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What changed in ALPHA & OMEGA SEMICONDUCTOR Ltd's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ALPHA & OMEGA SEMICONDUCTOR Ltd's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+364 added−589 removedSource: 10-K (2025-08-28) vs 10-K (2024-08-23)

Top changes in ALPHA & OMEGA SEMICONDUCTOR Ltd's 2025 10-K

364 paragraphs added · 589 removed · 127 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

71 edited+20 added−23 removed98 unchanged
Biggest changeOn March 29, 2016, we entered into a joint venture contract (the “JV Agreement”) with two investment funds owned by the Municipality of Chongqing (the “Chongqing Funds”), pursuant to which the Company and the Chongqing Funds formed a joint venture, (the “JV Company”), for the purpose of constructing and operating a power semiconductor packaging, testing and 12-inch wafer fabrication facility in the Liangjiang New Area of Chongqing, China (the “JV Transaction”).
Biggest changeAs of June 30, 2025, we owned approximately 39.2% of outstanding equity interest in a joint venture company (the “JV Company”) that operates a power semiconductor packaging, testing and 12-inch wafer fabrication facility (“Fab”, “Chongqing Fab” ) in the LiangJiang New Area of Chongqing, China, and the JV Company is an important supplier of wafers and assembly and test services to us.
In addition, our distributors and sales representatives 6 assist us in our sales and marketing efforts by identifying potential customers, creating additional demand and promoting our products, in which case we may pay a sales commission. Our sales cycle varies depending on the types of products and can range from six to eighteen months.
In addition, our distributors and sales representatives assist us in our sales and marketing efforts by identifying potential customers, creating additional demand and promoting our products, in which case we may pay a sales commission. 6 Our sales cycle varies depending on the types of products and can range from six to eighteen months.
As our technologies are deployed in new applications and as we diversify our product portfolio based on new technology platforms, we may be subject to new potential infringement claims. Patent litigation, if and when instituted against us, could result in substantial costs and a diversion of our management's attention and resources.
As our technologies are deployed in new applications and as we diversify our product portfolio based on new technology platforms, we may be subject to potential infringement claims. Patent litigation, if and when instituted against us, could result in substantial costs and a diversion of our management's attention and resources.
Our Power IC and low voltage (5V-40V) MOSFET products address these markets. In the area of AC-DC power supplies for electronic equipment, data centers and servers, the market is characterized by a continuous demand for energy conservation through higher efficiency, which drives the market for our medium voltage (40V-400V) and high voltage (500V-1000V) MOSFET products.
Our Power IC and low voltage 2 (5V-40V) MOSFET products address these markets. In the area of AC-DC power supplies for electronic equipment, data centers and servers, the market is characterized by a continuous demand for energy conservation through higher efficiency, which drives the market for our medium voltage (40V-400V) and high voltage (500V-1000V) MOSFET products.
The following table lists our product families and the principal end uses of our products: Product Family Description Product Categories within Product Type Typical Application Power Discretes Low on-resistance switch used for routing current and switching voltages in power control circuits High power switches used for power circuits DC-DC for CPU/GPU DC-AC conversion AC-DC conversion Load switching Motor control Battery protection Power factor correction Smart phone chargers, battery packs, notebooks, desktop and servers, data centers, base stations, graphics card, game boxes, TVs, AC adapters, power supplies, motor control, power tools, E-vehicles, white goods and industrial motor drives, UPS systems, solar inverters and industrial welding Power ICs Integrated devices used for power management and power delivery DC-DC Buck conversion DC-DC Boost conversion Smart load switching DrMOS power stage Flat panel displays, TVs, Notebooks, graphic cards, servers, DVD/Blu-Ray players, set-top boxes, and networking equipment Analog power devices used for circuit protection and signal switching Transient voltage protection Analog switch Electromagnetic interference filter Notebooks, desktop PCs, tablets, flat panel displays, TVs, smart phones, and portable electronic devices Power discrete products Power discretes are used across a wide voltage and current spectrum, requiring high efficiency and reliability under harsh conditions.
The following table lists our product families and the principal end uses of our products: 4 Product Family Description Product Categories within Product Type Typical Application Power Discretes Low on-resistance switch used for routing current and switching voltages in power control circuits High power switches used for power circuits DC-DC for CPU/GPU DC-AC conversion AC-DC conversion Load switching Motor control Battery protection Power factor correction Smart phone chargers, battery packs, notebooks, desktop and servers, data centers, base stations, graphics card, game boxes, TVs, AC adapters, power supplies, motor control, power tools, E-vehicles, white goods and industrial motor drives, UPS systems, solar inverters and industrial welding Power ICs Integrated devices used for power management and power delivery DC-DC Buck conversion DC-DC Boost conversion Smart load switching DrMOS power stage Flat panel displays, TVs, Notebooks, graphic cards, servers, AI datacenters, DVD/Blu-Ray players, set-top boxes, and networking equipment Analog power devices used for circuit protection and signal switching Transient voltage protection Analog switch Electromagnetic interference filter Notebooks, desktop PCs, tablets, flat panel displays, TVs, smart phones, and portable electronic devices Power discrete products Power discretes are used across a wide voltage and current spectrum, requiring high efficiency and reliability under harsh conditions.
We continuously increase the outsourcing portion of our packaging and testing requirements to other contract manufacturers to improve our ability to respond to changes in market demand. Our facilities have the combined capacity to package and test over 600 million parts per month and have available floor space for new package introductions.
We continuously increase the outsourcing portion of our packaging and testing requirements to other 8 contract manufacturers to improve our ability to respond to changes in market demand. Our facilities have the combined capacity to package and test over 600 million parts per month and have available floor space for new package introductions.
Our operation in Oregon is subject to Oregon Department of Environmental Regulations, Federal Environmental Protection Agency laws and regulations, and local jurisdictional regulations. We believe that we have been in material compliance with applicable environmental regulations and standards and have not had a material or adverse effect on our results of operations from complying with these regulations.
Our operation in Oregon is subject to Oregon Department of Environmental 10 Regulations, Federal Environmental Protection Agency laws and regulations, and local jurisdictional regulations. We believe that we have been in material compliance with applicable environmental regulations and standards and have not had a material or adverse effect on our results of operations from complying with these regulations.
We train our managers to become good stewards for our employees, balancing the need for quality of life with performance results. We believe that these efforts contribute to the growth and well-being of our employees, as more than 50% of our managerial positions are filled through promotions of existing employees.
We train our managers to become good stewards for our employees, balancing the need for quality of life with performance results. We believe that these efforts contribute to the growth, well-being and loyalty of our employees, as more than 50% of our managerial positions are filled through promotions of existing employees.
We have also entered into intellectual property licensing agreements with other companies to use selected 9 third-party technology for the development of our products, although we do not believe our business is dependent to any significant degree on any individual third-party license agreement.
We have also entered into intellectual property licensing agreements with other companies to use selected third-party technology for the development of our products, although we do not believe our business is dependent to any significant degree on any individual third-party license agreement.
Our Nominating 10 and Corporate Governance Committee leads the effort in recruiting qualified directors to serve on our Board. Our employees appreciate and value the strength of our people-oriented culture and the benefits our workplace diversity brings. We commit to a fair and living wage for all employees.
Our Nominating and Corporate Governance Committee leads the effort in recruiting qualified directors to serve on our Board. Our employees appreciate and value the strength of our people-oriented culture and the benefits our workplace diversity brings. We commit to a fair and living wage for all employees.
However, we are committed to vigorously defending and protecting our investment in our intellectual property. Therefore, the strength of our intellectual property program, including the breadth and depth of our portfolio, will be critical to our success in the new markets we intend to pursue.
However, we are committed to vigorously 9 defending and protecting our investment in our intellectual property. Therefore, the strength of our intellectual property program, including the breadth and depth of our portfolio, will be critical to our success in the new markets we intend to pursue.
This model also allows us to respond more quickly to our customer demands, enhances relationships with strategic customers, provides flexibility in capacity management, and enables geographic diversification of our wafer supply chain.
This model also allows us to respond more quickly to our customer demands, enhances relationships with strategic customers, provides flexibility in capacity management, and enables geographic diversification of our supply chain.
This includes expanding our power IC portfolio with multiphase controllers and smart power stages to address advanced System on Chip (SoC) products used in personal computing, graphics cards, and gaming.
This includes expanding our power IC portfolio with multiphase controllers and smart power stages to address advanced System on Chip (SoC) products used in personal computing, AI, graphics cards, and gaming.
Introduction of these 4 multiphase controllers has enabled AOS to become a complete solution level provider, across multiple compute platforms from PCs, graphics cards to AI and datacenter.
Introduction of these multiphase controllers has enabled AOS to become a complete solution level provider, across multiple compute platforms from PCs, graphics cards to AI and datacenter.
During the fiscal year ended June 30, 2024, we continued our diversification strategy by developing new silicon and packaging platforms to expand our serviceable available market, or SAM, and offer higher performance products. Our metal-oxide-semiconductor field-effect transistors, or MOSFET, portfolio expanded significantly across a full range of voltage applications.
During the fiscal year ended June 30, 2025, we continued our diversification strategy by developing new silicon and packaging platforms to expand our serviceable available market, or SAM, and offer higher performance products. Our metal-oxide-semiconductor field-effect transistors, or MOSFET, portfolio expanded significantly across a full range of voltage applications.
In addition, our ability to develop new technology is enhanced by the operation of our own manufacturing facilities in Oregon and our close partnership with the JV.
In addition, our ability to develop new technology is enhanced by the operation of our own manufacturing facilities in Oregon and our close partnership with the JV Company.
As part of the enhanced process, we have also conducted extensive risk assessment on export control compliance and implemented training programs for our employees. Executive Officers The following table lists the names, ages and positions of our executive officers as of August 15, 2024. There are no family relationships between any executive officers, except that Mr. Stephen C.
As part of the enhanced process, we have also conducted extensive risk assessment on export control compliance and implemented training programs for our employees. Executive Officers The following table lists the names, ages and positions of our executive officers as of August 15, 2025. There are no family relationships between any executive officers, except that Mr. Stephen C.
We are also subject to SEC rules that require diligence, disclosure and reporting on whether certain minerals and metals, known as conflict minerals, used in our products originate from the Democratic Republic of Congo and adjoining countries. As of June 30, 2024, 2023 and 2022, we were in compliance with the related conflict minerals rule.
We are also subject to SEC rules that require diligence, disclosure and reporting on whether certain minerals and metals, known as conflict minerals, used in our products originate from the Democratic Republic of Congo and adjoining countries. As of June 30, 2025, 2024 and 2023, we were in compliance with the related conflict minerals rule.
We plan to further expand the breadth of our product portfolio to increase our total bill-of-materials within an electronic system and to address the power requirements of additional electronic systems. Our product portfolio currently consists of approximately 2,700 products and we have introduced over 100 new products in this past fiscal year.
We plan to further expand the breadth of our product portfolio to increase our total bill-of-materials within an electronic system and to address the power requirements of additional electronic systems. Our product portfolio currently consists of approximately 2,800 products and we have introduced over 100 new products in this past fiscal year.
For assembly and test, we primarily rely upon our in-house facilities in China. In addition, we utilize subcontracting partners for industry standard packages. We believe our in-house packaging and testing capability provides us with a competitive advantage in proprietary packaging technology, product quality, cost and sales cycle time.
For assembly and test, we primarily rely upon our in-house facilities in China. In addition, we utilize subcontracting partners for industry standard packages. We believe our in-house packaging and testing capability provide us with a competitive advantage in proprietary packaging technology, product quality, cost and sales cycle time.
Although our largest end-market is the personal computing (“PC”) market, we have successfully diversified our business by expanding into other markets, including consumer, communications, and power supply and industrial markets.
Although our largest end-market is the Computing market, we have successfully diversified our business by expanding into other markets, including consumer, communications, and power supply and industrial markets.
Our high-voltage portfolio includes our proprietary insulated-gate bipolar transistor ("IGBT") technology, which we provide highly robust and easy-to-use solutions for industrial motor control and white goods applications. We have also deployed our 1200V SiC (Silicon carbide) products based on our AlphaSiC platform, designed to address high efficiency, high density industrial applications such as solar inverters, UPS, and battery management systems.
Our high-voltage portfolio includes our proprietary IGBT technology, which we provide highly robust and easy-to-use solutions for industrial motor control and white goods applications. We have also deployed our 1200V SiC (Silicon carbide) products based on our AlphaSiC platform, designed to address high efficiency, high density industrial applications such as solar inverters, UPS, and battery management systems.
The proliferation of computer and consumer electronics, such as notebooks, tablets, smart phones, flat panel displays and portable media players created the need for sophisticated power management that increases power efficiency and extends battery life. The evolution of these 2 products is characterized by increased functionality, thinner and smaller form factors and decreasing prices.
The proliferation of computer and consumer electronics, such as notebooks, tablets, smart phones, and portable media players created the need for sophisticated power management that increases power efficiency and extends battery life. The evolution of these products is characterized by increased functionality, thinner and smaller form factors and decreasing prices.
In contrast, our newer Power IC and IGBT products, used mostly in the power supply, home appliance and industrial applications, require a more extended design and marketing timeline and thus have a longer sales cycle.
In contrast, our IGBT and Module products, used mostly in the power supply, home appliance and industrial applications, require a more extended design and marketing timeline and thus have a longer sales cycle.
Chang is a son of Dr. Mike F. Chang. 11 Name Age Position Stephen C. Chang 47 Chief Executive Officer and Director Mike F.
Chang is a son of Dr. Mike F. Chang. Name Age Position Stephen C. Chang 48 Chief Executive Officer and Director Mike F.
Our portfolio of power semiconductors includes approximately 2,700 products, and has grown with the introduction of over 100 new products in the fiscal year ended June 30, 2024, and over 60 and 130 new products in the fiscal years ended June 30, 2023 and 2022, respectively.
Our portfolio of power semiconductors includes approximately 2,800 products, and has grown with the introduction of over 100 new products in the fiscal year ended June 30, 2025, and over 100 and 60 new products in the fiscal years ended June 30, 2024 and 2023, respectively.
The increased application of power semiconductors to control motors in white goods and industrial applications is driving demand for Insulated Gate Bipolar Transistors, or IGBTs. IGBTs are also being used in renewable energy and automotive applications.
The increased application of power semiconductors to control motors in white goods and industrial applications is driving demand for IGBTs. IGBTs are also being used in renewable energy and automotive applications.
While we have made progress in our diversification and expansion into additional applications, we continue to support and grow our PC business by expanding bill-of-material content, gaining market share, and acquiring new customers.
While we have made progress in our diversification and expansion into additional applications, we continue to support and grow our computing business by expanding bill-of-material content, gaining market share, acquiring new customers, and expanding into new application areas such as AI.
We have an extensive patent portfolio that consists of 930 issued patents and 52 pending patents in the United States as of June 30, 2024. We also have a total of 1,025 foreign patents, which were based primarily on our research and development efforts through June 30, 2024.
We have an extensive patent portfolio that consists of 949 issued patents and 64 pending patents in the United States as of June 30, 2025. We also have a total of 961 foreign patents, which were based primarily on our research and development efforts through June 30, 2025.
Our in-house and wholly-owned packaging and testing facilities are located in Shanghai, China which handle most of our packaging and testing requirements for our products. In addition, the JV Company handles a portion of our packaging and testing requirement.
The final tested products are then shipped to our distributors or customers. Our in-house and wholly-owned packaging and testing facilities are located in Shanghai, China which handle most of our packaging and testing requirements for our products. In addition, the JV Company handles a portion of our packaging and testing requirement.
We also developed new technologies and products designed to penetrate into markets beyond our MOSFET computing base, including the consumer, communications and industrial markets, Insulated Gate Bipolar Transistors, or IGBTs for the home appliance market, as well as power ICs for next generation computing and gaming applications.
We also developed new technologies and products designed to penetrate into markets beyond our MOSFET computing base, including the consumer, communications and industrial markets, Insulated Gate Bipolar Transistors, or IGBTs and integrated power modules for the home appliance market, as well as power integrated circuits (“ICs”) for personal computing (“PC ”), advanced computing and gaming applications.
Accordingly, we intend to leverage our expertise to increase the number of power discrete technology platforms and power IC designs, including future digital power controller products that are currently under development, to expand our product offerings and deliver complete 3 power solutions for our targeted applications.
Accordingly, we intend to leverage our expertise to increase the number of power discrete technology platforms and power IC designs, including multiphase controller products to expand our product offerings and deliver complete power solutions for our targeted applications.
Human Capital Resources As of June 30, 2024, we had 2,332 employees, of whom 745 were located in the United States, 1,409 were located in China, and 178 were located in other parts of the world. None of our employees is represented by a collective bargaining agreement.
Human Capital Resources As of June 30, 2025, we had 2,428 employees, of whom 770 were located in the United States, 1,475 were located in China, and 183 were located in other parts of the world. None of our employees is represented by a collective bargaining agreement.
In general, our traditional power discrete products in PC and TV applications progress more rapidly through the customer's design and marketing processes, and therefore they generally have a shorter sales cycle.
In general, our power discrete products and Power IC products in Computing and Consumer segments progress more rapidly through the customer's design and marketing processes, and therefore they generally have a shorter sales cycle.
Chang, Ph.D ., is the founder of our company and serves as our Executive Chairman. Dr. Chang served as Chief Executive Officer since the founding of our company until March 2023. Prior to establishing our company, Dr.
Chang, Ph.D ., is the founder of our company and serves as our Chairman of the Board and Executive Vice President of Strategic Initiatives. Dr. Chang previously served as Executive Chairman from March 2023 to March 2025. He served as Chief Executive Officer since the founding of our company until March 2023. Prior to establishing our company, Dr.
Sales to WPG and Promate accounted for 46.0% and 25.0% of our revenue, respectively, for the fiscal year ended June 30, 2024, 35.6% and 21.6% of our revenue, respectively, for the fiscal year ended June 30, 2023, and 39.7% and 24.6% of our revenue, respectively, for fiscal year ended June 30, 2022, respectively.
Sales to WPG and Promate accounted for 51.3% and 22.1% of our revenue, respectively, for the fiscal year ended June 30, 2025, 46.0% and 25.0% of our revenue, respectively, for the fiscal year ended June 30, 2024, and 35.6% and 21.6% of our revenue, respectively, for fiscal year ended June 30, 2023, respectively.
We have established quality assurance procedures that are intended to control quality throughout the manufacturing process, including qualifying new parts for production at each packaging facility, conducting root cause analysis, testing for lots with process defects and implementing containment and preventive actions. The final tested products are then shipped to our distributors or customers.
After packaging, all devices are tested in accordance with our specifications and substandard or defective devices are rejected. We have established quality assurance procedures that are intended to control quality throughout the manufacturing process, including qualifying new parts for production at each packaging facility, conducting root cause analysis, testing for lots with process defects and implementing containment and preventive actions.
As of June 30, 2024, we had 930 patents issued in the United States, of which 927 were based on our research and development efforts and 3 were acquired, and these patents are set to expire between 2024 and 2042.
As of June 30, 2025, we had 949 patents issued in the United States, which were based on our research and development efforts, of the 949 issued patents, 855 are active and these patents are set to expire between 2025 and 2043.
Experienced engineers engaged in the design process are necessary because computer-aided design cannot fully model the behavior of analog circuitry. Therefore, experienced analog engineers with requisite knowledge are in great demand but short supply worldwide.
Improper interactions between analog circuit elements can potentially render an electronic system inoperable. Experienced engineers engaged in the design process are necessary because computer-aided design cannot fully model the behavior of analog circuitry. Therefore, experienced analog engineers with requisite knowledge are in great demand but short supply worldwide.
We also had a total of 1,025 foreign patents, including 468 Chinese patents, 506 Taiwanese patents, 27 Korean patents, 4 Hong Kong patents, 5 Philippine patents, 8 Japanese patents, 3 Europe patent and 4 India patent as of June 30, 2024. Substantially all of our foreign patents were based on our research and development efforts.
We also had a total of 961 foreign patents, including 392 Chinese patents, 520 Taiwanese patents, 29 Korean patents, 5 Philippine patents, 8 Japanese patents, 3 Europe patents and 4 India patents as of June 30, 2025. Substantially all of our foreign patents were based on our research and development efforts.
Li served in various management positions in our Company since 2012, including Executive Vice President of World-Wide Manufacturing, Senior Vice President of World-Wide Manufacturing, Vice President of Front-End Operation, the director of Process Integration and Senior Manager of Process Integration. Dr.
Li, Ph.D ., has been serving as our Chief Operating Officer since August 2021. Prior to that, Dr. Li served in various management positions in our Company since 2012, including Executive Vice President of World-Wide Manufacturing, Senior Vice President of World-Wide Manufacturing, Vice President of Front-End Operation, the director of Process Integration and Senior Manager of Process Integration. Dr.
Chang previously served as the Company’s President from January 2021 to February 2023. Prior to that, Mr. Chang served in various management positions, including Executive Vice President of Product Line Management, Senior VP of Marketing, VP of the MOSFET Product Line, and Senior Director of Product Marketing. Mr.
Chang served in various management positions, including Executive Vice President of Product Line Management, Senior VP of Marketing, VP of the MOSFET Product Line, and Senior Director of Product Marketing. Mr.
Yifan Liang has been serving as our Chief Financial Officer since August 2014 and Corporate Secretary since November 2013. Mr. Liang served as our Interim Chief Financial Officer from November 2013 to August 2014, our Chief Accounting Officer since October 2006, and our Assistant Corporate Secretary from November 2009 to November 2013. Mr.
Liang served as our Interim Chief Financial Officer from November 2013 to August 2014, our Chief Accounting Officer from October 2006 to November 2013, and our Assistant Corporate Secretary from November 2009 to November 2013. Mr. Liang became our company's corporate controller in August 2004. Prior to joining us, Mr.
Our efforts to develop innovative packaging technologies continues to provide new and cost-effective solutions with higher power density to our customers. During the fiscal year ended June 30, 2024, we continued our diversification strategies by developing new silicon and packaging platforms to expand our SAM and offer higher performance products.
During the fiscal year ended June 30, 2025, we continued our diversification strategies by developing new silicon and packaging platforms to expand our SAM and offer higher performance products.
As the industry has evolved, ODMs are increasingly responsible for designing portions, or entire systems, of the products they manufacture for the OEMs. In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products, which they sell directly to consumers. Our ODM customers include Compal Electronics, Inc., Foxconn, Quanta Computer Incorporated, Wistron Corporation and Delta Electronics.
Through our distributors, we provide products to ODMs who traditionally are contract manufacturers for OEMs. As the industry has evolved, ODMs are increasingly responsible for designing portions, or entire systems, of the products they manufacture for the OEMs. In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products, which they sell directly to consumers.
Our portfolio of products targets high-volume applications, including personal computers, graphic cards, game consoles, flat panel TVs, home appliances, power tools, smart phones, battery packs, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment.
We differentiate ourselves by integrating our expertise in technology, design and advanced manufacturing and packaging to optimize product performance and cost. Our portfolio of products targets high-volume applications, including personal computers, graphic cards, game consoles, home appliances, power tools, smart phones, battery packs, consumer and industrial motor controls and power supplies for computers, servers and telecommunications equipment.
These foreign patents will expire in the years between 2024 and 2042. In addition, as of June 30, 2024, we had a total of 159 patent applications, of which 52 patents were pending in the United States, 79 patents were pending in China, 23 patents were pending in Taiwan and 5 patents were pending in other countries.
These foreign patents will expire in the years between 2025 and 2043. In addition, as of June 30, 2025, we had a total of 165 patent applications, of which 64 patents were pending in the United States, 68 patents were pending in China, 31 patents were pending in Taiwan and 2 patents were pending in India.
Chang, Ph.D. 79 Executive Chairman and Chairman of the Board Yifan Liang 60 Chief Financial Officer and Corporate Secretary Wenjun Li, Ph.D. 55 Chief Operating Officer Bing Xue, Ph.D. 60 Executive Vice President of Worldwide Sales and Business Development Stephen C. Chang has served as our Chief Executive Officer since March 2023 and as a director since November 2022. Mr.
Chang, Ph.D. 80 Chairman of the Board and Executive Vice President of Strategic Initiatives Yifan Liang 61 Chief Financial Officer and Corporate Secretary Wenjun Li, Ph.D. 56 Chief Operating Officer Bing Xue, Ph.D. 61 Executive Vice President of Worldwide Sales and Business Development Stephen C.
Packaging and testing Completed wafers from the foundries are sent to our in-house packaging and testing facilities or to our subcontractors, where the wafers are cut into individual die, soldered to lead frames, wired to terminals and then encapsulated in protective packaging. After packaging, all devices are tested in accordance with our specifications and substandard or defective devices are rejected.
Currently wafers from our third-party accounts for around 30% of AOS’s total wafer supply. Packaging and testing Completed wafers from the foundries are sent to our in-house packaging and testing facilities or to our subcontractors, where the wafers are cut into individual die, soldered to lead frames, wired to terminals and then encapsulated in protective packaging.
We continue to invest in developing new technologies and products utilizing our own fabrication and packaging facilities as it is critical to our long-term success. We also evaluate appropriate investment levels and stay focused on new product introductions to improve our competitiveness. We have research and development teams in Silicon Valley (Sunnyvale, California), Oregon, Texas, Arizona, Korea, Taiwan, and China.
We also evaluate appropriate investment levels and stay focused on new product introductions to improve our competitiveness. We have research and development teams in Silicon Valley (Sunnyvale, California), Oregon, Texas, Arizona, Korea, Taiwan, and China. We believe that these diverse research and development teams enable us to develop leading edge technology platforms and new products.
Chang focused on product research and development in various management positions at General Electric Company from 1974 to 1987. Dr. Chang received his B.S. in electrical engineering from National Cheng Kung University, Taiwan, and M.S. and Ph.D. in electrical engineering from the University of Missouri.
Chang focused on product research and development in various management positions at General Electric Company from 1974 to 1987. Dr.
Regulations governing energy efficiency have accelerated this process in many applications. Analog semiconductors The semiconductor industry is segmented into analog and digital. Analog semiconductors process light, sound, motion, radio waves and electrical currents and voltages. In contrast, digital semiconductors process binary signals represented by a sequence of ones and zeros.
Analog semiconductors process light, sound, motion, radio waves and electrical currents and voltages. In contrast, digital semiconductors process binary signals represented by a sequence of ones and zeros. As a result of these fundamental differences, the analog semiconductor industry is distinct from the digital semiconductor industry in terms of the complexity of design and the length of product cycle.
Due to the diverse nature of end-market applications, we market both general purpose MOSFETs that are used in multiple applications as well as application specific MOSFETs. Our current power discrete product line includes industry standard trench MOSFETs, SRFETs, XSFET, electrostatic discharge, protected MOSFETs, high and mid-voltage MOSFETs and IGBTs.
Due to the diverse nature of end-market applications, we market both general purpose MOSFETs that are used in multiple applications as well as application specific MOSFETs.
The functionality and performance of semiconductors have generally increased over time, while size and cost have generally decreased. These advances have led to a proliferation of more complex semiconductors being used in a wide variety of consumer, computing, communications and industrial markets and have contributed to the growth of the semiconductor industry.
These advances have led to a proliferation of more complex semiconductors being used in a wide variety of consumer, computing, communications and industrial markets and have contributed to the growth of the semiconductor industry. Regulations governing energy efficiency have accelerated this process in many applications. Analog semiconductors The semiconductor industry is segmented into analog and digital.
As of June 30, 2024, 2023 and 2022, our two largest distributors were WPG Holdings Limited, or WPG, and Promate Electronic Co. Ltd., or Promate.
In general, under our agreements with distributors, they have limited rights to return unsold merchandise, subject to time and volume limitations. As of June 30, 2025, 2024 and 2023, our two largest distributors were WPG Holdings Limited, or WPG, and Promate Electronic Co. Ltd., or Promate.
Also, we introduced MRigidCSP™ package technology strengthening our battery management MOSFETs. In addition, we announced application-specific EZBuck™ regulator to power 5V system rails. Distributors and customers We have established direct relationships with key OEMs, including Dell Inc., Hewlett-Packard Company, Samsung Group, and Stanley Black & Decker, Inc., most of whom we serve through our distributors and ODMs.
Distributors and customers We have established direct relationships with key OEMs, including Dell Inc., Hewlett-Packard Company, Samsung Group, and Stanley Black & Decker, Inc., most of whom we serve through our distributors and ODMs. In addition, based on our historical design win activities, our power semiconductors are also incorporated into products sold to many other leading OEMs.
Our sales seasonality is affected by a number of factors, including global and regional economic conditions as well as the PC market trends and conditions, revenue generated from new products, changes in distributor ordering patterns in response to channel 7 inventory adjustments and end customer demand for our products and fluctuations in consumer purchase patterns prior to major holiday seasons.
Sales seasonality is influenced by various factors, including global and regional economic conditions, trends within the personal computer (PC) market, revenue contributions from newly introduced products, variations in distributor ordering behavior driven by channel inventory adjustments, and end-customer demand. Additionally, fluctuations in consumer purchasing patterns—particularly leading up to major holiday seasons—also contribute to the seasonal nature of our revenue.
We were incorporated in Bermuda on September 27, 2000 as an exempted limited liability company. The address of our registered office is Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda. The address of our U.S. office is Alpha and Omega Semiconductor Incorporated, 475 Oakmead Parkway, Sunnyvale, CA 94085. The telephone number of our U.S. office is (408) 830-9742.
Xue received his B.S. in Physics from Xiamen University, and Ph.D. in Physical Chemistry from University of Pennsylvania. Corporate Information We were incorporated in Bermuda on September 27, 2000 as an exempted limited liability company. The address of our registered office is Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda.
In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products which are sold directly to consumers.
While OEMs typically focus design efforts on flagship products, ODMs are increasingly responsible for designing portions, or entire systems, of the products they manufacture for OEMs. In addition, several ODMs are beginning to design, manufacture and brand their own proprietary products which are sold directly to consumers.
We believe that these diverse research and development teams enable us to develop leading edge technology platforms and new products. Our areas of research and development focus include: Packaging technologies : Consumer demand for smaller and more compact electronic devices with higher power density is driving the need for advanced packaging technology.
Our areas of research and development focus include: Packaging technologies : Consumer demand for smaller and more compact electronic devices with higher power density is driving the need for advanced packaging technology. Our group of dedicated packaging engineers focuses on smaller form factors, and higher power output with efficient heat dissipation and cost-effectiveness.
Our group of dedicated packaging engineers focuses on smaller form factors, and higher power output with efficient heat dissipation and cost-effectiveness. We have invested resources in developing and enhancing our proprietary packaging technologies, including the establishment of our in-house packaging and testing facilities.
We have invested resources in developing and enhancing our proprietary packaging technologies, including the establishment of our in-house packaging and testing facilities. Our efforts to develop innovative packaging technologies continues to provide new and cost-effective solutions with higher power density to our customers.
Increase direct relationships and product penetration with OEM and ODM customers We have developed direct relationships with key OEMs that are responsible for branding, designing and marketing a broad array of electronic products, as well as ODMs that have traditionally been responsible for manufacturing these products.
Increase direct relationships and product penetration with OEM and ODM customers We have developed direct relationships with key OEMs that are responsible for branding, designing and marketing a broad array of electronic products, as well as ODMs that have traditionally been responsible for manufacturing these products. 3 We are also focusing on developing and solidifying relationships with certain Tier 1 customers, whose reputation, resources and market share may enable us to generate more significant sales and design wins, and we believe long-term relationships with Tier 1 customers will be a critical factor in our strategy to grow and expand our business operations.
In February 2023, we entered into a license agreement with a customer to license our proprietary SiC technology and to provide 24-months of engineering and development services for a total fee of $45 million, consisting of fees of $18.0 million, $6.8 million and $9.0 million paid to us in the March 2023, July 2023 and February 2024, respectively, with the remaining amount to be paid upon the achievement of specified engineering services and product milestones.
In February 2023, the Company entered into a license agreement with a customer, pursuant to which the Company agreed to license its proprietary Silicon Carbide (SiC) technology to the customer and engineering and development services for 24 months for a total fee of $45.0 million, consisting of an upfront fee and various milestone payments over the 24 months.
While we no longer control the JV Company, the JV Company continued to provide us with significant level of foundry capacity to enable us to develop and manufacture our products, including a commitment to provide us with a monthly wafer production capacity until December 2023, and additional commitment to provide wafer capacity after December 2023 if the JV Company’s production capacity reaches certain specified level.
In addition, the JV Company will continue to provide us with a significant level of foundry capacity to enable us to develop and manufacture our products. Pursuant to an agreement with the JV Company and other shareholders of the JV Company, the JV Company is committed to provide us with a specified level of monthly wafer production capacity.
In order to take advantage of the expertise of end-customer fulfillment logistics and shorter payment cycles, we sell most of our products through distributors. In general, under our agreements with distributors, they have limited rights to return unsold merchandise, subject to time and volume limitations.
Our ODM customers include Compal Electronics, Inc., Foxconn, Quanta Computer Incorporated, Wistron Corporation and Delta Electronics. In order to take advantage of the expertise of end-customer fulfillment logistics and shorter payment cycles, we sell most of our products through distributors.
Seasonality As we provide power semiconductors used in consumer electronic products, our business is subject to seasonality.
Seasonality Our business is subject to seasonal fluctuations, primarily due to our involvement in the power semiconductor market for consumer electronic products.
Liang became our company's corporate controller in August 2004. Prior to joining us, Mr. Liang held various positions at PricewaterhouseCoopers LLP, or PwC, from 1995 to 2004, including Audit Manager in PwC’s San Jose office. Mr.
Liang held various positions at PricewaterhouseCoopers LLP, or PwC, from 1995 to 2004, including Audit Manager in PwC’s San Jose office. Mr. Liang received his B.S. in management information system from the People's University of China and M.A. in finance and accounting from the University of Alabama. Wenjun.
We have incorporated various wholly-owned subsidiaries in different jurisdictions. Please refer to Exhibit 21.1 to this Form 10-K for a complete list of our subsidiaries. Our industry Semiconductors are electronic devices that perform a variety of functions, such as converting or controlling signals, processing data and delivering or managing power.
Our industry Semiconductors are electronic devices that perform a variety of functions, such as converting or controlling signals, processing data and delivering or managing power. The functionality and performance of semiconductors have generally increased over time, while size and cost have generally decreased.
Research and development We view technology as a competitive advantage, and we invest significant time and capital in research and development to address the technology-intensive needs of our end customers. Our research and development expenditures for the fiscal years of 2024, 2023 and 2022 were $89.9 million, $88.1 million and $71.3 million, respectively.
Our research and development expenditures for the fiscal years of 2025, 2024 and 2023 were $94.3 million, $89.9 million and $88.1 million, respectively. We continue to invest in developing new technologies and products utilizing our own fabrication and packaging facilities as it is critical to our long-term success.
Liang received his B.S. in management information system from the People's University of China and M.A. in finance and accounting from the University of Alabama. Wenjun. Li, Ph.D ., has been serving as our Chief Operating Officer since August 2021. Prior to that, Dr.
Chang received his B.S. in electrical engineering from National Cheng Kung University, Taiwan, and M.S. and Ph.D. in electrical engineering from the University of Missouri. 11 Yifan Liang has been serving as our Chief Financial Officer since August 2014 and Corporate Secretary since November 2013. Mr.
This is particularly important in the development of power semiconductor products due to the unique nature of their technology. While digital technologies are highly standardized in leading foundries, power semiconductor technologies tend to be more unique as they seek to accommodate a wider range of voltage applications.
This is particularly important in the development of power semiconductor products due to the unique nature of their technology. Our strategies We seek to advance our position as a designer, developer and global supplier of a broad portfolio of power semiconductors.
Removed
We differentiate ourselves by integrating our expertise in technology, design and advanced manufacturing and packaging to optimize product performance and cost.
Added
On December 30, 2024, the JV Company signed an investment agreement with an investor, pursuant to which the investor agreed to invest RMB 500 million (or $68.5 million based on the currency exchange rate between RMB and 1 U.S. Dollar on December 31, 2024) in the JV Company in exchange for a 7.09% interest.
Removed
As of December 1, 2021, we owned 50.9%, and the Chongqing Funds owned 49.1%, of the equity interest in the JV Company. The Joint Venture was accounted under the provisions of the consolidation guidance since we had controlling financial interest until December 1, 1 2021. As of December 2, 2021, we ceased having control over the JV Company.
Added
This transaction closed on January 15, 2025, at which time, the percentage of outstanding JV Company’s equity interest owned by the Company was reduced to approximately 39.2%. We recorded a gain of $0.5 million on the change of equity interest in the JV Company, which was included in the equity method investment loss line in the consolidated statements of operations.
Removed
Therefore, we deconsolidated the JV Company as of that date. Subsequently, we have accounted for its investment in the JV Company using the equity method of accounting. As of June 30, 2023, the percentage of outstanding JV equity interest beneficially owned by the Company was reduced to 42.2%.
Added
The funding of the investment was agreed to be made in three installments. The JV Company received the first installment of RMB 40 million (or $5.5 million) on December 31, 2024. However, the JV Company has not received the remaining two installments as of the filing date.
Removed
Such reduction reflects (i) the sale by the Company of approximately 2.1% of the outstanding JV equity interest which resulted in the deconsolidation of the JV Company, (ii) additional sale by the Company of approximately 1.1% of outstanding JV equity interest in December 2021, (iii) the adoption of an employee equity incentive plan and the issuance of additional equity interest equivalent to 3.99% of the JV Company to investors in exchange for cash in December 2021, and (iv) issuance of additional equity interest of the JV to investors in January 2022.
Added
On July 14, 2025, we entered into an equity transfer agreement (“Agreement”) with the investor to sell approximately 20.3% of outstanding equity interest in the JV Company for an aggregate cash consideration of $150 million.
Removed
In February 2024, the JV Company repurchased certain shares that were previously issued to employees under the employee equity incentive plan, which increased our percentage of equity ownership in the JV Company by 0.54%. As of June 30, 2024, the percentage of outstanding JV equity interest beneficially owned by us was 42.8%.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

31 edited+7 added−216 removed71 unchanged
Biggest changeRisk Factor Summary Risks Related to Our Business • We may be adversely affected by the macroeconomic conditions and cyclicality of the semiconductor industry. • The decline of personal computing (“PC”) markets may have a material adverse effect on our results of operations. • Our strategy of diversification into different market segments may not succeed according to our expectations. • Our operating results may fluctuate from period to period due to many factors, which may make it difficult to predict our future performance. • Geopolitical and economic conflicts between United States and China may adversely affect our business. • Our revenue may fluctuate significantly from period to period due to ordering patterns from our distributors and seasonality. • We may not be able to introduce or develop new and enhanced products that meet or are compatible with our customer’s product requirements in a timely manner. • We may not win sufficient designs, or our design wins may not generate sufficient revenue for us to maintain or expand our business. • Our success depends upon the ability of our OEM end customers to successfully sell products incorporating our products. • The operation of our Oregon Fab subjects us to additional risks and the need for additional capital expenditures which may negatively impact our results of operations. • Defects and poor performance in our products could result in loss of customers, decreased revenue, unexpected expenses and loss of market share. • If we do not forecast demand for our products accurately, we may experience product shortages, delays in product shipment, excess product inventory, or difficulties in planning expenses, which will adversely affect our business and financial condition. • We face intense competition and may not be able to compete effectively which could reduce our revenue and market share. • Our reliance on third-party semiconductor foundries to manufacture our products subjects us to risks. • Our lack of control over the JV Company may adversely affect our operations. • Our reliance on distributors to sell a substantial portion of our products subjects us to a number of risks. • We have made and may continue to make strategic acquisitions of other companies, assets or businesses and these acquisitions introduce significant risks and uncertainties. • If we are unable to obtain raw materials in a timely manner or if the price of raw materials increases significantly, production time and product costs could increase, which may adversely affect our business. • We may not be able to accurately estimate provisions at fiscal period end for price adjustment and stock rotation rights under our agreements with distributors, and our failure to do so may impact our operating results. • Our operation of two wholly-owned packaging and testing facilities are subject to risks that could adversely affect our business and financial results. • We may be adversely affected by any disruption in our information technology systems. • We depend on the continuing services of our senior management team and other key personnel. • Failure to protect our patents and our other proprietary information could harm our business and competitive position. 13 • Intellectual property disputes could result in lengthy and costly arbitration, litigation or licensing expenses or prevent us from selling our products. • The DOC government investigation and evolving export control regulations may adversely affect our financial performance and business operations. • Global or regional economic, political and social conditions could adversely affect our business and operating results. • Our business operations could be significantly harmed by natural disasters or global epidemics. • Our insurance may not cover all losses, including losses resulting from business disruption or product liability claims. • Our international operations subject our company to risks not faced by companies without international operations. • If we fail to maintain an effective internal control environment as well as adequate control procedures over our financial reporting, investor confidence may be adversely affected thereby affecting the value of our stock price. • We are subject to the risk of increased income taxes and changes in existing tax rules. • Our debt agreements include financial covenants that may limit our ability to pursue business and financial opportunities and subject us to risk of default. • The imposition of U.S. corporate income tax on our Bermuda parent and non-U.S. subsidiaries could adversely affect our results of operations. • We may be classified as a passive foreign investment company (“PFIC”), which could result in adverse U.S. federal income tax consequences for U.S. holders. • The average selling prices of products in our markets have historically decreased rapidly and will likely do so in the future, which could harm our revenue and gross margins.
Biggest changeRisk Factor Summary Risks Related to Our Business • Our operating results and financial conditions are affected by downturns in the semiconductor industry, changes in end-market demand and other macro-economic trends. • The decline of personal computing (“PC”) markets may have a material adverse effect on our results of operations. • Our strategy of diversification into different market segments may not succeed according to our expectations and may expose us to new risks and place significant strains on our management, operational, financial and other resources. • Our operating results may fluctuate from period to period due to many factors, which may make it difficult to predict our future performance. • Geopolitical and economic conflicts between United States and China may adversely affect our business. • Our revenue may fluctuate significantly from period to period due to ordering patterns from our distributors and seasonality. • We may not be able to introduce or develop new and enhanced products that meet or are compatible with our customer’s product requirements in a timely manner. • We may not win sufficient designs, or our design wins may not generate sufficient revenue for us to maintain or expand our business. • Our success depends upon the ability of our OEM end customers to successfully sell products incorporating our products. • The operation of our Oregon Fab subjects us to additional risks and the need for additional capital expenditures which may negatively impact our results of operations. • Defects and poor performance in our products could result in loss of customers, decreased revenue, unexpected expenses and loss of market share, and we may face warranty and product liability claims arising from defective products. • The average selling prices of products in our markets have historically decreased rapidly and will likely do so in the future, which could harm our revenue and gross margins. • If we do not forecast demand for our products accurately, we may experience product shortages, delays in product shipment, excess product inventory, or difficulties in planning expenses, which will adversely affect our business and financial condition. • We face intense competition and may not be able to compete effectively which could reduce our revenue and market share. • Our reliance on third-party semiconductor foundries to manufacture our products subjects us to risks. • Our lack of control over the JV Company may adversely affect our operations. • Our recent sale of equity interest in the JV Company is subject to certain closing conditions, and if the conditions are not met, we may not receive a portion or any of the cash proceeds from the sale. • Our reliance on distributors to sell a substantial portion of our products subjects us to a number of risks. • We have made and may continue to make strategic acquisitions of other companies, assets or businesses and these acquisitions introduce significant risks and uncertainties. • If we are unable to obtain raw materials in a timely manner or if the price of raw materials increases significantly, production time and product costs could increase, which may adversely affect our business. • We may not be able to accurately estimate provisions at fiscal period end for price adjustment and stock rotation rights under our agreements with distributors, and our failure to do so may impact our operating results. • Our operation of two wholly-owned packaging and testing facilities are subject to risks that could adversely affect our business and financial results. • We may be adversely affected by any disruption in our information technology systems. • We depend on the continuing services of our senior management team and other key personnel. • Failure to protect our patents and our other proprietary information could harm our business and competitive position. • Intellectual property disputes could result in lengthy and costly arbitration, litigation or licensing expenses or prevent us from selling our products. • Evolving export control regulations may adversely affect our financial performance and business operations. • Global or regional economic, political and social conditions could adversely affect our business and operating results. • Our business operations could be significantly harmed by natural disasters or global epidemics. • Our insurance may not cover all losses, including losses resulting from business disruption or product liability claims. • Our international operations subject our company to risks not faced by companies without international operations. • If we fail to maintain an effective internal control environment as well as adequate control procedures over our financial reporting, investor confidence may be adversely affected thereby affecting the value of our stock price. 13 • We are subject to the risk of increased income taxes and changes in existing tax rules. • Our debt agreements include financial covenants that may limit our ability to pursue business and financial opportunities and subject us to risk of default. • The imposition of U.S. corporate income tax on our Bermuda parent and non-U.S. subsidiaries could adversely affect our results of operations. • We may be classified as a passive foreign investment company (“PFIC”), which could result in adverse U.S. federal income tax consequences for U.S. holders. • Changes in our United States federal income tax classification, or that of our subsidiaries, could result in adverse tax consequences to our 10% or greater U.S. shareholders. • Changes in tariffs and international trade policies affecting imports and exports may have a material adverse effect on our business operations and financial performance.
Risks Related to Our Corporate Structure and Our Common Shares • Our share price may be volatile and you may be unable to sell your shares at or above the purchase price, if at all. 14 • If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our common shares or if our operating results do not meet their expectations, the trading price of our common shares could decline. • Anti-takeover provisions in our bye-laws could make an acquisition of us more difficult and may prevent attempts by our shareholders to replace or remove our current management. • We are a Bermuda company and the rights of shareholders under Bermuda law may be different from U.S. laws.
Risks Related to Our Corporate Structure and Our Common Shares • Our share price may be volatile and you may be unable to sell your shares at or above the purchase price, if at all. • If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our common shares or if our operating results do not meet their expectations, the trading price of our common shares could decline. • Anti-takeover provisions in our bye-laws could make an acquisition of us more difficult and may prevent attempts by our shareholders to replace or remove our current management. • We are a Bermuda company and the rights of shareholders under Bermuda law may be different from U.S. laws.
To manage this diversification effectively, we will need to take various actions, including: • enhancing management information systems, including forecasting procedures; • further developing our operating, administrative, financial and accounting systems and controls; 15 • managing our working capital and sources of financing; • maintaining close coordination among our engineering, accounting, finance, marketing, sales and operations organizations; • retaining, training and managing our employee base; • enhancing human resource operations and improving employee hiring and training programs; • realigning our business structure to more effectively allocate and utilize our internal resources; • improving and sustaining our supply chain capability; and • managing both our direct and distribution sales channels in a cost-efficient and competitive manner.
To manage this diversification effectively, we will need to take various actions, including: • enhancing management information systems, including forecasting procedures; • further developing our operating, administrative, financial and accounting systems and controls; • managing our working capital and sources of financing; • maintaining close coordination among our engineering, accounting, finance, marketing, sales and operations organizations; • retaining, training and managing our employee base; • enhancing human resource operations and improving employee hiring and training programs; • realigning our business structure to more effectively allocate and utilize our internal resources; • improving and sustaining our supply chain capability; and • managing both our direct and distribution sales channels in a cost-efficient and competitive manner.
These factors include, among others: • a deterioration in general demand for electronic products, particularly the PC market, as a result of global or regional financial crises and associated macro-economic slowdowns, and/or the cyclicality of the semiconductor industry; • a deterioration in business conditions at our distributors and /or end customers; • adverse general economic conditions in the countries where our products are sold or used; • the emergence and growth of markets for products we are currently developing; • our ability to successfully develop, introduce and sell new or enhanced products in a timely manner and the rate at which our new products replace declining orders for our older products; • the anticipation, announcement or introduction of new or enhanced products by us or our competitors; • changes in the selling prices of our products and in the relative mix in the unit shipments of our products, which have different average selling prices and profit margins; • the amount and timing of operating costs and capital expenditures, including expenses related to the maintenance and expansion of our business operations and infrastructure; • the announcement of significant acquisitions, disposition or partnership arrangements; • changes in the utilization of our in-house manufacturing capacity and the availability of manufacturing capacity at third-party foundries and the JV Company; • supply and demand dynamics and the resulting price pressure on the products we sell; • the unpredictable volume and timing of orders, deferrals, cancellations and reductions for our products, which may depend on factors such as our end customers' sales outlook, purchasing patterns and inventory adjustments based on general economic conditions or other factors; • changes in laws and regulations affecting our business operations; • changes in costs associated with manufacturing of our products, including pricing of wafer, raw materials and assembly services; • announcement of significant share repurchase programs; • our concentration of sales in consumer applications and changes in consumer purchasing patterns and confidence; and • the adoption of new industry standards or changes in our regulatory environment.
These factors include, among others: • a deterioration in general demand for electronic products, particularly the PC market, as a result of global or regional financial crises and associated macro-economic slowdowns, and/or the cyclicality of the semiconductor industry; • a deterioration in business conditions at our distributors and /or end customers; • adverse general economic conditions in the countries where our products are sold or used; • the emergence and growth of markets for products we are currently developing; 15 • our ability to successfully develop, introduce and sell new or enhanced products in a timely manner and the rate at which our new products replace declining orders for our older products; • the anticipation, announcement or introduction of new or enhanced products by us or our competitors; • changes in the selling prices of our products and in the relative mix in the unit shipments of our products, which have different average selling prices and profit margins; • the amount and timing of operating costs and capital expenditures, including expenses related to the maintenance and expansion of our business operations and infrastructure; • the announcement of significant acquisitions, disposition or partnership arrangements; • changes in the utilization of our in-house manufacturing capacity and the availability of manufacturing capacity at third-party foundries and the JV Company; • supply and demand dynamics and the resulting price pressure on the products we sell; • the unpredictable volume and timing of orders, deferrals, cancellations and reductions for our products, which may depend on factors such as our end customers’ sales outlook, purchasing patterns and inventory adjustments based on general economic conditions or other factors; • changes in laws and regulations affecting our business operations, including trade regulations and tariffs; • changes in costs associated with manufacturing of our products, including pricing of wafer, raw materials and assembly services; • announcement of significant share repurchase programs; • our concentration of sales in consumer applications and changes in consumer purchasing patterns and confidence; and • the adoption of new industry standards or changes in our regulatory environment.
Any actual or perceived errors, defects or poor performance in our products could result in the replacement or recall of our products, shipment delays, rejection of our products, damage to our reputation, lost revenue, diversion of our engineering personnel from our product development efforts in order to address or remedy any defects 18 and increases in customer service and support costs, all of which could have a material adverse effect on our business and operations.
Any actual or perceived errors, defects or poor performance in our products could result in the replacement or recall of our products, shipment delays, rejection of our products, damage to our reputation, lost revenue, diversion of our engineering personnel from our product development efforts in order to address or remedy any defects and increases in customer service and support costs, all of which could have a material adverse effect on our business and operations.
Using a foundry with which we have no established relationship could expose us to potentially unfavorable pricing, unsatisfactory quality or insufficient capacity allocation. 20 We also rely on third-party foundries to effectively implement certain of our proprietary technology and processes and also require their cooperation in developing new fabrication processes.
Using a foundry with which we have no established relationship could expose us to potentially unfavorable pricing, unsatisfactory quality or insufficient capacity allocation. We also rely on third-party foundries to effectively implement certain of our proprietary technology and processes and also require their cooperation in developing new fabrication processes.
A significant decrease in our distributors’ channel inventory in one period may lead to a significant rebuilding of channel inventory in subsequent periods, or vice versa, which may cause our quarterly revenue and operating results to fluctuate significantly. In addition, because our power semiconductors are used in consumer electronics products, our revenue is subject to seasonality.
A significant decrease in our distributors’ channel inventory in one period may lead to a significant rebuilding of channel inventory in subsequent periods, or vice versa, which may cause our quarterly revenue and operating results to fluctuate significantly. 16 In addition, because our power semiconductors are used in consumer electronics products, our revenue is subject to seasonality.
If the JV Company is not able to generate sufficient cash flow to make 21 payments under these loans, the JV Company may be in default, which will adversely affect its ability to continue operations and provide foundry services to us. In addition, the JV Company requires additional funding to continue its operations and to refinance its existing indebtedness.
If the JV Company is not able to generate sufficient cash flow to make payments under these loans, the JV Company may be in default, which will adversely affect its ability to continue operations and provide foundry services to us. In addition, the JV Company requires additional funding to continue its operations and to refinance its existing indebtedness.
For example, while we remain a major customer of the JV Company, the JV Company may decide to enter into business relationships with other customers and allocate foundry capacities to such customers, which may prevent us from securing a desirable or sufficient level of manufacturing capacity for our products.
For example, 20 while we remain a major customer of the JV Company, the JV Company may decide to enter into business relationships with other customers and allocate foundry capacities to such customers, which may prevent us from securing a desirable or sufficient level of manufacturing capacity for our products.
The failure of our OEM end customers to achieve or maintain commercial success for any reason could harm our business, results of operations, and financial condition and prospects. The operation of our Oregon Fab subjects us to additional risks and the need for additional capital expenditures which may negatively impact our results of operations.
The failure of our OEM end customers to achieve or maintain commercial success for any reason could harm our business, results of operations, and financial condition and prospects. 17 The operation of our Oregon Fab subjects us to additional risks and the need for additional capital expenditures which may negatively impact our results of operations.
This process requires us to make numerous forecasts and assumptions relating to the demand of our end customers, channel inventory, and general market conditions. Because we sell most of our products to distributors, who in turn sell to our end customers, we have limited visibility as to end customer demand.
This process requires us to make numerous forecasts and assumptions relating to the demand of our end customers, channel inventory, and general market 18 conditions. Because we sell most of our products to distributors, who in turn sell to our end customers, we have limited visibility as to end customer demand.
The decline of personal computing (“PC”) markets may have a material adverse effect on our results of operations. A significant amount of our revenue is derived from sales of products in the PC markets such as notebooks, motherboards and notebook battery packs.
The decline of personal computing (“PC”) markets may have a material adverse effect on our results of operations. 14 A significant amount of our revenue is derived from sales of products in the PC markets such as notebooks, motherboards and notebook battery packs.
In the past, we have encountered product compatibility issues with a major OEM that has negatively impacted our financial results, and although we have resolved fully such issues with the OEM, there is no guarantee that the same compatibility issues will not occur in the future with other OEMs.
In the past, we have encountered product compatibility issues with a major OEM that have negatively impacted our financial results, and although we have resolved fully such issues with the OEM, there is no guarantee that the same compatibility issues will not occur in the future with other OEMs.
In addition, we cannot be assured that these 17 efforts would result in a design win, that our product would be incorporated into an end customer's initial product design, or that any such design win would lead to production orders and generate sufficient revenue.
In addition, we cannot be assured that these efforts would result in a design win, that our product would be incorporated into an end customer’s initial product design, or that any such design win would lead to production orders and generate sufficient revenue.
While we retained control over the JV Company from inception of 2021, we lost control over the JV Company in December 2021 as our equity interest in the JV Company has been diluted through the issuances of additional equity securities by the JV Company and other transactions.
While we retained control over the JV Company from inception to 2021, we lost control over the JV Company in December 2021 as our equity interest in the JV Company has been diluted through the issuances of additional equity securities by the JV Company and other transactions.
Risks Related to Doing Business in China • China’s economic, political and social conditions, as well as government policies, could affect our business and growth. • Changes in China’s laws, legal protections or government policies on foreign investment in China may harm our business. • The continuing trade tensions between the U.S. and China may result in increased tariffs on imported goods from China could adversely affect our business operations. • Uncertainties exist with respect to the interpretation and implementation of PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations. • Limitations on our ability to transfer funds to our China subsidiaries could adversely affect our ability to expand our operations, make investments that could benefit our businesses and otherwise fund and conduct our business. • China's currency exchange control and government restrictions on investment repatriation may impact our ability to transfer funds outside of China. • The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China. • Our results of operations may be negatively impacted by fluctuations in foreign currency exchange rates between U.S. dollar and Chinese Yuan, or RMB. • PRC labor laws may adversely affect our results of operations. • Relations between Taiwan and China could negatively affect our business, financial condition and operating results and, therefore, the market value of our common shares.
Risks Related to Doing Business in China • China’s economic, political and social conditions, as well as government policies, could affect our business and growth. • Changes in China’s laws, legal protections or government policies on foreign investment in China may harm our business. • The continuing trade tensions between the U.S. and China may result in increased tariffs on imported goods from China could adversely affect our business operations. • Our China subsidiaries’ current corporate structure and business operations may be affected by the Foreign Investment Law of the PRC. • Limitations on our ability to transfer funds to our China subsidiaries could adversely affect our ability to expand our operations, make investments that could benefit our businesses and otherwise fund and conduct our business. • China's currency exchange control and government restrictions on investment repatriation may impact our ability to transfer funds outside of China. • The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China. • Our results of operations may be negatively impacted by fluctuations in foreign currency exchange rates between U.S. dollar and Chinese Yuan ("RMB"). • PRC labor laws may adversely affect our results of operations. • Relations between Taiwan and China could negatively affect our business, financial condition and operating results and, therefore, the market value of our common shares.
Our revenue from the PC markets accounted for approximately 43.0%, 35.2% and 44.5% of our total revenue for the years ended June 30, 2024, 2023 and 2022, respectively. The increasing popularity of smaller, mobile computing devices such as tablets and smart phones with touch interfaces is rapidly changing the PC markets both in the United States and abroad.
Our revenue from the PC markets accounted for approximately 46.6%, 43.0% and 35.2% of our total revenue for the years ended June 30, 2025, 2024 and 2023, respectively. The increasing popularity of smaller, mobile computing devices such as tablets and smart phones with touch interfaces is rapidly changing the PC markets both in the United States and abroad.
In recent year, broad fluctuations in the semiconductor markets and the global economic conditions, in particular the decline of the PC market conditions, as well as the COVID-19 pandemic, have had a more significant impact on our results of operations, than seasonality, and have made it difficult to assess the impact of seasonal factors on our business.
In recent year, broad fluctuations in the semiconductor markets and the global economic conditions, in particular the decline of the PC market conditions, have had a more significant impact on our results of operations, than seasonality, and have made it difficult to assess the impact of seasonal factors on our business.
At various times during recent years, the United States and China have had disagreements over political and economic issues, including but not limited to, the recent imposition of tariffs by the U.S. on goods imported from China and to the U.S. government's efforts to restrict transfer and sharing of technologies, including semiconductor technologies, between the two countries.
At various times during recent years, the United States and China have had disagreements over political and economic issues, including, but not limited to, the recent imposition of tariffs by the U.S. on goods imported from China or sourced from China and imposition of retaliatory tariffs and other countermeasures (like government investigations, sanctions, etc.) by China, as well as the U.S. government’s efforts to restrict transfer and sharing of technologies, including semiconductor technologies, between the two countries.
If customer demand or revenue for a particular period is lower than we expect, we may not be able to proportionately reduce our fixed operating expenses for that period, which would harm our operating results.
If customer demand or revenue for a particular period is lower than we expect, we may not be able to proportionately reduce our fixed operating expenses for that period, which would harm our operating results. We face intense competition and may not be able to compete effectively which could reduce our revenue and market share.
Therefore, comparing our operating results on a period-to-period basis may not be meaningful, and you should not rely on our past results as an indication of our future performance. 16 Geopolitical and economic conflicts between United States and China may adversely affect our business Geopolitical conflicts and tensions between the United States and China have threatened and destabilized trading relationships and economic activities between the two countries.
Therefore, comparing our operating results on a period-to-period basis may not be meaningful, and you should not rely on our past results as an indication of our future performance. Geopolitical and economic conflicts between United States and China may adversely affect our business.
If we are unable to compete effectively for any of the foregoing or other reasons, our business, results of operations, and financial condition and prospects will be harmed. Our reliance on third-party semiconductor foundries to manufacture our products subject us to risks. The allocation of our wafer production between in-house facility and third-party foundries may fluctuate from time to time.
If we are unable to compete effectively for any of the foregoing or other reasons, our business, results of operations, and financial condition and prospects will be harmed. 19 Our reliance on third-party semiconductor foundries to manufacture our products subject us to risks.
While we believe the negative impact of inventory correction has gradually subsided in mid-2024, we cannot predict how and when the market will be fully recovered. We have implemented measures and strategies to mitigate the effect of such a downturn. These measures and strategies may not be sufficient or successful, in which case our operating results may be adversely affected.
While we believe the negative impact of inventory correction has gradually subsided since mid-2024 and early 2025, we cannot predict how and when the market will be fully recovered. We have implemented measures and strategies to mitigate the effect of such a downturn.
Our strategy of diversification into different market segments may not succeed according to our expectations and may expose us to new risks and place significant strains on our management, operational, financial and other resources.
These measures and strategies may not be sufficient or successful, in which case our operating results may be adversely affected. Our strategy of diversification into different market segments may not succeed according to our expectations and may expose us to new risks and place significant strains on our management, operational, financial and other resources.
Any of the foregoing risks could materially reduce the expected return of our investment in the JV Transaction and adversely affect our business operations, our financial performance and the trading price of our shares. Our reliance on distributors to sell a substantial portion of our products subjects us to a number of risks.
Any of the foregoing risks could materially reduce the expected return of our investment in the JV Company and adversely affect our business operations, our financial performance and the trading price of our shares.
While we expect some recovery of the macroeconomic trend by the end of 2023 and early 2024, there is no guarantee that it will occur and a prolonged and extended downturn in the semiconductor industry will have a substantial impact on our operating results and financial conditions.
In addition, the broader semiconductor industry experienced a decline in calendar year 2023 with some recovery in 2024, but there is no guarantee that further recovery will occur and a prolonged and extended downturn in the semiconductor industry will have a substantial impact on our operating results and financial conditions.
Because we have significant operations in both countries, such conflicts and tensions may negatively impact our business.
Geopolitical conflicts and tensions between the United States and China have threatened trading relationships and economic activities between the two countries. Because we have significant operations in both countries, such conflicts and tensions may negatively impact our business.
Our main competitors are primarily headquartered in the United States, Japan, Taiwan and Europe. Our major competitors for our power discretes include Infineon Technologies AG, Magnachip Semiconductor Corporation, ON Semiconductor Corp., STMicroelectronics N.V., Toshiba Corporation, Diodes Incorporated and Vishay Intertechnology, Inc.
Our major competitors in power discretes include Infineon Technologies AG, ON Semiconductor Corp., STMicroelectronics N.V., Toshiba Corporation, Diodes Incorporated and Vishay Intertechnology, Inc. Our major competitors for our power ICs include Monolithic Power Systems, Inc., ON Semiconductor Corp., Richtek Technology Corp., Semtech Corporation, Texas Instruments Inc. and Vishay Intertechnology, Inc..
We face intense competition and may not be able to compete effectively which could reduce our revenue and market share. 19 The power semiconductor industry is highly competitive and fragmented. If we do not compete successfully against current or potential competitors, our market share and revenue may decline.
The power semiconductor industry is highly competitive and fragmented. If we do not compete successfully against current or potential competitors, our market share and revenue may decline. Our main competitors are primarily headquartered in the United States, Japan, Taiwan and Europe.
Our major competitors for our power ICs include Global Mixed-mode Technology Inc., Monolithic Power Systems, Inc., ON Semiconductor Corp., Richtek Technology Corp., Semtech Corporation, Texas Instruments Inc. and Vishay Intertechnology, Inc. We expect to face competition in the future from our competitors, other manufacturers, designers of semiconductors and start-up semiconductor design companies.
We expect to face competition in the future from our competitors, other manufacturers, designers of semiconductors and start-up semiconductor design companies.
There is no guarantee that we will be successful in renewing the capacity agreement, and even if we do, there is no guarantee that we will obtain favorable pricing or service terms, or that such capacity will be sufficient, which may adversely affect our results of operations.
Although the JV Company has agreed to provide us with a specified level of monthly wafer production capacity, there is no guarantee that such capacity will be sufficient, which may adversely affect our results of operations.
Removed
Since mid-2022, we have experienced an industry-wide decline of customer demand for semiconductor products due primarily to the build-up of excess inventory prior to the cessation of the COVID-19 pandemic. This decline has negatively affected our recent financial performance in 2023.
Added
More recently, we have observed the impact of certain government regulations, such as tariffs or other related trade regulation, that can negatively affect the global semiconductor markets and cause a decline for the demand of our products.
Removed
We expect to continue to rely in part on third party foundries to meet our wafer requirements. Although we use several independent foundries, our primary third-party foundry is HHGrace, which manufactured 3.8%, 9.6% and 10.3% of the wafers used in our products for the fiscal years ended June 30, 2024, 2023 and 2022, respectively.
Added
In addition, our Tier 1 customers often have stringent standards and strict requirements that must be met before our products can be sold, which may create challenges and difficulties in our product development efforts.
Removed
Although the JV Company has previously agreed to provide us with a guaranteed capacity on a monthly basis, such guarantee has expired and we are in the process of negotiating a new arrangement with the JV Company to provide us with capacity.
Added
The allocation of our wafer production between in-house facility and third-party foundries may fluctuate from time to time. We expect to continue to rely in part on third party foundries to meet our wafer requirements.
Removed
In addition, while we expect to achieve a financial return for our investment in the JV Company as a result of the China IPO, the China IPO process is complex, time-consuming and subject to a number of risks and there is no guarantee that the China IPO will be completed in a timely manner, or at all, and the JV Company’s failure to close the China IPO will negatively affect our investment in the JV Company.
Added
In July 2025, we entered into an equity transfer agreement with a strategic investor to sell approximately 20.3% of outstanding equity interest in the JV Company. As of June 30, 2025, our interest in the JV Company was 39.2%.
Removed
We sell a substantial portion of our products to distributors, who in turn sell to our end customers. Our distributors typically offer power semiconductor products from several different companies, including our direct competitors. The distributors assume collection risk and provide logistical services to end customers, including stocking our products.
Added
Our recent sale of equity interest in the JV Company is subject to certain closing conditions, and if the conditions are not met, we may not receive a portion or any of the cash proceeds under the equity transfer agreement and we may be required to unwind the transaction, which will adversely affect our financial results and reputation.
Removed
Two distributors, WPG and Promate, collectively accounted for 71.0%, 57.2% and 64.3% of our revenue for the fiscal years ended June 30, 2024, 2023 and 2022, respectively.
Added
On July 14, 2025, we entered into an equity transfer agreement with a third-party strategic investor to sell approximately 20.3% of outstanding equity interest in the JV Company for an aggregate cash consideration of $150 million to be paid in four installments, subject to satisfaction of certain conditions.
Removed
We currently have effective agreements with Promate and WPG to serve as our distributors, and such agreement is renewed automatically for one-year period continuously unless terminated earlier pursuant to the terms of such agreements. We believe that our success will continue to depend upon these distributors.
Added
Such conditions include, among other things, shareholder approval by the JV Company and certain registrations, approvals by government authorities and closing of additional investment by the strategic investor in the JV Company’s equity, which are outside of our control. For a more detailed description of the installment payments and related conditions, please see
Removed
Our reliance on distributors subjects us to a number of risks, including: • write-downs in inventories associated with stock rotation rights and increases in provisions for price adjustments granted to certain distributors; • potential reduction or discontinuation of sales of our products by distributors; • failure to devote resources necessary to sell our products at the prices, in the volumes and within the time frames that we expect; • focusing their sales efforts on products of our competitors; • dependence upon the continued viability and financial resources of these distributors, some of which are small organizations with limited working capital and all of which depend on general economic conditions and conditions within the semiconductor industry; • dependence on the timeliness and accuracy of shipment forecasts and resale reports from our distributors; • management of relationships with distributors, which can deteriorate as a result of conflicts with efforts to sell directly to our end customers; and • our agreements with distributors which are generally terminable by either party on short notice.
Removed
If any significant distributor becomes unable or unwilling to promote and sell our products, or if we are not able to renew our contracts with the distributors on acceptable terms, we may not be able to find a replacement distributor on reasonable terms or at all and our business could be harmed.
Removed
We have made and may continue to make strategic acquisitions of other companies, assets or businesses or form joint ventures with partners to advance our business objectives. These acquisitions and joint ventures involve significant risks and uncertainties.
Removed
In order to position ourselves to take advantage of growth opportunities, we have made, and may continue to make, strategic acquisitions, mergers, partnership, joint ventures and alliances that involve significant risks and uncertainties.
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Successful acquisitions and alliances in the semiconductor industry are difficult to accomplish because they require, among other factors, efficient integration and aligning of product offerings and manufacturing operations and coordination of sales and marketing and research and development efforts.
Removed
We may also seek to establish partnerships, joint ventures and acquisition of assets in various foreign jurisdictions where we may not have significant operating experience. In addition, we may encounter unanticipated challenges and difficulties, including regulatory and compliance issues, lack of local support and geopolitical tensions.
Removed
The difficulties of integration and alignment may be increased by the necessity of coordinating geographically separated organizations, the complexity of the technologies being integrated and aligned and the necessity of integrating personnel with dissimilar business backgrounds. Furthermore, there is no guarantee that we will be able to identify viable targets for strategic acquisition.
Removed
Also we may incur significant costs in efforts that may not result in a successful acquisitions. 22 In addition, we may also issue equity securities to pay for future acquisitions or alliances, which could be dilutive to existing shareholders.
Removed
We may also incur debt or assume contingent liabilities in connection with acquisitions and alliances, which could impose restrictions on our business operations and harm our operating results.
Removed
If we are unable to obtain raw materials in a timely manner or if the price of raw materials increases significantly, production time and product costs could increase, which may adversely affect our business. Our fabrication and packaging processes depend on raw materials such as silicon wafers, gold, copper, molding compound, petroleum and plastic materials and various chemicals and gases.
Removed
From time to time, suppliers may extend lead times, limit supplies or increase prices due to capacity constraints or other factors. If the prices of these raw materials rise significantly, we may be unable to pass on the increased cost to our customers.
Removed
Our results of operations could be adversely affected if we are unable to obtain adequate supplies of raw materials in a timely manner or at reasonable price.
Removed
In addition, from time to time, we may need to reject raw materials because they do not meet our specifications or the sourcing of such materials do not comply with our conflict mineral policies, resulting in potential delays or declines in output.
Removed
Furthermore, problems with our raw materials may give rise to compatibility or performance issues in our products, which could lead to an increase in customer returns or product warranty claims.
Removed
Errors or defects may arise from raw materials supplied by third parties that are beyond our detection or control, which could lead to additional customer returns or product warranty claims that may adversely affect our business and results of operations.
Removed
We may not be able to accurately estimate provisions at fiscal period end for price adjustment and stock rotation rights under our agreements with distributors, and our failure to do so may impact our operating results. We sell a majority of our products to distributors under arrangements allowing price adjustments and returns under stock rotation programs, subject to certain limitations.
Removed
As a result, we are required to estimate allowances for price adjustments and stock rotation for our products as inventory at distributors at each reporting period end. Our ability to reliably estimate these allowances enables us to recognize revenue upon delivery of goods to distributors instead of upon resale of goods by distributors to end customers.
Removed
We estimate the allowance for price adjustment based on factors such as distributor inventory levels, forecasted distributor selling prices, distributor margins and demand for our products. Our estimated allowances for price adjustments, which we offset against accounts receivable from distributors, were $41.7 million and $40.0 million at June 30, 2024 and 2023, respectively.
Removed
Our accruals for stock rotation are estimated based on historical returns and individual distributor agreement, and stock rotation rights, which are recorded as accrued liabilities on our consolidated balance sheets, are contractually capped based on the terms of each individual distributor agreement.
Removed
Our estimated liabilities for stock rotation at June 30, 2024 and 2023 were $4.7 million and $5.6 million, respectively. Our estimates for these allowances and accruals may be inaccurate.
Removed
If we subsequently determine that any allowance and accrual based on our estimates is insufficient, we may be required to increase the size of our allowances and accrual in future periods, which would adversely affect our results of operations and financial condition.
Removed
Our operation of two wholly-owned packaging and testing facilities are subject to risks that could adversely affect our business and financial results. We have two wholly-owned packaging and testing facilities located in Shanghai, China that handle most of our packaging and testing requirements.
Removed
The operation of high-volume packaging and testing facilities and implementation of our advanced packaging technology are complex and demand a high degree of precision and may require modification to improve yields and product performance.
Removed
We have committed substantial resources to ensure that our packaging and testing facilities operate efficiently and successfully, including the acquisition of equipment and raw materials, and training and management of a large number of technical personnel and employees.
Removed
Due to the fixed costs associated with operating our own packaging and testing facilities, if we are unable to utilize our in-house facilities at a desirable level of production, our gross margin and results of operations may be adversely affected.
Removed
For example, a significant decline in our market share or sales orders may negatively impact our factory utilization and reduce our ability to achieve profitability.
Removed
In addition, the operation of our packaging and testing facilities is subject to a number of risks, including the following: 23 • unavailability of equipment, whether new or previously owned, at acceptable terms and prices; • facility equipment failure, power outages or other disruptions; • shortage of raw materials, including packaging substrates, copper, gold and molding compound; • failure to maintain quality assurance and remedy defects and impurities; • changes in the packaging requirements of customers; • compliance with local and regional legal and regulatory requirements; and • operation stoppage due to the city-wide lockdown in response to public health emergencies or pandemics.
Removed
Any of the foregoing risks could adversely affect our capacity to package and test our products, which could delay shipment of our products, result in higher expenses, reduce revenue, damage our relationships with customers and otherwise adversely affect our business, results of operations, financial condition and prospects.
Removed
Our business operations and financial conditions may be adversely affected by any disruption in our information technology systems, including any cyberattacks and breaches. Our operations are dependent upon our information technology systems, which encompass all of our major business functions across offices internationally.
Removed
We rely upon such information technology systems to manage and replenish inventory, complete and track customer orders, coordinate sales activities across all of our products and services, maintain vital data and information, perform financial and accounting tasks and manage and perform various administrative and human resources functions.
Removed
A substantial disruption in our information technology systems for any extended time period (arising from, for example, system capacity limits from unexpected increases in our volume of business, outages or delays in our service) could result in delays in receiving inventory and supplies or filling customer orders and adversely affect our customer service and relationships.
Removed
Our systems might be damaged or interrupted by natural or man−made events or by computer viruses, physical or electronic break−ins, cyber-attacks and similar disruptions affecting the global Internet. In the past we have experienced cybersecurity incidents and threats against our information technology systems.
Removed
While these incidents and attacks did not have a material adverse effect on our business operation or results of operations, they caused temporary disruptions and interfered with our operations. Any cybersecurity breach and financial loss may also have a negative impact on our internal control over financial reporting.
Removed
While we have implemented additional measures to enhance our security protocol to protect our system and intend to do so in response to any threats, there is no guarantee that future attacks would be thwarted or prevented.
Removed
We also expect to incur additional costs and expenses to upgrade our information technology system and establish additional protective measures to prevent future breaches.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table sets forth the location, size and primary use of our principal properties that are material to our business operations: Location Square Footage Primary Use 475 Oakmead Parkway Sunnyvale, California, USA 94085 57,000 Research and development, marketing, sales and administration 3131 Northeast Brookwood Parkway Hillsboro, Oregon, USA 97124 252,950 Wafer fabrication facility Building 1/2 and 8/9, No. 91, Lane 109, Rongkang Road, Songjiang District, Shanghai, China 201614 221,301 Packaging and testing, manufacturing support Building 1,2,3 No.135 Rongkang Road, Songjiang Export Process Zone, Area B, Songjiang, Shanghai,China 201614 250,198 Packaging and testing, manufacturing support We believe that our current facilities are adequate and that additional space will be available on commercially reasonable terms for the foreseeable future. 39
Biggest changeThe following table sets forth the location, size and primary use of our principal properties that are material to our business operations: Location Square Footage Primary Use 475 Oakmead Parkway Sunnyvale, California, USA 94085 57,000 Research and development, marketing, sales and administration 3131 Northeast Brookwood Parkway Hillsboro, Oregon, USA 97124 252,950 Wafer fabrication facility Building 1/2 and 8/9, No. 91, Lane 109, Rongkang Road, Songjiang District, Shanghai, China 201614 221,301 Packaging and testing, manufacturing support Building 1,2,3 No.135 Rongkang Road, Songjiang Export Process Zone, Area B, Songjiang, Shanghai,China 201614 250,198 Packaging and testing, manufacturing support We believe that our current facilities are adequate and that additional space will be available on commercially reasonable terms for the foreseeable future. 38
Item 2. Properties As of July 31, 2024, our primary U.S. facility, which houses our research and design function, as well as elements of marketing and administration, is located in Sunnyvale, California. We conduct our manufacturing, research and development, sales and marketing and administration in Asia and North America.
Item 2. Properties As of July 31, 2025, our primary U.S. facility, which houses our research and design function, as well as elements of marketing and administration, is located in Sunnyvale, California. We conduct our manufacturing, research and development, sales and marketing and administration in Asia and North America.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings As previously disclosed, the Company continues to cooperate with the Department of Commerce (“DOC”) in connection with its ongoing investigation of the Company’s export control practices. DOC has not informed the Company of any specific timeline or schedule under which DOC will complete its review.
Biggest changeItem 3. Legal Proceedings As previously disclosed, the Company cooperated with the Department of Commerce (“DOC”) in connection with its administrative investigation regarding certain transactions by the Company.
Irrespective of the validity of such claims, we could incur significant costs in the defense thereof or could suffer adverse effects on its operations. Item 4. Mine Safety Disclosures Not Applicable. 40 PART II
Irrespective of the validity of such claims, we could incur significant costs in the defense thereof or could suffer adverse effects on our operations. Item 4. Mine Safety Disclosures Not Applicable. 39 PART II
Added
On July 2, 2025, the Company announced that it reached a settlement agreement with DOC to close its investigation, pursuant to which the Company agreed to make a one-time payment of $4.25 million. The resolution does not impact the Company’s ongoing business operations.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 40 Part II. 41 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6. [Reserved] 42 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 43 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 61 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 39 Part II. 40 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 40 Item 6. [Reserved] 41 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 42 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 56 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAs of July 31, 2024, there were approximately 144 holders of record of our common shares, not including those shares held in a street or nominee name. Dividend Policy We have never declared or paid cash dividends on our common shares.
Biggest changeAs of July 31, 2025, there were approximately 149 holders of record of our common shares, not including those shares held in a street or nominee name. Dividend Policy We have never declared or paid cash dividends on our common shares.
Share Performance Graph The following graph compares the total cumulative shareholder return on our common shares with the total cumulative return of the NASDAQ Composite Index and the Philadelphia Semiconductor Index for the last five fiscal years ended June 30, 2024, assuming an investment of $100 at the beginning of such period and the reinvestment of any dividends.
Share Performance Graph The following graph compares the total cumulative shareholder return on our common shares with the total cumulative return of the NASDAQ Composite Index and the Philadelphia Semiconductor Index for the last five fiscal years ended June 30, 2025, assuming an investment of $100 at the beginning of such period and the reinvestment of any dividends.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers During the fourth quarter of fiscal year 2024, the Company did not repurchase any common shares. 41
Purchases of Equity Securities by the Issuer and Affiliated Purchasers During the fourth quarter of fiscal year 2025, the Company did not repurchase any common shares. 40

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeTransactions that involve conversion of Renminbi into foreign currency in relation to foreign direct investments and provision of debt financings in China are classified as “capital account” transactions. Examples of “capital account” transactions include repatriations of investments by foreign owners and repayments of loan principal to foreign lenders.
Biggest changeOther transactions that involve conversion of RMB into foreign currency are classified as “capital account” transactions; examples of “capital account” transactions include repatriations of investment by or loans to foreign owners, or direct equity investments in a foreign entity by a China domiciled entity.
A Chinese company must pay 10% of its annual after-tax profits into the statutory reserve fund to fund the statutory reserve fund unless it has reached 50% of the registered capital of the company.
A Chinese company must pay 10% of its annual after-tax profits to fund its statutory reserve fund unless it has reached 50% of the registered capital of the company.
"Capital account" transactions require prior approval from SAFE or its provincial branch or an account bank delegated by SAFE to convert a remittance into a foreign currency, such as U.S. dollars, and transmit the foreign currency outside of China.
“Capital account” transactions require prior approval from, or registration with SAFE or its provincial branch or its authorized banks to convert a remittance into a foreign currency, such as U.S. dollars, and transmit the foreign currency outside of China.
The parent company is incorporated under the laws of Bermuda and is subject to Bermuda law with respect to taxation. Under current Bermuda law, the Company is not subject to any income or capital gains taxes in Bermuda.
Under current Bermuda law, the Company is not subject to any income or capital gains taxes in Bermuda.
If we become subject to the Bermuda CIT, we may be subject to additional income taxes, which may adversely affect our financial position, results of operations and our overall business.
If we become subject to the Bermuda CIT, we may be subject to additional income taxes, which may adversely affect our financial position, results of operations and our overall business. Our debt agreements include financial covenants that may limit our ability to pursue business and financial opportunities and subject us to risk of default.
We estimate the price adjustments for inventory at the distributors based on factors such as distributor inventory levels, forecasted distributor selling prices, distributor margins and demand for our products.
As a result, we are required to estimate allowances for price adjustments and stock rotation for our products as inventory at distributors at each reporting period end. We estimate the allowance for price adjustment based on factors such as distributor inventory levels, forecasted distributor selling prices, distributor margins and demand for our products.
Pursuant to applicable regulations, foreign-invested enterprises in China may pay dividends only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations.
Accordingly, our Chinese subsidiaries may use RMB to purchase foreign exchange for settlement of such “current account” transactions without pre-approval. However, pursuant to applicable regulations, foreign‑invested enterprises in China may pay dividends only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations.
The Chinese government imposes certain currency exchange controls on cash transfers out of China. Regulations in China permit foreign owned entities to freely convert the Renminbi into foreign currency for transactions that fall under the “current account,” which includes trade related receipts and payments, interests, and dividend payments.
A significant portion of our business is conducted in China where the currency is the RMB. Regulations in China permit foreign owned entities to freely convert the RMB into foreign currency for transactions that fall under the “current account,” which includes trade related receipts and payments, interest and dividends.
The Company is not in a position to determine whether the annual revenues may meet and/or cross the 750 million Euro threshold for at least two of the four fiscal years immediately preceding the fiscal year when CIT may apply. The Company continues to monitor and assess if and when it may be within the scope of the CIT.
The Company did not generate more than 750 million Euro revenue in any of the four fiscal years before the tax year starting July 1, 2025. The Company continues to monitor and assess if and when it may be within the scope of the CIT.
Capacity utilization affects our gross margin because we have certain fixed costs at our Shanghai facilities and our Oregon Fab. If we are unable to utilize our manufacturing facilities at a desired level, our gross margin may be adversely affected.
Due to the fixed costs associated with operating our own packaging and testing facilities, if we are unable to utilize our in-house facility at a desirable level of production, our gross margin and results of operations may be adversely affected.
As a result of this and other restrictions under PRC laws and regulations, our China subsidiaries are restricted in their ability to transfer a portion of their net assets to us, and such restriction may adversely affect our ability to generate sufficient liquidity to fund our operations or other expenditures.
As a result of these and other restrictions under Chinese laws and regulations, our China subsidiaries are restricted in their abil ity to transfer a portion of their net assets to the parent. Such restricted portion amounted to approximat ely $93.9 million, or 11.4% of our total consolidated net assets attributed to the Company as of June 30, 2025.
Removed
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following discussion of the financial condition and results of our operations in conjunction with our consolidated financial statements and the notes to those statements included elsewhere in this annual report.
Added
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview . We cannot be certain that these conditions will be satisfied on a timely basis, including those conditions that are outside of our control.
Removed
Our consolidated financial statements contained in this annual report are prepared in accordance with U.S. GAAP.
Added
If these conditions are not met by the deadlines as set forth in the equity transfer agreement, we may be exposed to significant risks, including failure to receive a portion or any of the cash proceeds from the sale, which may adversely affect our ability to continue investment in technology, R&D projects and acquisition of assets complimentary to our business operations.
Removed
Overview We are a designer, developer, and global supplier of a broad range of discrete power devices, wide band gap power devices, power management ICs and modules, including a wide portfolio of Power MOSFET, SiC, IGBT, IPM, TVS, HV Gate Drivers, Power IC, and Digital Power products.
Added
Furthermore, failure to meet these conditions may require the parties to terminate and unwind the transaction, which will adversely affect our reputation, business operations and stock price. Our reliance on distributors to sell a substantial portion of our products subjects us to a number of risks.
Removed
Our portfolio of power semiconductors includes approximately 2,700 products, and has grown with the introduction of over 100 new products in the fiscal year ended June 30, 2024, and over 60 and 130 new products in the fiscal years ended June 30, 2023 and 2022, respectively.
Added
We sell a substantial portion of our products to distributors, who in turn sell to our end customers. Our distributors typically offer power semiconductor products from several different companies, including our direct competitors. The distributors assume collection risk and provide logistical services to end customers, including stocking our products.
Removed
Our teams of scientists and engineers have developed extensive intellectual properties and technical knowledge that encompass major aspects of power semiconductors, which we believe enables us to introduce and develop innovative products to address the increasingly complex power requirements of advanced electronics.
Added
Two distributors, WPG and Promate, collectively accounted for 73.4%, 71.0% and 57.2% of our revenue for the fiscal years ended June 30, 2025, 2024 and 2023, respectively.
Removed
We have an extensive patent portfolio that consists of 930 patents and 52 patent applications in the United States as of June 30, 2024. We also have a total of 1,025 foreign patents, which primarily were based on our research and development efforts through June 30, 2024.
Added
We currently have effective agreements with Promate and WPG to serve as our distributors, and such agreement is renewed automatically for one-year period continuously unless terminated earlier pursuant to the terms of such agreements. We believe that our success will continue to depend upon these distributors.
Removed
We differentiate ourselves by integrating our expertise in technology, design and advanced manufacturing and packaging to optimize product performance and cost.
Added
Our reliance on distributors subjects us to a number of risks, including: • write-downs in inventories associated with stock rotation rights and increases in provisions for price adjustments granted to certain distributors; • potential reduction or discontinuation of sales of our products by distributors; • failure to devote resources necessary to sell our products at the prices, in the volumes and within the time frames that we expect; • focusing their sales efforts on products of our competitors; • dependence upon the continued viability and financial resources of these distributors, some of which are small organizations with limited working capital and all of which depend on general economic conditions and conditions within the semiconductor industry; 21 • dependence on the timeliness and accuracy of shipment forecasts and resale reports from our distributors; • management of relationships with distributors, which can deteriorate as a result of conflicts with efforts to sell directly to our end customers; and • our agreements with distributors which are generally terminable by either party on short notice.
Removed
Our portfolio of products targets high-volume applications, including personal computers, graphic cards, game consoles, flat panel TVs, home appliances, power tools, smart phones, battery packs, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment.
Added
If any significant distributor becomes unable or unwilling to promote and sell our products, or if we are not able to renew our contracts with the distributors on acceptable terms, we may not be able to find a replacement distributor on reasonable terms or at all and our business could be harmed.
Removed
During fiscal year 2024, we accelerated the development of new technology platforms which allowed us to introduce 36 medium and high voltage MOSFET products, targeting primarily the industrial markets and computing marketing, as well as 17 low voltage MOSFET products primarily for the computing market.
Added
We have made and may continue to make strategic acquisitions of other companies, assets or businesses or form joint ventures with partners to advance our business objectives. These acquisitions and joint ventures involve significant risks and uncertainties.
Removed
In addition, we introduced 37 Power IC new products for computing applications, communication and consumer markets. Our business model leverages global resources, including research and development and manufacturing in the United States and Asia. Our sales and technical support teams are localized in several growing markets.
Added
In order to position ourselves to take advantage of growth opportunities, we have made, and may continue to make, strategic acquisitions, mergers, partnership, joint ventures and alliances that involve significant risks and uncertainties.
Removed
We operate an 8-inch wafer fabrication facility located in Hillsboro, Oregon, or the Oregon Fab, which is critical for us to accelerate proprietary technology development, new product introduction and improve our financial performance. To meet the market demand for the more mature high volume products, we also utilize the wafer manufacturing capacity of selected third party foundries.
Added
Successful acquisitions and alliances in the semiconductor industry are difficult to accomplish because they require, among other factors, efficient integration and aligning of product offerings and manufacturing operations and coordination of sales, marketing and research and development efforts.
Removed
For assembly and test, we primarily rely upon our in-house facilities in China. In addition, we utilize subcontracting partners for industry standard packages. We believe our in-house packaging and testing capability provides us with a competitive advantage in proprietary packaging technology, product quality, cost and sales cycle time.
Added
We may also seek to establish partnerships, joint ventures and acquisition of assets in various foreign jurisdictions where we may not have significant operating experience. In addition, we may encounter unanticipated challenges and difficulties, including regulatory and compliance issues, lack of local support and geopolitical tensions.
Removed
On March 29, 2016, we formed a joint venture (the “JV Company”) with two investment funds owned by the Municipality of Chongqing (the “Chongqing Funds”), for the purpose of constructing and operating a power semiconductor packaging, testing and 12-inch wafer fabrication facility (“Fab”) in the LiangJiang New Area of Chongqing, China.
Added
The difficulties of integration and alignment may be increased by the necessity of coordinating geographically separated organizations, the complexity of the technologies being integrated and aligned and the necessity of integrating personnel with dissimilar business backgrounds. Furthermore, there is no guarantee that we will be able to identify viable targets for strategic acquisition.
Removed
As of December 1, 2021, we owned 50.9%, and the Chongqing Funds owned 49.1% of the equity interest in the JV Company. The Joint Venture was accounted under the provisions of the consolidation guidance since we had controlling financial interests until December 1, 2021. On December 1, 2021 (the “Effective Date”), Alpha & Omega Semiconductor (Shanghai) Ltd.
Added
Also we may incur significant costs in efforts that may not result in a successful acquisitions. In addition, we may also issue equity securities to pay for future acquisitions or alliances, which could be dilutive to existing shareholders.
Removed
(“AOS SH”) and Agape Package Manufacturing (Shanghai) Limited (“APM SH” and, together with AOS SH, the “Sellers”), each a wholly-owned subsidiary of the Company, entered into a share transfer agreement ("STA") with a third-party investor to sell a portion of the Company's equity interest in the JV Company which consists of a power semiconductor packaging, testing and 12-inch wafer fabrication facility in Chongqing, China (the “Transaction”).
Added
We may also incur debt or assume contingent liabilities in connection with acquisitions and alliances, which could impose restrictions on our business operations and harm our operating results.
Removed
The Transaction closed on December 2, 2021 (the “Closing Date”), which reduced the Company’s equity interest in the JV Company from 50.9% to 48.8%. Also, the Company’s right to designate directors on the board of JV Company was reduced to three (3) out of seven (7) directors, from four (4) directors prior to the Transaction.
Added
If we are unable to obtain raw materials in a timely manner or if the price of raw materials increases significantly, production time and product costs could increase, which may adversely affect our business. Our fabrication and packaging processes depend on raw materials such as silicon wafers, gold, copper, molding compound, petroleum and plastic materials and various chemicals and gases.
Removed
As a result of the Transaction and other factors, the Company no longer has a controlling financial interest in the JV Company. The JV Company was deconsolidated from the Company’s Consolidated Financial Statements effective as of the Closing Date.
Added
From time to time, suppliers may extend lead times, limit supplies or increase prices due to capacity constraints or other factors. If the prices of these raw materials rise significantly, we may be unable to pass on the increased cost to our customers.
Removed
On December 24, 2021, we entered into a share transfer agreement with another third-party investor, pursuant to which the Company sold to this investor 1.1% of outstanding equity interest held by the Company in the JV Company.
Added
Our results of operations could be adversely affected if we are unable to obtain adequate supplies of raw materials in a timely manner or at reasonable price.
Removed
In addition, the JV Company adopted an employee equity incentive plan and issued an equity interest equivalent to 3.99% of the JV Company in exchange for cash. As a result of these two transactions, the Company owned 45.8% of the equity interest in the JV Company as of December 31, 2021.
Added
In addition, from time to time, we may need to reject raw materials because they do not meet our specifications or the sourcing of such materials do not comply with our conflict mineral policies, resulting in potential delays or declines in output.
Removed
On January 26, 2022, the JV Company completed a financing transaction pursuant to a corporate investment agreement (the “Investment Agreement”) between the JV Company and certain third-party investors (the “New Investors”).
Added
Furthermore, problems with our raw materials may give rise to compatibility or performance issues in our products, which could lead to an increase in customer returns or product warranty claims.
Removed
Under the Investment Agreement, the New Investors purchased newly issued equity interest of the JV Company, representing approximately 7.82% of post-transaction outstanding equity interests of the JV Company, for a total purchase price of RMB 43 509 million (or approximately USD 80 million based on the currency exchange rate as of January 26, 2022) (the “Investment”).
Added
Errors or defects may arise from raw materials supplied by third parties that are beyond our detection or control, which could lead to additional customer returns or product warranty claims that may adversely affect our business and results of operations.
Removed
Following the closing of the January 26, 2022 Investment, the percentage of outstanding JV equity interest beneficially owned by the Company was reduced to 42.2% at June 30, 2022.
Added
We may not be able to accurately estimate provisions at fiscal period end for price adjustment and stock rotation rights under our agreements with distributors, and our failure to do so may impact our operating results. We sell a majority of our products to distributors under arrangements allowing price adjustments and returns under stock rotation programs, subject to certain limitations.
Removed
In February 2024, the JV Company repurchased certain shares that were previously issued to employees under the employee equity incentive plan, which increased the Company’s percentage of equity ownership in the JV Company by 0.54%. As of June 30, 2024, the percentage of outstanding JV equity interest beneficially owned by the Company was 42.8%.
Added
Our estimated allowances for price adjustments, which we offset against accounts receivable from distributors, were $40.8 million and $41.7 million at June 30, 2025 and 2024, respectively.
Removed
We reduced our ownership of the JV Company to below 50% to increase the flexibility of the JV Company to raise capital to fund its future expansion. The JV Company is also contemplating an eventual listing on the Science and Technology Innovation Board, or STAR Market, of the Shanghai Stock Exchange.
Added
Our accruals for stock rotation are estimated based on historical returns and individual distributor agreement, and stock rotation rights, which are recorded as accrued liabilities on our consolidated balance sheets, are contractually capped based on 22 the terms of each individual distributor agreement.
Removed
The reduction of our ownership assists the JV Company in meeting certain regulatory listing requirements. A potential STAR Market listing may take several years to consummate and there is no guarantee that such listing by the JV Company will be successful or will be completed in a timely manner, or at all.
Added
Our estimated liabilities for stock rotation at June 30, 2025 and 2024 were $6.2 million and $4.7 million, respectively. Our estimates for these allowances and accruals may be inaccurate.
Removed
In addition, the JV Company will continue to provide us with significant level of foundry capacity to enable us to develop and manufacture our products.
Added
If we subsequently determine that any allowance and accrual based on our estimates is insufficient, we may be required to increase the size of our allowances and accrual in future periods, which would adversely affect our results of operations and financial condition.
Removed
On July 12, 2022, the current shareholders of the JV Company entered into a shareholders contract, pursuant to which the JV Company committed to provide us with a monthly wafer production capacity until December 2023, and additional commitment to provide wafer capacity after December 2023 if the JV Company’s production capacity reaches certain specified level.
Added
Our operations of one wholly-owned packaging and testing facility are subject to risks that could adversely affect our business and financial results. We have one wholly-owned packaging and testing facility located in Shanghai, China that handles the majority of our packaging and testing requirements.
Removed
Other Factors Affecting Our Performance The global, regional economic and PC market conditions : Because our products primarily serve consumer electronic applications, any significant changes in global and regional economic conditions could materially affect our revenue and results of operations.
Added
The operation of high-volume packaging and testing facility and implementation of our advanced packaging technology are complex and demand a high degree of precision and may require modification to improve yields and product performance.
Removed
A significant amount of our revenue is derived from sales of products in the PC markets, such as notebooks, motherboards and notebook battery packs. Therefore, a substantial decline in the PC market could have a material adverse effect on our revenue and results of operations.
Added
We have committed substantial resources to ensure that our packaging and testing facilities operate efficiently and successfully, including the acquisition of equipment and raw materials, and training and management of a large number of technical personnel and employees.
Removed
The PC markets have experienced a modest global decline in recent years due to continued growth of demand in tablets and smart phones, worldwide economic conditions and the industry inventory correction which had and may continue to have a material impact on the demand for our products.
Added
For example, a significant decline in our market share or sales orders may negatively impact our factory utilization and reduce our ability to achieve profitability.
Removed
A decline of the PC market may have a negative impact on our revenue, factory utilization, gross margin, our ability to resell excess inventory, and other performance measures.
Added
In addition, the operation of our packaging and testing facility is subject to a number of risks, including the following: • unavailability of equipment, whether new or previously owned, at acceptable terms and prices; • facility equipment failure, power outages or other disruptions; • shortage of raw materials, including copper, gold and molding compound; • failure to maintain quality assurance and remedy defects and impurities; • changes in the packaging requirements of customers; • compliance with local and regional legal and regulatory requirements; and • unexpected customs, tax and other government audits and investigations concerning related party transactions, transfer pricing arrangements, IP license and royalty payments, etc.
Removed
We have executed and continue to execute strategies to diversify our product portfolio, penetrate other market segments, including the consumer, communications and industrial markets, and improve gross margins and profit by implementing cost control measures.
Added
Any of the foregoing risks could adversely affect our capacity to package and test our products, which could delay shipment of our products, result in higher expenses, reduce revenue, damage our relationships with customers and otherwise adversely affect our business, results of operations, financial condition and prospects.
Removed
While making efforts to reduce our reliance on the computing market, we continue to support our computing business and capitalize on the opportunities in this market with a more focused and competitive PC product strategy to gain market share.
Added
Our business operations and financial conditions may be adversely affected by any disruption in our information technology systems, including any cyberattacks and breaches. Our operations are dependent upon our information technology systems, which encompass all of our major business functions across offices internationally.
Removed
Manufacturing costs and capacity availability: Our gross margin is affected by a number of factors including our manufacturing costs, utilization of our manufacturing facilities, the product mixes of our sales, pricing of wafers from third party foundries and pricing of semiconductor raw materials.
Added
We rely upon such information technology systems to manage and replenish inventory, complete and track customer orders, coordinate sales activities across all of our products and services, maintain vital data and information, perform financial and accounting tasks and manage and perform various administrative and human resources functions.
Removed
In addition, from time to time, we may experience wafer capacity constraints, particularly at third party foundries, that may prevent us from meeting fully the demand of our customers.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

6 edited+0 added−0 removed9 unchanged
Biggest changeWe estimate that a 10% increase or decrease in the costs of raw materials subject to commodity price risk, such as gold, would decrease or increase our current year's net earnings by $0.6 million, assuming that such changes in our costs have no impact on the selling prices of our products and that we have no pending commitments to purchase metals at fixed prices. 61
Biggest changeWe estimate that a 10% increase or decrease in the costs of raw materials subject to commodity price risk, such as gold and silver, would decrease or increase our current year's net earnings by $1.0 million, assuming that such changes in our costs have no impact on the selling prices of our products and that we have no pending commitments to purchase metals at fixed prices. 56
Commodity Price Risk We are subject to risk from fluctuating market prices of certain commodity raw materials, particularly gold, that are used in our manufacturing process and incorporated into our end products. Supplies for such commodities may from time-to-time become restricted, or general market factors and conditions may affect the pricing of such commodities.
Commodity Price Risk We are subject to risk from fluctuating market prices of certain commodity raw materials, particularly gold and silver, that are used in our manufacturing process and incorporated into our end products. Supplies for such commodities may from time-to-time become restricted, or general market factors and conditions may affect the pricing of such commodities.
In order to minimize exposure to foreign currencies, we maintained cash and cash equivalent balances in foreign currencies, including Chinese Yuan (“RMB”) as operating funds for our foreign operating expenses.
In order to minimize exposure to foreign currencies, we maintained cash and cash equivalent balances in foreign currencies, including Chinese Yuan as operating funds for our foreign operating expenses.
For our subsidiaries which use the local currency as the functional currency, the results and financial position are translated into U.S. dollar using exchange rates at balance sheet dates for assets and liabilities and using average exchange rates for income and expenses items.
For our subsidiaries which use the local currency as the functional currency, the results and financial position are translated into U.S. dollars using exchange rates at balance sheet dates for assets and liabilities and using average exchange rates for income and expenses items.
The resulting translation differences are presented as a separate component of accumulated other comprehensive income (loss) and noncontrolling interest in the consolidated statements of equity.
The resulting translation differences are presented as a separate component of accumulated other comprehensive income (loss) in the consolidated statements of equity.
As of June 30, 2024, we had $38.4 million outstanding under our loan and $3.2 million outstanding under our financing leases, which were subject to fluctuations in interest rates. For the year ended June 30, 2024, a hypothetical 10% increase in the interest rate could result in $0.2 million additional annual interest expense.
As of June 30, 2025, we had $26.7 million outstanding under our loan and $2.3 million outstanding under our financing leases, which were subject to fluctuations in interest rates. For the year ended June 30, 2025, a hypothetical 10% increase in the interest rate could result in $0.1 million additional annual interest expense.

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