What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2023-08-18 compared with 2022-08-22 · 311 added, 470 removed, 1078 unchanged (42% of the section changed)

1 unchanged sentence

Conclusions Regarding Disclosure Controls and Procedures

Although many of the restrictions and containment measures implemented by governmental authorities in response to the COVID-19 pandemic have since been lifted or scaled back, some of our employees continue to work from home, or on a hybrid basis.

Established business continuity plans were initiated in order to mitigate the impact to our control environment, operating procedures, data, and internal controls.

The design of our processes and controls allow for remote execution with accessibility to secure data.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).

3 unchanged sentences

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO 2013 framework).

Based on our evaluation under the COSO 2013 framework, our management concluded that our internal control over financial reporting was effective, at the reasonable assurance level, as of June 25, 2022.

Based on our evaluation under the COSO 2013 framework and the satisfactory completion of the remediation actions described below, our management concluded that our internal control over financial reporting was effective, at the reasonable assurance level, as of June 24, 2023.

The effectiveness of our internal control over financial reporting, as of June 24, 2023, has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report included herein on page F-2.

Remediated Material Weakness

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 a company’s annual or interim financial statements will not be prevented or detected on a timely basis.

During the quarter ended June 24, 2023, the Company identified a material weakness in internal control related to the identification and monitoring of the sales reporting requirements of a single non-royalty bearing intellectual property license agreement.

The material weakness was primarily due to ineffective risk assessment related to identifying and analyzing risks and ineffective information and communication processes related to identifying and assessing the accuracy of the information used in reporting under certain non-royalty bearing intellectual property license agreements.

As a result of this lack of controls, an immaterial error in financial reporting was identified.

The Company has concluded that the material weakness described above was fully remediated as of June 24, 2023, due to the implementation of specific processes and controls to identify reporting requirements for non-royalty bearing intellectual property license agreements and to monitor the Company’s ongoing compliance with periodic sales reporting in accordance with the terms of such agreements.

These controls were tested and determined to be operating effectively as of June 24, 2023.

Changes in Internal Control Over Financial Reporting

Except as noted above, there were no changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Except for the identified material weakness and remediation described above under the heading “

Remediated Material Weakness ,”

there were no other changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended June 24, 2023, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

6 unchanged sentences

There were no items requiring reporting on Form 8-K that were not reported on Form 8-K during the fourth quarter of the year covered by this Form 10-K.

DISCLOSURE REGA RDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

DIRECTORS, EXECUTIVE OF FICERS AND CORPORATE GOVERNANCE

20 unchanged sentences

Incorporated by Reference

Asset Purchase Agreement, dated December 18, 2019, by and among Synaptics Incorporated and Creative Legend Investments Ltd.

Quarterly Report on Form 10-Q

February 6, 2020

First Amendment to Asset Purchase Agreement, dated March 3, 2020, by and among Synaptics Incorporated and Creative Legend Investments Ltd .

Quarterly Report on Form 10-Q

Second Amendment to Asset Purchase Agreement, dated April 15, 2020, by and among Synaptics Incorporated and Beijing OmniVision Technologies Co.

Annual Report on Form 10-K

August 21, 2020

Agreement and Plan of Merger, dated July 17, 2020, by and among Synaptics Incorporated, DisplayLink Corp., Falcon Merger Sub, Inc., the sellers who became parties thereto and Shareholder Representative Services LLC

22 unchanged sentences

September 12, 2002

Indenture, dated as of June 26, 2017, by and between the Company and Wells Fargo, National Association, as trustee

Current Report on Form 8-K

June 26, 2017

Form of 0.50% Convertible Senior Note due 2022

Current Report on Form 8-K

June 26, 2017

Description of Registrant’s Securities

12 unchanged sentences

December 2, 2021

Second Amendment, dated as of March 16, 2023, by and among Synaptics Incorporated, the Lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent

Current Report on Form 8-K

March 17, 2023

Third Amendment, dated as of July 28, 2023, by and among Synaptics Incorporated, the Revolving Credit Lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent

Current Report on Form 8-K

August 3, 2023

Synaptics Incorporated 2019 Inducement Equity Plan

19 unchanged sentences

October 28, 2021

Amended and Restated 2019 Equity Incentive Compensation Plan

Current Report on Form 8-K

October 27, 2022

Form of Restricted Stock Unit Award Agreement under the 2019 Equity and Incentive Compensation Plan (for awards granted before July 27, 2021)

20 unchanged sentences

Form of Market Stock Unit Award Agreement under the 2019 Equity and Incentive Compensation Plan

Filed herewith

Annual Report on Form 10-K

August 22, 2022

2019 Employee Stock Purchase Plan

27 unchanged sentences

Current Report on Form 8-K

Employment Offer Letter, dated February 7, 2019 between the registrant and Kermit Nolan

Quarterly Report on Form 10-Q

Written Description of the Synaptics Incorporated Retention Program Adopted May 6, 2019

7 unchanged sentences

February 6, 2020

Employment Offer Letter, dated February 26, 2020 between the registrant and Phil Kumin

Annual Report on Form 10-K

August 21, 2020

Employment Offer Letter, dated December 4, 2018 between the registrant and Saleel Awsare

1 unchanged sentence

August 21, 2020

Purchase and Sale Agreement with Escrow Instructions, dated November 24, 2021, by and between Synaptics Incorporated and SBC & D Co., Inc.

d/b/a South Bay Development Company

Current Report on Form 8-K

December 1, 2021

First Amendment to Purchase and Sale Agreement with Escrow Instructions, dated December 20, 2021, by and between Synaptics Incorporated and SBC & D Co., Inc.

d/b/a South Bay Development Company

Quarterly Report on Form 10-Q

February 3, 2022

List of Subsidiaries

52 unchanged sentences

/s/ Nelson C.

Chairman of the Board

August 19, 2022

Chair of the Board

August 18, 2023

53 unchanged sentences

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated 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 consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the 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.

Valuation of inventories and losses on inventory purchase obligations

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter 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 matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate.

Valuation of inventories

As discussed in Note 1 to the consolidated financial statements, the Company held $137.2 million of inventories as of June 24, 2023 which are stated at the lower of cost or net realizable value.

The Company records a write-down for excess, obsolete or unmarketable inventories based on forecasts of future demand and market conditions.

Additionally, a liability and a charge are recorded to cost of sales for estimated losses on inventory the Company is obligated to purchase from contract manufacturers when a customer delays its delivery schedule, cancels its order, or for other factors.

We identified the valuation of inventories associated with excess, obsolete or unmarketable inventories and losses on inventory purchase obligations as a critical audit matter.

A higher degree of auditor judgment was required to evaluate the Company’s estimate of net realizable value for these inventories and losses on inventory purchase obligations.

We identified the valuation of inventories associated with excess, obsolete or unmarketable inventories as a critical audit matter.

A higher degree of auditor judgment was required to evaluate the Company’s estimate of net realizable value for these inventories.

Specifically, there is a high degree of subjectivity in evaluating the effect of any unexpected or sudden declines in market demand which may result from changes to or cancellations of customer orders, rapid product improvements or technological advances, due to the nature of the evidence available related to these factors.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s process to develop the estimated net realizable value of inventory and recognition of losses related to outstanding inventory purchase obligations.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s process to develop the estimated net realizable value of inventory.

For a selection of inventory items, we assessed the Company’s assumptions by comparing them to historical activity and demand forecasts.

We also considered customer communications, as well as end user and third-party publications.

For a sample of inventory items, we recalculated the required write-downs and losses and compared this to the recorded amounts.

We confirmed with the Company’s significant vendors regarding outstanding purchase obligations of the Company.

Additionally, we tested a sample of returns which resulted from quality related issues of the Company's products during the year and subsequent to period-end to evaluate if additional write-downs or losses were warranted.

Evaluation of certain intangible assets acquired through business combinations

As discussed in Note 4 to the consolidated financial statements, during the year ended June 25, 2022, the Company consummated a business combination for total consideration of $543.3 million.

In connection with this acquisition, the Company recorded various intangible assets, which included developed technologies and customer relationships with an acquisition-date fair value of $150.0 million and $45.0 million, respectively.

We identified the evaluation of the fair values allocated to acquired developed technologies and certain customer relationship intangible assets as a critical audit matter.

We performed sensitivity analyses to determine the significant assumptions used to value these acquired intangible assets, individually and in the aggregate.

The fair value of these acquired intangible assets were sensitive to possible changes to the following key assumptions, requiring a high degree of auditor judgment and the use of valuation professionals with specialized skills and knowledge:

Developed technologies:

Projected revenue

Technology obsolescence

Customer relationship:

Estimated customer ramp up periods

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s acquisition-date valuation processes, including controls related to the development of the key assumptions, as listed above.

We evaluated the reasonableness of the Company’s projected revenue, technology obsolescence, and estimated customer ramp up periods by comparing them to historical actual results of the acquired entities and certain peer and market participant data.

We involved valuation professionals with specialized skills and knowledge, who assisted in:

evaluating certain peer group and market participant data used in the assessment of projected revenue by assessing the appropriateness of the guideline comparable companies identified by management’s specialist and checking the accuracy of certain peer group and market participant data

assessing the reasonableness of technology obsolescence based on the nature of the technology acquired.

As part of the procedure, we considered customer communications, as well as end user and third-party publications.

For a sample of inventory items, we recalculated the required write-downs and compared this to the recorded amounts.

We have served as the Company’s auditor since 2003.

7 unchanged sentences

Short-term investments

Accounts receivable, net of allowances of $ 6.0 and $ 5.8 at June 2022 and 2021, respectively

Accounts receivable, net of allowance for credit losses of $ 5.0 and $ 6.0 at June 2023 and 2022, respectively

Prepaid expenses and other current assets

11 unchanged sentences

Current portion of long-term debt

Convertible notes, net

Total current liabilities

7 unchanged sentences

10,000,000 shares authorized;

no shares issued and

no shares issued and outstanding

Common stock:

$ 0.001 par value;

120,000,000 shares authorized, 67,745,800 and 66,963,006

shares issued, and 39,621,179 and 35,331,903 shares outstanding,

at June 2022 and 2021, respectively

120,000,000 shares authorized, 68,687,511 and 67,745,800 shares issued,

and 38,571,072 and 39,621,179 shares outstanding, at June 2023 and 2022, respectively

Additional paid-in capital

Treasury stock:

28,124,621 and 31,631,103 common shares at June 2022 and

2021, respectively, at cost

30,116,439 and 28,124,621 common shares at June 2023 and 2022, respectively, at cost

Accumulated other comprehensive loss

18 unchanged sentences

Gain from sale and leaseback transaction

Gain on sale of assets

Income before provision for income taxes and equity investment income (loss)

Income before provision for income taxes and equity investment gain (loss)

Provision for income taxes

6 unchanged sentences

(in millions)

Other comprehensive loss

Unrealized loss on available-for-sale securities

Other comprehensive income (loss)

Unrealized gain (loss) on available-for-sale securities

Reclassification adjustments for losses included in net income

Other comprehensive income (loss)

Comprehensive income

7 unchanged sentences

Balance at June 2020

Issuance of common stock for share-

based award compensation plans

Payroll taxes for deferred stock units

Purchases of treasury stock

Share-based compensation

Balance at June 2020

Issuance of common stock for share-

based award compensation plans

Payroll taxes for deferred stock units

Purchases of treasury stock

Issuance of common stock for share-based award compensation plans

Payroll taxes related to net share settlement of share-based awards

Treasury stock issued for redemption of convertible notes

Share-based compensation attributable to acquisition

Share-based compensation

1 unchanged sentence

Other comprehensive loss

Issuance of common stock for share-

based award compensation plans

Issuance of common stock for share-based award compensation plans

Treasury stock issued for redemption of convertible notes

Payroll taxes for deferred stock units

Payroll taxes related to net share settlement of share-based awards

Share-based compensation attributable to acquisition

1 unchanged sentence

Balance at June 2022

Other comprehensive income

Issuance of common stock for share-based award compensation plans

Payroll taxes related to net share settlement of share-based awards

Common stock repurchased

Share-based compensation

Balance at June 2023

See accompanying notes to consolidated financial statements.

8 unchanged sentences

Gain on sale of audio technology assets

Gain on sale of assets

Gain on sale of property and equipment and sale and leaseback transaction

Gain on sale and leaseback transaction

Loss on redemption of convertible notes

1 unchanged sentence

Amortization of convertible debt discount and issuance costs

Amortization of debt issuance costs

Amortization of right-of-use assets

Amortization of cost of development services

Acquired in-process research and development

Provision for inventory excess and obsolescence

Equity investment (gain) loss

10 unchanged sentences

Proceeds from sale of assets

Purchase of in-process research and development

Acquisition of businesses, net of cash and cash equivalents acquired

1 unchanged sentence

Proceeds from sale of audio technology assets

Proceeds from sales of investments

Proceeds from maturity of investments

Proceeds from sale of investments

Purchase of short-term securities

Purchases of property and equipment

Receipt of liquidation payment on equity investment

Purchase of intangible assets

Proceeds from sale of equity method investment

Cost method investment

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities

Proceeds from issuance of debt

Proceeds from borrowings under line-of-credit

Payment on line of credit borrowings and debt

Purchases of treasury stock

Refundable deposit paid to vendor

Return of deposit received from vendor

Proceeds from issuance of shares

Payment of debt issuance costs

Proceeds from issuance of shares

Payroll taxes related to net share settlement of share-based awards

Repurchases of common stock

Repayment on line of credit borrowings and debt

Payment for redemption of convertible notes

Payroll taxes for deferred stock and market stock units

Net cash provided by financing activities

Refundable deposit paid to vendor

Return of deposit received from vendor and other

Net cash provided by (used in) financing activities

Effect of exchange rate changes on cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Supplemental disclosures of cash flow information

Cash paid for taxes, net of refunds

Cash paid for interest

Net cash paid for taxes

Cash refund on taxes

Non-cash investing and financing activities:

Unpaid property, plant and equipment

Supplemental disclosures of non-cash transactions

Purchases of property and equipment in current liabilities

Receipt of intangible assets from advance payment made in previous fiscal year

See accompanying notes to consolidated financial statements.

2 unchanged sentences

Organization and Summary of Significant Accounting Policies

Organization and Basis of Presentation

We are a leading worldwide developer and fabless supplier of premium mixed signal semiconductor solutions changing the way humans engage with connected devices and data, engineering exceptional experiences throughout the home, at work, in the car and on the go.

1 unchanged sentence

We deliver complete chip, firmware and software semiconductor solutions that allow our customers to seamlessly integrate advanced functions into their end products.

Basis of Presentation and Principles of Consolidation

Our fiscal year is the 52- or 53-week period ending on the last Saturday in June.

Accordingly, every fifth or sixth fiscal year will have a 53-week period.

The additional week in a 53-week year is added to the first quarter, making such quarter a 14-week period.

The fiscal years presented in this report were 52-week periods ended June 24, 2023, June 25, 2022, and June 26, 2021.

The consolidated financial statements are presented in accordance with U.S.

3 unchanged sentences

Certain reclassifications have been made to the amounts for prior years in order to conform to the current year’s presentation

Our fiscal year is the 52- or 53-week period ending on the last Saturday in June.

The fiscal years presented in this report were 52-week periods ended June 25, 2022, June 26, 2021 and June 27, 2020.

Use of Estimates

2 unchanged sentences

On an ongoing basis, we evaluate our estimates, including those related to revenue, allowance for doubtful accounts, cost of revenue, inventories, loss on purchase commitments, product warranty, accrued liabilities, share-based compensation costs, provision for income taxes, deferred income tax asset valuation allowances, uncertain tax positions, goodwill, intangible assets, investments, and loss contingencies.

We base our estimates on historical experience, applicable laws and regulations, and various other assumptions that we believe to be reasonable under the circumstances, including our expectations regarding the potential impacts on our business of the COVID-19 pandemic, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

We base our estimates on historical experience, applicable laws and regulations, and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions.

8 unchanged sentences

We regularly review our investment portfolio to identify and evaluate investments that have indicators of possible impairment.

Factors considered in determining whether a loss is other-than-temporary include, but are not limited to:

Some of the factors we consider include, but are not limited to, the following:

the length of time and extent a security’s fair value has been below its cost, the financial condition and near-term prospects of the investee, the credit quality of the security’s issuer, likelihood of recovery and our intent and ability to hold the security for a period of time sufficient to allow for any anticipated recovery in value.

3 unchanged sentences

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

When determining the fair value measurements for assets and liabilities, we consider the principal or most advantageous market in which we would transact, and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk.

The carrying amounts reported in the consolidated

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

financial statements approximate the fair value for cash, accounts receivable, accounts payable and accrued liabilities due to their short-term nature.

determining the fair value measurements for assets and liabilities, we consider the principal or most advantageous market in which we would transact, and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk.

The carrying amounts reported in the consolidated financial statements approximate the fair value for cash, accounts receivable, accounts payable and accrued liabilities due to their short-term nature.

Intangible assets, property and equipment, and goodwill are measured at fair value on a non-recurring basis if impairment is indicated.

18 unchanged sentences

We then select an appropriate method for measuring satisfaction of the performance obligations.

Rights to our intellectual property, or IP, are either sold or licensed to customers.

Revenue recognition from the licensing of our IP is dependent on the nature and terms of each agreement.

We recognize revenue from the licensing of our IP upon delivery of the IP if there are no substantive future obligations to perform under the arrangement.

Sales-based or usage-based royalties from the license of IP are recognized at the later of the period the sale or usage occurs, or the satisfaction of the performance obligation to which some or all of the sales-based or usage-based royalties have been allocated.

Revenue from sales to distributors is recognized upon shipment of the product to the distributors (sell-in basis).

1 unchanged sentence

In the absence of a master sales agreement, we consider a customer's purchase order or our standard terms and conditions to be the contract with the customer.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our pricing terms are negotiated independently, on a stand-alone basis.

9 unchanged sentences

Sales returns liabilities are recorded as refund liabilities within other accrued liabilities.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our accounts receivable balance is from contracts with customers and represents our unconditional right to receive consideration from customers.

Payments are generally due within three months of completion of the performance obligation and subsequent invoicing and, therefore, do not include significant financing components.

In fiscal 2022 , there was no material bad debt charge recorded on accounts receivable.

There was $ 1.3 million of contract assets (i.e., unbilled accounts receivable, deferred commissions) recorded on the consolidated balance sheets as of June 2023, and $ 1.2 million as of June 2022.

Contract assets are presented as part of prepaid expenses and other current assets.

Contract liabilities and refund liabilities were $ 27.3 million and $ 61.3 million, respecti vely, as of June 25, 2022 , and $ 7.0 million and $ 36.1 million, respectively, as of June 26, 2021.

Contract liabilities and refund liabilities were $ 18.7 million and $ 39.8 million, respectively, as of June 2023, and $ 27.3 million and $ 61.3 million, respectively, as of June 2022.

Both contract liabilities and refund liabilities are presented as part of customer obligations in other accrued liabilities on our consolidated balance sheets.

11 unchanged sentences

Advertising costs, if any, are expensed when incurred.

Allowance for Doubtful Accounts

We maintain allowances for doubtful accounts for estimated losses resulting from the inability of customers to meet their financial obligations.

Allowance for Credit Losses

We maintain allowances for credit losses resulting from the inability of customers to meet their financial obligations.

On an ongoing basis, we evaluate the collectability of accounts receivable based on a combination of factors.

In circumstances in which we are aware of a specific customer’s potential inability to meet its financial obligation, we record a specific reserve of the bad debt against amounts due.

In circumstances in which we are aware of a specific customer’s potential inability to meet its financial obligation, we record a specific reserve of the credit loss against amounts due.

In addition, we make judgments and estimates on the collectability of accounts receivable based on our historical bad debt experience, customers’

2 unchanged sentences

operating results or financial position.

If circumstances change adversely, additional bad debt allowances may be required.

For the fiscal year ended June 25, 2022 credit losses on our accounts receivable were $ 0.2 million.

There were no credit losses on our accounts receivable for the fiscal year ended June 26, 2021 .

We believe that an adequate allowance for doubtful accounts has been provided.

If circumstances change adversely, additional credit loss allowances may be required.

At June 2023 and June 2022, the allowance for credit losses on our trade receivables was $ 5.0 million and $ 6.0 million, respectively.

Cost of Revenue

Our cost of revenue includes the cost of products shipped to our customers, which primarily includes the cost of products built to our specifications by our contract manufacturers, the cost of silicon wafers supplied by independent semiconductor wafer manufacturers, and the related assembly, package, and test costs of our products.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

wafer manufacturers, and the related assembly, package, and test costs of our products.

Also included in our cost of revenue are personnel and related costs, including share-based compensation for quality assurance and manufacturing support personnel;

8 unchanged sentences

Finished goods

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Inventories are recorded at standard cost, which approximates actual cost computed on a first-in, first-out basis.

We record a write-down, if necessary, to reduce the carrying value of inventory to its net realizable value.

6 unchanged sentences

We compute depreciation using the straight-line method over the estimated useful lives of the assets.

We amortize leasehold improvements over the shorter of the lease term or the useful life of the asset.

During fiscal 2020, we invested $ 5.0 million in Eta Compute in exchange for preferred stock.

This investment provides us with a strategic relationship that enables us to better address expanded industry opportunities for artificial intelligence applications.

The investment is accounted for under the cost method.

In April 2017, we paid $ 18.4 million for a 14.4 % interest in OXi Technology Ltd., or OXi.

In April 2019, our investment ownership was reduced to 13.8 % as a result of new investment in OXi.

We determined the equity method of accounting applied to our investment as we had significant influence over OXi’s operating and financial policies.

We recorded our portion of OXi’s net income or net loss on a one quarter lag due to the timing of the availability of OXi’s financial records.

We did not have any material related party transactions with OXi.

During fiscal 2022, we sold our investment in OXi for $ 5.0 million.

In connection with the sale of our investment in OXi, we recorded a gain of $ 2.5 million, offset by our share of OXi's net losses of $ 0.9 million.

The net gain of $ 1.6 million is included in Equity investment (gain) loss in the consolidated statements of operations.

We amortize leasehold improvements over the shorter of the lease term or the estimated useful life of the asset.

Foreign Currency

4 unchanged sentences

We remeasure foreign currency expenses at the weighted average exchange rate in the month that the transaction occurred.

These foreign currency transactions and remeasurement gains and losses, resulted in a net gain of $ 5.6 million and $ 0.2 million in fiscal 2022 and 2020, respectively, and a net loss of $ 1.4 million in fiscal 2021 .

These foreign currency transactions and remeasurement gains and losses, resulted in a net loss of $ 2.3 million in fiscal 2023, a net gain of $ 5.6 million in fiscal 2022 and a net loss of $ 1.4 million in fiscal 2021 .

Gains and losses resulting from foreign currency transactions are included in selling, general, and administrative expenses in the consolidated statements of operations.

9 unchanged sentences

The fair value of each of our goodwill reporting units is generally estimated using discounted cash flow methodologies.

Based on the impairment analysis performed in the fourth quarter of each year presented, the fair value of our reporting units exceeded the carrying value;

as such, our annual qualitative assessment did not indicate that a more detailed quantitative analysis was necessary and no goodwill impairment was recognized for each period presented.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We elected not to perform the qualitative assessment and performed the quantitative goodwill impairment test in fiscal 2023 .

Based on the impairment analysis performed in the fourth quarter of each year presented, the fair value of our reporting units exceeded their carrying values and no goodwill impairment was recognized.

Intangible Assets

1 unchanged sentence

Finite-lived intangible assets are amortized for financial reporting purposes using the straight-line method over the estimated useful lives of the assets ranging from 1 to 6 years.

Indefinite-lived intangible assets are not amortized but tested annually for impairment on an annual basis in the fourth quarter, or when events or changes in circumstances indicate that indefinite-lived intangible assets might be impaired.

Indefinite-lived intangible assets are not amortized but tested annually for impairment in the fourth quarter, or when events or changes in circumstances indicate that indefinite-lived intangible assets might be impaired.

Impairment of Long-Lived Assets

6 unchanged sentences

No impairment of long-lived assets was recognized for fiscal 2023, 2022, and 2021 .

We determine if a contract is a lease or contains a lease at the inception of the contract and reassess that conclusion if the contract is modified.

All leases are assessed for classification as an operating lease or a finance lease.

Operating lease right-of-use, or ROU, assets are included in non-current other assets on our consolidated balance sheet.

Operating lease liabilities are separated into a current portion, included within other accrued liabilities on our consolidated balance sheet, and a non-current portion, included within other long-term liabilities on our consolidated balance sheet.

We do not have any finance lease ROU assets or liabilities.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

We do not obtain and control the right to use the identified asset until the lease commencement date.

Our lease liabilities are recognized at the applicable lease commencement date based on the present value of the lease payments required to be paid over the lease term.

Because the interest rate implicit in the lease is not readily determinable, we generally use our incremental borrowing rate to discount the lease payments to present value.

The estimated incremental borrowing rate is derived from information available at the lease commencement date.

We factor in publicly available data for instruments with similar characteristics when calculating our incremental borrowing rates.

Our ROU assets are also recognized at the applicable lease commencement date.

The ROU asset equals the carrying amount of the related lease liability, adjusted for any lease payments made prior to lease commencement and lease incentives provided by the lessor.

Variable lease payments are expensed as incurred and do not factor into the measurement of the applicable ROU asset or lease liability.

The term of our leases equals the non-cancellable period of the lease, including any rent-free periods provided by the lessor, and also include options to renew or extend the lease (including by not terminating the lease) that we are reasonably certain to exercise.

We establish the term of each lease at lease commencement and reassess that term in subsequent periods if a triggering event occurs.

Operating lease cost for lease payments is recognized on a straight-line basis over the lease term.

Our lease contracts often include lease and non-lease components.

For our leases, we have elected the practical expedient offered by the standard to not separate lease from non-lease components and account for them as a single lease component.

We determine if an arrangement is a lease at inception.

Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.

Operating lease ROU assets also include any initial direct costs and prepayments less lease incentives.

Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options.

As our leases do not provide an implicit rate, we use our collateralized incremental borrowing rate based on the information available at the lease commencement date, including lease term, in determining the present value of lease payments.

Lease expense for these leases is recognized on a straight-line basis over the lease term.

We have elected, for all classes of underlying assets, not to recognize ROU assets and lease liabilities for leases with a term of twelve months or less.

Lease cost for short-term leases is recognized on a straight-line basis over the lease term.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Other Accrued Liabilities and Other Long-Term Liabilities

4 unchanged sentences

As of the end of fiscal 2023 and 2022, other long-term accrued liabilities consisted of the following (in millions):

Income taxes payable, long-term

Non-current deferred tax liability

Operating lease liabilities, long-term

Segment Information

We operate in one segment:

the development, marketing, and sale of human experience semiconductor solutions for electronic devices and products.

The chief operating decision maker, or CODM, is our CEO, Our CODM evaluates financial performance and allocates resources using financial information reported on a company-wide basis.

Deferred tax liability

Income taxes payable, long-term

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Share-Based Compensation

14 unchanged sentences

The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes.

The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

realized upon ultimate settlement with a taxing authority.

The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement with a taxing authority.

The calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of highly complex tax laws.

9 unchanged sentences

We accrue for estimated warranty costs under those guarantees based upon historical experience, and for specific items, at the time their existence is known and the amounts are determinable.

Business Combinations

In accordance with the guidance for business combinations, we determine whether a transaction or other event is a business combination, which requires that the assets acquired and liabilities assumed constitute a business.

3 unchanged sentences

We capitalize acquisition-related costs and fees associated with asset acquisitions and immediately expense acquisition-related costs and fees associated with business combinations.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We allocate the fair value of purchase consideration to the tangible assets acquired, liabilities assumed and intangible assets acquired based on their estimated fair values.

8 unchanged sentences

Research and development costs are expensed as incurred.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Accounting Pronouncements Issued But Not Yet Adopted

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848.

ASU 2022-06 defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024.

Effective March 16, 2023, we transitioned our credit and loan agreements from LIBOR to the Secured Overnight Financing Rate, or SOFR.

We are currently evaluating the timing of adoption and impact, if any, of this standard on our consolidated financial statements.

In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805):

Accounting for Acquired Contract Assets and Contract Liabilities”

which improves comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination by providing consistent recognition guidance.

This standard is effective for fiscal years beginning after December 15, 2022.

We will adopt this standard in the first quarter of our fiscal 2024 and do not expect it to have a material impact on our consolidated financial statements.

Net Income Per Share

8 unchanged sentences

Our basic net income per share amounts for each period presented have been computed using the weighted average number of shares of common stock outstanding.

Our diluted net income per share amounts for each period presented include the weighted average effect of potentially dilutive shares.

Our diluted net income per share amounts for each period presented include

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

the weighted average effect of potentially dilutive shares.

We used the “treasury stock”

method to determine the dilutive effect of outstanding stock options, RSUs, MSUs, PSUs and convertible notes.

method to determine the dilutive effect of outstanding share-based awards and convertible notes.

Property and Equipment

Property and equipment as of the end of fiscal 2023 and 2022 consisted of the following (in millions):

Building and building improvements

Up to 35 years

Computer equipment

6 unchanged sentences

Our construction in progress primarily includes machinery and equipment that we expect to place in service in the next 12 months.

Acquisitions, Divestiture and Investment

Asset Acquisition

During the third quarter of fiscal 2023, we completed the acquisition of certain developed technology intangible assets from Broadcom for an aggregate consideration of $ 30.0 million, which was paid in cash in the previous fiscal year.

This transaction did not meet the definition of a business combination as substantially all of the fair value of the gross assets acquired was concentrated in the finite-lived developed technology intangible asset.

As a result, this transaction was accounted for as an asset acquisition and the total purchase consideration was allocated to intangible assets, amortized over an estimated useful life of six years.

Emza Visual Sense, Ltd.

On October 25, 2022 , we acquired all of the outstanding shares of Emza Visual Sense, Ltd.

, or Emza, a developer of ultra-low-power artificial intelligence visual sensing solutions , for total purchase consideration of $ 15.8 million.

The purchase price was attributed to $ 0.3 million cash acquired, $ 8.0 million of intangible assets, $ 9.8 million of goodwill and $ 2.3 million net liabilities assumed.

Goodwill recognized from the acquisition of Emza is not deductible for income tax purposes.

Pro forma results of operations for this acquisition have not been presented because they are not material to our consolidated results of operations, either individually or in the aggregate.

DSP Group, Inc.

On August 30, 2021 , we entered into an agreement and plan of merger with DSP Group, Inc., or DSPG, to acquire all of the equity of DSPG, a leading global provider of voice and wireless chipset solutions for converged communications, for $ 22.00 per share in an all-cash transaction, referred to as the DSPG acquisition.

The DSPG acquisition closed on

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

December 2, 2021 , or the DSPG Closing Date, whereupon we obtained voice and wireless technology and product solutions for converged communications.

The DSPG acquisition closed on December 2, 2021 , or the DSPG Closing Date, whereupon we obtained voice and wireless technology and product solutions for converged communications.

In addition, under the terms of the agreement and plan of merger, we provided replacement equity awards to the transferred employees and allocated $ 1.7 million of the replacement equity awards value to consideration transferred.

5 unchanged sentences

The final purchase price allocation is as follows (in millions):

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

June 25, 2022

20 unchanged sentences

Net assets acquired

The following table summarizes the final amounts of the fair values recognized for the assets acquired and liabilities assumed for these two acquisitions as of the acquisition date as well as adjustments made during the measurement period:

Previously Reported

December 25, 2021

Measurement Period Adjustments (1)

Other current assets

Developed technology and other intangible assets

Deferred tax asset

Other long-term assets

Current liabilities

Deferred tax liability

Other long-term liabilities

Consideration adjustment

Net assets acquired

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(1) The measurement period adjustments were based upon information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the measurement of the amounts recognized at that date.

There were no measurement period adjustments during fiscal 2023.

The following table summarizes the estimated fair value of the intangible assets as of the DSPG Closing Date (in millions):

12 unchanged sentences

We expect to complete the in-process research and development project in calendar year 2024.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The value of goodwill reflects the anticipated synergies of the combined operations and workforce of DSPG as of the DSPG Closing Date.

2 unchanged sentences

The consolidated financial statements include approximately $ 83.8 million of revenue from the DSPG Closing Date through June 2022.

It is impracticable to determine the effect on net income attributable to DSPG as we initiated the integration of a substantial portion of DSPG into our ongoing operations during the second quarter of fiscal 2022, which was completed in the subsequent quarter.

It is impracticable to determine the effect on net income attributable to DSPG as we completed the integration of DSPG into our ongoing operations during the third quarter of fiscal 2022.

In fiscal year 2022, we incurred $ 4.4 million in acquisition related costs which were recorded in selling, general and administrative expense in the consolidated statements of operations.

In December 2021, we executed the Term Loan Facility agreement in the amount of $ 600.0 million, the proceeds of which were used to finance the DSPG acquisition and we incurred $ 11.2 million of debt financing costs thereon.

As of June 2023 , $ 6.0 million of the Term Loan Facility is included in short-term debt, and $ 585.0 million is included in long-term debt on the accompanying consolidated balance sheets.

See “Note 8 –

for additional information.

Supplemental Pro Forma Information (Unaudited)

1 unchanged sentence

The pro forma adjustments are based upon currently available information and certain assumptions we believe are reasonable under the circumstances.

The following supplemental pro forma information presents the combined results of operations for the year ended June 25, 2022 and June 26, 2021, as if DSPG had been acquired as of the beginning of fiscal 2021.

The following supplemental pro forma information presents the combined results of operations as if DSPG had been acquired as of the beginning of fiscal 2021.

Pro forma adjustments used to arrive at pro forma net income included adjustments for the addition of intangible amortization expense for the value of intangibles under the purchase price allocation, adjustments to record acquired inventories at fair value, transaction and restructuring costs.

2 unchanged sentences

Net income (loss)

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

On July 17, 2020 , we entered into a definitive agreement to acquire 100 % of equity interest in DisplayLink Corporation, or DisplayLink, a leader in high-performance video compression technology, for $ 305 million in cash adjusted for (i) estimated cash and cash equivalents and short-term investments at the closing (ii) estimated indebtedness outstanding immediately prior to the closing, (iii) unpaid portion as of the closing of certain transaction expenses incurred by DisplayLink, and (iv) the amount that the estimated working capital of DisplayLink exceeds or falls short, respectively, of a certain specified target working capital set forth in an Agreement and Plan of Merger, or the Merger Agreement, with $ 3.1 million of the purchase price held in escrow accounts for adjustments after closing and to secure the Seller Parties’

indemnification obligations under the Merger Agreement.

The acquisition closed on July 31, 2020 , or the DisplayLink Closing Date, whereupon we obtained high-performance video compression technology which will further enhance our current IoT business.

This acquisition has been accounted for using the purchase method of accounting in accordance with the business acquisition guidance.

Under the purchase accounting method, the total estimated purchase consideration of the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their relative fair values.

The excess of the purchase consideration over the net tangible and identifiable intangible assets acquired and liabilities has been recorded as goodwill.

Our estimate of the fair values of the acquired intangible assets at June 26, 2021, was based on established and accepted valuation techniques performed with the assistance of our third-party valuation specialists.

The adjusted purchase price paid for DisplayLink was $ 444.0 million.

The following table summarizes the amounts recorded for the estimated fair values of the assets acquired and liabilities assumed as of the DisplayLink Closing Date (in millions):

Cash and cash equivalents

Short-term investments

Accounts receivable, net

Prepaid expenses and other current assets

Property and equipment

Intangible assets

Right-of-use lease asset

Non-current other assets

Total identifiable assets acquired

Accounts payable

Other accrued liabilities

Short-term lease liabilities

Long-term lease liabilities

Other long-term liabilities

Total liabilities

Net identifiable assets acquired

Net assets acquired

There were no measurement period adjustments during fiscal year ended June 25, 2022.

During the fiscal year ended June 26, 2021 we recorded measurement period adjustments of $ 0.9 million to goodwill comprising of increases of $ 2.3 million in prepaid expenses and decreases of $ 0.8 million to other accrued liabilities and increases of $ 1.4 million in other long-term liabilities for a net increase of $ 1.7 million to the fair value of other acquired net tangible assets.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes the estimated fair value of the intangible assets as of the DisplayLink Closing Date (in millions):

Estimated Weighted Average Useful Lives in Years

Estimated Fair

Developed technology

Customer contracts and related relationships

In process research and development

Licensed technology

Estimated fair value of acquired intangibles

We estimated the fair value of the identified intangible assets using a discounted cash flow model for each of the underlying identified intangible assets.

These fair value measurements were based on significant inputs not observable in the market and thus represent a Level 3 measurement.

Key assumptions include the level and timing of expected future cash flows, conditions and demands specific to each intangible asset over its remaining useful life, and discount rates we believe to be consistent with the inherent risks associated with each type of asset, which range from 11.0 % to 11.5 %.

The fair value of these intangible assets is primarily affected by the projected revenue, gross margins, operating expenses, the technology migration curve, customer ramp up period and the anticipated timing of the projected income associated with each intangible asset coupled with the discount rates used to derive their estimated present values.

We believe the level and timing of expected future cash flows appropriately reflects market participant assumptions.

In-process research and development consists of a next generation docking and video interface products for the IoT market.

We expect to complete the in-process research and development project in fiscal 2023.

The value of goodwill reflects the anticipated synergies of the combined operations and workforce of DisplayLink as of the DisplayLink Closing Date.

No ne of the goodwill is expected to be deductible for income tax purposes.

Prior to the DisplayLink acquisition, we did not have an existing relationship or transactions with DisplayLink.

The consolidated financial statements include approximately $ 115.3 million and $ 110.0 million of revenue during fiscal 2022 and 2021, respectively.

It is impracticable to determine the effect on net income attributable to DisplayLink as we integrated a substantial portion of DisplayLink into our ongoing operations during the first quarter of fiscal 2021 .

The following unaudited pro forma financial information (in millions, except per share data) presents the combined results of operations for us and DisplayLink as if the DisplayLink acquisition had occurred at the beginning of fiscal 2020.

The unaudited pro forma financial information has been prepared for comparative purposes only and does not purport to be indicative of the actual operating results that would have been recorded had the DisplayLink acquisition actually taken place at the beginning of fiscal 2020 and should not be taken as indicative of future consolidated operating results.

Additionally, the unaudited pro forma financial results do not include any anticipated synergies or other expected benefits from the DisplayLink acquisition.

(1) Includes results of Broadcom Wireless Connectivity Business

Pro forma adjustments used to arrive at pro forma net income included adjustments for historical amortization expense, the addition of intangible amortization expense for the value of intangibles under the purchase price allocation, transaction costs and restructuring costs.

The total pro forma adjustments for fiscal 2021 was a decrease to net income of $ 1.1 million.

Broadcom Wireless Connectivity Business

On July 2, 2020 , we entered into definitive agreements with Broadcom to acquire certain assets and assume certain liabilities of, and obtain non-exclusive licenses relating to, Broadcom’s existing Wi-Fi, Bluetooth and GPS/GNSS products and business in the IoT market, or Broadcom Business Acquisition, for an aggregate consideration of $ 250 million in cash which closed on July 23, 2020 , or the Broadcom Business Acquisition Closing Date.

We also entered into certain transition

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

agreements with Broadcom for a period of three years .

We acquired these assets and assumed certain liabilities from Broadcom in order to obtain wireless connectivity technology which will enhance our current IoT business.

The acquisition has been accounted for using the purchase method of accounting in accordance with the business acquisition guidance.

The excess of the purchase consideration over the net tangible and identifiable intangible assets acquired and liabilities has been recorded as goodwill.

Our estimate of the fair values of the acquired intangible assets at the Broadcom Business Acquisition Closing Date was based on established and accepted valuation techniques performed with the assistance of our third-party valuation specialists.

The following table summarizes the adjusted purchase price paid for the Broadcom Business Acquisition (in millions):

Adjustments to consideration transferred, net

Roadmap products - estimated cost of development

We entered into a derivative and roadmap product agreement and an asset purchase agreement with Broadcom.

The derivative and roadmap product agreement includes the purchase of derivative and roadmap product development services to be performed by Broadcom.

We estimated the value of the development services to be approximately $ 25.0 million, and accounted for it separate from the business combination.

At June 25, 2022 and June 26, 2021, the net book value of the development services is $ 5.8 million and $ 15.8 million, respectively.

The estimated value of the development services is amortizing over the period of time estimated to complete the development or approximately thirty months.

The amortization of the estimated cost of development is included in research and development in our consolidated statements of operations.

In addition, under the terms of the asset purchase agreement we provided replacement equity compensation awards to the transferred employees and Broadcom agreed to make cash payments to transferred employees as incentive to accept employment offers from our company.

We determined $ 3.5 million of value related to these arrangements should be included as consideration transferred, which was partially offset by $ 2.0 million of cash payments to transferred employees as a reduction of consideration transferred.

The following table summarizes the amounts recorded for the estimated fair values of the assets acquired and liabilities assumed as of the Broadcom Business Acquisition Closing Date (in millions):

Property and equipment

Acquired intangible assets

Total identifiable assets acquired

Liabilities assumed

Net assets acquired

We estimated the fair value of the identified intangible assets using a discounted cash flow model for each of the underlying identified intangible assets.

These fair value measurements were based on significant inputs not observable in the market and thus represent a Level 3 measurement.

We believe the level and timing of expected future cash flows appropriately reflects market participant assumptions.

The following table summarizes the estimate of the intangible assets as of the Broadcom Business Acquisition Closing Date (in millions):

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Estimated Weighted Average Useful Lives in Years

Estimated Fair

Developed technology

Customer contracts and related relationships

Order backlog

Estimated fair value of acquired intangibles

The value of goodwill reflects the anticipated synergies of the combined operations and workforce of the transferred Broadcom Business assets as of the Broadcom Business Acquisition Closing Date.

A ll of the goodwill is expected to be deductible for income tax purposes.

Prior to the Broadcom Business Acquisition, we did not have an existing relationship or transactions with Broadcom.

The consolidated financial statements include approximately $ 228.8 million and $ 100.4 million of revenue during fiscal 2022 and 2021, respectively.

It is impracticable to determine the effect on net income attributable to the Broadcom Business Acquisition as we had integrated a substantial portion of the Broadcom Business Acquisition into our ongoing operations at the close.

In December 2020, we completed the sale of limited audio technology intangible assets, received a fully-paid up perpetual license back from the buyer and, as an element of the transaction licensed other audio technology intangible assets to the buyer under a fully-paid up perpetual license arrangement.

Under the asset purchase agreement and the intellectual property license agreement, we received $ 35.0 million in cash.

The gain on the sale of the audio technology assets was $ 34.2 million.

In April 2020, we completed the sale of the assets of our LCD Touch Controller and Display Driver Integration product line, or TDDI, for LCD mobile displays.

We retained our automotive TDDI product line and our discrete touch and discrete display driver product lines supporting LCD and OLED for the mobile market.

The assets sold under the asset purchase agreement had a carrying value of approximately $ 33.6 million as of the closing date of the transaction for cash consideration of $ 138.7 million.

The gain on sale of the assets was $ 105.1 million.

Cash, Cash Equivalents and Short-Term Investments

The following table summarizes our cash, cash equivalents and short-term investments by category at June 25, 2022 (in millions):

The following table summarizes our cash, cash equivalents and short-term investments by category at June 2023 and June 2022 (in millions):

We use the specific-identification method to determine any realized gains or losses from the sale of our short-term investments classified as available-for-sale.

Amortized Cost

Gross unrealized gain (loss)

Amortized Cost

Gross unrealized gain (loss)

Cash equivalents:

Money market funds

Treasury bills

Total cash and cash equivalents

4 unchanged sentences

Total short-term investments

We did not hold any short-term investments at the end of fiscal 2021.

We use the specific-identification method to determine any realized gains or losses from the sale of our short-term investments classified as available-for-sale.

During fiscal 2022, we did not realize significant gains or losses on a gross level from the sale of our short-term investments classified as available-for-sale.

The following table classifies our short-term investments by contractual maturities ( in millions ):

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table classifies our short-term investments by contractual maturities ( in millions ):

Amortized Cost

Due within 1 year

16 unchanged sentences

Our marketable securities are held by custodians who obtain investment prices from a third-party pricing provider that incorporates standard inputs in various asset price models.

At June 25, 2022, financial assets measured at fair value on a recurring basis are summarized below (in millions):

At the end of June 2023 and 2022, financial assets measured at fair value on a recurring basis are summarized below (in millions):

Cash equivalents:

Money market funds

Treasury bills

Short-term investments:

3 unchanged sentences

The above table excludes $ 853.9 million of cash held in our bank accounts.

There were no transfers in or out of our Level 1, 2 or 3 assets during fiscal 2022 or 2021.

We did not hold any financial assets measured at fair value during fiscal 2021.

We did not have any financial instruments measured at fair value on a recurring basis within Level 3 fair value during fiscal 2023 and 2022 and there were no transfers in or out of our Level 1 or 2 assets during the same periods.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Financial Instruments Not Recorded at Fair Value on a Recurring Basis

4 unchanged sentences

The carrying amounts and estimated fair values of the Senior Notes and Term Debt are as follows for the periods presented (in millions):

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

June 25, 2022

June 26, 2021

Carrying Amount

4 unchanged sentences

Term Loan due 2028

Convertible notes due 2022

Goodwill and Acquired Intangible Assets

8 unchanged sentences

Video interface technology

Display driver technology

Not applicable

Human presence detection technology

Licensed technology and other

2 unchanged sentences

Acquired intangibles, gross

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

During fiscal 2023 , we retired fully amortized intangible assets of $ 20.4 million of display driver technology.

During fiscal 2022 , we retired fully amortized intangible assets of $ 21.5 million of audio and video developed technology, $ 12.0 million in backlog and $ 3.1 million in licensed technology and other.

During fiscal 2021, we retired fully amortized intangible assets of $ 143.6 million of display driver developed technology and $ 28.3 million of customer relationships.

Amortization expense is calculated using the straight-line method over the estimated useful lives of the acquired intangibles.

4 unchanged sentences

Future amortization

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

On March 11, 2021, we completed an offering of $ 400.0 million aggregate principal amount of 4.0% senior notes due 2029, or the Senior Notes, in a private offering.

The Senior Notes were issued pursuant to an Indenture, dated as of March 11, 2021, or the Senior Notes Indenture, by and among our company, the guarantors named therein and Wells Fargo Bank, National Association, as trustee.

The Senior Notes Indenture provides that the Senior Notes will bear interest at a rate of 4.0 % per annum, payable in cash semi-annually in arrears on December 15 and June 15 of each year, commencing on June 15, 2021.

The Indenture provides that the Senior Notes will bear interest at a rate of 4.0 % per annum, payable in cash semi-annually in arrears on December 15 and June 15 of each year, commencing on June 15, 2021.

The Senior Notes will mature on June 15, 2029 and are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by each of our current and future domestic restricted subsidiaries that guarantee our obligations under our senior secured credit facilities.

Prior to June 15, 2024, we may redeem the Senior Notes, in whole or in part, at a redemption price of 100 % of the principal amount thereof, plus a make-whole premium set forth in the Senior Notes Indenture, plus accrued and unpaid interest, if any, up to, but excluding, the redemption date .

We may redeem some or all of the Senior Notes on or after June 15, 2024 at the redemption prices specified below, plus accrued and unpaid interest, if any, up to, but excluding, the redemption date:

Prior to June 15, 2024, we may redeem the Senior Notes, in whole or in part, at a redemption price of 100 % of the principal amount thereof, plus a make-whole premium set forth in the Indenture, plus accrued and unpaid interest, if any, up to, but excluding, the redemption date .

On or after June 15, 2024, we may redeem some or all of the Senior Notes at the redemption prices specified below, plus accrued and unpaid interest, if any, up to, but excluding, the redemption date:

2026 and thereafter

3 unchanged sentences

Under certain circumstances, the guarantors may be released from their Senior Note guarantees without consent of the holders of Senior Notes.

Under the terms of the Senior Notes Indenture, the Senior Notes rank equally in right of payment with all of our and the guarantors’

Under the terms of the Indenture, the Senior Notes rank equally in right of payment with all of our and the guarantors’

existing and future senior indebtedness, and rank contractually senior in right of payment to our and the guarantors’

2 unchanged sentences

existing and future secured indebtedness, including secured indebtedness under our senior secured credit facilities, to the extent of the value of the assets securing such indebtedness.

The Senior Notes and guarantees are structurally subordinated to all existing and future indebtedness and liabilities (including trade payables) of our subsidiaries that do not guarantee the Senior Notes.

The Senior Notes Indenture contains covenants that, subject to exceptions and qualifications, among other things, limit our ability and the ability of our Restricted Subsidiaries (as defined in the Senior Notes Indenture) to (i) incur additional indebtedness and guarantee indebtedness;

The Senior Notes and guarantees are structurally subordinated to all

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

existing and future indebtedness and liabilities (including trade payables) of our subsidiaries that do not guarantee the Senior Notes.

The Indenture contains covenants that, subject to exceptions and qualifications, among other things, limit our ability and the ability of our Restricted Subsidiaries (as defined in the Indenture) to (i) incur additional indebtedness and guarantee indebtedness;

(ii) pay dividends or make other distributions or repurchase or redeem our company’s or any parent’s capital stock;

8 unchanged sentences

and (x) consolidate, merge or sell all or substantially all of its assets.

The Senior Notes Indenture contains customary events of default including, without limitation, failure to make required payments, failure to comply with certain agreements or covenants, cross-acceleration to certain other indebtedness in excess of specified amounts, certain events of bankruptcy and insolvency, and failure to pay certain judgments.

An event of default under the Senior Notes Indenture will allow either the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding Senior Notes to accelerate, or in certain cases, will automatically cause the acceleration of, the maturity of the principal, and accrued and unpaid interest, if any, on all outstanding Notes.

The Indenture contains customary events of default including, without limitation, failure to make required payments, failure to comply with certain agreements or covenants, cross-acceleration to certain other indebtedness in excess of specified amounts, certain events of bankruptcy and insolvency, and failure to pay certain judgments.

An event of default under the Indenture will allow either the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding Senior Notes to accelerate, or in certain cases, will automatically cause the acceleration of, the maturity of the principal, and accrued and unpaid interest, if any, on all outstanding Notes.

Debt issuance costs relating to the Senior Notes of $ 5.7 million, netted against the debt amount on the consolidated balance sheet, are amortized as interest expense using the effective interest method over 99 months .

The total interest expense recorded on the Senior Notes during the fiscal year ended June 25, 2022 was $ 16.6 million.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The total interest expense and amortization of the debt issuance costs recorded on the Senior Notes during the fiscal year ended June 2023 and 2022 was $ 16.6 million in each year.

Revolving Credit Facility

On March 11, 2021, we amended and restated our Amended and Restated Credit Agreement, with the lenders and Wells Fargo Bank, National Association, as administrative agent, or the Credit Agreement, to, among other changes, extend the maturity date of our senior secured revolving credit facility, to five years from the closing date of the amendment, increase the facility size from $ 200.0 million to $ 250.0 million, and replace the requirement to maintain a total debt to Consolidated EBITDA (as defined in the Credit Agreement) ratio of not more than 4.75 to 1.00 with a requirement to maintain a net total debt to Consolidated EBITDA ratio of not more than 3.75 to 1.00 provided that for the four fiscal quarters ending after the date of a material acquisition, such maximum leverage ratio shall be adjusted to 4.25 to 1.00, and thereafter 3.75 to 1.00, provided further, that such deemed increase pursuant to the foregoing shall not apply to more than two material acquisitions consummated during the term of the Credit Agreement.

On March 16, 2023, we entered into a Second Amendment, or the Second Amendment, and on July 28, 2023, we entered into a Third Amendment, or the Third Amendment, to our Second Amended and Restated Credit Agreement, as amended, the Credit Agreement, with the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent, dated March 11, 2021.

The Second Amendment replaces the LIBOR-based interest rate applicable to borrowings under the Credit Agreement with a SOFR-based interest rate, and the Third Amendment provides that the consolidated interest coverage ratio financial covenant only applies if, as of the last day of any fiscal quarter, our aggregate cash and cash equivalents balance is less than $ 450 million.

The Credit Agreement provides for a revolving credit facility in a principal amount of up to $ 250 million, which includes a $ 20 million sublimit for letters of credit and a $ 25 million sublimit for swingline loans.

1 unchanged sentence

Future proceeds under the revolving credit facility are available for working capital and general corporate purposes.

In March 2021, we used a portion of the proceeds from the Senior Notes described above to repay the $ 100.0 million outstanding borrowings on this revolving credit facility.

As of June 2023 , there was no balance outstanding under the revolving credit facility.

1 unchanged sentence

Debt issuance costs relating to the revolving credit facility of $ 1.6 million, included in non-current other assets on our consolidated balance sheet, are being amortized over 60 months .

Our obligations under the Credit Agreement are guaranteed by the material domestic subsidiaries of our company, subject to certain exceptions (such material subsidiaries, together with our company, collectively, the Credit Parties).

The obligations of the Credit Parties under the Credit Agreement and the other loan documents delivered in connection therewith are secured by a first priority security interest in substantially all of the existing and future personal property of the Credit Parties, including, without limitation, 65 % of the voting capital stock and 100 % of the non-voting capital stock of certain of the Credit Parties’

Our obligations under the Credit Agreement are guaranteed by the material domestic subsidiaries of our company, subject to certain exceptions, who collectively with our company are referred to as the Credit Parties.

The obligations of the Credit Parties under the Amended Credit Agreement and the other loan documents delivered in connection therewith are secured by a first priority security interest in substantially all of the existing and future personal property of the Credit Parties, including, without limitation, 65 % of the voting capital stock and 100 % of the non-voting capital stock of certain of the Credit Parties’

direct foreign subsidiaries, subject to certain exceptions.

The revolving credit facility bears interest at our election of a Base Rate plus an Applicable Margin or LIBOR plus an Applicable Margin.

The Credit Agreement bears interest, at our election, of a Base Rate plus an Applicable Margin or Adjusted Term SOFR, as defined in the Second Amendment, plus an Applicable Margin.

Swingline loans bear interest at a Base Rate plus an Applicable Margin.

The Base Rate is a floating rate that is the greater of the Prime Rate, the Federal Funds Rate plus 50 basis points, or LIBOR plus 100 basis points.

The Applicable Margin is based on a sliding scale which ranges from 0.25 to 100 basis points for Base Rate loans and 100 basis points to 175 basis points for LIBOR loans.

The Base Rate is a floating rate that is the greater of the Prime Rate, the Federal Funds Rate plus 50 basis points, or Adjusted Term SOFR plus 100 basis points.

The Applicable Margin is based on a sliding scale which ranges from 25 to 100 basis points for Base Rate loans and 100 basis points to 175 basis points for Adjusted Term SOFR loans.

We are required to pay a commitment fee on any unused commitments under the Credit Agreement which is determined on a leverage-based sliding scale ranging from 0.175 % to 0.25 % per annum.

Interest and fees are payable on a quarterly basis.

The LIBOR index is expected to be discontinued at the end of June 2023.

Under our credit facility, when the LIBOR index is discontinued, we will switch to a comparable or successor rate as selected by us and the administrative agent, which may include the Secured Overnight Financing Rate, or SOFR.

Under the Credit Agreement, there are various restrictive covenants, including two financial covenants which limit the consolidated total leverage ratio, or leverage ratio, the consolidated interest coverage ratio, or interest coverage ratio, a restriction that permits accounts receivable financings provided that the aggregate unpaid amount of permitted accounts receivable financings are no more than the greater of $ 100 million and 50% of the amount of all accounts receivable of our company and specified subsidiaries and other specific items.

The leverage ratio is the ratio of debt as of the measurement date to Consolidated EBITDA, for the four consecutive quarters ending with the quarter of measurement.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Under the Credit Agreement, there are various restrictive covenants, including two financial covenants which limit the consolidated total leverage ratio, or leverage ratio, the consolidated interest coverage ratio, or interest coverage ratio, which after the Third Amendment, only applies if our cash and cash equivalents balance is less than $ 450 million as of the last day of any fiscal quarter.

The leverage ratio is the ratio of net debt as of the measurement date to Consolidated EBITDA, for the four consecutive quarters ending with the quarter of measurement.

The current leverage ratio shall not exceed 3.75 to 1.00 provided that for the four fiscal quarters ending after the date of a material acquisition, such maximum leverage ratio shall be adjusted to 4.25 to 1.00, and thereafter 3.75 to 1.0.

The interest coverage ratio is Consolidated EBITDA to interest expense for the four consecutive quarters ending with the quarter of measurement.

The interest coverage ratio must not be less than 3.50 to 1.0 during the term of the Credit Agreement.

As of the end of fiscal 2022, we remain in compliance with the restrictive covenants.

If our quarter-end cash and cash equivalents balance is less than $ 450.0 million, the interest coverage ratio must not be less than 3.50 to 1.0 as of the date of determination.

As of the end of the quarter, we remain in compliance with the restrictive covenants.

Term Loan Facility

On December 2, 2021, we entered into that certain First Amendment and Lender Joinder Agreement to the Credit Agreement, to, among other things, establish a new $ 600.0 million incremental term loan facility, or the Term Loan Facility.

The Term Loan Facility was advanced by certain existing and new lenders under the Credit Agreement to finance the DSPG

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Term Loan Facility was advanced by certain existing and new lenders under the Credit Agreement to finance the DSPG acquisition.

The Term Loan Facility matures on December 2, 2028 .

Principal on the Term Loan Facility is payable in equal quarterly installments on the last day of each March, June, September and December of each year, beginning December 31, 2021, at a rate of 1.00 % per annum.

Borrowings under the Term Loan Facility will accrue interest at the London Interbank Offered Rate, or LIBOR, plus 2.25 % or at the base rate plus 1.50 %, subject to a 25 basis point step-down based on total gross leverage, and subject to a LIBOR floor of 50 basis points.

The base rate is the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the Wells Fargo Bank, National Association prime rate and (iii) the one-month LIBOR plus 1.00%.

Borrowings under the Term Loan Facility accrue interest at the SOFR, plus 2.25 %, or at the Base Rate plus 1.25 %, subject to a 25 basis point step-down based on total gross leverage, and subject to an Adjusted Term SOFR floor of 50 basis points.

The base rate is the highest of (i) the Federal Funds Rate plus 0.50 %, (ii) the Prime Rate and (iii) the one-month Adjusted Term SOFR plus 1.00 %.

The Term Loan Facility contains customary representations and warranties, affirmative and negative covenants and events of default, in each case consistent with the Credit Agreement.

The Term Loan Facility does not contain any financial covenant.

The Term Loan Facility does not contain any financial covenants.

The Term Loan Facility is subject to a 1.00% prepayment premium in the event all or any portion of the Term Loan Facility is prepaid within the first 6 months in connection with a repricing transaction only.

1 unchanged sentence

Debt issuance costs relating to the Term Loan Facility of $ 11.2 million, netted against the debt amount on the consolidated balance sheet, are amortized as interest expense over 96 months.

The total interest expense recorded on the Term Loan during fiscal 2022 was $ 10.4 million .

The total interest expense and amortization of the debt issuance costs recorded on the Term Loan Facility during fiscal 2023 and 2022 was $ 37.9 million and $ 11.2 million, respectively .

The following table presents the future principal payments related to our Senior Notes and Term Loan Facility in future fiscal years (in millions):

Term Loan Facility

As of the end of fiscal 2023 and 2022, our total debt is presented in our consolidated balance sheet as follows (in millions):

Issuance costs

Total debt, net of issuance costs

Issuance costs

Total debt, net of issuance costs

Current portion of long-term debt

Long-term debt

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Convertible Debt

3 unchanged sentences

The conversion rate was equal to 13.7267 shares per $ 1,000 principal amount of the Convertible Notes, which was the initial conversion rate of 13.6947 shares per $1,000 principal amount of the Convertible Notes plus a number of additional shares equal to 0.0320 shares per $1,000 principal amount of the Convertible Notes.

We elected to settle any conversions by Combination Settlement (as defined in the Convertible Notes Indenture) with a Specified Dollar Amount (as defined in the Convertible Notes Indenture) per $1,000 principal amount of Convertible Notes equal to $1,000, plus a number of shares of the our common stock, to be determined pursuant to the Convertible Notes Indenture, together with additional cash, if applicable, in lieu of delivering any fractional shares of common stock.

As a result of this election, on August 4, 2021, we settled or redeemed the remaining outstanding Convertible Notes for $ 505.6 million in cash representing the principal amount outstanding and delivered approximately 3.5 million shares in common stock from our treasury stock for additional amounts, resulting in a loss of approximately $ 8.1 million which is included in Interest and other expense, net on our condensed consolidated statements of income included elsewhere in this report.

Leases, Commitments and Contingencies

In fiscal 2020, we adopted Accounting Standards Codification Topic 842, or ASC 842, Leases, which requires recognition of ROU assets and lease liabilities for most leases on our consolidated balance sheet.

We adopted ASC 842 using a modified retrospective transition approach as of the effective date as permitted.

As a result, we were not required to adjust our comparative period financial information for effects of the standard or make the new required lease disclosures for the periods before the date of adoption.

We elected the package of practical expedients which allows us not to reassess (1) whether existing or expired contracts, as of the adoption date, contain leases, (2) the lease classification for existing leases, and (3) whether existing initial direct costs meet the new definition.

We also elected the practical expedient to not separate lease and non-lease components for our leases, and to not recognize ROU assets and liabilities for short-term leases.

The most significant impact of the adoption of the standard was the recognition of ROU assets and lease liabilities for operating leases on our consolidated balance sheet.

Adoption of the standard did not have a material impact on our consolidated statements of operations or cash flows.

We elected to settle any conversions by Combination Settlement (as defined in the Convertible Notes Indenture) with a Specified Dollar Amount (as defined in the Convertible Notes Indenture) per $1,000 principal amount of Convertible Notes equal to $1,000, plus a number of shares of our common stock, to be determined pursuant to the Convertible Notes Indenture, together with additional cash, if applicable, in lieu of delivering any fractional shares of common stock.

Our leases primarily include our headquarters office and worldwide office and research and development facilities which are all classified as operating leases.

1 unchanged sentence

The leases expire at various dates through fiscal year 2034 , some of which include options to extend the lease for up to seven years .

During fiscal

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

2022, we recorded approximately $ 12.7 million of operating leases expense.

During fiscal 2023 and 2022, we recorded approximately $ 12.0 million and $ 12.7 million of operating leases expense, respectively.

Our short-term leases are immaterial and we do not have finance leases.

5 unchanged sentences

Supplemental cash flow information related to leases is as follows (in millions):

Cash paid for operating leases included in operating

Supplemental non-cash information related to lease

liabilities arising from obtaining right-of-use assets

Cash paid for operating leases included in operating cash flows

Supplemental non-cash information related to lease liabilities arising from obtaining right-of-use assets

As of the end of fiscal 2023, the weighted average remaining lease term was 7.38 years, and the weighted average discount rate was 5.15 % .

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Future minimum lease payments for the operating lease liabilities are as follows (in millions):

1 unchanged sentence

Total lease liabilities

We recognized rent expense on a straight-line basis of $ 12.7 million, and $ 10.1 million for fiscal 2022 and 2021, respectively.

Sale and Leaseback Transaction

2 unchanged sentences

The transaction qualified for sale and leaseback and operating lease accounting classification, and we recorded a gain of $ 5.4 million which is recorded in the gain on sale and leaseback transaction line in the consolidated statements of operations.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Indemnifications and Contingencies

Legal proceedings

2 unchanged sentences

We accrue for loss contingencies when it is both probable that we will incur the loss and when we can reasonably estimate the amount of the loss or range of loss.

During the fourth quarter of fiscal 2023 , we accrued $ 4.0 million in relation to a contractual dispute with a vendor.

Contingencies

8 unchanged sentences

We have not recorded any liability in our consolidated financial statements for such indemnification obligations.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Stockholders’

15 unchanged sentences

Reserved for future issuance

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Treasury Stock

4 unchanged sentences

As of the end of fiscal 2023, we had $ 893.9 million of common stock remaining to be repurchased under our common stock repurchase program.

During fiscal 2022 and 2021, we issued 3.5 million and 0.1 million shares, respectively, from treasury stock for settlement of redemptions of our convertible notes.

Share-Based Compensation

18 unchanged sentences

As a result of approval by our stockholders of our amended and restated 2019 Incentive Plan on October 27, 2020, no new awards will be granted under the 2019 Inducement Equity Plan.

Our share-based compensation plans with outstanding awards consist of our 2010 Incentive Plan, our 2019 Incentive Plan, our 2019 Inducement Equity Plan, and our 2019 ESPP.

Share-based compensation awards available for grant or issuance for each plan as of the beginning of the fiscal year, including changes in the balance of awards available for grant for fiscal 2023, were as follows:

11 unchanged sentences

Balance at June 2023

Share-based compensation and the related tax benefit recognized in our consolidated statements of income for fiscal 2022, 2021, and 2020 were as follows (in millions):

Share-based compensation and the related tax benefit for our stock-based awards and our cash settled phantom stock units, which we granted in October 2019 (see Phantom Stock Units below) recognized in our consolidated statements of income for fiscal 2023, 2022, and 2021 were as follows (in millions):

Stock-based awards

Phantom Stock Units

Stock-based awards

Phantom Stock Units

Stock-based awards

Phantom Stock Units

Cost of revenue

4 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Included in the preceding table is share-based compensation for our cash-settled phantom stock units, which we granted in October 2019 (see Phantom Stock Units below) (in millions):

Cost of revenue

Research and development

Selling, general, and administrative

We recognize a tax benefit upon expensing certain share-based awards associated with our share-based compensation plans, including RSUs, market stock units, or MSUs, PSUs, and phantom stock units.

1 unchanged sentence

We compare the actual tax benefit associated with the tax deduction from share-based award activity to the hypothetical tax benefit based on the grant date fair values of the corresponding share-based awards.

Tax benefit associated with excess tax deduction creditable to income tax provision is recognized when incurred.

Tax deficiency associated with a tax shortfall is debited to income tax provision when incurred.

Tax benefit associated with excess tax deduction creditable to our income tax provision is recognized when incurred.

Tax deficiency associated with a tax deduction shortfall is debited to our income tax provision when incurred.

Historically, we have issued new shares in connection with our share-based compensation plans, however, treasury shares are also available for issuance.

11 unchanged sentences

The aggregate intrinsic value was determined using the closing price of our common stock on the last trading day of fiscal 2023, or June 23, 2023, of $ 81.16 .

All of the stock options outstanding were vested and in-the-money as of the end of fiscal 2022.

Cash received and the aggregate intrinsic value of stock options exercised for fiscal 2023, 2022, and 2021 were as follows (in millions):

1 unchanged sentence

Aggregate intrinsic value

There have been no stock options granted since fiscal 2018.

There was no unrecognized share-based compensation costs for stock options granted under our various plans.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Restricted Stock Units

5 unchanged sentences

Delivery of shares under the plans take place on the quarterly vesting dates.

At the delivery date, we withhold shares to cover applicable statutory minimum tax withholding for grantees subject to withholding and deliver a net quantity of shares to the grantee after such withholding.

At the delivery date, we withhold shares to cover applicable statutory tax withholding for grantees subject to withholding and deliver a net quantity of shares to the grantee after such withholding.

Until delivery of shares, the grantee has no rights as a stockholder with respect to any shares underlying the RSU award.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

RSU activity, including RSUs granted, delivered, and forfeited in fiscal 2023, and the balance and aggregate intrinsic value of RSUs as of the end of fiscal 2023 were as follows:

(in millions)

Balance at June 2022

Balance at June 2023

Of the shares delivered, 169,529 shares valued at $ 31.4 million were withheld to meet statutory tax withholding requirements.

The aggregate intrinsic value was determined using the closing price of our common stock on the last trading day of fiscal 2022, or June 24, 2022 , of $ 128.78 .

At the end of fiscal 2023, the aggregate intrinsic value of RSUs expected to vest was $ 105.9 million and the number of RSU awards expected to vest is 1.3 million shares.

Our closing stock price of $ 81.16 on the last day of trading in fiscal 2023 was used to calculate the intrinsic value for the RSUs.

The unrecognized share-based compensation cost for RSUs granted under our 2019 Incentive Plan, our 2019 Inducement Equity Plan and our 2010 Incentive Plan was approximately $ 122.7 million as of the end of fiscal 2023, which will be recognized over a weighted average period of approximately 1.84 years.

The aggregate market value of RSUs delivered in fiscal 2022, 2021, and 2020 was $ 106.4 million, $ 48.2 million, and $ 36.0 million, respectively.

Market Stock Units

6 unchanged sentences

and the fourth tranche (in the case of four-year vesting) vests based on a four-year performance period.

For MSU awards granted in fiscal 2023, performance is measured based on our achievement of a specified level of total stockholder return, or TSR, relative to the TSRs of each company in the Russell 2000 Index.

The potential payout ranges from 0 % to 300 % of the target grant quantity based on our TSR performance relative to the TSRs of each company in the Russell 2000 Index.

No payout will occur if our TSR performance falls below the 25th percentile of the TSRs of each company in the Russell 2000 Index, and a 300 % payout will occur if our TSR performance exceeds the 80th percentile of the TSRs of each company in the Russell 2000 Index.

Performance payouts between the 25th and 80th percentiles will be determined on a linear basis with performance at the 50th percentile equal to 100 % of target.

The first tranche and the second tranche can payout up to 300 %, and the payout for the third tranche will be calculated based on the total target quantity for the entire grant multiplied by the payout factor, based on performance for the three-year performance period, less shares issued for the first tranche and the second tranche, but not less than the third tranche target quantity multiplied by the final payout factor.

For MSU awards granted in fiscal 2022 and 2021, performance is measured based on our achievement of a specified level of total stockholder return, or TSR, relative to the TSRs of each company in the Russell 2000 Index.

2 unchanged sentences

Performance payouts between the 25th and 75th percentiles will be determined on a linear basis with performance at the 50th percentile equal to 100 % of target.

The first tranche and the second tranche can payout up to 200 %, and the payout for the third tranche will be calculated based on the total target quantity for the entire grant multiplied by the payout factor, based on performance for the three-year performance period, less shares issued for the first tranche and the second tranche, but not less than the third tranche target quantity multiplied by the final payout factor.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

For MSU awards granted in fiscal 2022 and 2021, the first tranche and the second tranche can payout up to 200 %, and the payout for the third tranche will be calculated based on the total target quantity for the entire grant multiplied by the payout factor, based on performance for the three-year performance period, less shares issued for the first tranche and the second tranche.

For outstanding MSU awards granted prior to fiscal 2021, performance is measured based on our achievement of a specified level of TSR relative to the TSR of the S&P Semiconductor Select Industry Index, or SPSISC Index.

The potential payout ranges from 0 % to 200 % of the target grant quantity and is adjusted on a two-to-one ratio based on our TSR performance relative to SPSISC Index TSR.

For MSU awards granted prior to fiscal 2021 and vesting over three years, the payout for the first tranche and the second tranche will not exceed 100 % and the payout for the third tranche will be calculated based on the total target quantity for the entire grant multiplied by the payout factor, based on performance for the three-year performance period, less shares issued for the first tranche and the second tranche.

For MSUs vesting over four years, the payout for the first tranche, the second tranche and the third tranche will not exceed 100 % and the payout for the fourth tranche will be calculated based on the total target quantity for the entire grant multiplied by the payout factor, based on performance for the four-year performance period, less shares issued for the first tranche, the second tranche and the third tranche.

For outstanding MSU awards granted in fiscal 2020, performance is measured based on our achievement of a specified level of TSR relative to the TSR of the S&P Semiconductor Select Industry Index, or the Index.

The potential payout ranges from 0 % to 200 % of the target grant quantity and is adjusted on a two-to-one ratio based on our TSR performance relative to the Index.

The payout for the first tranche, the second tranche and the third tranche will not exceed 100 % and the payout for the fourth tranche will be calculated based on the total target quantity for the entire grant multiplied by the payout factor, based on performance for the four-year performance period, less shares issued for the first tranche, the second tranche and the third tranche.

Delivery of shares earned, if any, will take place on the dates provided in the applicable MSU grant agreement, assuming the grantee is still an employee, consultant, or director of our company at the end of the applicable performance period.

2 unchanged sentences

MSU activity, including MSUs granted, delivered, and forfeited in fiscal 2023, and the balance and aggregate intrinsic value of MSUs as of the end of fiscal 2023 were as follows:

(in millions)

Balance at June 2022

1 unchanged sentence

Balance at June 2023

As a result of the Synaptics TSR outperforming the Index TSR by 185.21 percentage points for the tranche three payout period ended in fiscal 2022, we delivered 200 % of the targeted shares underlying the fiscal 2019 MSU grants.

As a result of the Synaptics TSR outperforming the Index TSR by 226.12 percentage points for the tranche two payout period ended in fiscal 2022, we delivered 100 % of the targeted shares underlying the fiscal 2020 MSU grants as the tranche two payout is capped at a 100% payout.

As a result of the Synaptics TSR performing at the 76 th percentile relative to the constituents of the Russell 2000 Index for the tranche one payout period ended in fiscal 2022, we delivered 200 % of the targeted shares underlying the fiscal 2021 MSU grants.

Of the shares delivered, 105,719 shares valued at $ 18.3 million were withheld to meet statutory minimum tax withholding requirements.

The aggregate intrinsic value assumes a 100 % payout factor and was determined using the closing price of our common stock on the last trading day of fiscal 2022, or June 24, 2022 , of $ 128.78 .

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As a result of Synaptics achieving the 80 th percentile relative to the remaining constituents in the Russell 2000 Index, we delivered 200 % of the targeted shares underlying tranche one of the fiscal 2022 MSU grants.

As a result of Synaptics achieving the 84 th percentile relative to the remaining constituents in the Russell 2000 Index, we delivered 200 % of the targeted shares underlying tranche two of the fiscal 2021 MSU grants.

As a result of the Synaptics TSR outperforming the Index TSR by 84.53 percentage points for the tranche three performance period, we delivered 200 % of the targeted shares underlying the fiscal 2020 MSU grants, less shares issued for the first tranche and second tranche.

At the end of fiscal 2023, the aggregate intrinsic value of MSUs expected to vest was $ 18.5 million and the number of MSU awards expected to vest is 0.2 million shares.

Our closing stock price of $ 81.16 on the last day of trading in fiscal 2023 was used to calculate the intrinsic value for the MSUs.

The fair value of each MSU granted from our plans for fiscal 2023, 2022, and 2021 was estimated at the date of grant using the Monte Carlo simulation model, assuming no expected dividends and the following assumptions:

Expected volatility of company

45.46 % - 52.55 %

Expected volatility of Index

5 unchanged sentences

Risk-free interest rate

0.26 % - 1.52 %

Fair value per award

5 unchanged sentences

Performance Stock Units

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our 2019 Incentive Plan and our 2010 Incentive Plan provide for the grant of PSU awards to our employees, consultants, and directors.

2 unchanged sentences

Generally, PSU awards have a specific one-year performance period and vesting occurs over three service periods with the final service period ending approximately three years from the grant date.

Performance is measured based on the achievement of a specified level of performance relative to predefined performance criteria (for PSU awards granted in fiscal 2022 and prior to fiscal 2021 the performance criteria is based on non-GAAP earnings per share, for PSU awards granted in fiscal 2021 the performance criteria is based on a combination of our design win revenue, non-GAAP gross margin percentage and non-GAAP operating expenses).

For our fiscal 2022 PSU awards, the potential payout ranges from 0 % to 200 % of the target grant quantity and is adjusted on a linear basis with a payout triggering if our measurement results equals greater than 75 % of the target with a maximum payout achieved at 125 % of target.

Performance is measured based on the achievement of a specified level of performance relative to predefined performance criteria (for PSU awards granted in fiscal 2023 and 2022 , the performance criteria was based on non-GAAP earnings per share, for PSU awards granted in fiscal 2021 the performance criteria was based on a combination of our design win revenue, non-GAAP gross margin percentage and non-GAAP operating expenses).

For our fiscal 2023 PSU awards, the potential payout ranges from 0 % to 200 % of the target grant quantity and is adjusted on a linear basis with a payout triggering if our measurement results are greater than 65 % of the target with a maximum payout achieved at 135 % of target.

Delivery of shares earned, if any, will take place on the dates provided in the applicable PSU grant agreement, assuming the grantee is still an employee, consultant, or director of our company at the end of the applicable service period.

2 unchanged sentences

PSU activity, including PSUs granted, delivered, and forfeited in fiscal 2023, and the balance and aggregate intrinsic value of PSUs as of the end of fiscal 2023 were as follows:

(in millions)

Balance at June 2022

2 unchanged sentences

We value PSUs using the aggregate intrinsic value on the grant date and amortize the compensation expense over the three-year service period on a ratable basis, dependent upon the probability of meeting the performance measures.

Of the shares delivered, 94,642 shares valued at $ 17.6 million were withheld to meet statutory minimum tax withholding requirements.

The PSU awards outstanding balance at June 2022 is based on the target grant quantity and does not include the performance adjustment of 183,472 shares for completed performance periods.

The unrecognized share-based compensation cost of our

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

outstanding PSUs was approximately $ 31.7 million as of June 25, 2022 , which will be recognized over a weighted average period of approximately 0.72 years.

The PSU awards outstanding balance at June 2023 is based on the target grant quantity and does not include any performance adjustment of shares for completed performance periods.

At the end of fiscal 2023, the aggregate intrinsic value of PSUs expected to vest was $ 20.6 million and the number of PSU awards expected to vest is 0.2 million shares.

Our closing stock price of $ 81.16 on the last day of trading in fiscal 2023 was used to calculate the intrinsic value for the PSUs.

The unrecognized share-based compensation cost of our outstanding PSUs was approximately $ 3.3 million as of June 2023, which will be recognized over a weighted average period of approximately 0.67 years.

Phantom Stock Units

The 2019 Incentive Plan authorizes the grant of phantom stock units to non-employee directors, officers and employees.

The 2019 Incentive Plan authorized the grant of phantom stock units to non-employee directors, officers and employees.

We initially granted phantom stock units in October 2019.

Phantom stock units are cash-settled and entitle the recipient to receive a cash payment equal to the value of a single share for each unit based on the average closing share price of our stock over the thirty calendar days prior to the vesting date.

Grants of phantom stock units vest over three years , with an annual vesting date of October 31 each year subsequent to the grant date.

We recognize compensation expense for phantom stock units on a straight-line basis for each tranche of each award based on the average closing price of our common stock over the thirty calendar days ended prior to each balance sheet date.

The outstanding phantom stock units had a fair value of $ 135.07 per unit at June 25, 2022 and our accrued liability for such units was $ 15.4 million.

The outstanding phantom stock units had a fair value of $ 140.17 per unit at June 26, 2021 and our accrued liability for such units was $ 18.4 million.

Phantom stock units were cash-settled and entitled the recipient to receive a cash payment equal to the value of a single share for each unit based on the average closing share price of our stock over the thirty calendar days prior to the vesting date.

Grants of phantom stock units vested over three years , with an annual

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

vesting date of October 31 each year subsequent to the grant date.

The final vesting occurred on October 31, 2022, and no phantom stock units remain outstanding under this plan.

Phantom stock activity was as follows:

(in millions)

Balance as of June 2022

1 unchanged sentence

Employee Stock Purchase Plan

Our 2019 ESPP became effective October 29, 2019 and replaced our 2010 ESPP.

The 2019 ESPP, and previously the 2010 ESPP, allows employees to designate up to 15 % of their base compensation, subject to legal restrictions and limitations, to purchase shares of common stock at 85 % of the lesser of the FMV at the beginning of the offering period or the exercise date.

Our 2019 ESPP allows employees to designate up to 15 % of their base compensation, subject to legal restrictions and limitations, to purchase shares of common stock at 85 % of the lesser of the FMV at the beginning of the offering period or the exercise date.

Under the 2019 ESPP, the offering period extends for up to one year and includes two exercise dates occurring at six-month intervals.

Under the 2010 ESPP, the offering period extended for up to two years and included four exercise dates occurring at six-month intervals.

Under the terms of our 2019 ESPP, and previously under our 2010 ESPP, if the FMV at an exercise date is less than the FMV at the beginning of the offering period, the current offering period will terminate and a new offering period will commence.

Under the terms of our 2019 ESPP, if the FMV at an exercise date is less than the FMV at the beginning of the offering period, the current offering period will terminate and a new offering period will commence.

Shares purchased, weighted average purchase price, cash received, and the aggregate intrinsic value for employee stock purchase plan purchases in fiscal 2023, 2022, and 2021 were as follows (in millions, except shares purchased and weighted average purchase price):

3 unchanged sentences

Aggregate intrinsic value

The fair value of each award granted under our 2019 ESPP and our 2010 ESPP for fiscal 2022, 2021, and 2020 was based on the Black-Scholes option pricing model.

The fair value of each award granted under our 2019 ESPP for fiscal 2023, 2022, and 2021 was based on the Black-Scholes option pricing model.

The fair value per award for fiscal 2023, 2022 and 2021 was $ 40.70 , $ 38.93 and $ 20.82 , respectively.

5 unchanged sentences

contributions, excluding catch-up contributions.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The employer matching funds vest immediately.

3 unchanged sentences

Income before provision for income taxes

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The provision for income taxes for fiscal 2023, 2022, and 2021 consisted of the following (in millions):

11 unchanged sentences

Foreign tax differential

Foreign income inclusion

inclusion of foreign income

Deferred taxes on unremitted foreign earnings

4 unchanged sentences

Non-current deferred tax assets and non-current deferred tax liabilities are included in “Non-current other assets”

and “Other long-term liabilities”, respectively, on our consolidated balance sheets.

and “Other long-term liabilities,”

respectively, on our consolidated balance sheets.

Significant components of our deferred tax assets (liabilities) as of the end of fiscal 2023 and 2022 consisted of the following (in millions):

5 unchanged sentences

Nondeductible interest

Business credit carryforward

Lease liabilities

Business credit carryforward

Net operating loss carryforward

7 unchanged sentences

Net deferred tax assets

The fiscal 2022 capital loss carryforward deferred tax asset and its corresponding valuation allowance includes a reclassification adjustment of $ 16.0 million to conform to the current period presentation.

This reclassification had no impact on previously reported deferred tax assets.

Realization of deferred tax assets depends on our generating sufficient U.S.

3 unchanged sentences

As of the end of fiscal 2023, a valuation allowance of $ 78.4 million was maintained to reduce deferred tax assets primarily related to state tax credits and capital losses carryforwards that are not more likely than not to be realized through future taxable income.

The net change in the valuation allowance during fiscal 2022 was an increase of $ 26.4 million, primarily due to an increase of unrealized deferred tax assets associated with the capital loss carryforwards from our DSPG acquisition..

The net change in the valuation allowance during fiscal 2023 was an increase of $ 3.4 million, primarily due to an increase of unrealized deferred tax assets associated with state tax credits.

We consider most of the earnings of our foreign subsidiaries as not indefinitely reinvested overseas and have made appropriate provisions for income or withholding taxes, that may result from a future repatriation of those earnings.

Further, we determined not to indefinitely reinvest earnings of certain subsidiaries acquired as part of our DSPG acquisition and established a $ 17.9 million deferred tax liability on the acquisition date balance sheet.

As a result, $ 14.3 million of our deferred tax liability is associated with unremitted foreign earnings, which if remitted would not result in a further provision for income taxes.

3 unchanged sentences

As of our fiscal 2023 , assuming full utilization of the associated foreign tax credits, the potential net deferred tax liability associated with these undistributed earnings and outside basis differences would be approximately $ 46 million.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of the end of fiscal 2023 , we had federal, California, and foreign net operating loss carryforwards of approximately $ 28.7 million, $ 25.0 million, and $ 49.6 million, respectively.

4 unchanged sentences

The federal research tax credit carryforward will begin to expire in 2029 and the state research tax credit can be carried forward indefinitely.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The total liability for gross unrecognized tax benefits related to uncertain tax positions, included in other liabilities in our consolidated balance sheets, increased by $ 13.9 million from $ 29.8 million in fiscal 2022 to $ 43.7 million in fiscal 2023.

Of this amount, $ 19.6 million will reduce the effective tax rate on income from continuing operations, if recognized.

Of this amount, $ 33.1 million will reduce the effective tax rate on income from operations, if recognized.

A reconciliation of the beginning and ending balance of gross unrecognized tax benefits for fiscal 2023, 2022, and 2021 consisted of the following (in millions):

2 unchanged sentences

Increase in unrecognized tax benefits related to prior year tax

Decrease due to effective settlement with tax authorities

Remeasurement of unrecognized tax benefits

1 unchanged sentence

Ending Balance

Accrued interest and penalties increased by $ 0.8 million in fiscal 2022 as compared to fiscal 2021 and decreased by $ 0.2 million in fiscal 2021 as compared to fiscal 2020.

Accrued interest and penalties inc reased by $ 0.5 million in fiscal 2023 as compared to fiscal 2022 and increased by $ 0.8 million in fiscal 2022 as compared to fiscal 2021 .

Accrued interest and penalties were $ 3.0 million and $ 2.5 million as of the end of fiscal 2023and 2022, respectively.

6 unchanged sentences

From fiscal 2017 onward, we remain subject to examination by one or more of these jurisdictions.

In January 2022, final foreign tax credit regulations, final regulations, were issued by the U.S.

Treasury modifying long established rules, including rules used in the determination of whether foreign taxes paid or accrued are creditable against U.S.

income taxes.

Subsequently, in July 2022, technical corrections and amendments to the final regulations were issued by the U.S.

These technical corrections and amendments do not change our initial view that certain foreign taxes we incur may not be creditable under the final regulations.

We are currently assessing the impact of the final regulations, together with certain research and development capitalization rules, all effective beginning with our fiscal 2023, but anticipate the impact will have a material adverse effect on our fiscal 2023 and future provision for income taxes.

Segment, Customers, and Geographic Information

3 unchanged sentences

the IoT product applications market, the personal computing, or PC, product applications market, and the mobile, product applications market.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The chief executive officer was identified as the chief operating decision maker, or CODM, and is ultimately responsible for and actively involved in the allocation of resources and the assessment of our performance.

The fact that we operate in only one reportable segment is based on the following:

Our organizational structure is based along functional lines.

Each of the functional department heads reports directly to the CODM.

The assessments of our performance company-wide, including assessment of our incentive compensation plan, are based largely on our operational performance and consolidated financial performance.

The decisions on allocation of resources and other operational decisions are made by the CODM based on his direct involvement with our operations and product development.

Net revenue within geographic areas based on our customers’

1 unchanged sentence

United States

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Net revenue from external customers for each group of similar products for fiscal 2023, 2022, and 2021 consisted of the following (in millions):

2 unchanged sentences

Mobile product applications

A reclassification has been made to the prior periods revenue presentation in the above table in order to conform to the current period revenue presentation.

The reclassification o f $ 32.0 million and $ 12.2 million during the fiscal years ended 2021 and 2020, respectively, moved virtual reality product revenue from Mobile product applications to IoT product applications.

Long-lived assets within geographic areas as of the end of fiscal 2023 and 2022 consisted of the following (in millions):

United States

The fiscal 2022 long-lived assets reported in the above table includes a reclassification of approximately $ 428.0 million to conform to the current period presentation.

The reclassification relates to goodwill and intangible assets previously reported within the Asia Pacific region that are now presented within the EMEA region.

This reclassification had no impact on previously reported geographic long-lived assets.

Our goodwill of $ 816.4 million has been allocated to two reporting units which include IoT and Mobile/PC.

7 unchanged sentences

Balance, end of period

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

During fiscal 2023 , no restructuring charges were recorded.

During fiscal 2022, we recorded restructuring and related charges of $ 18.3 million in our consolidated statements of operations.

4 unchanged sentences

The activities from the restructuring actions taken during fiscal 2021 were complete as of the end of fiscal 2021.

SYNAPTICS INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Subsequent Events

In July 2023, we entered into an agreement with Avago Technologies International Sales PTE.

Limited, or Broadcom, to acquire certain developed technology intangible assets from Broadcom for an aggregate consideration of $ 130.0 million.

We are still in the process of evaluating the proper accounting treatment under Topic 805 on Business Combinations.

On July 21, 2023, the IRS issued Notice 2023-55 which generally allows taxpayers to defer application of elements of the 2022 foreign tax credit final regulations, and related guidance, until 2024.

In our case, foreign taxes which were creditable under the prior regulations will continue to be creditable for our fiscal 2023.

As this Notice was issued subsequent to our fiscal 2023 and represents a retroactive change in tax law, we anticipate recording a discrete tax benefit in the first quarter of fiscal 2024 in the amount of approximately $ 12 million.

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 9A. Controls and Procedures