What changed in this filing

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Item 1A. Risk Factors

2025-01-30 compared with 2024-11-07 · 80 added, 59 removed, 451 unchanged (24% of the section changed)

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• We are subject to a number of risks associated with the sale of our former RF Business, and these risks could adversely impact our operations, financial condition and business.

– Risks associated with our capital structure

• We have outstanding debt which could materially restrict our business and adversely affect our financial condition, liquidity and results of operations.

– Risks associated with cybersecurity, intellectual property and litigation

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– General risk factors

• We have outstanding debt which could materially restrict our business and adversely affect our financial condition, liquidity and results of operations.

• We have been subject to shareholder activism and may be subject to such activism in the future.

Risks related to our global operations, including global macroeconomic and market risks

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Uncertainty about global economic conditions could result in customers postponing purchases of our products and services in response to tighter credit, unemployment, negative financial news, higher interest rates and/or declines in income or asset values and other macroeconomic factors, which could have a material negative effect on demand for our products and services and, accordingly, on our business, results of operations or financial condition.

For example, current global financial markets continue to reflect uncertainty, including, as a result of the ongoing military conflict between Russia and Ukraine and the ongoing conflicts in the Middle East, as well as a slowdown of the economy in China, which has impacted and could continue to impact demand for our products used in industrial and energy applications.

For example, current global financial markets continue to reflect uncertainty, including as a result of the ongoing military conflict between Russia and Ukraine and the ongoing conflicts in the Middle East, as well as ongoing trade tensions between certain countries including the U.S.

and China, which has impacted and could continue to impact demand for our products.

Given these uncertainties, there could be further disruptions to the global economy, financial markets and consumer confidence.

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Economic slowdowns or recessions and inflationary pressures could have a negative impact on our business, including decreased demand, increased costs, and other challenges.

Government actions to address economic slowdowns and increased inflation, including increased interest rates, also could result in negative impacts to our growth.

Government actions to address economic slowdowns and increased inflation, including elevated interest rates, also could result in negative impacts to our growth.

General trade tensions between the United States and China continue, and any economic and political uncertainty caused by the United States tariffs imposed on goods from China, among other potential countries, and any corresponding tariffs or currency devaluations from China or such other countries in response, has negatively impacted, and may in the future negatively impact, demand and/or increase the cost for our products.

The Trump administration has signaled the potential imposition of tariffs and retaliatory tariffs against U.S.

trading partners, including a 60% tariff on goods from China.

Additionally, Russia’s invasion of Ukraine in early 2022 triggered significant sanctions from the United States and European countries.

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Although we believe we have adequate liquidity and capital resources to fund our operations for at least the next 12 months, we expect to need additional funding to fully complete all of our intended expansion initiatives, which we may seek to obtain through, among other avenues, government funding, equity offerings or other non-debt funding sources, and debt financings (which may involve retiring, refinancing or modifying some of our existing debt).

As discussed in Note 14, "Subsequent Events," to our unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report, in connection with the PMT we entered into with the United States Department of Commerce for proposed direct capital grants under the CHIPS Act, we have agreed to raise additional capital from non-debt sources over the next 12 months and to restructure or refinance our outstanding convertible notes at specified intervals.

In connection with the PMT we entered into with the United States Department of Commerce on October 11, 2024 for proposed direct capital grants under the CHIPS Act, we have agreed to raise additional capital from non-debt sources over the next 12 months and to restructure or refinance our outstanding convertible notes at specified intervals.

If unfavorable capital market conditions exist, we may not be able to raise sufficient capital or restructure or refinance our outstanding convertible notes on favorable terms and on a timely basis, if at all, which would impact our ability to access government funds and issue additional 2030 Senior Notes.

If we issue equity or convertible debt securities to raise additional funds, our existing shareholders may experience dilution and the new equity or debt securities may have rights, preferences and privileges senior to those of our then-existing shareholders.

As discussed in Note 14, "Shareholders' Equity," to our unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report, we sold 27.8 million shares of common stock under the ATM Program, and if we further issue equity or convertible debt securities to raise additional funds, our existing shareholders may experience dilution and the new equity or debt securities may have rights, preferences and privileges senior to those of our then-existing shareholders.

If we incur additional debt, it may impose financial and operating covenants that could restrict the operations of our business.

In a rising interest rate environment, debt financing will become more expensive and may have higher transactional and servicing costs.

In a rising interest rate environment, debt financing would become more expensive and could have higher transactional and servicing costs.

In addition, our existing indebtedness may limit our ability to obtain additional financing in the future.

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• the burden of complying with foreign and international laws and treaties.

For example, the United States has imposed significant tariffs on Chinese-made goods, which the Biden administration has largely left in place, and in certain instances increased or proposed to increase such tariffs.

For example, the United States has imposed significant tariffs on Chinese-made goods and President Trump has indicated that he would seek to impose additional significant tariffs on goods from China, among other potential tariffs against U.S.

trading partners.

The tariffs imposed on Chinese goods, among other potential countries and any corresponding tariffs from China or such other countries in response has, and may in the future, negatively impact demand and/or increase the costs for our products.

In some instances, we have received and may continue to receive incentives from foreign governments to encourage our investment in certain countries, regions or areas outside of the United States.

Government incentives may include tax rebates, reduced tax rates, favorable lending policies and other measures, some or all of which may be available to us due to our foreign operations.

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These same governments also may provide increased incentives to or require production processes that favor local companies, which could further negatively impact our business and results of operations.

Changes in regulatory, geopolitical, social, economic, or monetary policies and other factors, including those which may result from the outcome of the 2024 United States Presidential election, if any, may have a material adverse effect on our business in the future, or may require us to exit a particular market or significantly modify our current business practices.

Changes in regulatory, geopolitical, social, economic, or monetary policies and other factors, including those which may result under the new U.S.

presidential administration, if any, may have a material adverse effect on our business in the future, or may require us to exit a particular market or significantly modify our current business practices.

Abrupt political change, terrorist activity and armed conflict pose a risk of general economic disruption in affected countries, which could also result in an adverse effect on our business and results of operations.

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In order to manage our growth and business strategy effectively relative to the uncertain pace of adoption, we must continue to:

• maintain, expand, construct and purchase adequate manufacturing facilities and equipment, as well as secure sufficient third-party manufacturing resources, to meet customer demand, including specifically the expansion of our silicon carbide capacity with the ramping of our state-of-the-art, automated 200mm capable silicon carbide device fabrication facility in New York, an expansion of our materials factory in Durham, North Carolina and the construction of a new materials manufacturing facility in Siler City, North Carolina;

• complete comprehensive due diligence, negotiate and finalize award documentation and the intercreditor agreement with the Department of Commerce, and fulfill all conditions, requirements and milestones for and receive the expected benefits from capital grants through the CHIPS Act;

• access capital markets to fund our growth initiatives, including our ongoing and planned capacity expansions, and to satisfy conditions relating to availability of government funding based on the PMT and access to additional funds under the 2030 Senior Notes Indenture;

• confirm our eligibility for and receive the expected benefits from refundable income tax credits through the CHIPS Act, and receive and potentially sell any tax credits for which we may apply under the IRA;

• maintain, expand, construct and purchase adequate manufacturing facilities and equipment, as well as secure sufficient third-party manufacturing resources, including specifically the expansion of our silicon carbide capacity with the ramping of our state-of-the-art, automated 200mm capable silicon carbide device fabrication facility in New York and the construction of a new materials manufacturing facility in Siler City, North Carolina;

• confirm our eligibility for and receive the expected benefits from refundable income tax credits through the CHIPS Act;

• meet our production capacity and delivery commitments to our customers, including those customers who provide us with capacity reservation deposits or similar payments;

• manage an increasingly complex supply chain (including managing the impacts of ongoing supply constraints in the semiconductor industry and meeting purchase commitments under take-or-pay arrangements with certain suppliers) that has the ability to supply an increasing number of raw materials, subsystems and finished products with the required specifications and quality, and deliver on time to our manufacturing facilities, our third-party manufacturing facilities, our logistics operations, or our customers;

• manage an increasingly complex supply chain and meeting purchase commitments under take-or-pay arrangements with certain suppliers that has the ability to supply an increasing number of raw materials, subsystems and finished products with the required specifications and quality, and deliver on time to our manufacturing facilities, our third-party manufacturing facilities, our logistics operations, or our customers;

• expand the skills and capabilities of our current management team;

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Our failure to conclude definitive agreements for any reason or to meet operational or financial milestones required to receive final awards could make it more difficult to maintain our liquidity requirements and could create a negative perception or reputational concern with respect to us and our business.

In addition, there is uncertainty regarding the impact of the Trump administration's policies with respect to the semiconductor industry and government funding, tax credits and tariffs.

Any of the above factors could have a material adverse effect on our business, results of operations or financial condition.

We are also increasingly dependent on information technology to enable us to improve the effectiveness of our operations and to maintain financial accuracy and efficiency.

Allocation and effective management of the resources necessary to successfully

implement, integrate, train personnel and sustain our information technology platforms will remain critical to ensuring that we are not subject to transaction errors, processing inefficiencies, loss of customers or suppliers, business disruptions or loss of or damage to intellectual property through a security breach in the near term.

Allocation and effective management of the resources necessary to successfully implement, integrate, train personnel and sustain our information technology platforms will remain critical to ensuring that we are not subject to transaction errors, processing inefficiencies, loss of customers or suppliers, business disruptions or loss of or damage to intellectual property through a security breach in the near term.

Additionally, we face these same risks if we fail to allocate and effectively manage the resources necessary to build, implement, upgrade, integrate and sustain appropriate technology infrastructure over the longer term.

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Additionally, if product demand decreases or if we fail to forecast demand decreases or changes accurately, we may experience a mismatch between current product demand and manufactured product mix, adversely impacting our results, including due to higher costs resulting from lower factory utilization, causing higher fixed costs per unit produced.

For example, in fiscal and calendar 2024, we and other semiconductor companies experienced and have continued to experience softer demand for power products in industrial and energy applications than expected.

For example, in fiscal 2024 and the first half of fiscal 2025, we and other semiconductor companies experienced and have continued to experience softer demand for our products than expected.

In response, we adjusted our production mix in our North Carolina fab to manufacture power products for automotive applications, which have higher unit costs in this fab.

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We generally purchase these sole or limited source items with purchase orders, and we have limited guaranteed supply arrangements with such suppliers, including take-or-pay arrangements and capacity reserve deposit agreements.

Some of our sources can have variations in attributes and availability which can affect our ability to produce products in sufficient volume or

Some of our sources can have variations in attributes and availability which can affect our ability to produce products in sufficient volume or quality.

We do not control the time and resources that these suppliers devote to our business, and we cannot be sure that these suppliers will perform their obligations to us.

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We evaluate inventory levels in the distribution channel, current economic trends and other related factors in order to account for these factors in our judgments and estimates.

As inventory levels and

product return trends change or we make changes to our distributor roster, we may have to revise our estimates and incur additional costs, and our gross margins and operating results could be adversely impacted.

As inventory levels and product return trends change or we make changes to our distributor roster, we may have to revise our estimates and incur additional costs, and our gross margins and operating results could be adversely impacted.

We depend on a limited number of customers, including distributors, for a substantial portion of our revenue, and the loss of, or a significant reduction in purchases by, one or more of these customers could adversely affect our operating results.

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Success in promoting and enhancing brand value depends in large part on our ability to provide high-quality products.

Brand value could diminish significantly due to a number of factors, including adverse publicity about our products (whether valid or not), a failure to maintain the quality of our products (whether perceived or real), the failure of our products to deliver consistently positive consumer experiences, the products becoming unavailable to consumers or consumer perception that we have acted in an irresponsible manner.

Brand value could diminish significantly due to a number of factors, including adverse publicity

about our products (whether valid or not), a failure to maintain the quality of our products (whether perceived or real), the failure of our products to deliver consistently positive consumer experiences, the products becoming unavailable to consumers or consumer perception that we have acted in an irresponsible manner.

Damage to our brand, reputation or loss of customer confidence in our brand or products could result in decreased demand for our products and have a negative impact on our business, results of operations or financial condition.

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If failures or defects occur, they could result in significant losses or product recalls.

A significant product recall

could also result in adverse publicity, damage to our reputation and a loss of customer confidence in our products.

A significant product recall could also result in adverse publicity, damage to our reputation and a loss of customer confidence in our products.

We also may be the target of product liability lawsuits against us if the use of our products at issue is determined to have caused injury or contained a substantial product hazard.

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(IDEAL) and on March 1, 2021, we completed the sale of our former LED Products business unit (the LED Business) to SMART Global Holdings, Inc.

We are subject to risks associated with these transactions, including risks associated with any required payments of indemnification obligations under the Purchase Agreement with IDEAL and the Asset Purchase Agreement with SGH for retained liabilities and breaches of representations, warranties or covenants.

We are subject to risks associated with these transactions, including risks associated with any required

payments of indemnification obligations under the Purchase Agreement with IDEAL and the Asset Purchase Agreement with SGH for retained liabilities and breaches of representations, warranties or covenants.

As a result, we may be unable to realize the anticipated benefits of these transactions.

Our failure to realize the anticipated benefits of these transactions would adversely impact our financial condition and could limit our ability to pursue additional strategic transactions.

Risks associated with our capital structure

We have outstanding debt which could materially restrict our business and adversely affect our financial condition, liquidity and results of operations.

As of December 29, 2024, our indebtedness consisted of $575.0 million aggregate principal amount of our 2026 Notes, $750.0 million aggregate principal amount of our 0.25% convertible senior notes due February 15, 2028 (the 2028 Notes), $1,750.0 million aggregate principal amount of our 1.875% convertible senior notes due December 1, 2029 (the 2029 Notes, and together with the 2026 Notes and the 2028 Notes, the Outstanding Convertible Notes) and $1,250.0 million aggregate principal amount of 2030 Senior Notes and an aggregate principal amount of $2,000.0 million of deposits under the CRD Agreement with Renesas America.

As discussed in Note 9, "Long-term Debt," to our unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report, on October 15, 2024, we entered into the 2030 Senior Notes Indenture which amends certain terms and conditions of the 2030 Senior Notes and permits us to issue and sell $750.0 million of additional notes, subject to the fulfillment of certain conditions.

On October 22, 2024, we issued an additional $250.0 million of 2030 Senior Notes.

Our ability to pay interest and repay the principal for any outstanding indebtedness under the Outstanding Convertible Notes, the 2030 Senior Notes and the CRD Agreement is dependent upon our ability to manage our business operations and generate sufficient cash flows to service such debt.

There can be no assurance that we will be able to manage any of these risks successfully.

The level of our outstanding debt may adversely affect our operating results and financial condition by, among other things:

• increasing our vulnerability to downturns in our business, to competitive pressures and to adverse general economic and industry conditions;

• requiring the dedication of an increased portion of our expected cash flows from operations to service our indebtedness, thereby reducing the amount of expected cash flow available for other purposes, including capital expenditures, or research and development;

• limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

• placing us at a competitive disadvantage compared to our peers that may have less indebtedness than we have by limiting our ability to borrow additional funds needed to operate and grow our business;

• increasing our interest expense if interest rates increase.

The 2030 Senior Notes Indenture includes a liquidity maintenance financial covenant requiring us to have an aggregate amount of unrestricted cash and cash equivalents maintained in accounts over which the trustee and collateral agent for the 2030 Senior Notes has been granted a perfected first lien security interest of at least $630 million as of the last day of any calendar month ending on or prior to March 31, 2025 and (b) $750 million as of April 1, 2025 and as of the last day of any calendar month ending thereafter, which amount will be reduced over time upon the fulfillment of certain conditions.

In addition, the 2030 Senior Notes Indenture contains certain restrictions that could limit our ability to, among other things:

incur additional indebtedness, dispose of assets, create liens on assets, make acquisitions or engage in mergers or consolidations, and engage in certain transactions with our subsidiaries and affiliates.

The 2030 Senior Notes Indenture also requires us to make an offer to repurchase the 2030 Senior Notes with 100% of the net cash proceeds of certain non-ordinary course asset sales and casualty events, subject to the ability to reinvest the proceeds of such casualty events and asset sales (subject to certain limitations), or upon a change of control.

The Indentures governing the Outstanding Convertible Notes (the Convertible Notes Indentures) require us to repurchase the Outstanding Convertible Notes upon certain fundamental changes relating to our common stock, and also prohibit our consolidation, merger, or sale of all or substantially all of our assets except with or to a successor entity assuming our obligations under the Indentures.

The CRD Agreement contains certain restrictions on our ability to incur debt and liens, consummate non-arm’s-length transactions with affiliates, consummate mergers and consolidations whereby obligations under the CRD Agreement are not assumed, and change the nature of our business.

The restrictions imposed by the 2030 Senior Notes Indenture, the Convertible Notes Indentures, and the CRD Agreement could limit our ability to plan for or react to changing business conditions, or could otherwise restrict our business activities and plans.

Our ability to comply with the provisions of the 2030 Senior Notes Indenture, the Convertible Notes Indentures, and the CRD Agreement may also be affected by events beyond our control and if any of these restrictions or terms is breached, it could lead to an event of default under the 2030 Senior Notes, the Outstanding Convertible Notes, and the CRD Agreement.

A default, if not cured or waived, may permit acceleration of our indebtedness.

In addition, our lenders could terminate their commitments to

make further loans under the 2030 Senior Notes Indenture or the CRD Agreement.

If our indebtedness is accelerated, we cannot be certain that we will have sufficient funds to pay the accelerated indebtedness or that we will have the ability to refinance accelerated indebtedness on terms favorable to us or at all.

The capped call transactions may not prevent dilution of our common stock upon conversion of the 2028 Notes or the 2029 Notes.

In connection with the pricing of the 2028 Notes and the 2029 Notes, we entered into privately negotiated capped call transactions with the option counterparties.

The capped call transactions are expected generally to reduce the potential dilution to our common stock upon any conversion of the 2028 Notes and 2029 Notes and/or offset any potential cash payments we are required to make in excess of the principal amount of the converted 2028 Notes and 2029 Notes, as the case may be, upon conversion of the 2028 Notes and 2029 Notes.

If, however, the market price per share of our common stock, as measured under the terms of the capped call transactions, exceeds the cap price of the capped call transactions ($212.04 for the 2028 Notes and $202.538 for the 2029 Notes), there would nevertheless be dilution and/or there would not be an offset of such potential cash payments, in each case, to the extent that such market price exceeds the cap price of the capped call transactions.

Risks associated with cybersecurity, intellectual property and litigation

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Litigation could adversely affect our operating results and financial condition.

We are often involved in litigation, primarily patent litigation, such as our patent dispute with The Trustees of Purdue University, as discussed further in Note 5, "Commitments and Contingencies," in our unaudited financial statements in Part I, Item 1 of this Quarterly Report.

We are often involved in litigation, primarily patent litigation, such as our patent dispute with The Trustees of Purdue University, and we and certain current and former executive officers were named as defendants in multiple securities class action lawsuits regarding past public disclosures, each as discussed further in Note 5, "Commitments and Contingencies," in our unaudited financial statements in Part I, Item 1 of this Quarterly Report.

Defending against existing and potential litigation will likely require significant attention and resources and, regardless of the outcome, result in significant legal expenses, which could adversely affect our results unless covered by insurance or recovered from third parties.

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Risks related to legal, regulatory, accounting, tax and compliance matters

The Company and certain of our current and former executive officers have been named as defendants in a securities class action lawsuit.

This lawsuit may require significant management time and attention and result in significant legal expenses, which could materially adversely affect our results and financial condition.

On November 15, 2024, we and certain current and former executive officers were named as defendants in a securities class action lawsuit filed in the United States District Court for the Northern District of New York.

The complaint alleges violations of Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 promulgated thereunder.

Additional lawsuits have been filed by shareholders regarding these same matters.

Such claims and any resulting litigation or additional allegations could subject us to liability.

Even if we prevail, such litigation could be time consuming and costly to defend, and could result in the diversion of our time and attention, which could materially and adversely affect our business, our reputation, results of operations and financial condition.

We may be required to recognize a significant charge to earnings if our goodwill or other assets become impaired.

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For other assets such as finite-lived intangible assets and fixed assets, we assess the recoverability of the asset balance when indicators of potential impairment are present.

For example, in the first quarter of fiscal 2024, we recorded an impairment to assets held for sale associated with the then-pending RF Business Divestiture of $144.6 million.

For example, in the second quarter of fiscal 2025, we recorded an impairment for abandoned assets of $124.5 million in connection with our 2025 Restructuring Plan, and in the first quarter of fiscal 2024, we recorded an impairment to assets held for sale associated with the then-pending RF Business Divestiture of $144.6 million.

The recognition of a significant charge to earnings in our consolidated financial statements resulting from any impairment of our goodwill or other assets could adversely impact our results of operations.

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• potential changes in tax laws or alterations in the interpretation of such tax laws and changes in generally accepted accounting principles, for example interpretations and United States regulations issued as a result of the significant changes to the United States tax law included within the Tax Cuts and Jobs Act of 2017 (the TCJA), the Coronavirus Aid, Relief and Economic Security Act of 2020 and the IRA;

• changes in available tax credits, including the eligibility for or the receipt of the expected benefits from refundable investment tax credits obtained through the CHIPS Act;

• changes or recapture of available tax credits, including our eligibility for or the receipt of the expected benefits from refundable investment tax credits obtained through the CHIPS Act;

• the implementation of international tax and profit shifting rules in countries in which we operate, as recommended by the Organization for Economic Co-operation and Development’s Base Erosion, including the establishment of a minimum tax of 15% on global income;

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General risk factors

We have outstanding debt which could materially restrict our business and adversely affect our financial condition, liquidity and results of operations.

As of September 29, 2024, our indebtedness consisted of $575.0 million aggregate principal amount of our 2026 Notes, $750.0 million aggregate principal amount of our 0.25% convertible senior notes due February 15, 2028 (the 2028 Notes), $1,750.0 million aggregate principal amount of our 1.875% convertible senior notes due December 1, 2029 (the 2029 Notes, and together with the 2026 Notes and the 2028 Notes, the Outstanding Convertible Notes) and $1,250.0 million aggregate principal amount of 2030 Senior Notes and an aggregate principal amount of $2,000.0 million of deposits under the CRD Agreement with Renesas America.

As discussed in Note 14, "Subsequent Events," to our unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report, on October 15, 2024, we entered into the 2030 Senior Notes Indenture which amends certain terms and conditions of the 2030 Senior Notes and permits us to issue and sell $750.0 million of additional notes, subject to the fulfillment of certain conditions.

On October 22, 2024, we issued an additional $250.0 million of 2030 Senior Notes.

There can be no assurance that we will be able to manage any of these risks successfully.

The level of our outstanding debt may adversely affect our operating results and financial condition by, among other things:

• increasing our vulnerability to downturns in our business, to competitive pressures and to adverse general economic and industry conditions;

• limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

• increasing our interest expense if interest rates increase.

In addition, the 2030 Senior Notes Indenture contains certain restrictions that could limit our ability to, among other things:

incur additional

indebtedness, dispose of assets, create liens on assets, make acquisitions or engage in mergers or consolidations, and engage in certain transactions with our subsidiaries and affiliates.

A default, if not cured or waived, may permit acceleration of our indebtedness.

In addition, our lenders could terminate their commitments to make further loans under the 2030 Senior Notes Indenture or the CRD Agreement.

Our business could be negatively impacted by shareholder activism.

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Shareholder activism could result in substantial costs.

In addition, actions of activist shareholders may cause significant fluctuations in our stock price based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals of our business.

The capped call transactions may not prevent dilution of our common stock upon conversion of the 2028 Notes or the 2029 Notes.

In connection with the pricing of the 2028 Notes and the 2029 Notes, we entered into privately negotiated capped call transactions with the option counterparties.

In addition, actions of activist shareholders may cause significant fluctuations in our stock price based on

temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals of our business.

Catastrophic events and disaster recovery may disrupt business continuity.

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If the value of such awards does not appreciate, as measured by the performance of the price of our common stock or if our stock-based compensation otherwise ceases to be viewed as a valuable benefit, our ability to attract, retain and motivate employees could be weakened, which could harm our business and results of operations.

Our stock price may be volatile.

On November 18, 2024, we announced the departure of our President and Chief Executive Officer, Gregg A.

On the same day, the Company's Board of Directors appointed Thomas H.

Werner, current Chair of the Board, as Executive Chair, in which role he is serving as our principal executive officer on an interim basis and is overseeing the continued execution of our strategy while the Board conducts a search for a new Chief Executive Officer.

Our CEO search process, which is being led by a search committee of the Board, to identify a candidate for a permanent President and Chief Executive Officer continues, and we are working with an executive search firm to assist with the process of identifying and evaluating both internal and external candidates.

There are no assurances concerning the timing or outcome of our search for a new Chief Executive Officer.

Our ability to execute our business strategies and attract and retain key executives may be adversely affected by the uncertainty associated with the transition to a successor Chief Executive Officer.

Our stock price has experienced and may continue to experience volatility.

Historically, our common stock has experienced substantial price volatility, particularly as a result of significant fluctuations in our revenue, earnings and margins over the past few years, and variations between our actual financial results and the published expectations of analysts.

For example, the closing price per share of our common stock on the New York Stock Exchange ranged from a low of $7.59 to a high of $46.84 during the twelve months ended September 29, 2024.

For example, the closing price per share of our common stock on the New York Stock Exchange ranged from a low of $6.44 to a high of $43.24 during the twelve months ended December 29, 2024.

If our future operating results or margins are below the expectations of stock market analysts or our investors, our stock price will likely decline.

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We are exposed to market value fluctuations and inherent interest rate risk related to our investment portfolio.

We have historically invested portions of our available cash in fixed interest rate securities such as high-grade corporate debt, commercial paper, municipal bonds, certificates of deposit, government securities and other fixed interest rate investments.

We have historically invested portions of our available cash in fixed interest rate securities such as high-grade corporate debt,

commercial paper, municipal bonds, certificates of deposit, government securities and other fixed interest rate investments.

The primary objective of our cash investment policy is preservation of principal.

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For example, during the COVID-19 pandemic, we experienced some limited disruptions in our supply chain and may experience similar disruptions in the future in the event of a pandemic.

health events could limit our ability to meet customer demand, lead to increased costs and have a material adverse effect on our financial condition and results of operations.

Restrictions on access to our manufacturing facilities or on our support operations or workforce, or similar limitations for our vendors and suppliers, and restrictions or disruptions of transportation, such as reduced availability of air transport, port closures, and increased border controls or closures in connection with future outbreaks of infectious diseases or similar public health events could limit our ability to meet customer demand, lead to increased costs and have a material adverse effect on our financial condition and results of operations.

Our amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the state courts of North Carolina will be the sole and exclusive forum for substantially all disputes between us and our shareholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees or agents.

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

What changed 10-Q

Item 1A. Risk Factors