,173 Interest income ​ $ 11,682 ​ $ 13,576 ​ $ 11,655 ​ ​ 14. LEGAL PROCEEDINGS AND CONTINGENCIES: From time to time in the ordinary course of business, the Company becomes involved in lawsuits, or customers and distributors may make claims against the Company. In accordance with ASC 450-10, Contingencies, the Company makes a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. On December 18, 2019, CogniPower LLC (“CogniPower”) filed a complaint against a customer of the Company in the United States District Court for the District of Delaware for infringement of two patents; the Company thereafter intervened and sought a declaration of non-infringement with respect to use of the Company’s products. Following a trial in August 2025, the Company successfully obtained verdicts of noninfringement and invalidity of all asserted claims, and as part of the noninfringement verdict, the jury found that no products incorporating the Company’s InnoSwitch products met the specific requirements of CogniPower’s asserted claims. The Court thereafter entered judgment in favor of the Company; briefing on post-trial motions is complete, with rulings expected in the coming months. On January 16, 2025, CogniPower filed a follow-on complaint against the same customer asserting the same two patents in the United States District Court for the District of Delaware, but that case was dismissed following the August 2025 verdict in the Company’s favor in CogniPower’s earlier case. The Company believes the jury verdicts and judgement in its favor are correct and intends to continue to vigorously defend itself against CogniPower’s claims against the Company’s technology, including on appeal if necessary. Currently, the Company is not able to estimate a loss or a range of loss for the ongoing litigations disclosed above. Adverse determinations in litigation could result in monetary losses, the loss of proprietary rights, subject the Company to significant liabilities, require the Company to seek licenses from third parties or prevent the Company from licensing the 67 Table of Contents technology, any of which could have a material adverse effect on the Company’s business, financial condition and operating results. On May 11, 2022, a former employee of the Company filed a first amended complaint in the Superior Court of California, County of Santa Clara alleging several violations of the Fair Employment and Housing Act. The complaint named the Company and one of its vice presidents and alleged, among other things, that the former employee was discriminated against and harassed based on age and disability, was retaliated against, and was wrongfully terminated in violation of public policy. Two of the plaintiff’s claims were dismissed with prejudice in response to the Company’s demurrer motions. Prior to trial, the plaintiff dismissed with prejudice the claims against the Company’s vice president and the claim of wrongful termination in violation of public policy. In June 2025, the remaining claims in the matter were tried before a jury. The jury reached a verdict and ruled in favor of the Company on the claims of age and disability discrimination and harassment based on age. The jury ruled in favor of the plaintiff and against the Company on the claims of harassment based on disability and retaliation and awarded compensatory damages of $ 3.2 million and punitive damages of $ 6.0 million. In the quarter ended June 30, 2025, the Company recognized a charge in the amount of $ 9.2 million in other operating expenses on the consolidated statements of income. In the quarter ended September 30, 2025, the Company recognized in other operating expenses on the consolidated statements of income an additional $ 0.7 million related to plaintiff attorney fees and related costs. The plaintiff had filed claims for attorney fees and other costs totaling $ 5.9 million; the Company was thus potentially exposed to an additional $ 5.2 million in expenses related to this matter. On December 9, 2025, the court issued orders on the parties’ motions on attorneys’ fees and costs, awarding claims for attorney fees and other costs totaling $ 2.1 million. As a result, in the quarter ended December 31, 2025, the Company recognized in other operating expenses on the consolidated statements of income an additional $ 1.4 million to reflect the court determination of plaintiff attorney fees and related costs. The Company disagrees with the jury’s verdicts and court’s orders against the Company and has appealed the judgement. The Company is unable to predict the outcome of any further proceedings with certainty, and there can be no assurance that the Company will prevail in the above-mentioned litigations. These litigations, whether or not determined in the Company’s favor or settled, will be costly and will divert the efforts and attention of the Company’s management and technical personnel from normal business operations, potentially causing a material adverse effect on the business, financial condition and operating results. 15. ACQUISITION: Odyssey Semiconductor Technologies On March 12, 2024, the Company agreed to acquire the assets of Odyssey, a U.S. company and a developer of vertical GaN transistor technology. The transaction closed on July 1, 2024, at which time all key Odyssey employees joined the Company. P ursuant to the asset purchase agreement, Odyssey sold, transferred and assigned substantially all of its assets to the Company for $ 9.52 million in cash. The purchase is intended to augment the Company’s development of high-power GaN switching technology. The acquisition has been accounted for using the acquisition method of accounting in accordance with ASC 805 - Business Combinations. Under the acquisition method of accounting, the total purchase consideration of the acquisition is allocated to the tangible assets and identifiable intangible assets acquired based on their relative fair values. The excess of the purchase consideration over the net tangible and identifiable intangible assets is recorded as goodwill, the amount of which represents the expected benefits to the Company of future technology and the knowledgeable and experienced employees who joined the Company. Goodwill is expected to be deductible over 15 years for tax purposes. The following table summarizes the purchase price and estimated fair values of the assets acquired as of July 1, 2024, the completion of the Odyssey acquisition: ​ ​ ​ ​ (In thousands) ​ Total Amount Assets Acquired ​ ​ ​ Property and equipment ​ $ 1,168 In-process research and development ​ ​ 4,930 Goodwill ​ ​ 3,422 Total purchase price ​ $ 9,520 ​ 68 Table of Contents The fair value of in-process research and development was determined based on the cost approach using the Company’s estimate of the costs that would be incurred if a market participant were to create the acquired technology from scratch. The Company considered the number of engineers required, salaries and related benefits, allocated overhead and the development time required to recreate the technology. The Company will record the in-process research and development as an intangible asset with an indefinite life until completion or abandonment of the associated research and development efforts, and will begin amortizing the value over the estimated life of the technology upon completion of development. Consistent with the treatment of other intangible assets with indefinite lives, the Company will test the in-process research and development for impairment on an annual basis or when impairment indicators are present. Pro forma results of operations for this acquisition have not been presented because they are not material to the Company’s consolidated financial statements. ​ 16. RETIREMENT PLANS: The Company sponsors a defined benefit pension plan (Pension Plan) for its Swiss subsidiary in accordance with the legal requirements of Switzerland. The plan assets, which provide benefits in the event of an employee’s retirement, death or disability, are held in legally autonomous trustee-administered funds that are subject to Swiss law. Benefits are based on the employee’s age, years of service and salary, and the plan is financed by contributions by both the employee and the Company. The net periodic benefit cost of the Pension Plan was not material to the Company’s financial statements during the years ended December 31, 2025, 2024 and 2023. As of December 31, 2025, the projected benefit obligation was $ 23.2 million, the plan assets were $ 14.2 million and the net pension liability was $ 9.0 million. As of December 31, 2024, the projected benefit obligation was $ 18.3 million, the plan assets were $ 11.4 million, and the net pension liability was $ 6.9 million. The Company has recorded the unfunded amount as a liability in its consolidated balance sheet at December 31, 2025 and 2024, under the other liabilities caption. The Company expects to make contributions to the Pension Plan of approximately $ 0.6 million during 2026. The accumulated unrealized actuarial balance on pension benefits, net of tax, at December 31, 2025, 2024 and 2023 was $ 0.1 million loss, $ 1.5 million loss and $ 1.6 million gain, respectively. These amounts were reflected in Note 3 under the caption accumulated other comprehensive income (loss). In accordance with the Compensation-Retirement Benefits Topic of ASC 715-20, Defined Benefits Plan , the Company recognizes the over-funded or under-funded status of its defined post-retirement plan as an asset or liability in its statement of financial position. The Company measured the plan assets and benefit obligations as of the date of the fiscal year-end. ​ 17. BANK LINE OF CREDIT: On July 27, 2016, the Company entered into a credit agreement with Wells Fargo Bank, National Association (the "Credit Agreement") that provides the Company 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. The Credit Agreement was amended on April 30, 2018, to extend the termination date from July 26, 2019, to April 30, 2022, with all other terms remaining the same. The Credit Agreement was amended on June 7, 2021, to provide an alternate borrowing rate as a replacement for LIBOR and extend the termination date from April 30, 2022, to June 7, 2026, with all other terms remaining the same. The Credit Agreement was amended with an effective date of June 28, 2023 to include the Secured Overnight Financing Rates as interest rate benchmark rates, with all other terms remaining the same. The Company’s ability to borrow under the revolving line of credit is conditioned upon the Company’s compliance with specified covenants, including reporting and financial covenants, primarily a minimum cash requirement and a debt to earnings ratio. The Credit Agreement terminates on June 7, 2026; all advances under the revolving line of credit will become due on such date, or earlier in the event of a default. The Company was compliant with all covenants and had no advances outstanding under the Credit Agreement as of December 31, 2025. ​ 18. SUBSEQUENT EVENTS: On January 31, 2026, the Company approved a reduction in force that resulted in the termination of approximately 7 % of the Company’s global workforce on February 2, 2026 in order to decrease the Company’s costs and create a more efficient organization to support its business. In connection with the reduction in force, the Company estimates it will incur approximately between $ 3.5 million and $ 4.0 million of costs, substantially all of which are related to employee severance and benefit costs, which the Company expects to recognize in the first quarter of 2026. 69 Table of Contents Schedule II Valuation and Qualifying Accounts The Company maintains an allowance for the distributors’ ship-and-debit credits relating to the sell-through of the Company’s products. This reserve is established using the Company’s historical ship-and-debit amounts and levels of inventory in the distributor channels. The following is a summary of the activity in the allowance for ship-and-debit credits: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning ​ ​ ​ ​ ​ ​ ​ Balance at End (In thousands) ​ ​ ​ of Period ​ ​ ​ Additions ​ ​ ​ Deductions (1) ​ ​ ​ of Period Allowance for ship and debit credits: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, 2023 ​ $ 53,184 ​ $ 202,159 ​ $ ( 219,326 ) ​ $ 36,017 Year ended December 31, 2024 ​ $ 36,017 ​ $ 211,185 ​ $ ( 220,756 ) ​ $ 26,446 Year ended December 31, 2025 ​ $ 26,446 ​ $ 223,846 ​ $ ( 216,691 ) ​ $ 33,601 (1) Deductions relate to ship-and-debit credits issued which adjust the sales price from the standard distribution price to the pre-approved lower price. Refer to Note 2, Significant Accounting Policies and Recent Accounting Pronouncements , for the Company’s revenue recognition policy, including the Company’s accounting for ship-and-debit claims. ​ 70 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. Not applicable.