SILICON LABORATORIES INC. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures We have performed an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the Exchange Act). Based on that evaluation, our management, including our CEO and CFO, concluded that our disclosure controls and procedures were not effective as of December 30, 2023 to provide reasonable assurance that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, as a result of the material weakness in our internal control over financial reporting described below. 39 Table of Contents Notwithstanding the material weakness in internal control over financial reporting described below, management believes and has concluded that the consolidated financial statements included in this Annual Report on Form 10-K fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U.S. generally accepted accounting principles. Changes in Internal Control over Financial Reporting There was no change in our internal controls during the fiscal quarter ended December 30, 2023 that materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting. Management’s Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control system was designed to provide reasonable assurance to our management and Board of Directors regarding the preparation and fair presentation of published financial statements. Our management assessed the effectiveness of our internal control over financial reporting as of December 30, 2023. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013 framework). Based on our assessment we concluded that, as of December 30, 2023, the material weakness described below existed. During the year-end financial reporting process of fiscal 2023, management identified a material weakness in internal control over financial reporting. The material weakness resulted from undue reliance on forecasted inventory demand information used in determining inventory carrying value adjustments without effectively designed controls over the evaluation of demand assumptions. These forecasts are used to determine inventory carrying value adjustments necessary to record such quantities at the lower of their cost or net realizable value. A material weakness is a deficiency, or a combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. This material weakness did not result in any material errors. With respect to the material weakness above, management, under the oversight of the Audit Committee, is in the process of designing appropriate controls and the remediation plan specific to the inventory valuation process. The material weakness will not be considered remediated until the enhanced controls operate for a sufficient period of time and management has concluded, through testing, that the related controls are effective. We will monitor the effectiveness of the remediation plan and refine the remediation plan as appropriate. Our independent registered public accounting firm, Ernst & Young LLP, issued an attestation report on our internal control over financial reporting. This report appears on page F-3. Item 9B. Other Information On January 25, 2024, the Compensation Committee of the Board of Directors of the Company approved a form of Performance Stock Units Grant Notice and Global PSU Award Agreement (the “PSU Award Agreement”) under its 2009 Stock Incentive Plan, as amended and restated. The PSU Awards will be earned based upon the level of achievement of the following performance criteria (each as defined in the PSU Award Agreement): ● Average Revenue Growth Rate Payout Percent (weighted 50%) ● Average Non-GAAP Operating Income Margin Payout Percent (weighted 50%) ​ The PSU Awards are all subject to the terms and conditions of the 2009 Stock Incentive Plan, as amended and restated, and the form of PSU Award Agreement, a copy of which is attached as Exhibit 10.19 to this Form 10-K and incorporated herein by reference. 40 Table of Contents Rule 10b5-1 Trading Arrangements There were no contracts, instructions, or written plans for the purchase or sale of our securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c), nor were there any non-Rule 10b5-1 trading arrangements, entered into or terminated by our directors and officers (as defined under Rule 16b-1(f) of the Exchange Act) during the quarter ended December 30, 2023. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections None. ​ Part III Certain information required by Part III is omitted from this report because we intend to file a definitive Proxy Statement pursuant to Regulation 14A (the “Proxy Statement”) no later than 120 days after the end of the fiscal year covered by this report, and certain information to be included therein is incorporated herein by reference. Item 10. Directors, Executive Officers and Corporate Governance The information required by this Item is incorporated by reference to the Proxy Statement under the sections captioned “Proposal One: Election of Directors,” “Executive Officers,” “Delinquent 16(a) Reports” and “Code of Ethics.” ​ Item 11. Executive Compensation The information under the caption “Executive Compensation” and “Proposal One: Election of Directors” appearing in the Proxy Statement, is incorporated herein by reference. ​ Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information under the caption “Ownership of Securities” and “Equity Compensation Plan Information” appearing in the Proxy Statement is incorporated herein by reference. ​ Item 13. Certain Relationships and Related Transactions, and Director Independence The information under the caption “Certain Relationships and Related Transactions, and Director Independence” appearing in the Proxy Statement is incorporated herein by reference. ​ Item 14. Principal Accounting Fees and Services The information under the caption “Proposal Two: Ratification of Appointment of Independent Registered Public Accounting Firm” appearing in the Proxy Statement is incorporated herein by reference. ​ 41 Table of Contents Part IV Item 15. Exhibits and Financial Statement Schedules (a) 1. Financial Statements Index ​ ​ ​ Page Report of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) F-1 ​ ​ Report of Independent Registered Public Accounting Firm F-3 ​ ​ Consolidated Balance Sheets at December 30 , 2023 and December 31, 2022 F-4 ​ ​ Consolidated Statements of Operations for the fiscal years ended December 30, 2023, December 31, 2022 and January 1, 2022 F-5 ​ ​ Consolidated Statements of Comprehensive Income (loss) for the fiscal years ended December 30, 2023, December 31, 2022 and January 1, 2022 F-6 ​ ​ Consolidated Statements of Changes in Stockholders’ Equity for the fiscal years ended December 30, 2023, December 31, 2022 and January 1, 2022 F-7 ​ ​ Consolidated Statements of Cash Flows for the fiscal years ended December 30, 2023, December 31, 2022 and January 1, 2022 F-8 ​ ​ Notes to Consolidated Financial Statements F-9 ​ 2. Schedules All schedules have been omitted since the information required by the schedule is not applicable or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the Consolidated Financial Statements and notes thereto. 3. Exhibits The exhibits listed on the accompanying index to exhibits immediately following the Consolidated Financial Statements are filed as part of, or hereby incorporated by reference into, this Form 10-K. ​ 42 Table of Contents (b) Exhibits The following exhibits are filed as part of this report: ​ Exhibit Number ​ ​ ​ 2.1* ​ Asset Purchase Agreement dated April 22, 2021 between Silicon Laboratories Inc. and Skyworks Solutions, Inc. (filed as Exhibit 2.1 to the Form 8-K filed on April 22, 2021). 3.1* ​ Form of Fourth Amended and Restated Certificate of Incorporation of Silicon Laboratories Inc. (filed as Exhibit 3.1 to the Registration Statement on Form S-1 (Securities and Exchange Commission File No. 333-94853) (the “IPO Registration Statement”)). 3.2* ​ Fifth Amended and Restated Bylaws of Silicon Laboratories Inc. (filed as Exhibit 3.1 to the Form 8-K filed on February 3, 2021). 4.1* ​ Specimen certificate for shares of common stock (filed as Exhibit 4.1 to the IPO Registration Statement). 4.7* ​ Description of Registrant’s Securities Registered under Section 12 of the Exchange Act (filed as Exhibit 4.7 to the Form 10 - K filed on February 1, 2023). 10.1*+ ​ Form of Indemnification Agreement between Silicon Laboratories Inc. and each of its directors and executive officers (filed as Exhibit 10.1 to the IPO Registration Statement). 10.2* ​ Credit Agreement, dated July 31, 2012, by and among Silicon Laboratories Inc., the subsidiaries of the borrower identified therein, Bank of America, N.A., Wells Fargo Bank, National Association, and Regions Bank (filed as Exhibit 10.1 to the Form 8-K filed August 1, 2012). 10.3* ​ First Amendment to Credit Agreement, dated July 24, 2015, by and among Silicon Laboratories Inc., the subsidiaries of the borrower identified therein, Wells Fargo Bank, National Association, Citibank, N.A., Regions Bank, Bank of America, N.A. and the lenders party thereto (filed as Exhibit 10.1 to the Form 8-K filed on July 29, 2015). 10.4* ​ Second Amendment to Credit Agreement, dated February 27, 2017, by and among Silicon Laboratories Inc., the subsidiaries of the borrower identified therein, Wells Fargo Bank, National Association and the lenders party thereto (filed as Exhibit 10.1 to the Form 8-K filed on February 27, 2017). 10.5* ​ Third Amendment to Credit Agreement, dated August 7, 2019, by and among Silicon Laboratories Inc., the subsidiaries of the borrower identified therein, Wells Fargo Bank, National Association and the lenders party thereto (filed as Exhibit 10.1 to the Form 8-K filed on August 7, 2019). 10.6* ​ Fourth Amendment to Credit Agreement, dated May 26, 2020, by and among Silicon Laboratories Inc., the subsidiaries of the borrower identified therein, Wells Fargo Bank, National Association and the lenders party thereto (filed as Exhibit 10.1 to the Form 8-K filed on May 27, 2020). 10.7* ​ Security and Pledge Agreement, dated July 31, 2012, by and among Silicon Laboratories Inc., with the other parties identified as “Obligors” (as defined therein) and such other parties that may become Obligors thereunder after the date thereof, and Bank of America, N.A (filed as Exhibit 10.2 to the Form 8-K filed August 1, 2012). 10.8*+ ​ Form of Restricted Stock Units Grant Notice and Global Restricted Stock Units Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated (filed as Exhibit 10.7 to the Form 10-K filed on February 1, 2017). 10.9*+ ​ Form of Market Stock Units Grant Notice and Global Market Stock Units Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated (filed as Exhibit 10.8 to the Form 10-K filed on February 1, 2017). 10.10*+ ​ Form of Stock Option Grant Notice and Global Stock Option Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated (filed as Exhibit 10.9 to the Form 10-K filed on February 1, 2017). 10.11* ​ Purchase Agreement between Silicon Laboratories Inc. and Goldman, Sachs & Co. and Wells Fargo Securities, LLC, as representatives of the several initial purchasers named therein, dated February 28, 2017 (filed as Exhibit 10.1 to the Form 8-K filed on March 6, 2017). 10.12*+ ​ Silicon Laboratories Inc. Form of Executive Severance Agreement (filed as Exhibit 10.2 to the Form 8-K filed on May 17, 2021). 10.13*+ ​ Silicon Laboratories Inc. Form of Performance Stock Units Grant Notice and Global PSU Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated (filed as Exhibit 10.3 to the Form 8-K filed on May 17, 2021). 43 Table of Contents ​ Exhibit Number ​ ​ ​ 10.14*+ ​ Silicon Laboratories Inc. 2009 Stock Incentive Plan (As Amended and Restated on April 22, 2021) (filed as Exhibit 4.3 to the Form S-8 filed on May 5, 2021). 10.15*+ ​ Silicon Laboratories Inc. 2009 Employee Stock Purchase Plan (As Amended and Restated on April 22, 2021) (filed as Exhibit 4.4 to the Form S-8 filed on May 5, 2021). 10.16*+ ​ Silicon Laboratories Inc. Form of Performance Stock Units Grant Notice and Global PSU Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated (filed as Exhibit 10.1 to the Form 8-K filed on December 23, 2021). 10.17*+ ​ Silicon Laboratories Inc. 2022 Bonus Plan (filed as Exhibit 10.1 to the Form 8-K filed on January 28, 2022). 10.18*+ ​ Silicon Laboratories Inc. Form of Performance Stock Units Grant Notice and Global PSU Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated (filed as Exhibit 10.20 to the Form 10-K filed on February 1, 2023). 10.19+ ​ Silicon Laboratories Inc. Form of Performance Stock Units Grant Notice and Global PSU Award Agreement under Registrant’s 2009 Stock Incentive Plan, as amended and restated. 21 ​ Subsidiaries of the Registrant. 23.1 ​ Consent of Independent Registered Public Accounting Firm. 24 ​ Power of Attorney (included on signature page to this Form 10-K). 31.1 ​ Certification of the Principal Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002. 31.2 ​ Certification of the Principal Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002. 32.1 ​ Certification as required by Section 906 of the Sarbanes-Oxley Act of 2002. 97 ​ Policy Relating to Recovery of Erroneously Awarded Compensation 101.INS ​ Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH ​ Inline XBRL Taxonomy Extension Schema Document 101.CAL ​ Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.LAB ​ Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE ​ Inline XBRL Taxonomy Extension Presentation Linkbase Document 101.DEF ​ Inline XBRL Taxonomy Extension Definition Linkbase Document 104 ​ Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) ​ ​ ​ ​ * Incorporated herein by reference to the indicated filing. + Management contract or compensatory plan or arrangement ​ Item 16. Form 10-K Summary None. ​ 44 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in Austin, Texas, on February 20, 2024. ​ ​ ​ SILICON LABORATORIES INC. ​ ​ By: /s/ R. Matthew Johnson ​ R. Matthew Johnson ​ ​ President and Chief Executive Officer ​ ​ ​ POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints R. Matthew Johnson and Mark Mauldin and each of them, acting individually, as his or her attorney-in-fact, each with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this annual report on Form 10-K and other documents in connection herewith and therewith, and to file the same, with all exhibits thereto, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection herewith and therewith and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated: ​ Name Title Date ​ ​ ​ ​ ​ /s/ Navdeep S. Sooch ​ Chairman of the Board ​ February 20, 2024 Navdeep S. Sooch ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ R. Matthew Johnson ​ President, Chief Executive Officer and Director ​ February 20, 2024 R. Matthew Johnson ​ (Principal Executive Officer) ​ ​ ​ ​ ​ ​ ​ /s/ Mark D. Mauldin ​ Interim Chief Financial Officer ​ February 20, 2024 Mark D. Mauldin ​ (Principal Financial Officer and Principal Accounting Officer) ​ ​ ​ ​ ​ ​ ​ /s/ William G. Bock ​ Director ​ February 20, 2024 William G. Bock ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Robert Conrad ​ Director ​ February 20, 2024 Robert Conrad ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Gregg Lowe ​ Director ​ February 20, 2024 Gregg Lowe ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Sherri Luther ​ Director ​ February 20, 2024 Sherri Luther ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Nina Richardson ​ Director ​ February 20, 2024 Nina Richardson ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Sumit Sadana ​ Director ​ February 20, 2024 Sumit Sadana ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Christy Wyatt ​ Director ​ February 20, 2024 Christy Wyatt ​ ​ ​ ​ ​ ​ ​ ​ 45 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Silicon Laboratories Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Silicon Laboratories Inc. (the Company) as of December 30, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity and cash flows for each of the three years in the period ended December 30, 2023, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 30, 2023 and December 31, 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 30, 2023, in conformity with U.S. generally accepted accounting principles. We also have 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 30, 2023, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 20, 2024 expressed an adverse opinion thereon. 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 Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex judgments. The communication of the critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. ​ ​ ​ Recognition of Variable Consideration Description of the Matter ​ As described in Note 2 of the consolidated financial statements, the transaction price for sales reflects the Company’s expectations about the consideration it will be entitled to receive and may include fixed or variable amounts. Variable consideration includes consideration due from distributor customers under agreements allowing reductions to the contract price due to pricing concessions. The Company uses estimates to determine the expected variable consideration to recognize as revenue which consider both actual historical pricing concessions issued and current and expected future market conditions. Auditing management’s variable consideration estimates relating to pricing concessions was judgmental because the calculations involve subjective management assumptions about the estimates of expected future pricing concessions. For example, the estimated variable consideration included in the transaction price reflects management’s evaluation of contractual terms, historical experience, assumptions about future economic conditions and the quantity of products distributors are expected to sell. Changes in those assumptions can have a material effect on the amount of variable consideration recognized. F- 1 Table of Contents How We Addressed the Matter in Our Audit ​ We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the measurement and valuation of the variable consideration recognized. For example, we tested controls over management’s review of the variable consideration methodology, the significant assumptions and the historical data utilized in the estimate for expected pricing concessions. To test the variable consideration recognized as revenue we performed audit procedures that included, among others, evaluating the Company’s methodology and related significant assumptions and estimates and tested the completeness and accuracy of the historical data utilized in the estimates. In our assessment of the methodology, we considered changes in the business, changes in pricing assumptions, and evaluated significant assumptions used by management by comparison to current trends and recent transactions. We also evaluated the accuracy of management’s assumed price concessions from prior periods by comparing to subsequent actual activity. ​ ​ Inventory Valuation Description of the Matter ​ At December 30, 2023, the Company’s net inventory balance was $194.3 million. As discussed in Note 2 to the consolidated financial statements, inventories are stated at the lower of cost, determined using the first-in, first-out method, or net realizable value. The Company writes down the carrying value of inventory to net realizable value for estimated obsolescence or unmarketable inventory based upon assumptions about the age of inventory, future demand, and market conditions. Auditing management’s inventory carrying value adjustments involved significant judgment because the estimates are based on several factors that are affected by market, industry and competitive conditions outside the Company’s control. In estimating inventory carrying value adjustments, management developed assumptions such as forecasts of future sales quantities which are sensitive to the competitiveness of product offerings, customer requirements, and product life cycles. These significant assumptions are forward-looking and could be affected by future economic and market conditions. How We Addressed the Matter in Our Audit ​ Our audit procedures included, among others, testing the reasonableness of management’s key assumptions and judgments and testing the accuracy and completeness of the underlying data used to determine the valuation of inventory. For instance, we compared the quantities and carrying value of on-hand inventories to related unit sales, both historical and forecasted, assessed the reasonableness of management’s estimates of forecasted unit sales, and evaluated factors that may impact expected quantities to be sold. ​ ​ ​ /s/ Ernst & Young LLP We have served as the Company’s auditor since 1996. Austin, Texas February 20, 2024 ​ ​ ​ ​ ​ ​ F- 2 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Silicon Laboratories Inc. Opinion on Internal Control Over Financial Reporting We have audited Silicon Laboratories Inc.’s internal control over financial reporting as of December 30, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, because of the effect of the material weakness described below on the achievement of the objectives of the control criteria, Silicon Laboratories Inc. (the Company) has not maintained effective internal control over financial reporting as of December 30, 2023, based on the COSO criteria. ​ A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management’s assessment. Management has identified a material weakness in controls related to the company’s inventory demand forecasting process. ​ We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 30, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity and cash flows for each of the three years in the period ended December 30, 2023, and the related notes. This material weakness was considered in determining the nature, timing and extent of audit tests applied in our audit of the 2023 consolidated financial statements, and this report does not affect our report dated February 20, 2024 which expressed an unqualified opinion thereon. ​ Basis for Opinion ​ The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. 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 audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. ​ Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. ​ Definition and Limitations of Internal Control Over Financial Reporting ​ A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. ​ Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. ​ ​ ​ /s/ Ernst & Young LLP ​ ​ Austin, Texas ​ February 20, 2024 ​ ​ ​ ​ F- 3 Table of Contents Silicon Laboratories Inc. Consolidated Balance Sheets (In thousands, except per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, ​ December 31, ​ 2023 2022 Assets ​ ​ ​ ​ ​ ​ Current assets: ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 227,504 ​ $ 499,915 Short-term investments ​ 211,720 ​ 692,024 Accounts receivable, net ​ 29,295 ​ 71,437 Inventories ​ 194,295 ​ 100,417 Prepaid expenses and other current assets ​ 75,117 ​ 97,570 Total current assets ​ 737,931 ​ 1,461,363 Property and equipment, net ​ 145,890 ​ 152,016 Goodwill ​ 376,389 ​ 376,389 Other intangible assets, net ​ 59,533 ​ 84,907 Other assets, net ​ 123,313 ​ 94,753 Total assets ​ $ 1,443,056 ​ $ 2,169,428 Liabilities and Stockholders’ Equity ​ ​ ​ ​ ​ ​ Current liabilities: ​ ​ ​ ​ ​ ​ Accounts payable ​ $ 57,498 ​ $ 89,860 Revolving line of credit ​ ​ 45,000 ​ ​ — Deferred revenue and returns liability ​ ​ 2,117 ​ ​ 6,780 Other current liabilities ​ ​ 58,955 ​ 89,136 Total current liabilities ​ ​ 163,570 ​ 185,776 Convertible debt, net ​ ​ — ​ ​ 529,573 Other non-current liabilities ​ ​ 70,804 ​ 49,071 Total liabilities ​ ​ 234,374 ​ 764,420 Commitments and contingencies ​ ​ ​ ​ ​ ​ Stockholders’ equity: ​ ​ ​ ​ ​ ​ Preferred stock – $ 0.0001 par value; 10,000 shares authorized; no shares issued ​ ​ — ​ ​ — Common stock – $ 0.0001 par value; 250,000 shares authorized; 31,897 and 31,994 shares issued and outstanding at December 30, 2023 and December 31, 2022, respectively ​ ​ 3 ​ 3 Additional paid-in capital ​ ​ 16,973 ​ ​ — Retained earnings ​ ​ 1,192,731 ​ 1,415,693 Accumulated other comprehensive loss ​ ​ ( 1,025 ) ​ ( 10,688 ) Total stockholders’ equity ​ ​ 1,208,682 ​ 1,405,008 Total liabilities and stockholders’ equity ​ $ 1,443,056 ​ $ 2,169,428 ​ The accompanying notes are an integral part of these Consolidated Financial Statements. ​ F- 4 Table of Contents Silicon Laboratories Inc. Consolidated Statements of Operations (In thousands, except per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Revenues ​ $ 782,258 ​ $ 1,024,106 ​ $ 720,860 Cost of revenues ​ 321,672 ​ 381,549 ​ 295,468 Gross profit ​ 460,586 ​ 642,557 ​ 425,392 Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ 337,744 ​ 332,326 ​ 273,208 Selling, general and administrative ​ 146,996 ​ 190,971 ​ 185,022 Operating expenses ​ 484,740 ​ 523,297 ​ 458,230 Operating income (loss) ​ ( 24,154 ) ​ 119,260 ​ ( 32,838 ) Other income (expense): ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest income and other, net ​ 19,165 ​ 13,915 ​ 5,696 Interest expense ​ ( 5,554 ) ​ ( 6,723 ) ​ ( 31,033 ) Income (loss) from continuing operations before income taxes ​ ( 10,543 ) ​ 126,452 ​ ( 58,175 ) Provision for income taxes ​ 7,943 ​ 38,450 ​ 13,427 Equity-method earnings (loss) ​ ​ ( 16,030 ) ​ ​ 3,400 ​ ​ 13,728 Income (loss) from continuing operations ​ ​ ( 34,516 ) ​ ​ 91,402 ​ ​ ( 57,874 ) Income from discontinued operations, net of income taxes ​ ​ — ​ ​ — ​ ​ 2,175,273 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ ( 34,516 ) ​ $ 91,402 ​ $ 2,117,399 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic earnings (loss) per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ Continuing operations ​ $ ( 1.09 ) ​ $ 2.61 ​ $ ( 1.35 ) Net income (loss) ​ $ ( 1.09 ) ​ $ 2.61 ​ $ 49.44 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Diluted earnings (loss) per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ Continuing operations ​ $ ( 1.09 ) ​ $ 2.54 ​ $ ( 1.35 ) Net income (loss) ​ $ ( 1.09 ) ​ $ 2.54 ​ $ 47.78 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares outstanding: ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 31,804 ​ 35,086 ​ 42,830 Diluted ​ ​ 31,804 ​ ​ 36,042 ​ ​ 44,315 ​ The accompanying notes are an integral part of these Consolidated Financial Statements. ​ F- 5 Table of Contents Silicon Laboratories Inc. Consolidated Statements of Comprehensive Income (Loss) (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ ​ 2023 2022 2022 Net income (loss) ​ $ ( 34,516 ) ​ $ 91,402 ​ $ 2,117,399 Other comprehensive income (loss), before tax: ​ ​ ​ ​ ​ ​ ​ ​ ​ Net changes to available-for-sale securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized gains (losses) arising during the period ​ 7,709 ​ ( 12,562 ) ​ ( 4,338 ) Reclassification for (gains) losses included in net income (loss) ​ ​ 4,596 ​ ​ 2,088 ​ ​ ( 335 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net changes to cash flow hedges: ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized gains (losses) arising during the period ​ 210 ​ ( 4,110 ) ​ ( 598 ) Reclassification for (gains) losses included in net income (loss) ​ ( 250 ) ​ 4,110 ​ ( 87 ) Other comprehensive income (loss), before tax ​ 12,265 ​ ( 10,474 ) ​ ( 5,358 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Provision (benefit) for income taxes ​ 2,602 ​ ( 2,205 ) ​ ( 1,125 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) ​ 9,663 ​ ( 8,269 ) ​ ( 4,233 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income (loss) ​ $ ( 24,853 ) ​ $ 83,133 ​ $ 2,113,166 ​ The accompanying notes are an integral part of these Consolidated Financial Statements. ​ F- 6 Table of Contents Silicon Laboratories Inc. Consolidated Statements of Changes in Stockholders’ Equity (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ Total ​ ​ ​ ​ Common ​ Paid-In ​ Retained ​ Comprehensive ​ Stockholders’ ​ Shares Stock Capital Earnings Income (Loss) Equity Balance as of January 2, 2021 ​ 43,925 ​ $ 4 ​ $ 204,359 ​ $ 993,664 ​ $ 1,814 ​ $ 1,199,841 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) — ​ — ​ — ​ ​ 2,117,399 ​ ​ — ​ ​ 2,117,399 Other comprehensive loss — ​ — ​ — ​ ​ — ​ ​ ( 4,233 ) ​ ​ ( 4,233 ) Stock issuances, net of shares withheld for taxes ​ 548 ​ ​ — ​ ​ ( 8,056 ) ​ ​ — ​ ​ — ​ ​ ( 8,056 ) Repurchases of common stock ​ ( 6,520 ) ​ ​ — ​ ​ ( 253,820 ) ​ ​ ( 896,224 ) ​ ​ — ​ ​ ( 1,150,044 ) Stock-based compensation ​ — ​ ​ — ​ ​ 58,264 ​ ​ — ​ ​ — ​ ​ 58,264 Convertible debt activity ​ 528 ​ ​ — ​ ​ ( 747 ) ​ ​ — ​ ​ — ​ ​ ( 747 ) Balance as of January 1, 2022 ​ 38,481 ​ ​ 4 ​ ​ — ​ ​ 2,214,839 ​ ​ ( 2,419 ) ​ ​ 2,212,424 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cumulative effect of adoption of accounting standard ​ — ​ ​ — ​ ​ — ​ ​ ( 59,963 ) ​ ​ — ​ ​ ( 59,963 ) Net income (loss) — ​ — ​ — ​ ​ 91,402 ​ ​ — ​ ​ 91,402 Other comprehensive loss — ​ — ​ — ​ ​ — ​ ​ ( 8,269 ) ​ ​ ( 8,269 ) Stock issuances, net of shares withheld for taxes ​ 387 ​ ​ — ​ ​ ( 3,608 ) ​ ​ — ​ ​ — ​ ​ ( 3,608 ) Repurchases of common stock ​ ( 6,874 ) ​ ​ ( 1 ) ​ ​ ( 56,968 ) ​ ​ ( 830,585 ) ​ ​ — ​ ​ ( 887,554 ) Stock-based compensation ​ — ​ ​ — ​ ​ 60,576 ​ ​ — ​ ​ — ​ ​ 60,576 Balance as of December 31, 2022 ​ 31,994 ​ ​ 3 ​ ​ — ​ ​ 1,415,693 ​ ​ ( 10,688 ) ​ ​ 1,405,008 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) — ​ ​ — ​ ​ — ​ ​ ( 34,516 ) ​ ​ — ​ ​ ( 34,516 ) Other comprehensive income — ​ ​ — ​ ​ — ​ ​ — ​ ​ 9,663 ​ ​ 9,663 Stock issuances, net of shares withheld for taxes ​ 505 ​ ​ — ​ ​ ( 3,577 ) ​ ​ — ​ ​ — ​ ​ ( 3,577 ) Repurchases of common stock ​ ( 1,522 ) ​ ​ — ​ ​ ( 24,578 ) ​ ​ ( 188,446 ) ​ ​ — ​ ​ ( 213,024 ) Stock-based compensation ​ — ​ ​ — ​ ​ 48,688 ​ ​ — ​ ​ — ​ ​ 48,688 Convertible debt activity ​ 920 ​ ​ — ​ ​ ( 3,560 ) ​ ​ — ​ ​ — ​ ​ ( 3,560 ) Balance as of December 30, 2023 ​ 31,897 ​ $ 3 ​ $ 16,973 ​ $ 1,192,731 ​ $ ( 1,025 ) ​ $ 1,208,682 ​ The accompanying notes are an integral part of these Consolidated Financial Statements. ​ F- 7 Table of Contents Silicon Laboratories Inc. Consolidated Statements of Cash Flows (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Operating Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ ( 34,516 ) ​ $ 91,402 ​ $ 2,117,399 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities of continuing operations: ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from discontinued operations, net of income taxes ​ ​ — ​ ​ — ​ ​ ( 2,175,273 ) Depreciation of property and equipment ​ 25,707 ​ 22,524 ​ 18,051 Amortization of other intangible assets ​ 25,374 ​ 34,071 ​ 44,505 Amortization of debt discount and debt issuance costs ​ ​ 960 ​ ​ 2,003 ​ ​ 22,767 Loss on extinguishment of convertible debt ​ ​ — ​ ​ 3 ​ ​ 3,370 Stock-based compensation expense ​ 48,208 ​ 60,510 ​ 56,842 Equity-method (earnings) loss ​ ​ 16,030 ​ ​ ( 3,400 ) ​ ​ ( 13,728 ) Deferred income taxes ​ ( 11,815 ) ​ ( 18,240 ) ​ ( 3,414 ) Changes in operating assets and liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Accounts receivable ​ 42,142 ​ 26,876 ​ ( 3,144 ) Inventories ​ ( 93,398 ) ​ ( 51,044 ) ​ ( 1,510 ) Prepaid expenses and other assets ​ ( 10,733 ) ​ ( 31,240 ) ​ 44,664 Accounts payable ​ ( 25,644 ) ​ 36,797 ​ ( 7,704 ) Other current liabilities and income taxes ​ ( 37,793 ) ​ ( 12,738 ) ​ 2,109 Deferred revenue and returns liability ​ ( 4,663 ) ​ ( 7,069 ) ​ 863 Other non-current liabilities ​ ​ 29,793 ​ ​ ( 9,181 ) ​ ​ ( 14,599 ) Net cash provided by (used in) operating activities of continuing operations ​ ( 30,348 ) ​ 141,274 ​ 91,198 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Investing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchases of marketable securities ​ ( 103,485 ) ​ ( 607,237 ) ​ ( 1,541,971 ) Sales of marketable securities ​ 395,565 ​ 223,354 ​ 250,075 Maturities of marketable securities ​ ​ 200,530 ​ ​ 650,946 ​ ​ 844,966 Purchases of property and equipment ​ ( 22,282 ) ​ ( 26,525 ) ​ ( 28,577 ) Purchases of other assets ​ ( 520 ) ​ — ​ ( 1,158 ) Net cash provided by (used in) investing activities of continuing operations ​ 469,808 ​ 240,538 ​ ( 476,665 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Financing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Proceeds from issuance of debt ​ ​ 80,000 ​ ​ — ​ ​ — Payments on debt ​ ​ ( 571,157 ) ​ ​ ( 21 ) ​ ​ ( 140,572 ) Repurchases of common stock ​ ​ ( 217,137 ) ​ ​ ( 883,424 ) ​ ​ ( 1,150,044 ) Payment of taxes withheld for vested stock awards ​ ​ ( 18,189 ) ​ ​ ( 15,387 ) ​ ​ ( 22,239 ) Proceeds from the issuance of common stock ​ ​ 14,612 ​ ​ 11,779 ​ ​ 14,183 Net cash used in financing activities of continuing operations ​ ( 711,871 ) ​ ( 887,053 ) ​ ( 1,298,672 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Discontinued Operations ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating activities ​ ​ — ​ ​ ( 69,467 ) ​ ​ ( 191,642 ) Investing activities ​ ​ — ​ ​ — ​ ​ 2,747,684 Net cash provided by (used in) discontinued operations ​ ​ — ​ ​ ( 69,467 ) ​ ​ 2,556,042 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Increase (decrease) in cash and cash equivalents ​ ( 272,411 ) ​ ( 574,708 ) ​ 871,903 Cash and cash equivalents at beginning of period ​ 499,915 ​ 1,074,623 ​ 202,720 Cash and cash equivalents at end of period ​ $ 227,504 ​ $ 499,915 ​ $ 1,074,623 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Supplemental Disclosure of Cash Flow Information: ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest paid ​ $ 4,471 ​ $ 4,427 ​ $ 5,010 Income taxes paid ​ $ 31,713 ​ $ 132,005 ​ $ 266,277 Noncash financing activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Issuance of common stock in connection with settlement of convertible debt ​ $ 148,487 ​ $ — ​ $ — ​ The accompanying notes are an integral part of these Consolidated Financial Statements. ​ ​ F- 8 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements December 30, 2023 1. Description of Business Silicon Laboratories Inc. (the “Company”), a Delaware corporation, is a leader in secure, intelligent wireless technology for a more connected world. Our integrated hardware and software platform, intuitive development tools, industry-leading ecosystem, and robust support help customers build advanced industrial, commercial, home, and life applications. The Company provides analog-intensive, mixed-signal solutions for use in a variety of electronic products in a broad range of applications for the Internet of Things (“IoT”) including connected home and security, industrial automation and control, smart metering, smart lighting, commercial building automation, consumer electronics, asset tracking and medical instrumentation. Within the semiconductor industry, the Company is known as a “fabless” company meaning that the integrated circuits (“ICs”) incorporated in its products are manufactured by third-party foundry semiconductor companies. On July 26, 2021, the Company sold its infrastructure and automotive business to Skyworks Solutions, Inc. for $ 2.75 billion in cash. The financial results of the infrastructure and automotive business for the fiscal year ended January 1, 2022 have been presented as discontinued operations in the Consolidated Financial Statements. See Note 3, Discontinued Operations , for additional information. ​ 2. Significant Accounting Policies Basis of Presentation and Principles of Consolidation The Company prepares financial statements on a 52 - or 53 -week fiscal year that ends on the Saturday closest to December 31. Fiscal 2023, 2022, and 2021 had 52 weeks. Fiscal 2023, 2022 and 2021 ended on December 30, 2023, December 31, 2022, and January 1, 2022, respectively. The accompanying Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Foreign Currency Transactions The Company’s foreign subsidiaries are considered to be extensions of the U.S. Company. The functional currency of the foreign subsidiaries is the U.S. dollar. Accordingly, gains and losses resulting from remeasuring transactions denominated in currencies other than U.S. dollars are included in interest income and other, net in the Consolidated Statements of Operations. Use of 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 amounts reported in the financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to inventories, goodwill, acquired intangible assets, other long-lived assets, revenue recognition, stock-based compensation and income taxes. Actual results could differ from those estimates, and such differences could be material to the financial statements. The Company periodically reviews the assumptions used in its financial statement estimates. Fair Value of Financial Instruments The fair values of the Company’s financial instruments are recorded using a hierarchical disclosure framework based upon the level of subjectivity of the inputs used in measuring assets and liabilities. The three levels are described below: Level 1 - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 - Inputs other than Level 1 that are directly or indirectly observable, such as quoted prices for similar assets or liabilities and quoted prices in less active markets. Level 3 - Inputs are unobservable for the asset or liability and are developed based on the best information available in the circumstances, which might include the Company’s own data. F- 9 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 2. Significant Accounting Policies (Continued) Cash and Cash Equivalents Cash and cash equivalents consist of cash deposits, money market funds and investments in debt securities with original maturities of ninety days or less when purchased. Investments The Company’s investments typically have original maturities greater than ninety days as of the date of purchase and are classified as available-for-sale securities. Investments in available-for-sale securities are reported at fair value, with unrealized gains and losses, net of tax, recorded as a component of accumulated other comprehensive loss in the Consolidated Balance Sheet. Investments in which the Company has the ability and intent, if necessary, to liquidate in order to support its current operations (including those with contractual maturities greater than one year from the date of purchase) are classified as short-term. The Company reviews its available-for-sale investments as of the end of each reporting period for declines in fair value based on the specific identification method. The Company records an allowance for credit loss when a decline in fair value is due to credit-related factors. The Company considers various factors in determining whether an investment is impaired, including the severity of the impairment, changes in underlying credit ratings, forecasted recovery, its intent to sell or the likelihood that it would be required to sell the investment before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made. When the Company concludes that a credit-related impairment has occurred, the Company assesses whether it intends to sell the security or if it is more likely than not that it will be required to sell the security before recovery. If either of these two conditions is met, the Company recognizes a charge in earnings equal to the entire difference between the security’s amortized cost basis and its fair value. If the Company does not intend to sell a security and it is not more likely than not that it will be required to sell the security before recovery, the unrealized loss is separated into an amount representing the credit loss, which is recognized in earnings, and the amount related to all other factors, which is recorded in accumulated other comprehensive loss. In addition, the Company has made equity investments in non-publicly traded companies. Equity investments in which the Company does not have control, but has the ability to exercise significant influence over operating and financial policies, are accounted for using the equity method. The Company’s proportionate share of income or loss is recorded in equity-method earnings in the Consolidated Statements of Operations. The Company has elected to use the measurement alternative under Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments, to value non-marketable equity investments that do not have readily determinable fair values. Under the alternative, these non-marketable equity investments are recorded at cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes of the same or similar securities in observable transactions. The Company periodically reviews its equity investments for declines in fair value based on the specific identification method and writes down investments to their estimated fair values when it determines that a decline has occurred. In fiscal 2023, the Company sold its ownership in Walden Technology Ventures III, a limited partnership, and recognized the loss in the Consolidated Statement of Operations. Derivative Financial Instruments The Company uses derivative financial instruments to manage certain exposures to the variability of foreign currency exchange rates. The Company’s objective is to offset increases and decreases in expenses resulting from these exposures with gains and losses on the derivative contracts, thereby reducing volatility of earnings. The Company does not use derivative contracts for speculative or trading purposes. The Company recognizes derivatives, on a gross basis, in the Consolidated Balance Sheet at fair value. Cash flows from derivatives are classified according to the nature of the cash receipt or payment in the Consolidated Statement of Cash Flows. The Company also uses foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on non-U.S. dollar balance sheet exposures. The Company does not apply hedge accounting to these foreign currency forward contracts. F- 10 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 2. Significant Accounting Policies (Continued) Inventories Inventories are stated at the lower of cost, determined using the first-in, first-out method, or net realizable value. The Company writes down the carrying value of inventory to net realizable value for estimated obsolescence or unmarketable inventory based upon assumptions about the age of inventory, future demand and market conditions. Inventory impairment charges establish a new cost basis for inventory and charges are not subsequently reversed to income even if circumstances later suggest that increased carrying amounts are recoverable. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the useful lives of the assets ranging from three to fifteen years . Leasehold improvements are depreciated over the lease term or their useful life, whichever is shorter. The Company owns the facilities for its headquarters in Austin, Texas. The buildings are located on land which is leased through 2099 from a third party. The rents for these ground leases were prepaid for the term of the leases. The buildings and leasehold interest in ground leases are being depreciated on a straight-line basis over their estimated useful lives of 40 years and 86 years , respectively. Business Combinations The Company records business combinations using the acquisition method of accounting and, accordingly, allocates the fair value of acquisition consideration to the assets acquired and liabilities assumed based on their fair values at the acquisition date. The excess of the fair value of purchase consideration over the fair value of the assets acquired and liabilities assumed is recorded as goodwill. The results of operations of the businesses acquired are included in the Company’s consolidated results of operations beginning on the date of the acquisition. Long-Lived Assets Purchased intangible assets are stated at cost, net of accumulated amortization, and are amortized using the straight-line method over their estimated useful lives, ranging from five to twelve years . Fair values are determined primarily using the income approach, in which the Company projects future expected cash flows and applies an appropriate discount rate. Long-lived assets “held and used” by the Company are reviewed for impairment whenever events or changes in circumstances indicate that their net book value may not be recoverable. When such factors and circumstances exist, the Company compares the projected undiscounted future cash flows associated with the related asset or group of assets over their estimated useful lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets and is recorded in the period in which the determination was made. The Company tests goodwill for impairment annually as of the first day of its fourth fiscal quarter and in interim periods if events occur that would indicate that the carrying value of goodwill may be impaired. The Company assesses goodwill for impairment by comparing the fair value of the reporting unit to its carrying amount. In determining fair value, several valuation methodologies are allowed, although quoted market prices are the best evidence of fair value. If the fair value of the reporting unit is less than its carrying amount, an impairment loss is recognized equal to that excess amount. ​ F- 11 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 2. Significant Accounting Policies (Continued) Leases At the commencement date of a lease, the Company recognizes a liability to make lease payments and an asset representing the right to use the underlying asset during the lease term. The lease liability is measured at the present value of lease payments over the lease term. As its leases typically do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date taking into consideration necessary adjustments for collateral, depending on the facts and circumstances of the lessee and the leased asset, and term to match the lease term. The right-of-use (“ROU”) asset is measured at cost, which includes the initial measurement of the lease liability and initial direct costs incurred by the Company and excludes lease incentives. Lease liabilities are recorded in other current liabilities and other non-current liabilities. ROU assets are recorded in other assets, net. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Operating lease costs are recognized on a straight-line basis over the lease term. Lease agreements that contain both lease and non-lease components are generally accounted for separately. Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Substantially all of the Company’s contracts with customers contain a single performance obligation, the sale of mixed-signal integrated circuit (IC) products. This performance obligation is satisfied when control of the product is transferred to the customer, which typically occurs upon delivery. Unsatisfied performance obligations primarily represent contracts for products with future delivery dates. The Company has opted to not disclose the amount of unsatisfied performance obligations as these contracts have original expected durations of less than one year . The transaction price reflects the Company’s expectations about the consideration it will be entitled to receive from the customer and may include fixed or variable amounts. Variable consideration primarily includes sales made to distributors under agreements allowing certain rights of return, referred to as stock rotation, and credits issued to the distributor due to price protection. The Company estimates variable consideration at the most likely amount to which it expects to be entitled. The estimate is based on information available to the Company, including recent sales activity and pricing data. The Company applies a constraint to its variable consideration estimate which considers both the likelihood of a return and the amount of a potential price concession. Variable consideration that does not meet revenue recognition criteria is deferred. The Company records a right of return asset in prepaid expenses and other current assets for the costs of distributor inventory not meeting revenue recognition criteria. A corresponding deferred revenue and returns liability amount is recorded for unrecognized revenue associated with such costs. The Company’s products carry a one-year replacement warranty. Payments are typically due within 30 days of invoicing and do not include a significant financing component. Shipping and Handling Shipping and handling costs are classified as a component of cost of revenues in the Consolidated Statements of Operations. Stock-Based Compensation The Company has stock-based compensation plans, which are more fully described in Note 15, Stock-Based Compensation . The Company accounts for those plans using a fair-value method and recognizes the expense in its Consolidated Statement of Operations. F- 12 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 2. Significant Accounting Policies (Continued) Research and Development Research and development costs are expensed as incurred. Research and development expense consists primarily of personnel-related expenses, including stock-based compensation, as well as new product masks, external consulting and services costs, equipment tooling, equipment depreciation, amortization of intangible assets, and an allocated portion of our occupancy costs. Assets purchased to support the Company’s ongoing research and development activities are capitalized when related to products which have achieved technological feasibility or have an alternative future use, and are amortized over their estimated useful lives. Advertising Advertising costs are expensed as incurred. Advertising expenses were not material for any of the periods presented. Income Taxes The Company accounts for income taxes using the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax laws and related rates that will be in effect when the differences are expected to reverse. These differences result in deferred tax assets and liabilities, which are included in the Company’s Consolidated Balance Sheets. The Company then assesses the likelihood that the deferred tax assets will be realized. A valuation allowance is established against deferred tax assets to the extent the Company believes that it is more likely than not that the deferred tax assets will not be realized, taking into consideration the level of historical taxable income and projections for future taxable income over the periods in which the temporary differences are deductible. Uncertain tax positions must meet a more-likely-than-not threshold to be recognized in the financial statements and the tax benefits recognized are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon final settlement. See Note 17, Income Taxes , for additional information. ​ Recent Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures . This ASU requires interim and annual disclosure of significant segment expenses that are regularly provided to the chief operating decision-maker (“CODM”) and included within the reported measure of a segment’s profit or loss, requires interim disclosures about a reportable segment’s profit or loss and assets that are currently required annually, requires disclosure of the position and title of the CODM, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, and contains other disclosure requirements. This authoritative guidance is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the effect of this new guidance on our consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740)—Improvements to Income Tax Disclosures . This ASU requires that reporting entities disclose specific categories in the effective tax rate reconciliation as well as information about income taxes paid. The authoritative guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the effect of this new guidance on our consolidated financial statements. ​ F- 13 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 3. Discontinued Operations On July 26, 2021, the Company sold its infrastructure and automotive business to Skyworks Solutions, Inc. for $ 2.75 billion in cash. The financial results of the infrastructure and automotive business, which are readily distinguishable from other components of the Company, have been presented as discontinued operations in the Consolidated Financial Statements because the sale represented a strategic shift for the Company. The following table presents the financial results of the infrastructure and automotive business (the “discontinued operations”) in the Company’s Consolidated Statements of Income for the year ended January 1, 2022 (in thousands, except per share data): ​ ​ ​ ​ ​ Revenues ​ $ 233,918 Costs of revenues ​ 95,457 Operating expenses ​ ​ 46,643 Operating income from discontinued operations ​ 91,818 Gain on sale of discontinued operations ​ ​ 2,423,161 Income from discontinued operations before income taxes ​ ​ 2,514,979 Provision for income taxes ​ 339,706 Income from discontinued operations ​ $ 2,175,273 ​ ​ ​ ​ Income from discontinued operations per share: ​ ​ Basic ​ $ 50.79 Diluted ​ $ 49.09 ​ ​ ​ F- 14 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 4. Earnings (Loss) Per Share The following table sets forth the computation of basic and diluted earnings (loss) per share (in thousands, except per share data): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 30, ​ December 31, ​ January 1, ​ ​ 2023 2022 2022 Income (loss) from continuing operations ​ $ ( 34,516 ) ​ $ 91,402 ​ $ ( 57,874 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Shares used in computing basic earnings (loss) per share ​ ​ 31,804 ​ 35,086 ​ 42,830 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of dilutive securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Stock-based awards and convertible debt ​ ​ — ​ 956 ​ — Shares used in computing diluted earnings (loss) per share ​ ​ 31,804 ​ 36,042 ​ 42,830 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings (loss) per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ ( 1.09 ) ​ $ 2.61 ​ $ ( 1.35 ) Diluted ​ $ ( 1.09 ) ​ $ 2.54 ​ $ ( 1.35 ) ​ In periods where the Company reports income from continuing operations, diluted earnings per share was computed using the treasury stock method for stock-based awards and the if-converted method for convertible debt. Diluted shares for fiscal 2023 excluded 0.9 million shares and fiscal 2021 excluded 1.5 million shares due to the Company’s loss from continuing operations for the periods. The Company irrevocably elected to settle the principal amount of its 0.625 % convertible senior notes due 2025 (the “2025 Notes”) in cash and intended to settle any excess value in shares in the event of a conversion. In June 2023, the Company paid $ 535.0 million in cash and issued 0.9 million shares of common stock in connection with the conversions and redemptions of the 2025 Notes. For fiscal 2022, approximately 0.6 million shares were included in the denominator for the calculation of diluted earnings per share (related to the not yet converted or redeemed 2025 Notes.) See Note 10, Debt , to the Consolidated Financial Statements for additional information. Securities that were anti-dilutive were insignificant and were excluded from the computation of diluted earnings per share in all periods presented. ​ ​ 5. Fair Value of Financial Instruments The following summarizes the valuation of the Company’s financial instruments (in thousands). The tables do not include either cash on hand or assets and liabilities that are measured at historical cost or any basis other than fair value. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ ​ ​ ​ at December 30, 2023 Using ​ ​ ​ ​ ​ Quoted Prices in ​ Significant Other ​ ​ ​ ​ ​ Active Markets for ​ Observable ​ ​ ​ ​ ​ Identical Assets ​ Inputs ​ ​ ​ Description (Level 1) (Level 2) Total Cash equivalents: ​ ​ ​ ​ ​ ​ ​ ​ ​ Money market funds ​ $ 137,195 ​ $ — ​ $ 137,195 Total cash equivalents ​ $ 137,195 ​ $ — ​ $ 137,195 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Short-term investments: ​ ​ ​ ​ ​ ​ ​ ​ ​ Corporate debt securities ​ $ — ​ $ 130,047 ​ $ 130,047 Government debt securities ​ ​ — ​ ​ 81,673 ​ ​ 81,673 Total short-term investments ​ $ — ​ $ 211,720 ​ $ 211,720 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ​ $ 137,195 ​ $ 211,720 ​ $ 348,915 ​ F- 15 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 5. Fair Value of Financial Instruments (Continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ ​ ​ at December 31, 2022 Using ​ ​ ​ ​ Quoted Prices in ​ Significant Other ​ ​ ​ ​ ​ Active Markets for ​ Observable ​ ​ ​ ​ ​ Identical Assets ​ Inputs ​ ​ ​ Description (Level 1) (Level 2) Total Cash equivalents: ​ ​ ​ ​ ​ ​ ​ ​ ​ Money market funds ​ $ 310,969 ​ $ — ​ $ 310,969 Corporate debt securities ​ ​ — ​ 3,249 ​ 3,249 Total cash equivalents ​ $ 310,969 ​ $ 3,249 ​ $ 314,218 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Short-term investments: ​ ​ ​ ​ ​ ​ ​ ​ ​ Corporate debt securities ​ $ — ​ $ 501,014 ​ $ 501,014 Government debt securities ​ ​ — ​ ​ 191,010 ​ ​ 191,010 Total short-term investments ​ $ — ​ $ 692,024 ​ $ 692,024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ​ $ 310,969 ​ $ 695,273 ​ $ 1,006,242 ​ Valuation methodology The Company’s cash equivalents and short-term investments that are classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; quoted prices in less active markets; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. Investments classified as Level 3 are valued using a discounted cash flow model. The assumptions used in preparing the discounted cash flow model include estimates for interest rates, amount of cash flows, expected holding periods of the securities and a discount to reflect the Company’s inability to liquidate the securities. The Company’s foreign currency derivative instruments are valued using discounted cash flow models. The assumptions used in preparing the valuation models include foreign exchange rates, forward and spot prices for currencies and market observable data of similar instruments. Contractual maturities of investments The Company’s available-for-sale investments are reported at fair value, with unrealized gains and losses, net of tax, recorded as a component of accumulated other comprehensive loss in the Consolidated Balance Sheet. The following summarizes the contractual underlying maturities of the Company’s available-for-sale investments at December 30, 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair ​ ​ Cost ​ Value Due in one year or less ​ $ 155,431 ​ $ 154,349 Due after one year through five years ​ ​ 57,518 ​ ​ 57,371 ​ ​ $ 212,949 ​ $ 211,720 ​ Unrealized Gains and Losses The available-for-sale investments that were in a continuous unrealized loss position, aggregated by length of time that individual securities have been in a continuous loss position, were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months ​ 12 Months or Greater ​ Total ​ ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ Fair ​ Unrealized ​ Fair ​ Unrealized ​ Fair ​ Unrealized As of December 30, 2023 Value Losses Value Losses Value Losses Corporate debt securities ​ $ 12,449 ​ $ ( 13 ) ​ $ 95,760 ​ $ ( 867 ) ​ $ 108,209 ​ $ ( 880 ) Government debt securities ​ ​ 28,255 ​ ​ ( 115 ) ​ ​ 31,122 ​ ​ ( 440 ) ​ ​ 59,377 ​ ​ ( 555 ) ​ ​ $ 40,704 ​ $ ( 128 ) ​ $ 126,882 ​ $ ( 1,307 ) ​ $ 167,586 ​ $ ( 1,435 ) ​ F- 16 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 5. Fair Value of Financial Instruments (Continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months ​ 12 Months or Greater ​ Total ​ ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ Fair ​ Unrealized ​ Fair ​ Unrealized ​ Fair ​ Unrealized As of December 31, 2022 Value Losses Value Losses Value Losses Corporate debt securities ​ $ 307,085 ​ $ ( 5,297 ) ​ $ 185,467 ​ $ ( 4,090 ) ​ $ 492,552 ​ $ ( 9,387 ) Government debt securities ​ ​ 76,651 ​ ​ ( 626 ) ​ ​ 100,209 ​ ​ ( 3,541 ) ​ ​ 176,860 ​ ​ ( 4,167 ) ​ ​ $ 383,736 ​ $ ( 5,923 ) ​ $ 285,676 ​ $ ( 7,631 ) ​ $ 669,412 ​ $ ( 13,554 ) ​ The gross unrealized losses as of December 30, 2023 and December 31, 2022 were due primarily to changes in market interest rates. ​ The Company records an allowance for credit loss when a decline in investment market value is due to credit-related factors. When evaluating an investment for impairment, the Company reviews factors such as the severity of the impairment, changes in underlying credit ratings, forecasted recovery, the Company’s intent to sell or the likelihood that it would be required to sell the investment before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made. As of December 30, 2023, there were no material declines in the market value of available-for-sale investments due to credit-related factors. At December 30, 2023 and December 31, 2022, there were no material unrealized gains associated with the Company’s available-for-sale investments. Level 3 fair value measurements The following summarizes the activity in Level 3 financial instruments for the year ended December 31, 2022 (in thousands): Assets ​ ​ ​ ​ ​ ​ ​ ​ December 31, Auction Rate Securities 2022 Beginning balance ​ ​ $ 4,980 Sales (1) ​ ​ ​ ( 6,000 ) Loss recognized in earnings ​ ​ ​ 300 Gain (loss) included in other comprehensive income (loss) ​ ​ 720 Ending balance ​ ​ $ — (1) On May 31, 2022, the Company sold its prior remaining holding of auction-rate securities for $ 5.7 million. Fair values of other financial instruments Prior to its conversion or redemption in June 2023, the Company’s debt was recorded at cost, but measured at fair value for disclosure purposes. The fair value of the Company’s 2025 Notes was determined using observable market prices. The notes were traded in less active markets and were therefore classified as a Level 2 fair value measurement. As of December 31, 2022, the fair value of the notes was $ 671.9 million. No notes were outstanding as of December 30, 2023. The Company’s other financial instruments, including cash, accounts receivable and accounts payable, are recorded at amounts that approximate their fair values due to their short maturities. F- 17 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 6. Derivative Financial Instruments The Company uses derivative financial instruments to manage certain exposures to the variability of foreign currency exchange rates. The Company’s objective is to offset increases and decreases in expenses resulting from these exposures with gains and losses on the derivative contracts, thereby reducing volatility of earnings. Cash Flow Hedges Foreign Currency Forward Contracts The Company may use foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on operating expenses denominated in currencies other than the U.S. dollar. Changes in the fair value of the contracts are recorded in accumulated other comprehensive loss in the Consolidated Balance Sheet and subsequently reclassified into earnings in the period during which the hedged transaction is recognized. The reclassified amount is reported in the same financial statement line item as the hedged item. If the foreign currency forward contracts are terminated or can no longer qualify as hedging instruments prior to maturity, the fair value of the contracts recorded in accumulated other comprehensive loss may be recognized in the Consolidated Statement of Operations based on an assessment of the contracts at the time of termination. As of December 30, 2023, the contracts had maturities of one to three months and an aggregate notional value of $ 6.8 million. Gains and losses expected to be reclassified into earnings in the next twelve months were not material. The fair value of the contracts, contract gains or losses recognized in other comprehensive income (loss) and amounts reclassified from accumulated other comprehensive loss into earnings were not material for any of the periods presented. ​ Non-designated Hedges Foreign Currency Forward Contracts The Company may use foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on non-U.S. dollar balance sheet exposures. The Company recognizes gains and losses on the foreign currency forward contracts in interest income and other, net in the Consolidated Statement of Operations in the same period as the remeasurement loss and gain of the related foreign currency denominated asset or liability. The Company does not apply hedge accounting to these foreign currency forward contracts. As of December 30, 2023, the Company held no such foreign currency forward contracts. The fair value of the foreign contracts and contract gains and losses recognized in income were not material for any of the periods presented. 7. Supplemental Information The following tables show the details of selected Consolidated Balance Sheet items (in thousands): ​ Inventories ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ ​ 2023 ​ 2022 Work in progress ​ $ 173,802 ​ $ 75,112 Finished goods ​ 20,493 ​ 25,305 ​ ​ $ 194,295 ​ $ 100,417 ​ F- 18 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 7. Supplemental Information (Continued) ​ Property and Equipment ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ ​ 2023 ​ 2022 Buildings and improvements ​ $ 130,482 ​ $ 125,471 Equipment ​ 68,703 ​ 62,304 Computers and purchased software ​ 51,755 ​ 55,065 Leasehold interest in ground leases ​ 23,840 ​ 23,840 Leasehold improvements ​ 14,971 ​ 14,209 Furniture and fixtures ​ 9,574 ​ 9,909 ​ ​ 299,325 ​ 290,798 Accumulated depreciation ​ ( 153,435 ) ​ ( 138,782 ) ​ ​ $ 145,890 ​ $ 152,016 ​ Other Assets, net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ 2023 2022 Equity-method investment (1) ​ $ — ​ $ 27,478 Other ​ 123,313 ​ 67,275 ​ ​ $ 123,313 ​ $ 94,753 (1) At December 31, 2022, the Company held an 8 % equity interest in Walden Technology Ventures III, a limited partnership. In fiscal 2023, the Company sold its ownership in this investment and recognized the net loss of $ 15.2 million in the Consolidated Statement of Operations. ​ Other Current Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ ​ 2023 ​ 2022 Accrued compensation and benefits ​ $ 16,891 ​ $ 43,736 Income taxes payable ​ ​ 6,133 ​ ​ 11,472 Other ​ 35,931 ​ 33,928 ​ ​ $ 58,955 ​ $ 89,136 ​ ​ Other Non-Current Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ ​ 2023 ​ 2022 Lease liability – non-current ​ $ 19,830 ​ $ 18,009 Other ​ 50,974 ​ 31,062 ​ ​ $ 70,804 ​ $ 49,071 ​ ​ F- 19 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 8. Risks and Uncertainties Financial Instruments Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash equivalents, investments, accounts receivable and derivatives. The Company places its cash equivalents and investments primarily in municipal bonds, money market funds, corporate bonds, U.S. government securities, agency bonds, asset-back securities, and Yankee bonds. Concentrations of credit risk with respect to accounts receivable are primarily due to customers with large outstanding balances. The Company’s customers that accounted for greater than 10% of accounts receivable consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, ​ December 31, ​ 2023 2022 Arrow Electronics * ​ 29 % Other ​ 13 % * ​ ​ * Less than 10% of accounts receivable The Company performs periodic credit evaluations of its customers’ financial condition and generally requires no collateral from its customers. The Company provides an allowance for expected credit losses based upon the net amount expected to be collected on such receivables. Losses have not been significant for any of the periods presented. As a result of its use of derivative instruments, the Company is exposed to the risk that its counterparties will fail to meet their contractual obligations. To mitigate this counterparty credit risk, the Company has a policy to enter into contracts with only selected major financial institutions. The Company periodically reviews and re-assesses the creditworthiness of such counterparties based on a variety of factors. Distributor Advances On sales to distributors, the Company’s payment terms often require the distributor to initially pay amounts owed to the Company for an amount in excess of their ultimate cost. The Company’s sales price to its distributors may be higher than the amount that the distributors will ultimately owe the Company because distributors often negotiate price reductions after purchasing the product from the Company and such reductions are often significant. These negotiated price discounts are not granted until the distributor sells the product to the end customer, which may occur after the distributor has paid the original invoice amount to the Company. Payment of invoices prior to receiving an associated discount can have an adverse impact on the working capital of the Company’s distributors. Accordingly, the Company has entered into agreements with certain distributors whereby it advances cash to the distributors to reduce the distributor’s working capital requirements. The advance amounts are based on the distributor’s inventory balance, and are adjusted quarterly. Such amounts are recorded in prepaid expenses and other current assets in the Consolidated Balance Sheet. The terms of these advances are set forth in binding legal agreements and are unsecured, bear no interest on unsettled balances and are due upon demand. The agreements governing these advances can be cancelled by the Company at any time. Suppliers A significant portion of the Company’s products are fabricated by Taiwan Semiconductor Manufacturing Co. (“TSMC”) or Semiconductor Manufacturing International Corporation (“SMIC”). The inability of TSMC or SMIC to deliver wafers to the Company on a timely basis could impact the production of the Company’s products for a substantial period of time, which could have a material adverse effect on the Company’s business, financial condition, results of operations and cash flows. F- 20 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 8. Risks and Uncertainties (Continued) Customers The Company sells directly to end customers, distributors and contract manufacturers. Although the Company actually sells the products to, and is paid by, distributors and contract manufacturers, the Company refers to the end customer as its customer. None of the Company’s end customers accounted for greater than 10% of revenue during fiscal 2023, 2022 or 2021. The Company’s distributors that accounted for greater than 10% of revenue consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Arrow Electronics 34 % 33 % 28 % Edom Technology 15 % 17 % 18 % Sekorm ​ * ​ * ​ 12 % * Less than 10% of revenue ​ ​ ​ F- 21 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 9. Other Intangible Assets, Net ​ The gross carrying amount and accumulated amortization of other intangible assets, net are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization ​ December 30, 2023 ​ December 31, 2022 ​ ​ Period ​ Gross ​ Accumulated ​ Gross ​ Accumulated ​ (Years) Amount Amortization Amount Amortization ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Developed technology 8 ​ $ 211,217 ​ $ ( 151,722 ) ​ $ 211,217 ​ $ ( 126,424 ) Trademarks 12 ​ ​ 910 ​ ​ ( 872 ) ​ 910 ​ ( 796 ) Total intangible assets ​ 8 ​ $ 212,127 ​ $ ( 152,594 ) ​ $ 212,127 ​ $ ( 127,220 ) ​ The following table presents details of intangible asset amortization expense recognized in the Consolidated Statements of Operations (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Research and development ​ $ 25,298 ​ $ 28,962 ​ $ 32,319 Selling, general and administrative ​ ​ 76 ​ 5,109 ​ 12,186 ​ ​ $ 25,374 ​ $ 34,071 ​ $ 44,505 ​ The estimated aggregate amortization expense for intangible assets subject to amortization for each of the five succeeding fiscal years is as follows (in thousands): ​ ​ ​ ​ ​ Fiscal Year ​ 2024 ​ $ 23,034 2025 ​ ​ 13,369 2026 ​ ​ 9,178 2027 ​ ​ 9,178 2028 ​ ​ 4,039 ​ ​ 10. Debt 0.625 % Convertible Senior Notes On June 1, 2020, the Company completed a private placement of $ 535 million principal amount convertible senior notes (the “2025 Notes”). The 2025 Notes bore interest semi-annually at a rate of 0.625 % per year and were scheduled to mature on June 15, 2025. The 2025 Notes were convertible at a conversion rate of 8.1980 shares of common stock per $1,000 principal amount of the 2025 Notes, or approximately 4.4 million shares of common stock, which was equivalent to a conversion price of $ 121.98 per share. The conversion rate was subject to adjustment under certain circumstances. Holders may have converted the 2025 Notes under the following circumstances: during any calendar quarter after the calendar quarter ended on September 30, 2020 if the closing price of the Company’s common stock for at least 20 trading days in the 30 consecutive trading days ending on the last trading day of the preceding calendar quarter is greater than or equal to $ 159.51 per share, representing 130 % of the conversion price of the 2025 Notes (“the Sales Price Trigger”); during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the closing sale price of our common stock and the conversion rate on each such trading day; if specified distributions or corporate events occur; if the 2025 Notes are called for redemption; or at any time after March 15, 2025. The Company may have redeemed all or any portion of the 2025 Notes, at its option, on or after June 20, 2023, if the last reported sale price of the Company’s common stock has been at least 130 % of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period. F- 22 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 10. Debt (Continued) The principal balance of the 2025 Notes was initially separated into liability and equity components, and recorded at fair value. The excess of the principal amount of the liability component over its carrying amount represented the debt discount, which was amortized to interest expense over the term of the 2025 Notes using the effective interest method. With the Company’s adoption of ASU 2020-06 in fiscal 2022, the principal balance of the 2025 Notes was no longer separated between liability and equity components. This resulted in an increase to the carrying value of its convertible debt, representing the unamortized debt discount as of January 2, 2022, with an offsetting reduction in stockholders’ equity. The Company incurred debt issuance costs of $ 10.4 million, which were allocated to the liability and equity components in proportion to the allocation of the proceeds. Upon the adoption of ASU 2020-06, the equity component was reclassified to liabilities and remeasured to reflect cumulative amortization since the issuance of the 2025 Notes. On March 22, 2023, the Company issued a notice of redemption for the 2025 Notes. Prior to the redemption, the Company received conversion notices representing $ 533.6 million principal amount of the notes. The Company paid $ 533.6 million in cash and issued 0.9 million shares of common stock, as well as $ 47 thousand in cash in lieu of fractional shares, for the conversions. Notes representing $ 1.4 million principal amount were redeemed at par, plus accrued interest. All note conversions and redemptions were completed in June 2023. The liability component of the 2025 Notes is recorded in convertible debt on the Consolidated Balance Sheet. Prior to the Company’s adoption of ASU 2020-06, the equity component of the 2025 Notes was recorded in stockholders’ equity. The effective interest rate for the liability component was 5.336 %. As of December 30, 2023, there were no remaining debt issuance costs. Interest expense related to the Company’s convertible debt was comprised of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, December 31, January 1, ​ ​ ​ 2023 ​ 2022 ​ 2022 Contractual interest expense ​ $ 1,493 ​ $ 3,346 ​ $ 3,662 Amortization of debt discount ​ ​ — ​ — ​ 21,112 Amortization of debt issuance costs ​ ​ 960 ​ 2,003 ​ 1,655 ​ ​ $ 2,453 ​ $ 5,349 ​ $ 26,429 ​ Credit Facility The Company and certain of its domestic subsidiaries (the “Guarantors”) have a $ 400 million revolving credit facility, as amended on June 30, 2023, with a maturity date of June 30, 2028. The credit facility includes a $ 25 million letter of credit sublimit and a $ 10 million swingline loan sublimit. The Company also has an option to increase the size of the borrowing capacity by up to the greater of an aggregate of $ 250 million and 100 % of EBITDA of the last four fiscal quarters, plus an amount that would not cause a secured net leverage ratio (funded debt secured by assets/EBITDA) to exceed 3.50 to 1.00, subject to certain conditions. ​ F- 23 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 10. Debt (Continued) Credit Facility (Continued) The credit facility, other than swingline loans, will bear interest at the Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin or, at the option of the Company, a base rate (defined as the highest of the Wells Fargo prime rate, the Federal Funds rate plus 0.50 % and the Adjusted Term SOFR plus 1.00 % ) plus an applicable margin. Swingline loans accrue interest at the base rate plus the applicable margin for base rate loans. The applicable margins for the Adjusted Term SOFR loans range from 1.00 % to 1.75 % and for base rate loans range from 0.00 % to 0.75 % , depending in each case, on the leverage ratio as defined in the credit facility. The credit facility contains various conditions, covenants and representations with which the Company must be in compliance in order to borrow funds and to avoid an event of default, including financial covenants that the Company must maintain a consolidated net leverage ratio (funded indebtedness less cash and cash equivalents up to $ 750 million and divided by EBITDA) of no more than 4.25 to 1, and a minimum interest coverage ratio (EBITDA/interest payments) of no less than 2.50 to 1. As of December 30, 2023, the Company was in compliance with all covenants of the credit facility. The Company’s obligations under the credit facility are guaranteed by the Guarantors and are secured by a security interest in substantially all assets of the Company and the Guarantors. As of December 30, 2023, $ 45.0 million was outstanding on the credit facility, with a weighted average interest rate of 6.46 %. ​ 11. Leases The Company leases certain facilities under operating lease agreements that expire at various dates through 2030. Some of these arrangements contain renewal options and require the Company to pay taxes, insurance and maintenance costs. Lease costs for operating leases were $ 7.8 million, $ 7.3 million and $ 7.4 million during fiscal 2023, 2022 and 2021, respectively. Supplemental Lease Information ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Consolidated Balance ​ December 30, December 31, Balance Sheet Information (in thousands) ​ Sheet Classification ​ 2023 ​ 2022 Operating lease right-of-use assets ​ Other assets, net ​ $ 26,740 ​ $ 24,717 Operating lease liabilities ​ Other current liabilities ​ $ 7,185 ​ $ 6,281 Operating lease liabilities ​ Other non-current liabilities ​ $ 19,830 ​ $ 18,009 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 30, December 31, Cash Flow Information (in thousands) ​ 2023 ​ 2022 Cash paid for operating lease liabilities $ 7,487 ​ $ 7,518 Right-of-use assets obtained in exchange for operating lease obligations $ 534 ​ $ 3,198 ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, Operating Lease Information ​ 2023 ​ 2022 Weighted-average remaining lease term 5.4 years ​ 5.1 years ​ Weighted-average discount rate 4.72 % 3.96 % ​ F- 24 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 11. Leases (Continued) The maturities of operating lease liabilities as of December 30, 2023 were as follows (in thousands): ​ ​ ​ ​ ​ Fiscal Year ​ ​ 2024 ​ $ 7,772 2025 ​ ​ 6,251 2026 ​ ​ 4,559 2027 ​ ​ 3,737 2028 ​ ​ 2,676 Thereafter ​ ​ 6,219 Total lease payments ​ ​ 31,214 Less imputed interest ​ ​ ( 4,199 ) Total lease liabilities ​ $ 27,015 ​ Lease income The Company leases a portion of its headquarter facilities to other tenants. Lease income from operating leases was $ 3.1 million, $ 6.2 million and $ 4.9 million during fiscal 2023, 2022 and 2021, respectively. ​ Maturities of lease income as of December 30, 2023 were as follows (in thousands): ​ ​ ​ ​ ​ Fiscal Year ​ 2024 ​ $ 2,481 2025 ​ ​ 1,919 2026 ​ 1,322 2027 ​ 439 2028 ​ 452 Thereafter ​ 233 ​ ​ 12. Commitments and Contingencies Litigation The Company is involved in various legal proceedings that have arisen in the normal course of business. While the ultimate results cannot be predicted with certainty, the Company does not expect them to have a material adverse effect on its Consolidated Financial Statements. ​ 13. Share Repurchases The Company repurchased 1.5 million shares, 6.9 million shares and 6.5 million shares of its common stock for $ 213.0 million, $ 887.6 million, and $ 1.15 billion during fiscal 2023, 2022 and 2021, respectively. Shares repurchased in fiscal 2021 included purchases of 4.0 million shares through a tender offer, 1.7 million shares through an accelerated share repurchase agreement and 0.8 million shares through the Company’s existing share repurchase program. ​ F- 25 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 14. Revenues The Company groups its products as Industrial & Commercial or Home & Life based on the target markets they address. The following represents revenue by product category (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 30, ​ December 31, ​ January 1, ​ ​ 2023 2022 2022 Industrial & Commercial ​ $ 496,578 ​ $ 573,725 ​ $ 377,401 Home & Life ​ 285,680 ​ 450,381 ​ 343,459 ​ ​ $ 782,258 ​ $ 1,024,106 ​ $ 720,860 ​ A portion of the Company’s sales are made to distributors under agreements allowing certain rights of return and/or price protection related to the final selling price to the end customers. These factors impact the timing and uncertainty of revenues and cash flows. The Company did not recognize any revenue during fiscal 2023 from performance obligations that were satisfied in previous reporting periods, and recognized revenue of $ 30.1 million and $ 12.4 million during fiscal 2022 and 2021, respectively, from performance obligations that were satisfied in previous reporting periods. The following disaggregates the Company’s revenue by sales channel (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 30, December 31, January 1, ​ 2023 2022 2022 Distributors ​ $ 611,332 ​ $ 829,373 ​ $ 584,010 Direct customers ​ ​ 170,926 ​ 194,733 ​ 136,850 ​ ​ $ 782,258 ​ $ 1,024,106 ​ $ 720,860 ​ ​ 15. Stock-Based Compensation The Company has two active stock plans, the 2009 Stock Incentive Plan (the “2009 Plan”) and the 2009 Employee Stock Purchase Plan (the “2009 ESPP”) that have been amended and approved by shareholders from time to time. ● The 2009 Plan allows for grants of stock options, stock appreciation rights, performance shares, performance stock units, restricted stock units (“RSUs”), restricted stock awards (“RSAs”), performance-based stock units (“PSUs”) and other awards (collectively, “awards”). All awards deduct one share from the 2009 Plan shares available for issuance for each share granted. Awards granted under the 2009 Plan contain vesting provisions mostly ranging from three to four years . To the extent awards granted under the 2009 Plan terminate, expire, or lapse for any reason, or are settled in cash, shares subject to such awards will again be available for grant. ● The 2009 ESPP allows eligible employees to purchase a limited number of shares of the Company’s common stock at no less than 85 % of the fair market value of a share of common stock at prescribed purchase intervals during an offering period. Each offering period is comprised of a series of one or more successive and/or overlapping purchase intervals and has a maximum term of 27 months . 2009 Plan The Company granted to its employees 0.5 million, 0.5 million and 0.6 million shares of full value awards from the 2009 Plan during fiscal 2023, 2022 and 2021, respectively. Full value awards include RSUs, MSUs, and PSUs. MSUs provide the rights to acquire a number of shares of common stock for no cash consideration based upon achievement of specified levels of market conditions. The requisite measurement period for these MSUs is also the vesting period, which is generally three years . MSUs granted in 2020 measured the relative performance of the total stockholders’ return of the Company against that of a selected benchmarked group of companies. The Company granted no MSUs in fiscal 2023, 2022 and 2021. ​ F- 26 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 15. Stock-Based Compensation (Continued) PSUs provide for the rights to acquire a number of shares of common stock for no cash consideration based upon the achievement of specified revenue or profitability objectives during the year. The requisite performance period of these PSUs is approximately three years from the date of grant. The Company granted 85,554 , 52,078 , and 116,809 PSUs in fiscal 2023, 2022, and 2021, respectively. 2009 ESPP The rights to purchase common stock granted under the 2009 ESPP are intended to be treated as either (i) purchase rights granted under an “employee stock purchase plan,” as that term is defined in Section 423(b) of the Internal Revenue Code (the “423(b) Plan”), or (ii) purchase rights granted under an employee stock purchase plan that is not subject to the terms and conditions of Section 423(b) of the Internal Revenue Code (the “Non-423(b) Plan”). The Company will retain the discretion to grant purchase rights under either the 423(b) Plan or the Non-423(b) Plan. During fiscal 2023, 2022 and 2021, the Company issued 154,000 , 109,000 , and 146,000 shares, respectively, under the 2009 ESPP to its employees. The weighted-average fair value for purchase rights granted in fiscal 2023 under the 2009 ESPP was $ 27.81 per share. Accounting for Stock-Based Compensation Stock-based compensation costs are based on the fair values on the date of grant for awards under the 2009 Plan, and on the date of enrollment for grants under the 2009 ESPP. The fair values of stock awards (such as RSUs, PSUs and RSAs) are estimated based on their intrinsic values. The fair values of MSUs are estimated using a Monte Carlo simulation. The fair values of stock options and grants under the 2009 ESPP are estimated using the Black-Scholes option-pricing model. The fair values of all such stock-based grants are generally amortized on a straight-line basis over the vesting period of the grants. The Company estimates potential forfeitures of stock grants and adjusts compensation cost recorded accordingly. The estimate of forfeitures will be adjusted over the requisite service period to the extent that actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of stock-based compensation expense to be recognized in future periods. The following table presents details of stock-based compensation costs recognized in the Consolidated Statements of Operations (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Cost of revenues ​ $ 906 ​ $ 1,152 ​ $ 964 Research and development ​ 35,491 ​ 32,860 ​ 24,986 Selling, general and administrative ​ 11,812 ​ 26,498 ​ 30,892 ​ ​ 48,208 ​ 60,510 ​ 56,842 Income tax benefit ​ ( 6,230 ) ​ ( 5,980 ) ​ ( 954 ) Share-based compensation – continuing operations ​ ​ 41,978 ​ ​ 54,530 ​ ​ 55,888 Share-based compensation – discontinued operations, net ​ ​ — ​ ​ — ​ ​ ( 2,007 ) Total ​ $ 41,978 ​ $ 54,530 ​ $ 53,881 ​ The Company recorded $ 0.6 million and $ 7.8 million of stock-based compensation charges included in selling, general and administrative expense during fiscal 2023 and fiscal 2021, respectively, in connection with the modification of certain equity awards. The modifications were pursuant to employee terminations. There were no other significant modifications made to any stock grants during fiscal 2023, 2022 or 2021. The Company had approximately $ 88.7 million of total unrecognized compensation cost related to equity grants as of December 30, 2023 that is expected to be recognized over a weighted-average period of approximately 2.0 years. There were no significant stock-based compensation costs capitalized into assets in any of the periods presented. F- 27 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 15. Stock-Based Compensation (Continued) Fair value assumptions and stock awards activity The fair values estimated from the Black-Scholes option-pricing model for ESPP shares granted were calculated using the following assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ Employee Stock Purchase Plan 2023 2022 2022 ​ Expected volatility ​ 40 % 44 % 42 % Risk-free interest rate % ​ 5.47 % 3.18 % 0.05 % Expected term (in months) ​ 9 ​ 9 ​ 9 ​ Dividend yield ​ — ​ — ​ — ​ ​ A summary of stock-based compensation activity with respect to fiscal 2023 follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ Weighted-Average ​ Aggregate ​ ​ ​ ​ Average ​ Remaining ​ Intrinsic ​ ​ Shares ​ Exercise ​ Contractual Term ​ Value Stock Options (000s) Price (In Years) (000s) Outstanding at December 31, 2022 118 ​ $ 38.80 3.12 ​ $ 11,457 Exercised ​ 24 ​ $ 37.88 ​ ​ ​ $ 2,162 Outstanding at December 30, 2023 94 ​ $ 39.03 2.12 ​ $ 8,790 Vested at December 30, 2023 and expected to vest 94 ​ $ 39.03 2.12 ​ $ 8,790 Exercisable at December 30, 2023 94 ​ $ 39.03 2.12 ​ $ 8,790 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- ​ Weighted-Average ​ Aggregate ​ ​ ​ ​ Average ​ Remaining ​ Intrinsic ​ ​ Shares ​ Grant Date ​ Vesting Term ​ Value RSAs and RSUs (000s) Fair Value (In Years) (000s) Outstanding at December 31, 2022 897 ​ $ 134.74 ​ ​ ​ ​ ​ Granted 420 ​ $ 137.11 ​ ​ ​ ​ ​ Vested or issued ( 416 ) ​ $ 127.51 ​ ​ ​ ​ ​ Cancelled or forfeited ( 77 ) ​ $ 142.05 ​ ​ ​ ​ ​ Outstanding at December 30, 2023 824 ​ $ 139.34 1.14 ​ $ 109,044 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at December 30, 2023 and expected to vest 759 ​ $ 139.36 1.14 ​ $ 100,329 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted- Weighted-Average ​ Aggregate ​ ​ ​ ​ Average ​ Remaining ​ Intrinsic ​ ​ Shares ​ Grant Date ​ Vesting Term ​ Value PSUs and MSUs (000s) Fair Value (In Years) (000s) Outstanding at December 31, 2022 225 $ 134.93 ​ ​ ​ ​ ​ Granted 86 ​ $ 188.45 ​ ​ ​ ​ ​ Vested or issued ( 33 ) ​ $ 92.31 ​ ​ ​ ​ ​ Cancelled or forfeited ( 33 ) ​ $ 95.47 ​ ​ ​ ​ ​ Outstanding at December 30, 2023 245 ​ $ 164.62 1.22 ​ $ 32,438 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at December 30, 2023 and expected to vest 85 $ 132.99 1.22 ​ $ 11,205 ​ F- 28 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 15. Stock-Based Compensation (Continued) The following summarizes the Company’s weighted average fair value at the date of grant: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Per grant of RSAs and RSUs ​ $ 137.11 $ 144.40 $ 135.28 Per grant of PSUs and MSUs ​ $ 188.45 $ 160.97 $ 145.11 ​ The following summarizes the Company’s stock-based payment and stock option values (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Intrinsic value of stock options exercised ​ $ 2,162 ​ $ — ​ $ 986 Intrinsic value of RSUs that vested ​ $ 61,371 ​ $ 57,621 ​ $ 76,654 Grant date fair value of RSUs that vested ​ $ 53,088 ​ $ 41,610 ​ $ 47,726 Intrinsic value of PSUs and MSUs that vested ​ $ 5,163 ​ $ — ​ $ 5,231 Grant date fair value of PSUs and MSUs that vested ​ $ 3,037 ​ $ — ​ $ 3,562 ​ As of December 30, 2023, the Company had reserved shares of common stock for future issuance as follows (in thousands): ​ ​ ​ ​ 2009 Plan 2,096 2009 ESPP 991 Total shares reserved 3,087 ​ ​ ​ 16. Employee Benefit Plan The Company maintains a defined contribution or 401(k) Plan for its qualified U.S. employees. Participants may contribute a percentage of their compensation on a pre-tax basis, subject to a maximum annual contribution imposed by the Internal Revenue Code. The Company may make discretionary matching contributions as well as discretionary profit-sharing contributions to the 401(k) Plan. The Company contributed $ 3.3 million, $ 3.2 million and $ 3.5 million to the 401(k) Plan during fiscal 2023, 2022 and 2021, respectively. ​ 17. Income Taxes Income (loss) from continuing operations, inclusive of equity-method earnings (loss) and before income taxes, includes the following components (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 ​ 2022 Domestic $ ( 14,539 ) $ 32,088 $ ( 15,384 ) Foreign ​ ​ ( 12,034 ) ​ 97,764 ​ ( 29,063 ) ​ ​ $ ( 26,573 ) ​ $ 129,852 ​ $ ( 44,447 ) ​ F- 29 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 17. Income Taxes (Continued) The provision (benefit) for income taxes consists of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Current: Domestic ​ $ 3,291 ​ $ 52,834 ​ $ ( 12,630 ) Foreign ​ ​ 15,599 ​ 3,856 ​ 9,447 Total Current ​ ​ 18,890 ​ 56,690 ​ ( 3,183 ) Deferred: ​ ​ ​ ​ ​ ​ ​ ​ ​ Domestic ​ ​ ( 9,036 ) ​ ( 17,728 ) ​ 17,873 Foreign ​ ​ ( 1,911 ) ​ ( 512 ) ​ ( 1,263 ) Total Deferred ​ ​ ( 10,947 ) ​ ( 18,240 ) ​ 16,610 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Provision for income taxes ​ $ 7,943 ​ $ 38,450 ​ $ 13,427 ​ The reconciliation of the federal statutory tax rate to the Company’s effective tax rate is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Federal statutory rate 21.0 % 21.0 % 21.0 % Foreign tax rate benefit ( 33.2 ) ​ ( 6.2 ) ​ ( 16.4 ) ​ (Nondeductible) nontaxable foreign items ​ ( 25.5 ) ​ 4.4 ​ ( 7.2 ) ​ GILTI and Subpart F income, net of foreign tax credits ​ ( 24.2 ) ​ 16.5 ​ ( 2.4 ) ​ Base erosion and anti-abuse tax ​ ( 7.4 ) ​ — ​ — ​ (Nondeductible) nontaxable domestic items ​ ( 3.6 ) ​ 0.7 ​ ( 2.8 ) ​ Foreign withholding taxes ​ ( 2.2 ) ​ 0.4 ​ — ​ State tax expense ​ ( 1.5 ) ​ 1.2 ​ ( 0.8 ) ​ Change in prior period valuation allowance ​ ( 1.5 ) ​ ( 0.3 ) ​ ( 10.5 ) ​ Net operating loss not benefited ​ — ​ — ​ ( 6.0 ) ​ Other tax effects of equity compensation ​ 1.1 ​ ( 0.3 ) ​ 0.5 ​ Nondeductible officer compensation ​ 1.3 ​ 2.0 ​ ( 10.3 ) ​ Excess tax benefit of stock-based compensation ​ 4.0 ​ ( 1.1 ) ​ 3.7 ​ Return to provision adjustments ​ 16.5 ​ ( 2.0 ) ​ 0.8 ​ Research and development tax credits ​ 26.4 ​ ( 5.3 ) ​ 0.1 ​ Other ( 1.1 ) ​ ( 1.4 ) ​ 0.1 ​ Effective tax rate ( 29.9 ) % 29.6 % ( 30.2 ) % ​ ​ F- 30 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 17. Income Taxes (Continued) The decrease in the provision for income taxes for fiscal 2023 was primarily due to decreases in pre-tax book income and global intangible low-taxed income inclusions as compared to fiscal 2022. The provision for income taxes for fiscal 2022 increased from fiscal 2021 primarily due to the recognition of certain tax benefits for fiscal 2021 in discontinued operations under FASB ASU 2019-12, Simplifying the Accounting for Income Taxes, and the required adoption of new U.S. tax rules regarding the capitalization of research and experimental costs in fiscal 2022. Under ASU 2019-12, the income tax benefit of a loss from continuing operations should be recognized in discontinued operations if the Company would be unable to benefit from the loss without considering the income from discontinued operations. As such, tax benefits associated with losses incurred for fiscal 2021 were recognized in discontinued operations. The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017. Under the Act, research and experimental expenditures incurred for tax years beginning after December 31, 2021 must be capitalized and amortized ratably over five or fifteen years for tax purposes, depending on where the research activities are conducted. The Company has elected to treat global intangible low-taxed income (“GILTI”) as a period cost, so the capitalization of research and experimental costs in GILTI increases the Company’s provision for income taxes. Additionally, the Act required companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously deferred from U.S. income tax under U.S. tax law. The Company elected to pay the transition tax over the eight-year period provided in the Act. As of December 30, 2023, the unpaid balance of its transition tax obligation was $ 14.3 million, which is payable between April 2024 and April 2025. This was recorded as components of other current liabilities and other non-current liabilities in the Consolidated Balance Sheet in the amounts of $ 6.4 million and $ 7.9 million, respectively. F- 31 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 17. Income Taxes (Continued) Deferred Income Taxes Deferred tax assets and liabilities are recorded for the estimated tax impact of temporary differences between the tax basis and book basis of assets and liabilities. Significant components of the Company’s deferred taxes as of December 30, 2023 and December 31, 2022 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ 2023 2022 Deferred tax assets: ​ ​ ​ ​ ​ ​ Capitalized research and development ​ $ 27,402 ​ $ 15,188 Tax credit carryforwards ​ ​ 13,303 ​ ​ 13,334 Intangible assets ​ ​ 7,188 ​ ​ 7,938 Net operating loss carryforwards ​ ​ 6,911 ​ ​ 4,965 Leases ​ ​ 6,584 ​ ​ 5,517 Deferred income on shipments to distributors ​ ​ 6,465 ​ ​ 6,726 Accrued liabilities ​ ​ 2,859 ​ ​ 6,809 Other ​ ​ 3,072 ​ ​ 7,118 ​ ​ 73,784 ​ 67,595 Less: Valuation allowance ​ ( 10,530 ) ​ ( 9,409 ) ​ ​ 63,254 ​ 58,186 ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: ​ ​ ​ ​ ​ ​ Intangible assets ​ ​ 13,916 ​ ​ 13,789 Fixed assets ​ ​ 8,353 ​ ​ 8,518 Leases ​ ​ 6,238 ​ ​ 5,189 Prepaid expenses and other ​ ​ 4,534 ​ ​ 5,637 Unrealized gain on equity-method investment ​ ​ — ​ ​ 4,120 ​ ​ 33,041 ​ 37,253 ​ ​ ​ ​ ​ ​ ​ Net deferred tax assets (liabilities) ​ $ 30,213 ​ $ 20,933 ​ As of December 30, 2023, the Company had foreign net operating loss and research and development tax credit carryforwards of approximately $ 47.2 million and $ 0.2 million, respectively. The foreign net operating loss carryforward does not expire. The foreign research and development tax credits expire in fiscal years 2042 through 2043. The Company also had U.S. federal net operating loss and research and development tax credit carryforwards of approximately $ 12.4 million and $ 1.1 million, respectively. These carryforwards expire in fiscal years 2026 through 2031. Recognition of these loss and credit carryforwards is subject to an annual limit, which may cause them to expire before they are used. ​ Additionally, the Company had state loss, state research and development, and state alternative minimum tax credit carryforwards of approximately $ 28.2 million, $ 12.9 million, and $ 0.1 million, respectively. Certain of these carryforwards expire in fiscal years 2025 through 2036, and others do not expire. Recognition of some of these loss and credit carryforwards is subject to an annual limit, which may cause them to expire before they are used. ​ F- 32 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 17. Income Taxes (Continued) A valuation allowance is established against a deferred tax asset when it is more likely than not that the deferred tax asset will not be realized. The Company maintains a valuation allowance with respect to certain deferred tax assets relating to state research and development tax credits, state net operating loss carryforwards and state alternative minimum tax credits. The following table summarizes the activity related to the valuation allowance for deferred tax assets (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at ​ Additions ​ ​ ​ Balance at ​ ​ Beginning of ​ Charged to ​ ​ ​ ​ End of ​ Period Expenses Deductions Period Year ended December 30, 2023 ​ $ 9,409 $ 1,121 ​ — $ 10,530 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, 2022 ​ $ 9,529 $ 792 $ ( 912 ) $ 9,409 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended January 1, 2022 ​ $ 5,311 $ 5,370 $ ( 1,152 ) $ 9,529 ​ Prior to fiscal 2023, the Company asserted permanent reinvestment of the earnings of all foreign subsidiaries, except for Singapore and China. During fiscal 2023, the Company modified its previous indefinite reinvestment assertion for the remaining foreign subsidiaries and recorded a deferred tax liability for applicable withholding taxes on the undistributed earnings in those jurisdictions. Uncertain Tax Positions The following table summarizes the activity related to gross unrecognized tax benefits (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 Beginning balance ​ $ 4,109 ​ $ 3,677 ​ $ 2,853 Additions based on tax positions related to current year ​ 737 ​ 872 ​ 830 Additions based on tax positions related to prior years ​ ​ 22 ​ ​ — ​ ​ — Reductions based on tax positions related to prior years ​ ​ — ​ ​ ( 6 ) ​ ​ ( 6 ) Reductions for tax positions as a result of a lapse of the applicable statute of limitations ​ ​ — ​ ​ ( 434 ) ​ ​ — Ending balance ​ $ 4,868 ​ $ 4,109 ​ $ 3,677 ​ As of December 30, 2023, December 31, 2022 and January 1, 2022, the Company had gross unrecognized tax benefits, inclusive of interest, of $ 5.4 million, $ 4.4 million and $ 3.9 million, respectively, of which $ 5.1 million, $ 4.4 million and $ 3.9 million, respectively, would affect the effective tax rate if recognized. The Company recognizes interest and penalties related to unrecognized tax benefits in the provision for income taxes. These amounts were not material for any of the periods presented. Following the completion of the Norwegian Tax Administration (“NTA”) examination of the Company’s Norwegian subsidiary for income tax matters relating to fiscal years 2013 – 2016, the Company received an assessment from the NTA in December 2017 concerning an adjustment to its 2013 taxable income related to the pricing of an intercompany transaction. The Company is currently appealing the assessment. The adjustment to the pricing of the intercompany transaction results in approximately 141.3 million Norwegian kroner, or $ 13.9 million, additional Norwegian income tax. The Company disagrees with the NTA’s assessment and believes the Company’s position on this matter is more likely than not to be sustained. The Company plans to exhaust all available administrative remedies, and if unable to resolve this matter through administrative remedies with the NTA, the Company plans to pursue judicial remedies. F- 33 Table of Contents Silicon Laboratories Inc. Notes to Consolidated Financial Statements (Continued) December 30, 2023 17. Income Taxes (Continued) The Company believes that it has accrued adequate reserves related to all matters contained in tax periods open to examination. Should the Company experience an unfavorable outcome in the NTA matter, however, such an outcome could have a material impact on its financial statements. Tax years 2015 through 2023 remain open to examination by the major taxing jurisdictions in which the Company operates. The Company’s 2021 tax year is currently under examination in India. Although the outcome of tax audits is always uncertain, the Company believes that the results of the examination will not materially impact its financial position or results of operations. The Company is not currently under audit in any other major taxing jurisdiction. The Company believes it is reasonably possible that its gross unrecognized benefits will decrease by approximately $ 1.7 million, inclusive of interest, in the next 12 months due to the lapse of the statute of limitations. ​ 18. Segment Information The Company has one operating segment, mixed-signal analog intensive products, consisting of numerous product areas. The Company’s chief operating decision maker is considered to be its Chief Executive Officer. The chief operating decision maker allocates resources and assesses performance of the business and other activities at the operating segment level. The Company groups its products into two categories, based on the target markets they address. See Note 14, Revenues , for a summary of the Company’s revenue by product category. Revenue is attributed to a geographic area based on the shipped-to location . The following summarizes the Company’s revenue by geographic area (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 30, ​ December 31, ​ January 1, ​ 2023 2022 2022 United States ​ $ 92,550 ​ $ 176,379 ​ $ 97,471 China ​ 219,741 ​ 334,821 ​ 311,513 Taiwan ​ ​ 90,382 ​ ​ 105,602 ​ ​ 68,196 Rest of world ​ 379,585 ​ 407,304 ​ 243,680 Total ​ $ 782,258 ​ $ 1,024,106 ​ $ 720,860 ​ The following summarizes the Company’s property and equipment, net by geographic area (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, ​ December 31, ​ 2023 2022 United States ​ $ 116,357 ​ $ 121,031 Rest of world ​ 29,533 ​ 30,985 Total ​ $ 145,890 ​ $ 152,016 ​ ​ 19. Restructuring Activities During the fourth quarter of 2023, the Company implemented a workforce reduction of approximately 10 % of its employees to reduce costs and align its business in response to market conditions. In fiscal 2023, the Company incurred employee separation costs of $ 9.1 million and non-cash charges for the accelerated vesting of certain equity awards of approximately $ 0.6 million. Employee separation costs of $ 6.0 million were recorded to research and development expenses and $ 3.0 million were recorded to selling, general and administrative expenses within the Consolidated Statement of Operations . No further material amounts are expected to be incurred. In fiscal 2023, the Company paid approximately $ 5 million of employee separation payments and accrued approximately $ 4 million in other current liabilities at December 30, 2023. ​ ​ F- 34