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Item 1A. Risk Factors

2026-08-10 compared with 2025-08-21 · 138 added, 64 removed, 315 unchanged (39% of the section changed)

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The market price of our securities could decline due to the materialization of these or any other risks, and you could lose part or all of your investment.

Risks Related to Proposed Merger between Synaptics and onsemi

The completion of the proposed Merger with onsemi may be delayed or not occur at all for a variety of reasons, including that the Merger Agreement is terminated, and the failure to complete the Merger could adversely affect our business, financial condition and results of operations and the market price of our common stock.

The completion of the proposed Merger with onsemi is subject to customary closing conditions, some of which are beyond our and onsemi’s control, including (1) the approval of the Merger Agreement by the holders of a majority of the shares of our common stock outstanding and entitled to vote (the “required Stockholder Vote”), (2) the expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”), and the approval of the Merger under certain other antitrust and foreign investment regimes, (3) the absence of any order, injunction or law of certain jurisdictions prohibiting the Merger, (4) the effectiveness of the registration statement pursuant to which shares of onsemi common stock to be issued in the Merger will be registered with the SEC, (5) the approval for listing on the Nasdaq Global Select Market of shares of onsemi common stock to be issued in the Merger, (6) the accuracy of the other party’s representations and warranties, subject to certain materiality and other standards set forth in the Merger Agreement, (7) compliance in all material respects with the other party’s covenants and other obligations under the Merger Agreement, (8) the absence of a continuing material adverse effect with respect to each of us or onsemi, and (9) the receipt by each party of customary closing tax opinions regarding the intended tax treatment of the Merger.

There can be no assurance that the Merger will be completed in the expected timeframe, or at all.

Subject to the terms and conditions of the Merger Agreement, the parties have agreed to use reasonable best efforts to take all actions reasonably necessary to consummate the Merger, including obtaining all required or necessary consents, approvals or waivers from third parties, and cooperating to obtain the regulatory approvals necessary to complete the Merger.

The Merger Agreement may be terminated under certain circumstances, including (1) by either us or onsemi if the Merger is not completed by June 25, 2027, which date may be extended for up to three periods of three months each, in each case under certain circumstances (the “End Date”), (2) by either us or onsemi if any court or governmental authority of a specified jurisdiction has issued a final non-appealable order or injunction prohibiting the Merger, (3) by onsemi prior to the required Stockholder Vote if our Board of Directors fails to include in our proxy statement its recommendation to stockholders to vote in favor of the adoption of the Merger Agreement or changes its recommendation, (4) by us prior to the required Stockholder Vote in order to accept a Superior Proposal (as defined in the Merger Agreement) (subject to payment of a termination fee, described below), (5) by either us or onsemi if we fail to receive the required Stockholder Vote at our stockholder meeting (including any adjournments and postponements thereof), or (6) by either party if the other party materially breaches its covenants, or breaches its representations and warranties, in the Merger Agreement such that the applicable conditions to closing would not be satisfied, subject in certain cases to the right of the breaching party to cure the breach.

We and onsemi may also terminate the Merger Agreement by mutual written consent.

Upon termination of the Merger Agreement, we, under specified circumstances, including termination by us to accept a Superior Proposal or by onsemi following a change in recommendation by our Board of Directors, will be required to pay onsemi a termination fee of $235.0 million (the “Synaptics Termination Fee”).

Additionally, onsemi, under specified circumstances, including termination following an injunction arising in connection with certain antitrust or foreign investment laws, or failure to receive certain required regulatory approvals of specified governmental authorities by the End Date, will be required to pay us a regulatory termination fee of $320.0 million (the “onsemi Regulatory Termination Fee”).

We and onsemi may also be subject to lawsuits or other demands challenging the Merger or certain disclosures made with respect thereto, and adverse rulings in these lawsuits, or the existence or pendency of these matters, may delay or prevent the Merger from being completed or require us or onsemi to incur significant costs to defend or settle these matters.

Any delay in completing the Merger could cause us to fail to realize, or to be delayed in realizing, some or all of the benefits that we expect to achieve if the Merger is successfully completed within the expected time frame.

If the Merger is not completed, or if there are delays in completing the Merger, our business, financial condition, results of operations and the market price of our common stock may be adversely affected in a number of ways, including:

• the market price of our common stock may decline to the extent that the current market price reflects an assumption that the Merger will be completed;

• if the Merger Agreement is terminated under certain circumstances specified in the Merger Agreement, we would be required to pay a termination fee as described above;

• we have incurred, and will continue to incur, significant expenses for professional services in connection with the Merger for which we will have received little or no benefit if the Merger is not completed, as well as other significant expenses that may not be recoverable if the Merger is not completed;

• the attention of our management will have been diverted to the Merger rather than our own operations and pursuit of other opportunities that could have been beneficial to us;

• we may experience negative publicity and/or reactions from our investors, employees, customers, suppliers, distributors and other business partners.

The completion of the proposed Merger is subject to the satisfaction or waiver of closing conditions contained in the Merger Agreement, including certain regulatory approvals which may not be received, may take longer than expected or the receipt of which may impose conditions that are not presently anticipated or that cannot be met, and if these closing conditions are not satisfied or waived, the proposed Merger will not be completed.

Various consents, clearances, approvals, authorizations and declarations of non-objection, or expiration of waiting periods (or extensions thereof), from certain regulatory and governmental authorities in the United States and certain other jurisdictions are conditions to completing the proposed Merger.

Regulatory and governmental entities may impose conditions on their respective approvals, in which case lengthy negotiations may ensue among such regulatory or governmental entities, us and onsemi, and we and onsemi may not be required under the terms of the Merger Agreement to accept such conditions.

Such conditions, any such negotiations and the process of obtaining such regulatory approvals, consents or clearances, including any potential changes to the terms of the Merger, could have the effect of delaying or preventing the completion of the Merger.

Subject to the terms of the Merger Agreement, we have agreed to use our reasonable best efforts to take all actions necessary to consummate the Merger, including obtaining all required or necessary consents, approvals or waivers from third parties, and cooperating to obtain the regulatory approvals necessary to complete the Merger.

Nonetheless, certain conditions to the completion of the Merger are not within our or onsemi’s control, and we cannot predict when or if these conditions will be satisfied (or waived, as applicable).

There can be no assurance that all required approvals will be obtained or that all closing conditions will otherwise be satisfied (or waived, if applicable), and, if all required approvals are obtained and all closing conditions are satisfied (or waived, if applicable), we can provide no assurance as to the terms, conditions and timing of such approvals or that the Merger will be completed in a timely manner or at all.

Even if regulatory approvals are obtained, it is possible conditions will be imposed that could result in a material delay in, or the abandonment of, the Merger or otherwise have an adverse effect on our business, financial condition, results of operations and the market price of our common stock.

Failure to realize the anticipated benefits of the Merger, delay in realizing those benefits, or significant challenges in integrating our company with onsemi could have an adverse effect on the price of onsemi common stock that our stockholders will own following the completion of the Merger.

We and onsemi have operated and, subject to and until the completion of the Merger, will continue to operate, independently.

The success of the Merger, including anticipated benefits and cost savings, will depend, in part, on our and onsemi's ability to successfully integrate our respective operations in a manner that results in various benefits and that does not materially disrupt existing business and strategic relationships or result in a loss of customers.

The process of integrating operations could result in a loss of key personnel or cause an interruption of, or loss of momentum in, the activities of one or more of the combined company's businesses.

Inconsistencies in standards, controls, procedures and policies could adversely affect the combined company.

The diversion of management's attention and any delays or difficulties encountered in connection with the Merger and the integration of our company’s and onsemi's operations could have an adverse effect on the business, financial condition, results of operations and prospects of the combined company.

If we and onsemi experience difficulties in the integration process, including those listed above, we may not fully realize the

anticipated benefits of the Merger in a timely manner or at all, and the price of onsemi common stock to be issued to our stockholders in the Merger could be adversely affected.

Uncertainty about the Merger may adversely affect relationships with our customers, suppliers, service providers, partners, consultants, and other business counterparties, whether or not the Merger is completed.

In response to the announcement of the Merger, our existing or prospective customers, suppliers, service providers, partners, consultants, and other business counterparties may:

• delay, defer, or cease entering into a business relationship with us or the combined company;

• terminate their relationships with us or the combined company;

• delay or defer other decisions concerning us or the combined company;

• seek to change the terms on which they do business with us or the combined company.

Any such delays or changes to terms could materially harm our business or, if the Merger is completed, the business of the combined company.

Losses of customers, suppliers, service providers, consultants or other important strategic relationships could have a material adverse effect on our business, financial condition and results of operations.

Such adverse effects could also be exacerbated by a delay in the completion of the Merger for any reason, including delays associated with obtaining the requisite regulatory approvals or the approval of our stockholders.

As a result of the Merger, our current and prospective employees could experience uncertainty about their future with us or the combined company.

As a result, key employees may depart because of such uncertainty or a desire not to remain with onsemi following the completion of the Merger.

As a result of the Merger, our current and prospective employees could experience uncertainty about their future with us or the combined company, or decide that they do not want to continue their employment with the combined company.

As a result, key employees may depart because of such uncertainty or a desire to not remain with onsemi following the completion of the Merger.

Losses of officers, key employees or other employees could materially harm our business, results of operations and financial condition.

Such adverse effects could also be exacerbated by a delay in the completion of the Merger.

We may also experience challenges in hiring new employees during the pendency of the Merger, or if the Merger Agreement is terminated, which could harm our ability to grow our business, execute on our business plans or enhance our operations.

If the Merger is consummated, the combined company may be less attractive to current and prospective employees, which could harm the business and prospects of the combined company.

Restrictions under the Merger Agreement may adversely affect our business and operations.

Under the terms of the Merger Agreement, we are subject to certain restrictions on the conduct of our business prior to completing the Merger which may adversely affect our ability to execute certain of our business strategies, including, but not limited to, making material acquisitions, disposing of material assets, entering into material agreements, making capital expenditures in excess of specified amounts, repurchasing our capital stock or other equity securities, issuing additional capital stock or other equity securities, or incurring additional indebtedness (in each case, subject to certain exceptions).

These limitations may have adverse effects on our existing or planned relationships with our existing or prospective customers, suppliers, service providers, consultants and employees, which could adversely affect our business and operations prior to the completion of the Merger.

Because the consideration to be received by our stockholders in connection with the Merger will include a fixed number of shares of onsemi common stock, and the market price of such shares has fluctuated and will continue to fluctuate, our stockholders cannot be sure of the value of the consideration they will receive in the Merger.

Under the Merger Agreement, at the effective time of the Merger, each share of our common stock (other than each share of our common stock held in treasury or held or owned by our subsidiaries, onsemi or any of its subsidiaries immediately prior to the effective time of the Merger) issued and outstanding immediately prior to the effective time of the Merger will be cancelled and converted into the right to receive 1.350 fully paid and non-assessable shares of onsemi common stock.

The market value of the consideration our stockholders will receive in the Merger will therefore fluctuate with the market price of onsemi common stock.

The implied value of the Merger Consideration to our stockholders has fluctuated since the date of the announcement of the Merger Agreement and will continue to fluctuate until the date the Merger is completed, which could occur a considerable amount of time after the date hereof.

onsemi's share price changes may result from a variety of factors, including, among others, general market and economic conditions, changes in onsemi's and our respective businesses, operations and prospects, risks inherent in the respective businesses, changes in market assessments of the likelihood that the Merger will be completed and/or the value that may be generated by the Merger and changes with respect to expectations regarding the timing of the Merger and regulatory considerations.

Many of these factors are beyond both our and onsemi's control.

In particular, the market price of onsemi common stock has declined since the Merger Agreement was entered into and may continue to decline, which has decreased, and may continue to decrease, the value of the Merger Consideration.

The Merger Agreement contains provisions that could discourage or deter a potential competing acquirer from making a favorable alternative transaction proposal to us and, in specified circumstances, could require us to pay a substantial termination fee to onsemi.

Under the Merger Agreement, we are subject to customary "no-shop" restrictions and are not permitted, subject to certain exceptions set forth in the Merger Agreement, to initiate, solicit or knowingly encourage or facilitate any inquiries or the making of any proposal or offer by or with a third party with respect to an acquisition proposal and to furnish nonpublic information to, or engage in discussions or negotiations with, a third party interested in pursuing an alternative business combination transaction.

Further, our Board of Directors has agreed to include in the proxy statement for the Merger its recommendation that our stockholders vote in favor of the Merger, subject to exceptions for superior proposals and other situations where failure to effect a recommendation change would be inconsistent with our Board of Directors' fiduciary duties.

Upon the termination of the Merger Agreement under specified circumstances, including, among others, the termination by onsemi in the event of a Change of Recommendation (as defined in the Merger Agreement) by our Board of Directors, we would be required to pay onsemi the Synaptics Termination Fee.

Such provisions of the Merger Agreement could discourage or deter a third party that may be willing to pay more than onsemi for our outstanding common stock from considering or proposing such an acquisition of our company.

Litigation may arise in connection with the Merger, which could be costly, prevent consummation of the Merger, divert management's attention and otherwise materially harm our business.

Securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into merger agreements and/or their directors and officers.

A negative outcome in any such lawsuit could result in substantial costs to us, including any costs associated with the indemnification of directors and officers.

Regardless of the outcome of any future litigation related to the Merger, such litigation may be time-consuming and expensive and may distract our management from running the day-to-day operations of their business.

If the Merger is not consummated for any reason, litigation could be filed in connection with the failure to consummate the Merger.

Any litigation related to the Merger may result in negative publicity or an unfavorable impression of us, which could adversely affect the price of our common stock, impair our ability to recruit or retain employees, damage our business relationships or otherwise materially harm our operations and financial performance.

Shares of onsemi common stock to be received by our stockholders as a result of the Merger will have different rights from shares of our common stock.

Upon consummation of the Merger, our stockholders will no longer be stockholders of our company, but will instead become stockholders of onsemi, and their rights as stockholders will be governed by onsemi’s certificate of incorporation and bylaws.

The terms of onsemi’s certificate of incorporation and bylaws may be materially different than the terms of our amended and restated certificate of incorporation and amended and restated bylaws, which currently govern the rights of our stockholders.

Risks Related to Our Industry and Business

We depend on the IoT, Enterprise and Automotive and Mobile product applications markets for a substantial portion of our revenue.

We depend on the Core IoT, Enterprise and Automotive and Mobile product applications markets for a substantial portion of our revenue.

These are cyclical, competitive and evolving markets that are subject to volatility, economic risk and uncertain growth, which may materially affect our business, revenue, operating results and financial condition.

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As a result, demand in these markets can fluctuate sharply based on factors such as inflation, interest rates, trade restrictions, or recessionary conditions.

During periods of slowing growth or heightened uncertainty, customers may cancel, reduce or defer orders, reduce inventory levels, or adjust production forecasts.

During periods of slowing growth or heightened uncertainty,

customers may cancel, reduce or defer orders, reduce inventory levels, or adjust production forecasts.

In addition, these economic conditions could result in higher inventory levels and the possibility of resulting excess capacity charges from our manufacturing partners if we need to slow production to reduce inventory levels.

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Changes to international trade policies, export controls, and foreign operations expose us to legal, regulatory, and operational risks.

As a global company headquartered in the U.S., we are subject to U.S.

and foreign laws and regulations governing import, export, and economic sanctions.

As a global company headquartered in the U.S., we are subject to complex and evolving U.S.

and foreign laws and regulations governing import, export, trade restrictions and economic sanctions.

These restrictions may prohibit sales to certain countries, entities, or individuals, or require export licenses for certain technologies.

Many of our customers, suppliers and contract manufacturers are foreign companies or have significant foreign operations, and many of the components used in our products are sourced from Asia.

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Tariffs on imported components, especially from Asia, could increase our production costs, disrupt supply chains, or make our products and our customers’ end products less competitive in global markets.

For example, in the first quarter of calendar 2025, the U.S.

government announced new tariffs on imports from several countries, prompting reciprocal tariffs.

For example, in calendar 2025 and 2026, the U.S.

government announced new tariffs on imports from several countries, including China, prompting reciprocal tariffs.

Tariffs on our customers’ products may reduce their global competitiveness, particularly in China.

Some OEMs in our industry have responded with short-term price adjustments and shifted production and sourcing outside of China.

Additionally, on August 6, 2025, the U.S.

government proposed a 100% tariff on imported semiconductors and chips, with possible exemptions for companies that invest in U.S.

manufacturing.

While still in the proposal phase, this policy could materially impact our sourcing strategy and component costs, depending on scope and implementation.

We rely on global foundry partners, many based in Asia, for a significant portion of our silicon.

If adopted, these tariffs could increase our manufacturing costs or require changes to our supply chain operations.

Additionally, in January 2026, the U.S.

government implemented a 25% tariff on certain imported semiconductors and chips not intended for use in the U.S.

These policies and the continued uncertainty and ongoing developments around trade policy could materially impact our sourcing strategy and component costs, increase our manufacturing costs or require changes to our supply chain operations.

Moreover, these tariffs and any other trade restrictions imposed on our customers or suppliers could adversely affect our financial results and position through reduced demand for our products and solutions, cancelled orders, supply chain disruptions, increased transaction costs, and increased expenses.

If the United States’ relationship with countries subject to increased tariffs results in additional trade disputes, trade protection measures, retaliatory actions and increased barriers, policies that favor domestic industries, or increased import or export licensing requirements or restrictions, then our deployment of resources in jurisdictions affected by such measures could be misaligned and our operations may be adversely affected.

We are actively evaluating strategies to mitigate such risks, including potential sourcing diversification or partnerships with U.S.-based manufacturers.

Geopolitical instability, including in the Middle East, Taiwan, or U.S.-China relations, could disrupt access to critical markets or destabilize key supply chain and logistics corridors.

On June 13, 2025, Israel launched a strike on Iranian military and nuclear sites, followed by Iranian retaliation.

On June 21, 2025, the U.S.

conducted targeted air strikes, which Iran answered with attacks on U.S.

Although a ceasefire has been reached, there is no assurance that hostilities will not escalate or recur.

This military escalation between Israel and Iran has increased geopolitical tensions and uncertainty across the broader region.

Escalations of hostilities could also trigger new or expanded U.S.

For example, the ongoing conflict and military escalations involving the United States, Israel, Iran and other countries in the Middle East and beyond have increased geopolitical tensions and uncertainty across the broader region, including sanctions and restrictions affecting key transportation routes such as the Suez Canal and the Strait of Hormuz, contributing to volatility in global energy prices.

As a result, we may experience disruptions to transportation routes and supply chains, including those involving third-party vendors, as well as higher transportation and logistics costs and broader inflationary pressures, which could adversely affect our revenue and

gross margin.

The extent and duration of these impacts remain uncertain, and further escalation and continued duration could materially and adversely affect our business and financial results.

Continuation or escalations of hostilities could also trigger new or expanded U.S.

sanctions or export controls affecting parties or regions with which we do business.

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This risk is particularly pronounced in markets such as Automotive, where long design cycles, combined with failure to win a design-in, could lock us out of a customer for several years.

If we fail to win key design opportunities, or if we are not perceived as a technology or industry leader,

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our business, financial condition and results of operations could be materially harmed.

If we fail to win key design opportunities, or if we are not perceived as a technology or industry leader, our business, financial condition and results of operations could be materially harmed.

Also, a design win does not guarantee revenue.

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We may not recover these costs if the product does not launch or is replaced by an alternative solution.

In addition, if we do not keep pace with rapid technological innovation—such as in AI, ML, edge computing and connectivity—our solutions may become less competitive or obsolete.

Failure to innovate, keep pace with customer expectations and win key design opportunities, convert such opportunities into sales, or offer compelling features at competitive prices could materially harm our market position and financial performance.

We are exposed to risks related to the use of artificial intelligence by us and our competitors.

We are integrating AI and ML technologies into our products, services, and internal processes, including in edge computing, voice and vision interfaces, and wireless connectivity.

The rapid pace of AI innovation may challenge our ability to remain competitive if we fail to keep pace with technological developments or if our competitors more effectively deploy AI.

We must invest substantial resources to enhance and develop new technologies, including hiring and retaining skilled engineers, adopting advanced tools and scaling R&D.

Even with investment, our technologies may fail to transition from development to cost-effective production or customers may choose competitors’ solutions due to price, performance or strategic alignment.

We are also integrating AI and ML technologies into our products, services and internal processes, including in edge computing, voice and vision interfaces and wireless connectivity.

The rapid pace of AI and ML innovations may challenge our ability to remain competitive if we fail to keep pace with technological developments or if our competitors more effectively deploy these technologies.

While AI and ML offer opportunities to enhance the functionality and efficiency of our product offerings, they also introduce operational, compliance and reputational risks.

While AI and ML technologies offer opportunities to enhance functionality and efficiency, they also present significant risks.

These include unintended consequences, such as inaccurate or biased outputs, potential misuse by personnel, vulnerabilities in third-party AI tools and heightened scrutiny under evolving laws and regulations governing data privacy, algorithmic transparency and ethical AI use.

The use of AI also may expose us to increased intellectual property risks, including claims of infringement, misappropriation or loss of proprietary information.

Failure to innovate, keep pace with customer expectations and win key design opportunities, convert such opportunities into sales, offer compelling features at competitive prices, could materially harm our market position and financial performance.

Failure to comply with such regulations could result in enforcement actions, fines, or restrictions on our business.

Additionally, the use of AI may expose us to intellectual property risks, including claims of infringement, misappropriation, or loss of proprietary information.

Any of these risks could adversely affect our business, financial condition, or results of operations.

Our growth depends on the successful development of emerging markets, including Core IoT, which may be slower, more competitive, or more regulated, which could result in our losing or failing to gain market share and suffering reduced revenue.

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Our products are not sold directly to end users.

Instead, our solutions are integrated into systems sold by OEMs and original design manufacturers (“ODM”), often through contract manufacturers that serve them.

A significant portion of our

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revenue is generated from a limited number of large customers.

Instead, our solutions are integrated into systems sold by OEMs and ODMs, often through contract manufacturers that serve them.

A significant portion of our revenue is generated from a limited number of large customers.

This concentration makes us highly dependent on the purchasing behavior of a few OEMs and ODMs and increases our exposure to revenue volatility.

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The adverse effect could be more substantial if we are unable to offset the loss by generating increased orders from other existing customers or by securing new design wins.

Significant reductions in sales to our largest customers, the loss of other major customers, a general decrease in demand, or our failure to expand our customer base, particularly in key markets, would materially impact our future operating results.

Significant reductions in sales to our largest customers, the loss of

other major customers, a general decrease in demand, or our failure to expand our customer base, particularly in key markets, would materially impact our future operating results.

Even when we meet our customers’ technical and pricing requirements, our success ultimately depends on the commercial success of their products that incorporate our solutions.

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Delays in one part of the chain can lead to a broader reduction in product builds that include our technologies.

For example, the current global shortage and elevated pricing of certain memory components across the broader electronics supply chain have, at times, influenced the timing of orders for certain products, particularly for smaller customers.

Limited visibility into future availability, timing, increased associated costs, and the potential for these conditions to persist could affect customer development timelines, purchasing behavior, production schedules, booking patterns, and the timing or visibility of orders in future periods.

If these conditions persist, our customers’ ability to manufacture their end products may be limited, or they may adjust production schedules, delay product launches, or revise demand forecasts, which in turn could lead them to reduce, delay or cancel orders for our products, even when demand for their end products remains strong.

Additionally, the current shortage and resulting price increase for memory components also may lead our customers to increase prices of their end products, which could lead to decreased demand for those products, ultimately negatively impacting orders for our products.

If customers delay orders of our products for longer periods of time due to such supply conditions, or hold inventory of our products for longer periods of time, we could experience a decline in our revenue and excess inventory.

In addition, we face ongoing risks from component and material shortages.

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Altogether, uncertainty in demand forecasting, reliance on outsourced manufacturing, and limited sourcing alternatives may materially impact our operating results, margins, and ability to fulfill customer expectations.

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Defects, security vulnerabilities, or performance failures in our products could result in liability, reputational harm, and lost revenue opportunities.

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Our protection efforts face limitations, particularly in foreign markets such as China, where IP enforcement is less predictable.

In the past, we have not always required all employees, consultants, suppliers, or partners to enter into formal written agreement for the protection of our technology including confidentiality or invention assignment agreements, and some may seek to assert rights in our technologies or use them without authorization.

The risk of inadvertent disclosure is further heightened by employee use of generative or third-party AI tools.

In the past, we have not always required all employees, consultants, suppliers, or partners to enter into formal written agreements for the protection of our technology including confidentiality or invention assignment agreements, and some may seek to assert rights in our technologies or use them without authorization.

The risk of inadvertent disclosure is further heightened by employee use of generative or third-party

Any claims, with or without merit, could result in significant litigation costs and diversion of resources, including the attention of management, and could require us to enter into royalty or licensing agreements, which may include terms that may not be commercially reasonable, which could have a material adverse effect on our business.

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In addition, we license certain technology used in and for our products from third parties, including open source components.

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Foreign exchange rate volatility could adversely affect our margins, pricing and competitiveness.

A substantial portion of our revenue is generated from customers located outside the United States, while a significant portion of our operating expenses, including R&D, supply chain and employee compensation, are denominated in foreign currencies such as the New Taiwan dollar, Japanese yen, Chinese yuan and Israeli shekel.

Although we transact business predominantly in U.S.

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We are dependent on the information security systems of these third parties and they face substantial security risks similar to those outlined above.

Any security breaches or incidents or other unauthorized access by third parties to the systems of our suppliers, service providers or other third parties with access to our sensitive data, or the existence of computer viruses, ransomware or other malicious code in their data, software or hardware, could result in disruptions or failures of systems used in our business.

Any of the foregoing, or the perception any of them has occurred, could have a material adverse impact on our business, operations and financial

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Any security breaches or incidents or other unauthorized access by third parties to the systems of our suppliers, service providers or other third

parties with access to our sensitive data, or the existence of computer viruses, ransomware or other malicious code in their data, software or hardware, could result in disruptions or failures of systems used in our business.

Any of the foregoing, or the perception any of them has occurred, could have a material adverse impact on our business, operations and financial results.

In addition, any compromise of security from a security breach or cyberattack could deter customers or business partners from entering into transactions that involve providing confidential information to us.

As a result, any compromise to the security of our systems could have a material adverse effect on our business, reputation, financial condition and operating results.

Risks Related to Acquisitions and Strategic Alliances

Any acquisitions or strategic alliances that we undertake could be difficult to execute or integrate, may not achieve expected results, and could disrupt our business or dilute stockholder value.

Risks Related to Other Acquisitions and Strategic Alliances

In addition to the risks described related to the Merger, any other acquisitions or strategic alliances that we undertake could be difficult to execute or integrate, may not achieve expected results, and could disrupt our business or dilute stockholder value.

We expect to continue to pursue opportunities to acquire other businesses or technologies, or to engage in strategic alliances, related to other businesses and technologies to complement our current solutions, expand into existing or new markets, enhance our technical capabilities or otherwise accelerate growth.

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If acquired businesses or investments underperform, we may not realize the intended strategic or financial benefits.

For example, in fiscal 2025, we recorded a $13.8 million impairment charge related to technology acquired in fiscal 2024, reflecting changes in customer demand and product development priorities.

For example, in fiscal 2026, we recorded a $6.8 million impairment charge related to in process research and development (“IPR&D”) acquired in fiscal 2025, reflecting management’s decision to cease development and commercialization activities for the technology.

We also recorded a $5.0 million impairment charge related to the cost method investment due to a significant deterioration in earnings performance of the investee.

Additional impairments may arise if other acquisitions or strategic partnerships do not meet our financial expectations.

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In addition, restrictive immigration policies, labor market saturation or compensation pressures could affect our access to technical talent.

Our compensation programs, which include cash and share-based compensation award components, has been instrumental in attracting, hiring, motivating and retaining qualified personnel.

Our compensation programs, which include cash and share-based compensation award components, have been instrumental in attracting, hiring, motivating and retaining qualified personnel.

Our success depends on our continued ability to use our share-based compensation programs to effectively compete for engineering and other technical personnel and professional talent without significantly increasing cash compensation costs.

We may also be impacted if a competitor recruits key employees, or we experience attrition in our senior leadership without adequate succession planning.

In addition, in May 2025, we announced the appointment of a new Chief Executive Officer.

Transitions in executive leadership may result in strategic business and operational changes, shifts in personnel priorities and/or uncertainty among employees, customers and investors.

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Such turnover can also disrupt long-term customer relationships, strategic execution or internal governance.

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If we are unable to obtain stockholder approval of share-based compensation award programs or additional shares for such programs, we could be at a competitive disadvantage in the marketplace for qualified personnel or may be required to increase the cash element of our compensation program.

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In the future, if we are unable to obtain stockholder approval of our share-based compensation programs or additional shares for such programs, we could be at a competitive disadvantage in the marketplace for qualified personnel or we may be required to increase the cash elements of our compensation program to account for this disadvantage.

Risks Factors Related to Our Future Growth, Capital Requirements and Indebtedness

Risks Related to Our Future Growth, Capital Requirements and Indebtedness

We may need to raise additional capital to support our growth, and failure to do so on acceptable terms could limit our ability to compete.

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Our outstanding debt, credit covenants, and convertible note obligations may limit our financial flexibility, expose us to liquidity risk, and result in stockholder dilution or adverse market impacts.

We have significant outstanding indebtedness, including our 4.000% Senior Notes due 2029 and our 0.75% Convertible Senior Notes due 2031 (“2031 Notes”).

We have significant outstanding indebtedness, including our 4.000% Senior Notes due 2029 (the “Senior Notes”) and our 0.75% Convertible Senior Notes due 2031 (the “2031 Notes”).

We may incur additional debt under our credit agreement or the indentures, which could amplify the risks described below.

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Subject to certain conditions, holders of the 2031 Notes can require us to repurchase their notes.

Upon conversion of the 2031 Notes in accordance with their terms, unless we elect to solely deliver shares of our common stock to settle such conversion (other than paying cash in lieu of delivering any fractional shares), we will be required, under the default

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settlement method, to settle the principal amount of the 2031 Notes in cash, and any conversion involving cash settlement could significantly affect our liquidity.

The conversion of some or all of the convertible senior notes would dilute the ownership interests of our existing stockholders to the extent we satisfy our conversion obligation by delivering shares of our common stock.

Historically, we have elected to satisfy our convertible senior note conversion obligations through the payment of cash in certain circumstances, the issuance of shares of common stock in other circumstances or a combination thereof, to such convertible senior note holders.

In addition, in connection with the issuance of each series of the convertible senior notes, we entered into capped call transactions with certain financial institutions to reduce the potential dilution to holders of our common stock upon any conversion or settlement of the convertible notes and/or offset any cash payments we are required to make above the principal amount of such convertible senior notes.

These counterparties or their respective affiliates may engage in hedging activities, such as buying or selling our common stock or related derivatives, which could negatively affect the market price of our common stock.

Upon conversion of the 2031 Notes in accordance with their terms, other than paying cash in lieu of delivering any fractional shares, we will be required,

under the default settlement method, to settle the principal amount of the 2031 Notes in cash, and any conversion involving cash settlement could significantly affect our liquidity.

The trading price of the 2031 Notes may also be volatile due to fluctuations in our common stock price, and there is currently no active trading market for the 2031 Notes.

The 2031 Notes are currently convertible at the holders’ option.

If the holders of the 2031 Notes elect to convert their notes during this period or any future period in which the notes become convertible, we may be required to make substantial cash payments and/or issue shares of common stock, which could adversely affect our liquidity and result in dilution to our stockholders.

The conversion of some or all of the 2031 Notes would dilute the ownership interests of our existing stockholders to the extent we satisfy our conversion obligation by delivering shares of our common stock.

Historically, we have elected to satisfy our 2031 Note conversion obligations through the payment of cash in certain circumstances, the issuance of shares of common stock in other circumstances or a combination thereof, to such 2031 Note holders.

In addition, in connection with the issuance of each series of the 2031 Notes, we entered into capped call transactions with certain financial institutions to reduce the potential dilution to holders of our common stock upon any conversion or settlement of the 2031 Notes and/or offset any cash payments we are required to make above the principal amount of such 2031 Notes.

The terms of the capped call transactions may be subject to adjustment in connection with the Merger.

The counterparties to the capped call transactions or their respective affiliates may engage in hedging activities, such as buying or selling our common stock or related derivatives, which could negatively affect the market price of our common sto ck.

We may incur material environmental liabilities as a result of prior operations at an acquired company.

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Changes in tax laws or regulations, domestically or internationally, could adversely affect our effective tax rate, deferred tax assets, or overall financial condition.

In particular, the Organization for Economic Co-operation and Development’s (“OECD”) Pillar Two framework introduces a 15% global minimum tax that jurisdictions such as the United Kingdom, Hong Kong, Switzerland, and Japan have begun implementing.

In particular, the Organization for Economic Co-operation and Development’s (“OECD”) Pillar Two framework (“Pillar Two”) introduces a 15% global minimum tax that jurisdictions such as the United Kingdom, Hong Kong, Switzerland, and Japan have begun implementing.

We currently do not anticipate a material impact to our fiscal 2026 tax rate or cash flows, but we will continue to monitor legislative developments and recognize any Pillar Two-related amounts as period costs.

In addition, effective July 4, 2025, the enactment date for U.S.

GAAP purposes, the One Big Beautiful Bill Act (“OBBBA”) introduced sweeping tax changes, including permanent extensions of certain provisions originally enacted under the Tax Cuts and Jobs Act of 2017.

A previously proposed retaliatory tax on foreign companies (Section 899) was removed following a G7 agreement.

We continue to assess the accounting and operational impacts of OBBBA, particularly under ASC 740, and its implications for our future financial reporting and tax planning.

In addition, the One Big Beautiful Bill Act (“OBBBA”), enacted on July 4, 2025, significantly amended the U.S.

Internal Revenue Code, including permanently extending and modifying certain provisions originally enacted under the Tax Cuts and Jobs Act of 2017.

Although the provisions currently effective for Synaptics have not had a material impact on our financial statements or cash flows, the interpretation and application of OBBBA will continue to evolve as additional guidance is issued by the U.S.

Treasury Department and the Internal Revenue Service.

Future legislative, regulatory, or administrative developments, as well as changes in our business operations or tax profile, could materially affect our effective tax rate, cash tax obligations, deferred tax assets, financial position, results of operations, and cash flows.

We are also subject to periodic examinations by tax authorities, and the calculation of our tax liabilities requires significant judgment.

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changes in entity structure or business operations;

audit outcomes and related interest or penalties;

audit outcomes and related interest or

revaluations of deferred tax assets or changes in tax credit availability;

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and our decision to repatriate foreign earnings subject to additional taxes.

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

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As a result, public announcements concerning our operations—or even general developments within the semiconductor sector—could cause the market price of our common stock to decline, regardless of our actual results.

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

What changed 10-K

Item 1A. Risk Factors