What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-05-07 compared with 2026-02-06 · 75 added, 88 removed, 193 unchanged (46% of the section changed)

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Refer to Note 3, “Fresh Start Accounting,” to our consolidated financial statements in Part I, Item 1 of this Quarterly Report for additional information.

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References to “Successor” or “Successor Company” relate to the financial position and results of operations of the Company after the Effective Date.

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We continue to expect increased mid- and long-term demand growth, however the timing and extent of these increases remains uncertain.

We also continue to explore opportunities to expand adoption of our products in new and growing industries, such as AI and datacenters, grid modernization and renewable energy and storage.

We also continue to explore opportunities to expand adoption of our products in new and growing industries, such as AI data centers, grid modernization and renewable energy and storage.

• Intense and Constantly Evolving Competitive Environment.

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We believe we are uniquely positioned as a vertically integrated supplier of U.S.-made silicon carbide products in the global semiconductor industry.

We are currently focused on three key priorities designed to put us on a path toward long-term growth and profitability:

• Accelerating our path to profitability;

We are currently focused on three key priorities:

• Advancing our technology leadership;

• Demonstrating strict financial discipline;

• Driving operational excellence.

We believe these efforts will support our goals of delivering long-term growth and profitability, while enabling us to continue to invest in our business to further develop the technologies and accelerate the growth opportunities of silicon carbide materials and silicon carbide power devices and modules.

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Results of Operations

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The next 53-week fiscal year will be for our 2030 fiscal year.

Period from September 30, 2025 to December 28, 2025 (Successor) and September 29, 2025 (Predecessor) Compared to Three Months Ended December 29, 2024 (Predecessor)

Consolidated statements of operations for the period from September 30, 2025 to December 28, 2025 (Successor), period of September 29, 2025 (Predecessor) and the three months ended December 29, 2024 (Predecessor), along with the change between the Successor period as compared to the three months ended December 29, 2024 were as follows:

Three Months Ended March 29, 2026 (Successor) Compared to Three Months Ended March 30, 2025 (Predecessor)

Consolidated statements of operations for the three months ended March 29, 2026 (Successor) and the three months ended March 30, 2025 (Predecessor), along with the change between the three months ended March 29, 2026 as compared to the three months ended March 30, 2025 were as follows:

Successor Predecessor

Period from September 30, 2025 to December 28, 2025 September 29, 2025 Three months ended December 29, 2024 Change

Three months ended March 29, 2026 Three months ended March 30, 2025 Change

(in millions of U.S.

Dollars, except share data) Amount % Revenue Amount % Revenue Amount % Revenue $ %

Dollars, except share data) Amount % Revenue Amount % Revenue $ %

Power products $100.1 66.6 % $107.5 58.0 % ($7.4) (6.9) %

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Cost of revenue, net 190.2 126.6 % 207.9 112.1 % (17.7) (8.5) %

Gross (loss) profit (78.3) (46.5) % — — % (37.2) (20.6) % (41.1) 110.5 %

Gross loss (40.0) (26.6) % (22.5) (12.1) % (17.5) 77.8 %

Research and development 27.2 18.1 % 42.2 22.8 % (15.0) (35.5) %

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Operating loss (114.3) (76.1) % (194.5) (104.9) % 80.2 (41.2) %

Reorganization items, net — — % (1,067.3) (100.0) % — — % — — %

Interest expense, net of capitalized interest 52.1 34.7 % 85.4 46.1 % (33.3) (39.0) %

Non-operating income, net (67.0) (39.8) % — — % (31.2) (17.3) % (35.8) 114.7 %

(Loss) income before income taxes (149.4) (88.7) % 1,067.3 100.0 % (372.3) (206.3) % 222.9 (59.9) %

Income tax expense (benefit) 1.2 0.7 % 3.5 100.0 % (0.1) (0.1) % 1.3 (1,300.0) %

Non-operating (income) expense, net (46.2) (30.8) % 5.5 3.0 % (51.7) (940.0) %

Loss before income taxes (120.2) (80.0) % (285.4) (153.9) % 165.2 (57.9) %

Income tax (benefit) expense (0.3) (0.2) % 0.1 0.1 % (0.4) (400.0) %

Net (loss) income ($119.9) (79.8) % ($285.5) (154.0) % $165.6 (58.0) %

The $12 million decrease in net sales for the Successor period ended December 28, 2025, compared to three months ended December 29, 2024 was primarily due to:

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The $35 million decrease in net sales for the three months ended March 29, 2026, compared to three months ended March 30, 2025 was primarily due to:

• Net sales of our Materials Product offerings decreased primarily due to lower volumes as our substrate customers continue to adjust the timing and size of their orders to rebalance supply to match weaker end market demand.

The proportion of Materials Products revenue attributable to long-term supply agreements with customers has decreased compared to the same periods in fiscal 2025, resulting in more volatility in the timing and pricing of our materials orders.

• Net sales of our Power Product offerings increased for both automotive and industrial applications.

End-of-life buys from our distributors associated with the planned shutdown of our 150mm device fab in Durham, North Carolina also contributed to revenue growth during the first and second quarters of fiscal 2026.

The revenue growth from our industrial applications was partially attributable to emerging opportunities for our AI and data center applications, a relatively small but growing vertical for our Power Products.

There has also continued to be volatility in the timing and pricing of our materials orders.

• Net sales of our Power Product offerings decreased from a reduction in automotive demand and continued pricing pressure during the period.

During the third quarter of fiscal 2026, approximately 90% of these revenues were attributable to products from the Mohawk Valley Fabrication facility (the "Mohawk Valley Fab") following the shutdown of our 150mm device fabrication facility in Durham, North Carolina (the "150mm Durham Fab") in the second quarter of fiscal 2026.

Cost of Revenue, Net and Gross Margin

The primary drivers of the $41 million decrease in gross profit for the Successor period ended December 28, 2025 compared to the three months ended December 29, 2024 included the following:

• Lower revenues as discussed above and unfavorable sales mix attributable to growth in lower margin Power Product offerings.

• $23 million increase in the carrying value of work-in-progress ("WIP") and finished goods inventory upon adoption of fresh start accounting, the entirety of which was recognized in cost of revenue, net in the second quarter of fiscal 2026 as the related inventory was sold.

• $16 million increase in intangible-related amortization expense presented in Cost of revenue, net, related to additional intangible assets recognized upon adoption of fresh start accounting.

• $20 million increase in underutilization costs, primarily related to the achievement of production readiness at our Siler City Fab at the end of fiscal 2025.

Prior to the substantial completion of the facility, these costs were included in start-up costs within Operating Expenses.

In addition to lower revenues and the impact of changes in sales mix between our Power and Materials products, the primary drivers of the $18 million increase in gross loss for the three months ended March 29, 2026 compared to the three months ended March 30, 2025 included the following:

• $19 million increase in underutilization costs, primarily related to the achievement of production readiness at our materials manufacturing facility in Siler City, North Carolina (the "Siler City Fab") at the end of fiscal 2025 and lower factory loadings at our Durham materials facility as we rebalance supply to match weaker end market demand.

Prior to the substantial completion of the Siler City fab, these costs were included in start-up costs within Operating Expenses.

We expect to continue to incur significant underutilization costs until market demand for our products meets or exceeds our production capacity;

• $16 million increase in write-downs related to obsolete customer-specific inventory we intend to scrap.

• $10 million decrease in depreciation expense related to the adoption of fresh start accounting.

The favorable impact of lower depreciation expense will increase in future quarters as additional inventory is sold.

• $16 million decrease in restructuring and other closure-related costs.

• $11 million decrease in restructuring and other closure-related costs, including accelerated depreciation and shutdown-related excess capacity charges.

Refer to Note 15, "Restructuring," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report for additional information;

• $35 million decrease in depreciation expense primarily related to the adoption of fresh start accounting partially offset by $14 million increase in intangible-related amortization expense presented in Cost of revenue, net, related to additional intangible assets recognized upon adoption of fresh start accounting.

Research and Development

The $19 million decrease in research and development expenses for the Successor period ended December 28, 2025 compared to three months ended December 29, 2024, was primarily due to:

The $15 million decrease in research and development expenses for the three months ended March 29, 2026 compared to three months ended March 30, 2025, was primarily due to:

• $10 million attributable to planned decreases in the amount of research and development wafer spend from product transfers and technology qualifications related to the Mohawk Valley Fab ramp;

• $6 million attributable to decreases in personnel costs, driven by lower headcount and lower estimated bonus attainment, and lower stock-based compensation costs attributable to the cancellation of unvested restricted stock unit ("RSU") and performance stock unit ("PSU") awards upon emergence from the Chapter 11 Cases;

• $4 million attributable to lower depreciation expense from the adoption of fresh start accounting,

• $5 million attributable to lower depreciation expense primarily from the adoption of fresh start accounting.

Sales, General and Administrative

The $22 million decrease in sales, general and administrative expenses for the Successor period ended December 28, 2025 compared to the three months ended December 29, 2024 was primarily due to:

• $16 million attributable to decreases in personnel costs related to lower headcount and lower estimated bonus attainment, and lower stock-based compensation costs attributable to the cancellation of unvested RSU and PSU awards upon emergence from the Chapter 11 Cases;

The $4 million decrease in sales, general and administrative expenses for the three months ended March 29, 2026 compared to the three months ended March 30, 2025 was primarily due to:

• $4 million attributable to planned reductions in marketing and outside services related to cost optimization efforts.

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Factory Start-up Costs

The $23 million decrease in factory start-up costs for the Successor period ended December 28, 2025 compared to the three months ended December 29, 2024, related to the substantial completion of the initial phase of construction of our materials manufacturing facility in Siler City, North Carolina.

The $24 million decrease in factory start-up costs for the three months ended March 29, 2026 compared to the three months ended March 30, 2025, related to the attainment of production readiness at the Siler City Fab.

Refer to Note 1, "Basis of Presentation and New Accounting Standards," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report for further details on the change in accounting policy due to the adoption of fresh start accounting.

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(in millions of U.S.

Dollars) Period from September 30, 2025 to December 28, 2025 September 29, 2025 Three months ended December 29, 2024 $ %

Dollars) Three months ended March 29, 2026 Three months ended March 30, 2025 $ %

Legal settlements $— $17.0 ($17.0) (100) %

Restructuring and other exit costs 1.7 40.7 (39.0) (96) %

Project, transformation and transaction costs 5.0 6.8 (1.8) (26) %

Executive severance costs — — 1.4 (1.4) (100) %

Amortization or impairment of fresh start accounting and acquisition-related intangibles 3.9 0.3 3.6 1,200 %

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Restructuring and other expenses $10.6 $65.4 ($54.8) (84) %

The decrease in Restructuring and other operating expenses during the Successor period ended December 28, 2025 compared to the three months ended December 29, 2024, was primarily driven by a decrease in restructuring charges related to our headcount reduction and facility consolidation plans, partially offset by an increase in costs related to our Chapter 11 Cases that did not qualify as reorganization items, net, and a $4 million increase in amortization expense, related to intangible assets recognized upon adoption of fresh start accounting.

Reorganization items, net

Reorganization items, net for the Predecessor period of September 29, 2025 related to our emergence from Chapter 11 bankruptcy and primarily consisted of the gain on settlement of liabilities subject to compromise and the impacts of fresh start valuation adjustments.

Refer to Note 2 - Emergence from Voluntary Reorganization Under Chapter 11 for additional details on the items included within Reorganization items, net.

The decrease in Restructuring and other operating expenses during the three months ended March 29, 2026 compared to the three months ended March 30, 2025, was primarily driven by a decrease in restructuring charges related to our headcount reduction and facility consolidation plans, the settlement of several ongoing legal matters and a $4 million increase in amortization expense, related to intangible assets recognized upon adoption of fresh start accounting.

Interest Expense, net

The decrease in interest expense during the Successor period ended December 28, 2025 compared to the three months ended December 29, 2024 was primarily related to decreases in our outstanding debt obligations upon emergence from the Chapter 11 Cases.

Non-Operating Expense, net

The decrease in interest expense during the three months ended March 29, 2026 compared to the three months ended March 30, 2025 was primarily related to decreases in our outstanding debt obligations upon emergence from the Chapter 11 Cases.

Non-Operating (Income) Expense, net

Successor Predecessor Change

(in millions of U.S.

Dollars) Period from September 30, 2025 to December 28, 2025 September 29, 2025 Three months ended December 29, 2024 $ %

Dollars) Three months ended March 29, 2026 Three months ended March 30, 2025 $ %

Changes in fair value of liability classified derivative contracts ($28.7) $— ($28.7) (100) %

Interest income (10.9) (19.4) 8.5 (44) %

Realized gain on MACOM Shares — — (15.7) 15.7 (100) %

Realized loss on MACOM Shares — 24.9 (24.9) (100) %

Gain on contingent cash (10.0) — (10.0) 100 %

Loss on debt extinguishment 2.8 — 2.8 100 %

Other expense, net 0.6 — 0.6 100 %

Non-operating expense, net

($67.0) $— ($31.2) ($35.8) 115 %

The decrease in interest income during the Successor period ended December 28, 2025 compared to the three months ended December 29, 2024 was primarily due to lower short-term investment balances and a lower interest rate environment.

The changes in fair value of derivatives are primarily related to the mark-to-market fair value impact on our equity forward contracts, fair value conversion option derivative and the warrant issued to Renesas.

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Period from September 30, 2025 to December 28, 2025 (Successor) and June 30, 2025 to September 29, 2025 (Predecessor) compared with Six months ended December 29, 2024 (Predecessor)

Non-operating (income) expense, net ($46.2) $5.5 ($51.7) (940) %

The increase in non-operating (income) expense, net during the three months ended March 29, 2026 compared to the three months ended March 30, 2025 was primarily due to the gain on contingent cash and remeasurement of certain liability-classified derivatives in the three months ended March 29, 2026, as further described in Note 3, "Fresh Start Accounting," and Note 9, "Fair Value of Financial Instruments," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report, partially offset by lower short-term investment balances and a lower interest rate environment, the debt extinguishment from the early pay down of our New Senior Secured Notes (as defined below) and loss related to the MACOM Shares.

Period from September 30, 2025 to March 29, 2026 (Successor) and June 30, 2025 to September 29, 2025 (Predecessor) compared with Nine months ended March 30, 2025 (Predecessor)

Successor Predecessor Predecessor

Period from September 30, 2025 to December 28, 2025 Period from June 30, 2025 to September 29, 2025 Six months ended December 29, 2024

Period from September 30, 2025 to March 29, 2026 Period from June 30, 2025 to September 29, 2025 Nine months ended March 30, 2025

(in millions of U.S.

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(Loss) income before income taxes (269.6) (84.6) % 423.7 215.3 % (939.5) (167.6) %

Income tax expense (benefit) 1.2 0.7 % 3.5 1.8 % 0.3 0.1 %

Income tax expense 0.9 0.3 % 3.5 1.8 % 0.4 0.1 %

Net (loss) income ($270.5) (84.9) % $420.2 213.5 % ($939.9) (167.7) %

The primary drivers of changes in the financial statement line items noted below, for the periods from September 30, 2025 to December 28, 2025 (Successor) and June 30, 2025 to September 29, 2025 (Predecessor) compared with the period of the six months ended December 29, 2024 (Predecessor) included the following:

• Revenue, net - Decreases in net sales of our Materials Products offerings driven by lower revenue attributable to long-term supply agreements and our customers' rebalancing supply to match weaker end market demand were partially offset by increases in net sales of our Power Product offerings for both automotive and industrial applications, partially attributable to end-of-life buys associated with the shutdown of our 150mm device fab in Durham, North Carolina, and growth in emerging applications for silicon carbide devices such as AI and data center applications.

• Cost of Revenue, net and Gross loss - Increases in cost of revenue, net and the corresponding decrease in Gross loss and Gross margin were primarily attributable to the following:

◦ $23 million of additional product costs related to fair value step-ups on WIP and Finished Goods recorded upon adoption of fresh start accounting, which was fully recognized as the products were sold in the Successor period ended December 28, 2025.

◦ $15 million of additional amortization expenses related to the recognition of developed technology and changes in the fair value of other intangibles upon the adoption of fresh start accounting, recognized in the Successor period ended December 28, 2025.

◦ Higher underutilization costs during the Predecessor and Successor periods of fiscal 2026, related to the achievement of production readiness at our Siler City Fab.

The primary drivers of changes in the financial statement line items noted below, for the periods from September 30, 2025 to March 29, 2026 (Successor) and June 30, 2025 to September 29, 2025 (Predecessor) compared with the period of the nine months ended March 30, 2025 (Predecessor) included the following:

• Revenue, net - Decreases in net sales of our Materials Products offerings driven by our customers' rebalancing supply to match weaker end market demand were partially offset by increases in net sales of our Power Product offerings for our industrial applications, partially attributable to end-of-life buys associated with the shutdown of our 150mm Durham Fab, and growth in emerging applications for silicon carbide devices such as AI and data center applications.

• Cost of Revenue, net and Gross loss - Increases in cost of revenue, net and the corresponding increase in Gross loss and decrease in Gross margin were primarily attributable to the following:

◦ Unfavorable changes in product mix for Power devices and pricing pressure for certain product lines.

◦ Higher underutilization costs during the Predecessor and Successor periods of fiscal 2026, related to the achievement of production readiness at our Siler City Fab, which expanded our capacity, and at our Durham materials facility related to lower factory loadings as we rebalance supply to match weaker end market demand.

Prior to the substantial completion of the facility in late fiscal 2025, these costs were included in start-up costs.

We expect to continue to incur significant underutilization costs until market demand for our products meets or exceeds our production capacity.

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◦ Specific reserves and inventory write-offs related to obsolete products as well as the planned shutdown of our 150mm device fab completed in the Successor period.

◦ Unfavorable changes in product mix for Power devices and pricing pressure for certain product lines.

◦ The items above were partially offset by lower restructuring and closure-related charges related to our 2025 Restructuring Plan, as well as lower depreciation expense in the Successor period attributable to the fair value adjustments to property, plant, and equipment as part of our adoption of fresh start accounting.

A portion of the $45 million favorable benefit from this reduction in depreciation expense was absorbed into inventory and will benefit future periods.

• Research and Development - The changes in researches in development costs were attributable to expected decreases in wafer spend from product transfers and technology qualifications, related to the timing of the Mohawk Valley Fab ramp in the prior period, as well as lower personnel costs related to the 2025 Restructuring Plan and the cancellation of unvested stock awards upon emergence from the Chapter 11 Cases.

◦ $23 million of additional product costs related to fair value step-ups on work-in-progress and finished goods recorded upon adoption of fresh start accounting, which was fully recognized as the products were sold in the Successor period ended March 29, 2026.

◦ $29 million of additional amortization expenses related to the recognition of developed technology and changes in the fair value of other intangibles upon the adoption of fresh start accounting, recognized in the Successor period ended March 29, 2026.

◦ Specific reserves and inventory write-offs related to obsolete products as well as the planned shutdown of our 150mm Durham Fab completed in the Successor period.

◦ The items above were partially offset by lower restructuring and closure-related charges related to our headcount reduction and facility closure and consolidation plan initiated during the first quarter of fiscal 2025 (the "2025 Restructuring Plan"), as well as lower depreciation expense in the Successor period attributable to the fair value adjustments to property, plant, and equipment as part of our adoption of fresh start accounting.

Refer to Note 3, "Fresh Start Accounting" and Note 15, "Restructuring," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report for additional information.

• Research and Development - The changes in research and development costs were attributable to expected decreases in wafer spend from product transfers and technology qualifications, related to the timing of the Mohawk Valley Fab ramp in the prior period, as well as lower personnel costs related to the 2025 Restructuring Plan and the cancellation of unvested stock awards upon emergence from the Chapter 11 Cases.

Additionally, the adoption of fresh start accounting reduced depreciation expense by $9 million.

• Sales, General & Administrative - The changes in sales, general and administrative expenses were primarily attributable to a decreases in personnel costs related to lower headcount and lower estimated bonus attainment.

Additionally, planned reductions in marketing and outside service spend related to cost optimization efforts.

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These costs are now included within Cost of Revenue, net.

• Restructuring and Other Operating Expenses - The changes in Restructuring and Other Operating Expenses primarily related to a significant decrease in Restructuring and other exit costs compared to the prior period, due to the timing of the 2025 Restructuring Plan and closure of the Farmer's Branch facility in December 2025.

• Restructuring and Other Operating Expenses - The changes in restructuring and other operating expenses primarily related to a significant decrease in restructuring and other exit costs compared to the prior period, due to the timing of the 2025 Restructuring Plan and closure of the Farmer's Branch facility in December of fiscal 2025 and the settlement of several legal matters.

These decreases were partially offset by a $7 million increase in intangible-related amortization expense during the Successor period, related to the adoption of fresh start accounting.

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Furthermore, after the Effective Date, interest expense was lower than the prior period as a result of a decrease in outstanding debt obligations upon emergence from the Chapter 11 Cases.

• Non-Operating Income/Expense - The changes in non-operating income (expense), net primarily related to the remeasurement of certain liability-classified derivatives in the Successor period, as further described in Note 3 and Note 9 of the Notes to Consolidated Financial Statements.

• Non-Operating Income/Expense - The changes in non-operating income, net primarily related to the remeasurement of certain liability-classified derivatives in the Successor period, as further described in Note 3, "Fresh Start Accounting," and Note 9, "Fair Value of Financial Instruments," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report.

The gains from mark-to-market adjustments on the liability-classified derivatives were partially offset by lower interest income attributable to lower average cash balances and less favorable yields.

• Income Tax Expense - The changes in income tax expense for the period primarily related to the income tax-related impacts of the Chapter 11 Cases and adoption of fresh start accounting.

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Liquidity and Capital Resources

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On the Effective Date, we issued new secured financing in an aggregate amount of $2.1 billion, consisting of (i) new Senior Secured Notes due 2030 (the "New Senior Secured Notes") in an aggregate principal amount of $1.3 billion, (ii) 7%/12% second lien senior secured PIK toggle notes due 2031 (the "New 2L Non-Convertible Notes") in an aggregate principal amount of $296.4 million, (iii) new 2.5% Convertible Second-Lien Senior Secured Notes due 2031 in an aggregate principal amount of $203.6 million to Renesas (the "New 2L Renesas Convertible Notes") and (iv) new 2.5% Convertible Second-Lien Senior Secured Notes due 2031 (the "New 2L Non-Renesas Convertible Notes") in an aggregate principal amount of $331.4 million, including the payment of the $30.25 million under the Rights Offering Backstop Commitment Agreement, dated June 22, 2025, between the Company, the rights offering backstop parties and the rights offering backstop parties thereto.

Refer to Note 11, "Long-term Debt," for additional information on our debt obligations and Note 1, "Basis of Presentation and New Accounting Standards," Note 2 "Emergence from Voluntary Reorganization under Chapter 11," and Note 3, "Fresh Start Accounting," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report for additional information on our Chapter 11 Cases and the adoption of fresh start accounting.

On March 19, 2026, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain investors in connection with a private placement offering of shares of common stock and pre‑funded warrants to purchase shares of common stock, resulting in aggregate gross proceeds of approximately $96.9 million.

On March 19, 2026, the Company also entered into a separate, privately negotiated issuance of 3.5% Convertible 1.5 Lien Senior Secured Notes due 2031 (the “1.5L Convertible Notes”) in an aggregate principal amount of $379.0 million.

The aggregate gross proceeds from these transactions were used to repurchase $475.9 million aggregate principal amount of the New Senior Secured Notes, which the total payment of $524.3 million included a make‑whole premium funded by the Company and accrued and unpaid interest.

Refer to Note 11, "Long-term Debt," for additional information on our debt obligations, Note 16, "Stockholders' Equity and Pre-Funded Warrants" for additional information on the Securities Purchase Agreement and Note 1, "Basis of Presentation and New Accounting Standards," Note 2 "Emergence from Voluntary Reorganization under Chapter 11," and Note 3, "Fresh Start Accounting," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report for additional information on our Chapter 11 Cases and the adoption of fresh start accounting.

The following table sets forth our cash, cash equivalents and short-term investments:

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(in millions of U.S.

Dollars) December 28, 2025 June 29, 2025 Change

Dollars) March 29, 2026 June 29, 2025 Change

Cash and cash equivalents $695.1 $467.2 $227.9

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(in millions of U.S.

Dollars Period from September 30, 2025 to December 28, 2025 Period from June 30, 2025 to September 29, 2025 Six months ended December 29, 2024

Dollars) Period from September 30, 2025 to March 29, 2026 Period from June 30, 2025 to September 29, 2025 Nine months ended March 30, 2025

Net cash used in operating activities ($126.4) ($22.4) ($469.2)

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Net change in cash and cash equivalents $214.1 $13.8 ($315.7)

The net increase in cash and cash equivalents of $337 million between December 28, 2025 and June 29, 2025 was primarily driven by cash flows from the following activities:

The net increase in cash and cash equivalents and short term investments of $209 million between March 29, 2026 and June 29, 2025 was primarily driven by cash flows from the following activities:

• Operating activities — Cash used in operating activities results from net (loss) income adjusted for certain non-cash items and changes in assets and liabilities.

Cash used in operating activities for the period from June 30, 2025 to September 29, 2025 (Predecessor) and the period from September 30, 2025 to December 28, 2025 (Successor) compared to the six months ended December 29, 2024, decreased by approximately $262 million.

This decrease was primarily driven by lower interest payments due to the Chapter 11 Cases, the timing of severance payments, decreases in payroll and other operating costs attributable to our restructuring initiatives, and favorable changes in working capital, partially offset by higher professional service costs attributable to the Chapter 11 Cases.

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Cash used in operating activities for the period from June 30, 2025 to September 29,

2025 (Predecessor) and the period from September 30, 2025 to March 29, 2026 (Successor) compared to the nine months ended March 30, 2025, decreased by approximately $320 million.

This decrease was primarily driven by lower interest payments due to the Chapter 11 Cases, the timing of severance payments, decreases in payroll and other operating costs attributable to our restructuring initiatives, mark-to-market adjustments on the liability-classified derivatives and favorable changes in working capital, partially offset by higher professional service costs attributable to the Chapter 11 Cases.

• Investing activities — Investing cash flows consist primarily of capital expenditures and short-term investment activity.

Cash provided by investing activities for the period from June 30, 2025 to September 29, 2025 (Predecessor) and the period from September 30, 2025 to December 28, 2025 (Successor) compared to the six months ended December 29, 2024 increased by $1.3 billion, primarily attributable to a planned decrease in gross capital expenditures and the receipt of approximately $700 million in Advanced Manufacturing Investment Credit refundable tax credits.

Cash provided by investing activities for the period from June 30, 2025 to September 29, 2025 (Predecessor) and the period from September 30, 2025 to March 29, 2026 (Successor) compared to the nine months ended March 30, 2025 increased by $967 million, primarily attributable to a planned decrease in gross capital expenditures and the receipt of approximately $733 million in Advanced Manufacturing Investment Credit refundable tax credits, New York State Grants related to the Mohawk Valley Fab and other government tax credits.

Additional increases in cash proceeds received from the disposal of non-core buildings and equipment and the MACOM Shares were primarily offset by lower proceeds from the net sale and maturity of short-term investments.

• Financing activities — Financing cash flows consist primarily of debt transactions and debt-related payments related to the Chapter 11 Cases, tax payments related to the net share settlement of restricted stock units, and proceeds from the exercise of options to acquire common stock.

Net cash used in financing activities for the period from June 30, 2025 to September 29, 2025 (Predecessor) and the period from September 30, 2025 to December 28, 2025 (Successor), compared to the six months ended December 29, 2024 increased by $617 million, primarily attributable to $565 million used in fiscal 2026 to repay our pre- and post-bankruptcy senior secured notes, per the terms of those agreements and the Chapter 11 claims settlements, and a net decrease of approximately $47 million attributable in cash proceeds received from debt issuances and our at-the-market offering in fiscal 2025.

Net cash used in financing activities for the period from June 30, 2025 to September 29, 2025 (Predecessor) and the period from September 30, 2025 to March 29, 2026 (Successor), compared to the nine months ended March 30, 2025 increased by $745 million, primarily attributable to $1,025 million used in fiscal 2026 to repay our pre- and post-bankruptcy senior secured notes, per the terms of those agreements and the Chapter 11 claims settlements partially offset by a net increase of approximately $307 million in cash proceeds received from debt issuances and the proceeds from the Securities Purchase Agreement.

Sources and Uses of Liquidity

Under the terms of the Restructuring Support Agreement and the Plan, following the emergence from the Chapter 11 Cases, we reduced our overall debt by approximately 70%, or $4.6 billion.

Following the paydown of the New Senior Secured Notes during the third quarter of fiscal 2026, we reduced our total debt by approximately $97 million and lowered our annual interest expense by an estimated $62 million.

We expect that our current operating forecast over the next 12 months will allow us to maintain operations and meet our obligations to customers, vendors and employees in the ordinary course of business.

Cash on hand during the first half of fiscal 2026 was primarily used for the following:

Cash on hand during the first three quarters of fiscal 2026 was primarily used for the following:

• normal recurring operating expenses;

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• implementation of the restructuring plans described in Note 15, "Restructuring," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report;

• repayments of principal for the Existing and New Senior Secured Notes.

• repayments of principal for New Senior Secured Notes.

Our currently anticipated sources of liquidity for the remainder of fiscal 2026 include:

• receipts from customers and other operating activities;

• expected receipts under government incentive programs;

• proceeds from the sale of our non-core assets and other short-term investments.

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The initial phases of our major expansion projects at the Mohawk Valley Fab and the Siler City Fab were substantially completed as of late fiscal 2025.

Consequently, we expect gross capital investment to decrease significantly, to approximately $49 million during the remainder of fiscal 2026.

Consequently, our gross capital investment has continued and is expected to continue to decrease significantly during fiscal 2026.

We also believe our ability to modulate capital investment up or down in response to expected production capacity demand requirements will continue to increase.

We also continue to actively pursue opportunities for federal funding, including but not limited to awards that may be made available through the CHIPS Act or other programs, including the recently established United States Investment Accelerator Office ("federal funding opportunities").

We also continue to actively pursue opportunities for federal funding, including but not limited to awards that may be made available through the CHIPS and Science Act or other programs, including the recently established United States Investment Accelerator Office ("federal funding opportunities").

We will continue to have take-or-pay inventory supplier agreements that require a minimum of $165 million of purchases over the next four years, as outlined further in Note 7, "Commitments and Contingencies," to our consolidated financial statements in Part I, Item 1 of this Quarterly Report.

We will also be required to purchase electricity for our facility in Siler City, North Carolina and Durham, North Carolina under a long-term electricity supply agreement with minimum volume and spend requirements of approximately $59 million over the next 4 years and approximately $24 million over the next 8 years, respectively.

We will also be required to purchase electricity for our facility in Siler City, North Carolina and

Durham, North Carolina under a long-term electricity supply agreement with minimum volume and spend requirements of approximately $57 million over the next 4 years and approximately $23 million over the next 8 years, respectively.

The Company has entered into an agreement with a supplier for equipment that has not yet been delivered or accepted by the Company.

While the Company has not accepted delivery of the equipment and, therefore, the arrangement has not commenced as a lease under ASC 842, the Company is contractually obligated to make monthly payments of $0.2 million for the next 184 months.

From time to time, we evaluate strategic opportunities, including potential acquisitions, joint ventures, divestitures, spin-offs or investments in complementary businesses, and we have continued to make such evaluations.

We may also access capital markets through the issuance of debt or equity, which we may use in connection with the acquisition of complementary businesses or other significant assets or for other strategic opportunities or general corporate purposes.

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Off-Balance Sheet Arrangements

As of December 28, 2025, we did not have any off-balance sheet arrangements.

As of March 29, 2026, we did not have any off-balance sheet arrangements.

We do not use off-balance sheet arrangements with unconsolidated entities or related parties, nor do we use any other forms of off-balance sheet arrangements.

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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 2. Management’s Discussion and Analysis