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What changed in Ultra Clean Holdings, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Ultra Clean Holdings, Inc.'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.

+254 added−233 removedSource: 10-K (2026-02-23) vs 10-K (2025-02-25)

Top changes in Ultra Clean Holdings, Inc.'s 2025 10-K

254 paragraphs added · 233 removed · 192 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

46 edited+8 added−8 removed77 unchanged
Biggest changeOur manufacturing facilities use similar processes and procedures enabling us to easily shift production between sites to support expanded demand and ensure business continuity. • Drive profitable growth with our flexible cost structure . We implement cost containment and capacity enhancement initiatives throughout the semiconductor demand cycles and benefit from the global presence and efficiencies of our supply chain.
Biggest changeSeveral of UCT’s facilities are also in low-cost regions, adding to our competitive advantage. • Provide production flexibility to respond rapidly to demand changes. Our manufacturing facilities use similar processes and procedures enabling us to easily shift production between sites to support expanded demand and ensure business continuity. • Drive profitable growth with our flexible cost structure .
We utilize our weldment and frame fabrication capabilities together with highly specialized engineering, global supply chain management, and 3 Table of Contents assembly capabilities to produce high performance products that are customized to meet the needs of equipment suppliers and chipmakers.
We utilize our weldment and frame 3 Table of Contents fabrication capabilities together with highly specialized engineering, global supply chain management, and assembly capabilities to produce high performance products that are customized to meet the needs of equipment suppliers and chipmakers.
We believe that our continued focus on efficient manufacturing, reduced design-to-delivery cycle times, and high quality and reliability will allow us to gain market share. Similarly, we believe there is room to gain market share with our cleaning and coating 4 Table of Contents services, both with chip and equipment makers, as customers typically outsource these solutions.
We believe that our continued focus on efficient manufacturing, reduced design-to-delivery 4 Table of Contents cycle times, and high quality and reliability will allow us to gain market share. Similarly, we believe there is room to gain market share with our cleaning and coating services, both with chip and equipment makers, as customers typically outsource these solutions.
In addition to U.S. manufacturing and service operations, we manufacture products and provide parts cleaning and other related services in our Asia Pacific, Europe and Middle East (“EMEA”) facilities to support local and U.S. based customers. We conduct our operating activities primarily through our subsidiaries.
In addition to U.S. manufacturing and service operations, we manufacture products and provide parts cleaning and other related services in our Asia Pacific (“APAC”), Europe and Middle East (“EMEA”) facilities to support local and U.S.-based customers. We conduct our operating activities primarily through our subsidiaries.
IDM Customer relationship managers work with process tool owners and Fab maintenance managers relating to the development and validation of cleaning recipes, addressing new tools cleaning and analytical requirements, and optimizing cleaning processes and analytical testing requirements to support node transitions. We have dedicated New Business Development managers for both our product and service businesses.
Chipmaker Customer relationship managers work with process tool owners and Fab maintenance managers relating to the development and validation of cleaning recipes, addressing new tools cleaning and analytical requirements, and optimizing cleaning processes and analytical testing requirements to support node transitions. We have dedicated New Business Development managers for both our product and service businesses.
Prior to joining the Company, Ms. Savage served at Credence Systems Corporation, a manufacturer of test equipment for the global semiconductor industry, as its Corporate Controller and Vice President of Finance from February 2008 to February 2009 and as Director of Internal Audit from May 2006 to February 2008. Prior to Credence Systems, Ms.
Savage served at Credence Systems Corporation, a manufacturer of test equipment for the global semiconductor industry, as its Corporate Controller and Vice President of Finance from February 2008 to February 2009 and as Director of Internal Audit from May 2006 to February 2008. Prior to Credence Systems, Ms.
Our two largest revenue customers in fiscal years 2024, 2023 and 2022 were Applied Materials, Inc. and Lam Research Corporation, each of which accounted for more than 10% of our total revenues in those three years.
Our two largest revenue customers in fiscal years 2025, 2024 and 2023 were Applied Materials, Inc. and Lam Research Corporation, each of which accounted for more than 10% of our total revenues in those three years.
We offer our customers a wide range of gas delivery solutions such as ultra-clean valves, high purity connectors, industrial process connectors and valves, pneumatic actuators, manifolds and safety solutions, hoses, pressure gauges, gas line and component heaters, as well as complex weldments.
We offer our customers a wide range of gas delivery solutions such as precision thermal products, ultra-clean valves, high purity connectors, industrial process connectors and valves, pneumatic actuators, manifolds and safety solutions, hoses, pressure gauges, gas line and component heaters, as well as complex weldments.
While several customers specify the full system bill of materials, many leverage our design expertise to help them select the appropriate components for their particular system. 5 Table of Contents • Fluid delivery systems: A typical OEM liquid delivery system consists of one or more chemical delivery units, comprised of small diameter high purity perflouroalkoxy (PFA) tubing, filters, flow controllers, regulators, component heaters, and an integrated electronic and/or pneumatic control system.
While several customers specify the full system bill of materials, many leverage our design expertise to help them optimize layout and select the appropriate components for their particular system. • Fluid delivery systems: A typical OEM liquid delivery system consists of one or more chemical delivery units, comprised of small diameter high purity perflouroalkoxy (PFA) tubing, filters, flow controllers, regulators, component heaters, and an integrated electronic and/or pneumatic control system.
These systems are typically pallet mounted and are enclosed in a sheet metal encasing. Our gas delivery system designs are developed in collaboration with our customers and are customized to meet the needs of specific processing requirements for OEMs.
These systems are typically pallet mounted and are enclosed in a sheet metal encasing. Our gas delivery system designs are developed in collaboration with our 5 Table of Contents customers and are customized to meet the needs of specific processing requirements for OEMs.
We also offer a wide range of parts and components such as ultra-clean valves, high purity connectors, industrial process connectors and valves, pneumatic actuators, manifolds and safety solutions, hoses, gas delivery systems, and pressure gauges. • Parts and components.
We also offer a wide range of parts and components such as precision thermal products, ultra-clean valves, high purity connectors, industrial process connectors and valves, pneumatic actuators, manifolds and safety solutions, hoses, gas delivery systems, and pressure gauges. • Parts and components.
Over the long-term, we believe the semiconductor market we serve will continue to grow due to multi-year industry demand from a broad range of drivers, such as new device architecture (e.g. gate all around) and memory devices (e.g. high bandwidth memory) necessary for cloud, artificial intelligence (“AI”) and machine learning (“ML”) applications.
Over the long-term, we believe the semiconductor market we serve will continue to grow due to multi-year industry demand from a broad range of drivers, such as new device architecture (e.g. gate all around and backside power distribution), memory devices (e.g. high bandwidth memory) necessary for cloud, artificial intelligence (“AI”) and machine learning (“ML”) applications, and advanced packaging.
Harding served as Vice President, Corporate Controller and Principal Accounting Officer from May 2016 to March 2020 and as Director of Finance and Accounting from May 2014 to May 2016 at FLIR Systems, Inc. (now part of Teledyne Technologies).
Prior to that, Mr. Harding served as Vice President, Corporate Controller and Principal Accounting Officer from May 2016 to March 2020 and as Director of Finance and Accounting from May 2014 to May 2016 at FLIR Systems, Inc. (now part of Teledyne Technologies).
We will continue to consider strategic acquisitions that enable us to improve our financial model, expand our geographic presence, secure new customers and diversify into complementary products and services markets as well as broaden our technological and cleaning and analytical capabilities in the markets we serve. • Strengthen vertical integration .
We will continue to consider strategic acquisitions that enable us to improve our financial model, expand our geographic presence, secure new customers and diversify into adjacent markets as well as broaden our technological and cleaning and analytical capabilities in the markets we serve. • Strengthen vertical integration .
Cook joined Infineon Technologies AG in 2003 and served as its Vice President and General Manager, RF and Protection Devices from May 2008 to December 2011, its Managing Director, Infineon Technologies North America from July 2007 to December 2008 and Vice President and General Manager, AI Marketing from May 2003 to May 2008.
Cook joined Infineon Technologies AG in 2003 and served as its Vice President and 10 Table of Contents General Manager, RF and Protection Devices from May 2008 to December 2011, its Managing Director, Infineon Technologies North America from July 2007 to December 2008 and Vice President and General Manager, AI Marketing from May 2003 to May 2008.
Customers that have elected to outsource their gas delivery systems and other critical subsystems including 7 Table of Contents cleaning and analytics, could elect in the future to develop and manufacture these subsystems internally, leading to further competition.
Customers that have elected to outsource their gas delivery systems and other critical subsystems including cleaning and analytics, could elect in the future to develop and manufacture these subsystems internally, leading to further competition.
Our Services business works closely with customers to identify and anticipate changes that will be required in next-generation equipment. UCT’s technical capability is extremely critical and differentiated to ensure high wafer yields and throughput as geometries shrink and density increases. Our Services business development activities are performed primarily in Hillsboro, Oregon; Phoenix, Arizona; Israel and South Korea.
Our Services business works closely with customers to identify and anticipate changes that will be required in next-generation equipment. UCT’s technical capability is extremely critical and differentiated to ensure high wafer yields and throughput as geometries shrink and density increases. Our Services business development activities are performed primarily in the United States, Israel, and South Korea.
He previously held a range of roles at Hewlett Packard in global IT management, consulting, and enterprise program management. Mr. McKibben holds an M.S. in Management Information Systems from the University of Arizona and a B.S. in Humanities and International Relations cum laude from Georgetown University. Chris Cook has served as our President, Products Business since April 2022.
He previously held a range of roles at Hewlett Packard in global IT management, consulting, and enterprise program management. Mr. McKibben holds an M.S. in Management Information Systems from the University of Arizona and a B.S. in Humanities and International Relations cum laude from Georgetown University. Chris Cook has served as our Chief Business Officer since August 2025. Mr.
As a group, our respective year’s top two customers accounted for 54.5%, 57.4% and 62.7% of the Company’s revenues for fiscal years 2024, 2023 and 2022, respectively. Approximately 94.9% of our total revenues for the fiscal year 2024 came from multiple segments of the semiconductor industry, which include IDM, Foundry, OEM, and sub-tier suppliers.
As a group, our respective year’s top two customers accounted for 58.7%, 54.5% and 57.4% of the Company’s revenues for fiscal years 2025, 2024 and 2023, respectively. Approximately 95.7% of our total revenues for the fiscal year 2025 came from multiple segments of the semiconductor industry, which include IDM, memory, foundry, OEM, and sub-tier suppliers.
We believe our customers will continue to outsource critical subsystems and that we are well positioned to capture a significant portion of these outsourcing opportunities. We have broadened our portfolio into the sub-fab with the design and manufacturing of components, process solutions and fully integrated sub-systems.
We believe our customers will continue to outsource critical subsystems and that we are well positioned to capture a significant portion of these outsourcing opportunities. We have broadened our IDM, memory and foundry portfolio into the sub-fab with the design and manufacturing of components, process solutions and fully integrated sub-systems which all support process tool facilitization.
Our international revenues represented 73.0%, 69.6% and 68.9% of total revenues for fiscal years ended 2024, 2023 and 2022, respectively. See Note 13 to the Notes to Consolidated Financial Statements for further information about our geographic revenues.
Our international revenues represented 75.9%, 73.0% and 69.6% of total revenues for fiscal years ended 2025, 2024 and 2023, respectively. See Note 12 of Notes to Consolidated Financial Statements for further information about our geographic revenues.
Our principal competitor for gas delivery systems is Ichor Systems, Inc., and our principal competitors for other critical subsystems are Flex Ltd., Foxsemicon Integrated Technology Inc., Jabil, Inc., Sanmina Corporation, Fujikin Incorporated, VDL ETG and Celestica Inc. For our gas delivery component solutions our principal competitors are Swagelok, Parker Hannifin, and Watlow.
Our principal competitors for gas delivery systems are Ichor Systems, Inc. and Fujikin Incorporated; our principal competitors for other critical subsystems are Foxsemicon Integrated Technology Inc., Jabil, Inc., VDL ETG, Celestica Inc. and Benchmark Electronics, Inc. For our gas delivery component solutions our principal competitors are Swagelok, Parker Hannifin, Fujikin and Watlow.
He previously held various roles of increasing responsibility at Renesas Technology (formerly Hitachi Semiconductor) from 1995 to 2003. Mr. Cook holds a B.S. in Electrical Engineering and Technology from Purdue University and completed the Program for Leadership Development at Harvard Business School. William C. Bentinck has served as our President, Semiconductor Services Business since May 2019. Mr.
He previously held various roles of increasing responsibility at Renesas Technology (formerly Hitachi Semiconductor) from 1995 to 2003. Mr. Cook holds a B.S. in Electrical Engineering and Technology from Purdue University and completed the Program for Leadership Development at Harvard Business School. Sam Johnson has served as our Head of the Services Division since August 15, 2025. Mr.
Savage also served as Manager, Business Process Risk Accounting, at Arthur Anderson LLP, the former accounting firm, from May 1996 to October 1999. Ms. Savage holds a B.S. in Managerial Economics from the University of California, Davis. Harjinder Bajwa joined UCT as Chief Operating Officer in June 2024. Mr.
Savage also served as Manager, Business Process Risk Accounting, at Arthur Anderson LLP, the former accounting firm, from May 1996 to October 1999. Ms. Savage holds a B.S. in Managerial Economics from the University of California, Davis.
However, new, modified or more stringent requirements or enforcement policies could be adopted by governmental agencies, which could affect our business operations. Employees and Human Capital As of December 27, 2024, we had 7,505 employees, of which 732 were temporary.
However, new, modified or more stringent requirements or enforcement policies could be adopted by governmental agencies, which could affect our business operations. 8 Table of Contents Employees and Human Capital As of December 26, 2025, we had 7,411 employees, of which 463 were temporary.
We require our employees, suppliers, customers and potential business partners to enter into confidentiality and non-disclosure agreements before we disclose to them any sensitive or proprietary information regarding our products, technology or business plans. We require employees to assign to us proprietary information, inventions and other intellectual property they create, modify or improve.
We require our employees, suppliers, customers and potential business partners to enter into confidentiality and non-disclosure agreements before we disclose to them any sensitive or proprietary information regarding our products, technology or business plans.
This website address is intended to be an inactive textual reference only; none of the information contained on our website is part of this report or is incorporated by reference herein. Executive Officers Set forth below is information concerning our executive officers as of February 21, 2025. Name Age Position James P.
This website address is intended to be an inactive textual reference only; none of the information contained on our website is part of this report or is incorporated by reference herein. 9 Table of Contents Executive Officers Set forth below is information concerning our executive officers as of February 23, 2026.
Scholhamer holds a B.S. in Materials and Metallurgical Engineering from the University of Michigan. Sheri Savage has served as our Chief Financial Officer since July 2016. Ms. Savage joined the Company as the Senior Director of Finance in April 2009. She was Senior Vice President of Finance and Chief Accounting Officer from February 2016 to July 2016.
Sheri Savage has served as our Chief Financial Officer since July 2016. Ms. Savage joined the Company as the Senior Director of Finance in April 2009. She was Senior Vice President of Finance and Chief Accounting Officer from February 2016 to July 2016. Prior to joining the Company, Ms.
For our services, cleaning and coating offerings, our main competitors in the U.S. are Pentagon Technologies and Cleanpart, and in South Korea, KoMiCo. For analytical services our primary competitors are Balazs (an Air Liquide company) and Cerium Labs. Some of these competitors have substantially greater financial, technical, manufacturing and marketing resources than UCT.
For our services, cleaning and coating offerings, our main competitors are KoMiCo, SHT, EnPro and Pentagon. For analytical services our primary competitors are Balazs (an Air Liquide company), Eurofins and SCAS. Some of these competitors have substantially greater financial, technical, manufacturing and marketing resources than UCT.
Prior to that, he served as President of Flex Power, the power supply business of Flextronics International Ltd. from January 2012 to June 2015. Mr.
Cook served as Founder, CEO and Adviser at Cauz Colony from June 2015 to December 2018. Prior to that, he served as President of Flex Power, the power supply business of Flextronics International Ltd. from January 2012 to June 2015. Mr.
These figures include 3,571 employees in Asia Pacific and 1,584 employees in EMEA. 8 Table of Contents Except where required by local regulations, our employees are not represented by labor unions, nor are they covered by collective bargaining agreements. We have not experienced a significant work stoppage. We believe that our employees are the foundation of our success.
Except where required by local regulations, our employees are not represented by labor unions, nor are they covered by collective bargaining agreements. We have not experienced a significant work stoppage. We believe that our employees are the foundation of our success.
Before joining UCT, Mr. Cook served as Executive Vice President and Chief Marketing Officer of Cypress Semiconductor from March 2017 to April 2020 when the company was acquired by Infineon Technologies AG. Mr. Cook served as Founder, CEO and Adviser at Cauz Colony from June 2015 to December 2018.
Cook joined the Company as the President of Products Business in April 2022. Before joining UCT, Mr. Cook served as Executive Vice President and Chief Marketing Officer of Cypress Semiconductor from March 2017 to April 2020 when the company was acquired by Infineon Technologies AG. Mr.
In addition, we believe our overseas facilities position us to respond effectively to future business demands. We employ a core engineering strategy with flexible partnering to augment our staff during the demand cycles within the semiconductor industry. • Continue to selectively pursue strategic acquisitions .
We employ a core engineering strategy with flexible partnering to augment our staff during the demand cycles within the semiconductor industry. • Continue to selectively pursue strategic acquisitions .
Positively involving our employees and giving back to communities is central to our culture. Supported by the Company, our employees contribute directly to the community with their time and resources. In 2024, we organized and conducted 31 events designed to give back and support its communities.
Positively involving our employees and giving back to communities is central to our culture. Supported by the Company, our employees directly contribute their time and resources through initiatives designed to give back and support our communities.
Competition When we compete for new business, it is typically against other suppliers of gas delivery systems, critical subsystems, parts and components, cleaning and analytical services, as well as the internal manufacturing and services groups of our customers.
We require employees to assign to us proprietary information, inventions and other intellectual property they create, modify or improve. 7 Table of Contents Competition When we compete for new business, it is typically against other suppliers of gas delivery systems, critical subsystems, parts and components, cleaning and analytical services, as well as the internal manufacturing and services groups of our customers.
Harding has served as our Senior Vice President, Chief Accounting Officer since June 2022. Prior to joining UCT, Mr. Harding served as Vice President and Corporate Controller at The Greenbrier Companies from March 2020 to June 2022. Prior to that, Mr.
Johnson holds a B.S. in Electrical and Computer Engineering from Cornell University and an M.B.A. from Harvard Business School. Brian E. Harding has served as our Senior Vice President, Chief Accounting Officer since June 2022. Prior to joining UCT, Mr. Harding served as Vice President and Corporate Controller at The Greenbrier Companies from March 2020 to June 2022.
These facilities house subsystem assembly, weldment and thermal control heater operations and are near the manufacturing facilities of existing and potential customers and their end users. Several of UCT’s facilities are also in low-cost regions, adding to our competitive advantage. • Provide production flexibility to respond rapidly to demand changes.
The diverse footprint of our manufacturing facilities allows us to provide cost-competitive solutions. These facilities house subsystem assembly, weldment and thermal control heater operations and are near the manufacturing facilities of existing and potential customers and their end users.
They are responsible for initiating and developing long-term, multi-level relationships and work closely with the customers on new business opportunities. Our Customer Business Management organization includes technical sales support for order placement, spare parts, quotes and production status updates as well as service and maintenance contracts and analysis business. We have technical relationship representatives located at most of our facilities.
Our Customer Business Management organization includes engineers who provide sub-system design through to design for manufacturability (“DFM”) recommendations and technical sales support for order placement, spare parts, quotes and production status updates as well as service and maintenance contracts and analysis business. We have technical relationship representatives located at most of our facilities.
Each customer relationship manager is dedicated to a specific customer account and is responsible for maintaining strong working relationships with that customer, and in many cases provide on-site support. OEM Customer relationship managers often attend customers’ internal meetings related to production and engineering design and quality to ensure that customer expectations are interpreted and communicated properly to the operations group.
Each customer relationship manager is dedicated to a specific customer account and is responsible for 6 Table of Contents maintaining strong working relationships with that customer, and in many cases provide on-site support.
Of our total employees, there were 130 in engineering, 26 in technology development, 402 in sales and support, 4,877 in direct manufacturing, 1,329 in indirect manufacturing and 741 in administrative and executive functions.
Of our total employees, there were 146 in engineering, 57 in technology development, 508 in sales and support, 4,778 in direct manufacturing, 1,367 in indirect manufacturing and 555 in administrative and executive functions. These figures include 3,772 employees in Asia Pacific and 1,663 employees in EMEA.
Scholhamer 58 Chief Executive Officer and Director Sheri Savage 54 Chief Financial Officer Harjinder Bajwa 58 Chief Operating Officer Jeff McKibben 62 Chief Information Officer Chris Cook 56 President, Products Business William C. Bentinck 63 President, Services Business Brian E. Harding 43 Senior Vice President, Chief Accounting Officer Jamie J. Palfrey 57 Senior Vice President, Global Human Resources Paul Y.
Name Age Position James Xiao 55 Chief Executive Officer and Director Sheri Savage 55 Chief Financial Officer Robert Wunar 58 Chief Operating Officer Jeff McKibben 63 Chief Information Officer Chris Cook 57 Chief Business Officer Sam Johnson 38 Senior Vice President and Services General Manager Brian E. Harding 45 Senior Vice President, Chief Accounting Officer Jamie J.
Customer relationship managers also work with customers to identify and meet their cost and design-to-delivery cycle time 6 Table of Contents objectives.
OEM Customer relationship managers often attend customers’ internal meetings related to production and engineering design and quality to ensure that customer expectations are interpreted and communicated properly to UCT’s engineering and operations groups. Customer relationship managers also work with customers to identify and meet their cost and design-to-delivery cycle time objectives.
We continue to expand the number and type of subsystems and services that we offer in the rapidly advancing semiconductor market. • Leverage our geographic presence in lower-cost manufacturing regions . The diverse footprint of our manufacturing facilities allows us to provide cost-competitive solutions.
Leveraging our technology roadmap assessments and broad customer engagements, we continue to expand the number and type of subsystem and service offerings we provide. This maintains our ability to address and adapt to the rapidly advancing semiconductor market and meet the process and performance requirements for advanced nodes. • Leverage our geographic presence in lower-cost manufacturing regions .
Bajwa holds a B.S. in Mechanical Engineering from Panjab University and an M.S. in Engineering from San Jose State University. He has also completed executive development programs at the Massachusetts Institute of Technology and Stanford University. Jeff McKibben has served as our Chief Information Officer since August 2021. Prior to joining UCT, Mr.
Wunar held various roles of increasing responsibility at Applied Materials, Inc. from July 1992 to December 2014. Mr. Wunar holds a Bachelor of Science in Electronics Engineering Technology from DeVry Institute of Technology. Jeff McKibben has served as our Chief Information Officer since August 2021. Prior to joining UCT, Mr.
Scholhamer joined Applied Materials, Inc. in 2006, where, prior to his most recent position, he served as Vice President of Operations Display and Solar Products Division from July 2006 to December 2008 and Corporate Vice President and General Manager of the Display Business Group from December 2008 to February 2011. Prior to that, Mr.
Xiao joined the Company after serving as Corporate Vice President and General Manager of Applied Materials, Inc., where he led the Semiconductor Dielectric ALD Product Group and Metal Deposition Products (MDP)/ALD BU operations from August 2023 to September 2025. Prior to this role, Mr.
Bentinck joined the Company as Senior Vice President, Semiconductor Services Business, in March 2019. Mr. Bentinck previously served as Executive Vice President and General Manager of Eugenus, Inc., a semiconductor equipment manufacturing company, from November 2017 to June 2018. Prior to that, Mr.
Johnson joined the Company as Senior Vice President, Strategy, in March 2025. Prior to joining the Company, Mr. Johnson served as Principal, Portfolio Operations and Head of ESG at Arcline Investment Management, a private equity firm, from December 2019 to March 2025. Previously, Mr.
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Cho 47 General Counsel and Corporate Secretary James P. Scholhamer joined the Company as Chief Executive Officer and a member of our Board of Directors in January 2015. Prior to joining Ultra Clean, Mr.
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We implement cost containment and capacity enhancement initiatives throughout the semiconductor demand cycles and benefit from the global presence and efficiencies of our supply chain. In addition, we believe our overseas facilities position us to respond effectively to future business demands.
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Scholhamer served as Corporate Vice President and General Manager of Applied 9 Table of Contents Materials, Inc., leading the Equipment Products Group and Display Services Group of its Global Service Division from February 2011 to January 2015. Mr.
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They are responsible for initiating and developing long-term, multi-level relationships and work closely with the customers on new business opportunities.
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Scholhamer worked for Applied Films Corporation as COO/CTO and Vice President of Operations, Engineering and Research Development in the company’s German office from September 2002 to July 2006 and as Vice President of Thin Film Coating Division and Thin Film Equipment Division in the company’s Colorado office from July 2000 to September 2002. Mr.
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As part of our ongoing commitment to SuCCESS2030, in 2025 we successfully conducted comprehensive materials, supply chain, and environmental health and safety surveys for our customers. These assessments included information on conflict and extended minerals reporting templates, facilities, and other key areas.
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Bajwa has 30 years of global operations expertise, including strategy development and execution, operations improvement and quality control, lean manufacturing and cost management. Most recently, Harjinder was the Chief Operating Officer for Reconext, a leading provider of aftermarket lifecycle services for electronics. Prior, he held various roles with Flex, Ltd. for 27 years.
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Palfrey 58 Senior Vice President, Global Human Resources Paul Y. Cho 48 General Counsel and Corporate Secretary Jinsong (“James”) Xiao has served as our Chief Executive Officer since September 2025. Mr.
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From 2011 to 2021, he was the Senior Vice President, Global Operations of the High Reliability Solutions business unit, where he oversaw global operations in Americas, Asia and Europe, and was part of significant growth in the business unit's revenue and operating profits. Mr.
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Xiao held various executive positions at Applied Materials since June 2006, including Corporate Vice President and General Manager of the Core Product Group within the Display & Flexible Technology division from April 2023 to July 2023; Corporate Vice President and General Manager of the Display Thin Film Group from February 2017 to April 2023; Vice President and General Manager of the Display CVD & Equipment Product Group from May 2015 to February 2017; and Managing Director/Vice President and General Manager of the Display CVD Products Division from February 2013 to May 2015.
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Bentinck served as Vice President and General Manager of the Logic & Memories Technology Group for AIXTRON Inc., a manufacturer of systems and equipment to the semiconductor industry, from April 2014 to November 2017. From August 2006 to March 2014, Mr.
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Robert Wunar was appointed by the Board of Directors of the Company as Chief Operating Officer on January 25, 2026, effective March 23, 2026. Mr. Wunar brings more than 30 years of operations and manufacturing leadership experience. Most recently, he served as Managing Director of Business Unit Operations at Applied Materials, Inc. from November 2020 to January 2026.
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Bentinck served as General Manager, Customer Support Business Group (Spares & Services) for Lam Research Corporation, a global supplier of wafer fabrication equipment and services to the semiconductor industry. Prior to Lam Research Corporation, Mr.
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Prior to that, Mr. Wunar served as Managing Partner at Applied Manufacturing Group, Inc. from December 2019 to November 2020 and as Principal at HelmSmart Consulting from January 2017 to December 2019. He also served as Senior Director, Business Operations, at SolarCity from December 2014 to December 2016. Earlier in his career, Mr.
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Bentinck served in various roles of increasing responsibility at Novellus Systems, Inc., a provider of advanced process equipment for the 10 Table of Contents global semiconductor industry, from 1991 through August 2006. Mr. Bentinck holds a B.S. in Chemical Engineering, and a M.S. in Engineering – Material Science, from California State Polytechnic University, Pomona. Brian E.
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Johnson was a consultant at Bain & Company, a management consulting firm, from July 2017 to December 2019. Earlier in his career, from August 2010 to May 2015, Mr. Johnson served in various capacities at Chevron Corporation, an integrated oil and gas company. Mr.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

69 edited+24 added−21 removed119 unchanged
Biggest changeThe amount of our future capital requirements will depend on many factors, including: the cost associated with the expansion of our manufacturing capacity into Malaysia as part of our strategic growth plan; the cost to maintain appropriate IT systems; the cost to maintain adequate manufacturing capacity; the timing and extent of spending to support product development efforts; the timing of new product introductions and enhancements to existing products; the timing, size and availability of strategic transactions; the cost to integrate our acquisitions into our business environment; changing manufacturing capabilities to meet new or increased customer requirements; market acceptance of our products; and our ability to generate sufficient cash flow from our operating activities.
Biggest changeOur future cash requirements will depend on many factors, including the following capital expenditures: expansion of manufacturing in Malaysia and other locations as part of our strategic growth plan; enhancement of IT systems and cybersecurity infrastructure; manufacturing process changes and facility modifications required to meeting evolving customer requirements; and timing of new product introductions.
Our annual and quarterly tax rates could be affected by numerous factors, including changes in the applicable tax laws, amount and composition of pre-tax income in countries with different tax rates, and valuation of our deferred tax assets and liabilities.
Our annual and quarterly tax rates could be affected by numerous factors, including changes in applicable tax laws, the amount and composition of pre-tax income in countries with different tax rates, and valuation of our deferred tax assets and liabilities.
Should the ERP system not be implemented successfully throughout all our business units on time and within budget, or if the system does not perform in a satisfactory manner, it could be disruptive and adversely affect our operations, including our ability to: (i) report accurate, timely and consistent financial results; (ii) purchase supplies, components and raw materials from our suppliers; and (iii) deliver products and services to customers on a timely basis and to collect our receivables from them.
Should the ERP system not be implemented or integrated successfully throughout all our business units on time and within budget, or if the system does not perform in a satisfactory manner, it could be disruptive and adversely affect our operations, including our ability to: (i) report accurate, timely and consistent financial results; (ii) purchase supplies, components and raw materials from our suppliers; and (iii) deliver products and services to customers on a timely basis and to collect our receivables from them.
The areas where we face risks include: • management of a larger, more complex and capital intensive combined business, including integrating supply and distribution channels, computer and accounting systems, and other aspects of operations; 12 Table of Contents • exposure to new operational risks, rules, regulations, worker expectations, customs and practices; • inability to complete proposed transactions due to the failure to obtain regulatory or other approvals, litigation or other disputes, and any ensuing obligation to pay a termination fee; • reduction of gross margins and pricing leverage due to the acquired company having the same customer base; • failure to realize expected returns from acquired businesses; • reduction in cash balances or increase in debt obligations to finance the acquisition, which may reduce the availability of cash flow for general corporate or other purposes; • integration of the capabilities of the acquired businesses without reducing the quality of existing products; • incorporation of different financial and reporting controls, processes, systems and technologies into our existing business environment; • unforeseen liabilities, expenses, or other losses associated with the acquisitions for which we do not have recourse under their respective agreements; • the risk of litigation or claims associated with a proposed or completed transaction; • inadequacy or ineffectiveness of an acquired company’s internal financial controls, disclosure controls and procedures, or environmental, health and safety, anti-corruption, human resource or other policies or practices; • performance shortfalls as a result of the diversion of management’s attention from the Company’s operations; • cultural challenges associated with integrating employees from the acquired business into our organization, and incentivization and retention of employees from the businesses we acquire; and • difficulties associated with the retention and transition of new customers and partners into our existing business.
The areas where we face risks include: • management of a larger, more complex and capital intensive combined business, including integrating supply and distribution channels, computer and accounting systems, and other aspects of operations; • exposure to new operational risks, rules, regulations, worker expectations, customs and practices; • inability to complete proposed transactions due to the failure to obtain regulatory or other approvals, litigation or other disputes, and any ensuing obligation to pay a termination fee; • reduction of gross margins and pricing leverage due to the acquired company having the same customer base; • failure to realize expected returns from acquired businesses; • reduction in cash balances or increase in debt obligations to finance the acquisition, which may reduce the availability of cash flow for general corporate or other purposes; • integration of the capabilities of the acquired businesses without reducing the quality of existing products; • incorporation of different financial and reporting controls, processes, systems and technologies into our existing business environment; • unforeseen liabilities, expenses, or other losses associated with the acquisitions for which we do not have recourse under their respective agreements; • the risk of litigation or claims associated with a proposed or completed transaction; • inadequacy or ineffectiveness of an acquired company’s internal financial controls, disclosure controls and procedures, or environmental, health and safety, anti-corruption, human resource or other policies or practices; • performance shortfalls as a result of the diversion of management’s attention from the Company’s operations; • cultural challenges associated with integrating employees from the acquired business into our organization, and incentivization and retention of employees from the businesses we acquire; and • difficulties associated with the retention and transition of new customers and partners into our existing business.
In addition, our suppliers experiencing natural disasters may not be able to provide sufficient components or raw materials in a timely manner, which can cause disruptions in our operations. Legal and Regulatory Risks Growing uncertainties with U.S. trade policies and export regulations with regard to China have adversely impacted and could continue to adversely impact us.
In addition, our suppliers experiencing natural disasters or geopolitical disruptions may not be able to provide sufficient components or raw materials in a timely manner, which can cause disruptions to our operations. Legal and Regulatory Risks Growing uncertainties with U.S. trade policies and export regulations with regard to China have adversely impacted and could continue to adversely impact us.
Our quarterly revenue and operating results, including our gross margin, have fluctuated significantly in the past, and we expect them to continue to fluctuate in the future for a variety of reasons, which may include: • the cyclical nature of the industries we serve that frequently oscillates between downturn and growth; • changes in the timing and size, or cancellation or postponement, of orders by our customers; • strategic decisions by our customers to terminate their outsourcing relationship with us or give market share to our competitors, which may result from decreased demand for our customers’ products by end customers; • strategic consolidation by our customers; • pricing pressure from either our competitors or our customers; • disruptions or delays in the manufacturing of our products or in the supply of components or raw materials; • introduction of new products or services; • delays in production ramp-up, low yields or other problems experienced at our manufacturing facilities; • changes in design-to-delivery cycle times; • inability to reduce our costs quickly, commensurate with reductions in our prices or in response to decreased demand; • changes in our product and/or service mix; • write-offs of excess or obsolete inventory; • one-time expenses or charges associated with failed acquisition negotiations or completed acquisitions; • inability to control our operating costs consistent with target levels; • announcements by our competitors of new products, services or technological innovations; and • geographic mix of customer orders or worldwide earnings.
Our quarterly revenue and operating results, including our gross margin, have fluctuated significantly in the past, and we expect them to continue to fluctuate in the future for a variety of reasons, which may include: • the cyclical nature of the industries we serve that frequently oscillates between downturn and growth; • changes in the timing and size, or cancellation or postponement, of orders by our customers; • strategic decisions by our customers to terminate their outsourcing relationship with us or give market share to our competitors, which may result from decreased demand for our customers’ products by end customers; • strategic consolidation by our customers; • pricing pressure from either our competitors or our customers; • disruptions or delays in the manufacturing of our products or in the supply of components or raw materials; 22 Table of Contents • introduction of new products or services; • delays in production ramp-up, low yields or other problems experienced at our manufacturing facilities; • changes in design-to-delivery cycle times; • inability to reduce our costs quickly, commensurate with reductions in our prices or in response to decreased demand; • changes in our product and/or service mix; • write-offs of excess or obsolete inventory; • one-time expenses or charges associated with failed acquisition negotiations or completed acquisitions; • inability to control our operating costs consistent with target levels; • announcements by our competitors of new products, services or technological innovations; and • geographic mix of customer orders or worldwide earnings.
We are exposed to political, economic, legal and other risks associated with operating in Asia and EMEA, including: • foreign currency exchange fluctuations; 13 Table of Contents • political, civil, public health and economic instability, such as the one resulting from the conflict between Israel and Hamas-led groups that started in 2023; • restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments, import/export restrictions and quotas, and customs duties and tariffs; • uncertainty regarding social, political and trade policies in the United States and abroad; • timing and availability of export licenses; • disruptions due to developing domestic infrastructure in countries like China, including transportation and energy; • difficulties in developing relationships with local suppliers, attracting new international customers, conducting due diligence with respect to business partners in certain international markets, collecting accounts receivables, and staffing and managing distant international subsidiaries and branch operations; • the burden of complying with foreign and international laws and treaties; • legal systems potentially subject to undue influence or corruption; and • potentially adverse tax consequences, including restrictions on the repatriation of earnings to the United States.
We are exposed to political, economic, legal and other risks associated with operating in Asia and EMEA, including: • foreign currency exchange fluctuations; • political, civil, public health and economic instability, such as the one resulting from the conflict between Israel and Hamas-led groups that started in 2023; • restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments, import/export restrictions and quotas, and customs duties and tariffs; • uncertainty regarding social, political and trade policies in the United States and abroad; • timing and availability of export licenses; • disruptions due to developing domestic infrastructure in countries like China, including transportation and energy; • difficulties in developing relationships with local suppliers, attracting new international customers, conducting due diligence with respect to business partners in certain international markets, collecting accounts receivables, and staffing and managing distant international subsidiaries and branch operations; • the burden of complying with foreign and international laws and treaties; • legal systems potentially subject to undue influence or corruption; and • potentially adverse tax consequences, including restrictions on the repatriation of earnings to the United States.
Problems with our products may: • cause delays in product introductions and shipments for us or our customers; • result in increased costs and diversion of development resources (for design modifications and others); • cause us to incur increased charges due to unusable inventory; 18 Table of Contents • result in liability for the unintended release of hazardous materials through the defective products, which can cause serious injury or death; • create indemnification and warranty claims for rework, replacement or other damages, which can be significant if our products have already been installed in a fabrication facility; • decrease market acceptance of, or customer satisfaction with, our products; and • result in lower yields for semiconductor manufacturers.
Problems with our products may: • cause delays in product introductions and shipments for us or our customers; • result in increased costs and diversion of development resources (for design modifications and others); • cause us to incur increased charges due to unusable inventory; • result in liability for the unintended release of hazardous materials through the defective products, which can cause serious injury or death; • create indemnification and warranty claims for rework, replacement or other damages, which can be significant if our products have already been installed in a fabrication facility; • decrease market acceptance of, or customer satisfaction with, our products; and • result in lower yields for semiconductor manufacturers.
International trade disputes could result, and have resulted in the past, in increases in tariffs and other trade restrictions and protectionist measures that could adversely impact our operations and reduce the competitiveness of our products relative to local and global competitors. We could be adversely affected by risks associated with joint ventures, including those in the Asian markets.
International trade disputes could result, and have resulted in the past, in increases in tariffs and other trade restrictions and protectionist measures that could adversely impact our operations and reduce the competitiveness of our products relative to local and global competitors. 14 Table of Contents We could be adversely affected by risks associated with joint ventures, including those in the Asian markets.
For example, one of our key suppliers was the target of a ransomware attack, which had a negative impact on our ability to procure the necessary volume of components to meet our projected production level. We may also experience difficulty in obtaining sufficient quantities of components and raw materials in times of growth in our business.
For example, one of our key suppliers was the target of a ransomware attack, which had a negative impact on our ability to procure the necessary volume of components to meet our projected production level. 16 Table of Contents We may also experience difficulty in obtaining sufficient quantities of components and raw materials in times of growth in our business.
We will then be forced to procure components or raw materials from higher-cost suppliers or reconfigure the design and manufacture of our products or services, which may eventually lead, and have led in the past, to our failure to fill customer orders.
We will then be forced to procure components or raw materials from higher- 13 Table of Contents cost suppliers or reconfigure the design and manufacture of our products or services, which may eventually lead, and have led in the past, to our failure to fill customer orders.
For the foreseeable future, therefore, any return on our shareholders’ investment will depend exclusively on the capital appreciation of our common stock. 24 Table of Contents
For the foreseeable future, therefore, any return on our shareholders’ investment will depend exclusively on the capital appreciation of our common stock. 25 Table of Contents
In order to respond to these modifications and deliver our products in a timely manner, we must effectively manage our manufacturing and procurement processes, the failure of which can lead to a loss 16 Table of Contents of business and reputational damage.
In order to respond to these modifications and deliver our products in a timely manner, we must effectively manage our manufacturing and procurement processes, the failure of which can lead to a loss of business and reputational damage.
For example, we have been incurring costs responding to a subpoena received from the SEC related to the material weaknesses identified in our 2022 and 2023 annual reports and the change of our independent auditors. Any environmental contamination at any of our production facilities could result in substantial liabilities.
For example, we incurred costs responding to a subpoena received from the SEC related to the material weaknesses identified in our 2022 and 2023 annual reports and the change of our independent auditors. Any environmental contamination at any of our production facilities could result in substantial liabilities.
Our revenues in periods of increasing demand depends, in part, upon our ability to: (i) timely mobilize our supply chain to maintain component and raw material supply; (ii) optimize our design, as well as mobilize our engineering and manufacturing capacity in a timely manner; (iii) expand, as necessary, our manufacturing, cleaning, coating and analytical services capacity; and (iv) maintain our product and service quality as we increase production.
Our revenues in periods of increasing demand depends, in part, upon our ability to: (i) timely mobilize our supply chain to maintain component and raw material supply at scale; (ii) optimize our design, as well as mobilize our engineering and 11 Table of Contents manufacturing capacity in a timely manner; (iii) expand, as necessary, our manufacturing, cleaning, coating and analytical services capacity; and (iv) maintain our product and service quality as we increase production.
Obtaining these export licenses is likely difficult for us and/or our customers, and any delays (or denial) in the approval process could disrupt our supply chains and negatively impact production schedules.
Obtaining these export licenses remains difficult for us and/or our customers, and any delays (or denial) in the approval process could disrupt our supply chains and negatively impact production schedules.
We have teams leading the implementation of the ERP system at most of our locations. To the extent these teams or key individuals are not retained through the implementation process, the success of our implementation could be compromised and the expected benefits of the ERP system may not be realized.
We have teams leading the implementation of the ERP system at most of our locations, and the integration of acquired entities onto our ERP platform. To the extent these teams or key individuals are not retained through the implementation process, the success of our implementation could be compromised and the expected benefits of the ERP system may not be realized.
We may also be liable for certain damages under our agreements with our customers, if we or our suppliers fail to effectively or timely re-configure manufacturing processes or components in response to these modifications. Our inability to successfully manage the implementation of a company-wide enterprise resource planning (“ERP”) system could adversely affect our operating results.
We may also be liable for certain damages under our agreements with our customers, if we or our suppliers fail to effectively or timely re-configure manufacturing processes or components in response to these modifications. Incomplete or unsuccessful implementation and integration of a company-wide enterprise resource planning (“ERP”) system could adversely affect our operating results.
Inventory is one of the largest assets on our balance sheet, representing 19.8% of our total assets as of December 27, 2024. Effective management of raw materials, work-in-process and finished goods is imperative to keep inventory costs down and maintain or improve gross margins, all the while meeting changing customer requirements.
Inventory is one of the largest assets on our balance sheet, representing 22.6% of our total assets as of December 26, 2025. Effective management of raw materials, work-in-process and finished goods is imperative to keep inventory costs down and maintain or improve gross margins, all the while meeting changing customer requirements.
We generated approximately 73.0% and 69.6% of our revenues in international markets for fiscal years 2024 and 2023, respectively. Depending on market conditions, we intend to further expand our operations in Asia Pacific and EMEA.
We generated approximately 75.9% and 73.0% of our revenues in international markets for fiscal years 2025 and 2024, respectively. Depending on market conditions, we intend to further expand our operations in Asia Pacific and EMEA.
Our top two customers accounted for 54.5%, 57.4% and 62.7% of our revenues for fiscal years 2024, 2023 and 2022, respectively.
Our top two customers accounted for 58.7%, 54.5% and 57.4% of our revenues for fiscal years 2025, 2024 and 2023, respectively.
If we were required to impair all or part of our goodwill and/or our acquired intangible assets, our net income and net worth could be materially adversely affected. We had $265.3 million of goodwill recorded on our Consolidated Balance Sheet as of December 27, 2024.
If we were required to impair all or part of our goodwill and/or our acquired intangible assets, our net income and net worth could be materially adversely affected. We had $114.2 million of goodwill recorded on our Consolidated Balance Sheet as of December 26, 2025.
Our facilities may experience catastrophic losses caused by natural disasters or other causalities, such as earthquakes, storms, floods, fires, public health epidemic, labor disruptions, power outages, terrorist attacks or political unrest, the occurrence of any one of which could disrupt our operations, delay production and shipments, and result in large repair expenses.
Our facilities may experience catastrophic losses from natural disasters or other causalities, such as earthquakes, storms, floods, fires, public health epidemics, labor disruptions, power outages, terrorist attacks or political unrest, any of which could disrupt operations, delay production and shipments, and result in significant repair expenses.
If any of the analysts issue an adverse opinion regarding our stock, our stock price would likely decline. Similarly, if these analysts cease publishing regular reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.
Similarly, if these analysts cease publishing regular reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.
While many of our customers are contractually obligated to indemnify us for the costs to defend third party claims arising out of our use of the information provided by the customers, the indemnified amount may not be enough to make us whole, or if our customers refuse to honor its obligations, we could end up in costly litigations both to defend against such third-party claims and to enforce our contractual indemnification rights. 20 Table of Contents We may become involved in litigations and regulatory proceedings, which could require significant attention from our management and result in significant expense to us and disruptions to our business.
While many of our customers are contractually obligated to indemnify us for the costs to defend third party claims arising out of our use of the information provided by the customers, the indemnified amount may not be enough to make us whole, or if our customers refuse to honor its obligations, we could end up in costly litigations both to defend against such third-party claims and to enforce our contractual indemnification rights.
There can be no assurance that any final determination will not be materially different from the treatment reflected in our historical income tax provisions and accruals, which could materially and adversely affect our financial condition and results of operations.
There can be no assurance that any final determination will not be materially different from the treatment reflected in our historical income tax provisions and accruals, which could materially and adversely affect our financial condition and results of operations. General Risk Factors The market for our stock is subject to significant fluctuation.
If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse opinion regarding our stock, our stock price and trading volume could decline. The trading market for our common stock is influenced by the research and reports that industry analysts publish about us or our business.
The trading market for our common stock is influenced by the research and reports that industry analysts publish about us or our business. If any of the analysts issue an adverse opinion regarding our stock, our stock price would likely decline.
We must achieve design wins to retain our existing customers and to obtain new customers. New capital equipment typically has a lifespan of several years, and OEMs frequently specify which systems, subsystems, components and instruments are to be incorporated in their equipment.
We must achieve design wins to retain our existing customers and to obtain new customers. New capital equipment typically has a lifespan of several years, and OEMs frequently specify which systems, subsystems, components and instruments are to be incorporated in their equipment. Once incorporated, the OEM will likely maintain that same composition of products for at least several months.
Our ability to remain profitable and mitigate the impact on our business in periods of decreasing demand depends, in part, upon our ability to: (i) maintain the prices, quality and delivery cycles of our products and services while managing costs by optimizing our inventory levels, (ii) reduce or cancel orders from our suppliers, all without compromising our relationships with such suppliers; and (iii) continue to motivate our employees while reducing our fixed and variable costs through various initiatives, which may include reducing our workforce. 11 Table of Contents The limited visibility we have on the future needs of our customers, combined with the cyclical and volatile nature of the industries we serve, makes future revenues, results of operations and net cash flows difficult to estimate.
Our ability to remain profitable and mitigate the impact on our business in periods of decreasing demand depends, in part, upon our ability to: (i) maintain the prices, quality and delivery cycles of our products and services while managing costs by optimizing our inventory levels, (ii) reduce or cancel orders from our suppliers, all without compromising our relationships with such suppliers; and (iii) continue to motivate our employees while reducing our fixed and variable costs through various initiatives, which may include reducing our workforce.
In connection with our Services business, we face a number of risks associated with customer parts being held on our premises, including the risk of mishandling or damaging, customer parts, any of which could be materially harmful for our business. The results of our operations, financial position and cash flows may suffer if we do not effectively manage our inventory.
We face a number of risks related to safeguarding this third-party property, including the risk of mishandling or damaging customer parts, any of which could be materially harmful for our business. The results of our operations, financial position and cash flows may suffer if we do not effectively manage our inventory.
Also, the amount, timing, and execution of our stock repurchase programs may fluctuate based on our priorities for the use of cash for other purposes and because of changes in cash flows, tax laws, and the market price of our common stock.
Even if our stock repurchase program is fully implemented, it may not enhance long-term stockholder value. Also, the amount, timing, and execution of our stock repurchase programs may fluctuate based on our priorities for the use of cash for other purposes and because of changes in cash flows, tax laws, and the market price of our common stock.
If the current trade relationship between U.S. and China continues on the same tense trajectory, we may experience additional taxes and tariffs on raw materials sourced from China, which could render our products less competitive and/or profitable.
If U.S. - China tensions escalate, we may experience additional taxes and tariffs on raw materials sourced from China, which could render our products less competitive and/or profitable.
We and our customers have significant operations in China. The extent of the impact of the ongoing trade tension between the United States and China on our sales and operations is difficult to predict. In December 2024, the U.S. Department of Commerce imposed additional license requirements on certain semiconductor goods and technologies sold to certain entities in China.
We and our customers have significant operations in China. The extent of the impact of the ongoing trade tension between the United States and China on our sales and operations is difficult to predict. Since December 2024, the U.S.
The timely development of new or enhanced products and services requires us to: • design innovative and performance-enhancing features to differentiate our products and services; • identify emerging technological trends, including new standards for our products and services; • accurately identify and design new products and services to meet market needs; • timely and efficiently collaborate with OEMs and IDMs to design and develop products and services; • timely ramp-up production of new products, especially new subsystems, at acceptable yields and costs; • successfully manage development production cycles; and • respond effectively to technological changes or product or service announcements by others.
If we are unable to integrate new technical specifications into competitive product and service designs, develop the technical capabilities necessary to manufacture new products or provide new services or make necessary modifications or enhancements to existing products or services, our business prospects could be harmed. 15 Table of Contents The timely development of new or enhanced products and services requires us to: • design innovative and performance-enhancing features to differentiate our products and services; • identify emerging technological trends, including new standards for our products and services; • accurately identify and design new products and services to meet market needs; • timely and efficiently collaborate with OEMs and IDMs to design and develop products and services; • timely ramp-up production of new products, especially new subsystems, at acceptable yields and costs; • successfully manage development production cycles; and • respond effectively to technological changes or product or service announcements by others.
The carrying amount of our fixed assets in Asia Pacific and EMEA were $121.0 million and $84.5 million, respectively as of December 27, 2024, and $132.6 million and $80.1 million, respectively as of December 29, 2023.
The carrying amount of our fixed assets in Asia Pacific and EMEA were $120.2 million and $83.0 million, respectively as of December 26, 2025, and $121.0 million and $84.5 million, respectively as of December 27, 2024.
As a result of the foregoing, we believe that quarter-to-quarter comparisons of our revenue and operating results may not be meaningful and that these comparisons may not be an accurate indicator of our future performance.
As a result of the foregoing, we believe that quarter-to-quarter comparisons of our revenue and operating results may not be meaningful and that these comparisons may not be an accurate indicator of our future performance. Changes in the timing or terms of a small number of transactions could disproportionately affect our operating results in any particular quarter.
Also, uncertainty and disruption to our organization as a 19 Table of Contents result of executive management transition could divert the executive management’s attention away from key areas of our business and have a material adverse effect on our business.
Also, uncertainty and disruption to our organization as a result of executive management transition could divert the executive management’s attention away from key areas of our business and have a material adverse effect on our business. Our business is subject to risks from natural disasters, infrastructure failures, and geopolitical conflicts, such as armed conflicts or terrorism.
We have identified material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls which, if not remediated, could adversely affect the accuracy, reliability, and timeliness of our financial reports, our reputation, business operations, and stock price.
We may identify material weaknesses in our internal control over financial reporting or otherwise fail to maintain effective internal controls, which could adversely affect our financial reporting, our reputation, operations, and stock price.
Accordingly, our intellectual property position is more vulnerable than it would be if it were protected primarily by patents. If we fail to protect our proprietary rights successfully, our competitive position could suffer.
Confidentiality agreements with our employees and others may not adequately prevent disclosure of trade secrets and other proprietary information. Accordingly, our intellectual property position is more vulnerable than it would be if it were protected primarily by patents. If we fail to protect our proprietary rights successfully, our competitive position could suffer.
If we are unable to remediate the material weaknesses, our ability to record, process and report financial information accurately, and to prepare financial statements within the time periods specified by the rules and forms of the SEC, could be adversely affected and could reduce the market’s confidence in our financial statements and harm our stock price.
If we identify material weaknesses in the future, and are unable to remediate those material weaknesses, our ability to record, process and report financial information accurately, and to prepare financial statements within the time periods specified by the rules and forms of the SEC, could be adversely affected and could reduce the market’s confidence in our financial statements and harm our stock price. 17 Table of Contents We are subject to order and shipment uncertainties and any significant reductions, cancellations or delays in customer orders could cause our revenue to decline and our operating results to suffer.
For example, the utilization rate of our manufacturing subsidiary in China may be negatively impacted if we would not be able to support our customers with goods and services originating out of that location.
For example, the utilization rate of our manufacturing subsidiary in China may be negatively impacted if we would not be able to support our customers with goods and services originating out of that location. 20 Table of Contents Additionally, tariffs and retaliatory tariffs levied by the United States and China on certain raw materials have in the past increased the cost of materials for our products.
Increased competition could result, and has resulted in the past, in price reductions, reduced gross margins or loss of market share. Competitors may introduce new products in the markets currently being served by our products. These new products may have better performance, lower prices and achieve broader market acceptance than our products.
Competitors may introduce new products in the markets currently being served by our products. These new products may have better performance, lower prices and achieve broader market acceptance than our products.
In addition, because many of our costs are fixed in the short term, we 17 Table of Contents could experience, and have experienced in the past, deterioration in our gross profit and operating margins when our sales volume declines.
In addition, because many of our costs are fixed in the short term, we could experience, and have experienced in the past, deterioration in our gross profit and operating margins when our sales volume declines. Any significant damage or loss of customer and supplier property held at our facilities could cause our operating results to suffer.
In addition, from time to time in the future, our joint venture partners may have economic or business interests that are different from ours.
In addition, from time to time in the future, our joint venture partners may have economic or business interests that are different from ours. If each joint venture business does not progress according to our plans and anticipated timing, our investment in the joint ventures may not be successful.
As long as our indebtedness remains outstanding, the restrictive 21 Table of Contents covenants and mandatory prepayment provisions could impair our ability to expand or pursue our business strategies or obtain additional funding.
As long as our indebtedness remains outstanding, the restrictive covenants and mandatory prepayment provisions could impair our ability to expand or pursue our business strategies or obtain additional funding. Insufficient cash flow from operations could limit our ability to fund capital expenditures, strategic acquisitions, or growth initiatives.
Any delay or failure in this process could result in a material financial harm. We have had to qualify as a supplier, and maintain that status, for each of our customers. This is often a lengthy process that normally involves customer inspection and approval of our engineering, documentation, manufacturing and quality control procedures before the customer will place volume orders.
Any delay or failure in this process could result in a material financial harm. We have had to qualify as a supplier, and maintain that status, for each of our customers.
If we cannot raise funds on acceptable terms when needed, we may not be able to develop or enhance our products, take advantage of future opportunities, grow our business or respond to competitive pressures or unanticipated requirements. Our quarterly revenue and operating results could fluctuate significantly from period to period, and this may cause volatility in our common stock price.
If we cannot secure adequate financing when needed, we may not be able to develop or enhance products, pursue strategic opportunities, maintain competitive manufacturing capacity, or respond effectively to competitive pressures or changing market conditions. Our quarterly revenue and operating results could fluctuate significantly from period to period, and this may cause volatility in our common stock price.
If we are unable to comply with these disclosure rules (which themselves may be subject to potential re-formulation by the new administration), we could be subject to enforcement actions by the SEC and liability under the Securities Exchange Act of 1934, which could result in material adverse consequences to our business, as well as significant fines and penalties.
If we are unable to comply with these disclosure rules (which themselves may be subject to potential re-formulation by the new administration), we could be subject to enforcement actions by the SEC and liability under the Securities Exchange Act of 1934, which could result in material adverse consequences to our business, as well as significant fines and penalties. 21 Table of Contents Financial, Tax and Capital Markets Risks We have significant existing indebtedness; the restrictive covenants under our credit agreement or other limitations on financing may limit our ability to expand or pursue our business strategy; if we are forced to pay our indebtedness prior to its maturity, our financial position could be materially and adversely affected.
The use of such hedging activities may not fully offset the adverse financial effects of unfavorable movements in foreign currency exchange rates over the time the hedges are in place. The market for our stock is subject to significant fluctuation.
The use of such hedging activities may not fully offset the adverse financial effects of unfavorable movements in foreign currency exchange rates over the time the hedges are in place. Changes in tax rates or tax assets and liabilities could affect results of operations.
If this occurs, we would expect to experience an immediate and significant decline in the trading price of our common stock. We cannot guarantee that our share repurchase program will be fully consummated or that it will enhance long-term stockholder value. We have a stock repurchase program under which we are authorized to repurchase our common stock.
We cannot guarantee that our share repurchase program will be fully consummated or that it will enhance long-term stockholder value. We have a stock repurchase program under which we are authorized to repurchase our common stock. Our repurchase program may be suspended or terminated at any time.
We are continuing the implementation of a company-wide ERP system. This process has been and continues to be complex and time-consuming and we expect to incur additional capital outlays and expenses. This ERP system will replace or interface with our existing operating and financial systems, which has been and is a major undertaking from a financial management and personnel perspective.
This ERP system will replace or interface with our existing operating and financial systems, which has been and is a major undertaking from a financial management and personnel perspective.
Once a cleaned or coated part has been qualified, the refurbishment processes used to clean or coat the qualified part will likely continue to be used.
IDMs typically establish cleaning, coating, and analytical services as they develop and qualify new chip designs for production. Once a cleaned or coated part has been qualified, the refurbishment processes used to clean or coat the qualified part will likely continue to be used.
These broad market fluctuations may adversely affect the trading price of our common stock. 23 Table of Contents Changes in tax rates or tax assets and liabilities could affect results of operations. As a global company, we are subject to taxation in the United States and various other countries. Significant judgment is required to determine and estimate worldwide tax liabilities.
As a global company, we are subject to taxation in the United States and various other countries. Significant judgment is required to determine and estimate worldwide tax liabilities.
We made capital expenditures of approximately $63.5 million and $75.8 million for fiscal years 2024 and 2023, respectively, which are primarily related to investments in our manufacturing facilities in the United States, Ireland and Malaysia and to our ERP system implementation.
We made capital expenditures of approximately $50.3 million and $63.5 million in fiscal years 2025 and 2024, respectively, primarily for manufacturing facility investments in the United States, Ireland and Malaysia, and for information technology infrastructure improvements, including ERP system upgrades and integration of acquired entities onto our platforms.
For example, customers may prevent us from moving our manufacturing sites from higher-cost regions to lower-cost regions, all the while seeking price reductions. If we are unable to retain and expand our business on favorable commercial terms, our business will be adversely affected and we may be susceptible to increased liability risk.
For example, customers may prevent us from moving our manufacturing sites from higher-cost regions to lower-cost regions, all the while seeking price reductions.
Defects in our products or services could damage our reputation, decrease market acceptance of our products, release hazardous materials, and result in litigation, indemnification liability or unexpected warranty claims.
Moreover, if we fail to maintain our status as a qualified supplier to any of our customers, such customer could cancel its orders or otherwise terminate its relationship with us. Defects in our products or services could damage our reputation, decrease market acceptance of our products, release hazardous materials, and result in litigation, indemnification liability or unexpected warranty claims.
Our management regularly evaluates potential strategic transactions with its advisors and our Board of Directors in the ordinary course of business.
We have made, and may in the future make, acquisitions of, or significant investments in, businesses that offer complementary products, services, technologies or market access. Our management regularly evaluates potential strategic transactions with its advisors and our Board of Directors in the ordinary course of business.
In addition, Section 404 of the Sarbanes-Oxley Act of 2002 requires us and our independent registered public accounting firm to evaluate and report on our internal control over financial reporting. The process of designing, implementing, maintaining, and updating our internal controls and complying with Section 404 is expensive and time consuming, and requires significant attention from management and company resources.
Maintaining effective internal controls over financial reporting is essential to providing reliable and timely financial reports and, together with adequate disclosure controls and procedures, detecting and preventing fraud. Section 404 of the Sarbanes-Oxley Act of 2002 requires both management and our independent registered public accounting firm to evaluate and report on our internal control over financial reporting.
This expansion of export license requirements in China has adversely impacted some of our customers with business presence in China, which in turn had an adverse impact on our business. These new regulations created uncertainty for our operations in China, as the full scope and extent of the new license requirements remain uncertain, and may change over time.
These evolving regulations have created ongoing uncertainty for our operations in China, as the full scope and extent of current and future license requirements remain uncertain, and may change over time.
Failure to maintain existing or implement new or improved controls, or difficulties encountered in their implementation, could harm our results of operations or cause us to fail to meet our reporting obligations. We have begun the process of evaluating the material weaknesses and have taken steps toward executing a full remediation plan.
Designing, implementing, maintaining, and continuously improving our internal controls requires significant management attention and company resources. Failure to maintain existing or implement new or improved controls, or difficulties encountered in their implementation, could harm our results of operations or cause us to fail to meet our reporting obligations.
We rely on a combination of trade secrets and contractual confidentiality provisions and, to a much lesser extent, patents, copyrights and trademarks to protect our proprietary rights. Confidentiality agreements with our employees and others may not adequately prevent disclosure of trade secrets and other proprietary information.
Our business is largely dependent upon our design, engineering, manufacturing, chemical processing, analytical and testing know-how. We rely on a combination of trade secrets and contractual confidentiality provisions and, to a much lesser extent, patents, copyrights and trademarks to protect our proprietary rights.
If we were required to impair all or a significant part of our goodwill and/or our acquired intangible assets, our financial results could be materially adversely affected. Fluctuations in foreign currency exchange rates may adversely affect our financial condition and results of operations. The majority of our international revenues are denominated in U.S. Dollars.
If we were required to impair all or a significant part of our goodwill and/or our acquired intangible assets, our financial results could be materially adversely affected. During the second quarter of 2025, the Company experienced a sustained decline in the market price of its common stock.
Frequent or persistent system failures could brand our products or services unattractive to customers, which may be difficult to reverse. Any steps we take to increase the reliability and redundancy of our systems may be expensive, reduce our operating margin and may not be successful in reducing the frequency or duration of unscheduled interruptions.
Any steps we take to increase the reliability and redundancy of our systems may be expensive, reduce our operating margin and may not be successful in reducing the frequency or duration of unscheduled interruptions. 19 Table of Contents Our business is largely dependent on the know-how of our employees, and we generally do not have an intellectual property position that is protected by patents.
In addition, due to economic and political conditions, tax laws and tax rates for income taxes in various jurisdictions may be subject to significant changes.
Due to economic and political conditions, tax laws and tax rates for income taxes in various jurisdictions may be subject to significant changes. The Organization for Economic Co-operation and Development and the G20 Inclusive Framework on Base Erosion and Profit Shifting have developed Pillar Two proposals that establish a global minimum corporate tax rate of fifteen percent.
Changes in the timing or terms of a small number of transactions could disproportionately affect our operating results in any particular 22 Table of Contents quarter. Moreover, our operating results in one or more future quarters may fail to meet our guidance or the expectations of securities analysts or investors.
Moreover, our operating results in one or more future quarters may fail to meet our guidance or the expectations of securities analysts or investors. If this occurs, we would expect to experience an immediate and significant decline in the trading price of our common stock.
Acquisitions could result in operating and integration difficulties, dilution, margin deterioration, diversion of management’s attention, and other consequences that may materially impact our business. We have made, and may in the future make, acquisitions of, or significant investments in, businesses that offer complementary products, services, technologies or market access.
If we are unable to retain and expand our business on favorable commercial terms, our business will be adversely affected and we may be susceptible to increased liability risk. 12 Table of Contents Acquisitions could result in operating and integration difficulties, dilution, margin deterioration, diversion of management’s attention, and other consequences that may materially impact our business.
If each joint venture business does not progress according to our plans and anticipated timing, our investment in the joint ventures may not be successful. 14 Table of Contents The industries in which we participate are highly competitive and rapidly evolving. We face intense competition from subsystem and component manufacturers in the industries we serve.
The industries in which we participate are highly competitive and rapidly evolving. We face intense competition from subsystem and component manufacturers in the industries we serve. Increased competition could result, and has resulted in the past, in price reductions, reduced gross margins or loss of market share.
Such qualification requirements limit our ability to quickly add new customers to offset any loss of, or reduction in sales to, existing customers. Moreover, if we fail to maintain our status as a qualified supplier to any of our customers, such customer could cancel its orders or otherwise terminate its relationship with us.
This is often a lengthy process that normally involves customer inspection and approval of our engineering, documentation, manufacturing and quality 18 Table of Contents control procedures before the customer will place volume orders. Such qualification requirements limit our ability to quickly add new customers to offset any loss of, or reduction in sales to, existing customers.
This risk is further exacerbated by the fact that our insurance policies do not fully cover the losses caused by earthquakes or other natural disasters or power loss. Our Fluid Solutions business operations are concentrated in Israel, where many key employees, offices and some of its production facilities are located.
Our Fluid Solutions business operations are concentrated in Israel, where key employees, offices and production facilities are located. The region faces ongoing armed conflict and security threats that directly impact our operations.
Removed
If we are unable to integrate new technical specifications into competitive product and service designs, develop the technical capabilities necessary to manufacture new products or provide new services or make necessary modifications or enhancements to existing products or services, our business prospects could be harmed.
Added
We are currently anticipating a period of historically elevated demand, driven by growth in artificial intelligence. During periods of strong demand such as those currently anticipated, competition for critical components, raw materials, and skilled labor intensifies, which may constrain our ability to meet customer requirements.
Removed
Once incorporated, the OEM will likely maintain 15 Table of Contents that same composition of products for at least several months. IDMs typically establish cleaning, coating, and analytical services as they develop and qualify new chip designs for production.
Added
A sharper-than-expected correction following a demand peak could exacerbate these challenges, particularly if we have meaningfully expanded our cost structure or inventory commitments in response to elevated near-term demand.
Removed
Based on our evaluation under the COSO framework as further described under “Item 9A – Controls and Procedures,” our management concluded that we did not maintain effective internal control over financial reporting as of December 27, 2024 due to material weaknesses.
Added
The limited visibility we have on the future needs of our customers, combined with the cyclical and volatile nature of the industries we serve, makes future revenues, results of operations and net cash flows difficult to estimate.
Removed
Effective internal controls over financial reporting are necessary for us to provide reliable and timely financial reports and, together with adequate disclosure controls and procedures, are designed to reasonably detect and prevent fraud.
Added
We are continuing to implement and integrate a company-wide ERP system. This process has been and continues to be complex and time-consuming and we expect to incur additional capital outlays and expenses.
Removed
Until the remediation plan is implemented, tested, and deemed effective, we cannot be certain that our actions will adequately remediate the material weaknesses or that no additional material weaknesses in our internal controls will be identified in the future.
Added
Although we have successfully remediated the material weaknesses identified in our Annual Report on Form 10-K for the year ended December 27, 2024, there can be no assurance that additional material weaknesses will not be identified in the future.
Removed
We are subject to order and shipment uncertainties and any significant reductions, cancellations or delays in customer orders could cause our revenue to decline and our operating results to suffer.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur employees are required to complete cybersecurity best practice training on a regular basis (no less than once a year), the results of which are collected and reported to the senior management for further evaluation.
Biggest changeOur employees are required to complete cybersecurity best practice training on a regular basis (no less than once a year), the results of which are collected and reported to senior management for further evaluation.
While these risks have yet to materially affect us, we cannot guarantee that our ongoing and increasingly robust approach towards cybersecurity will be able to prevent 25 Table of Contents cybersecurity incidents that could have a material adverse effect on us.
While these risks have yet to materially affect us, we cannot guarantee that our ongoing and increasingly robust approach towards cybersecurity will be able to prevent 26 Table of Contents cybersecurity incidents that could have a material adverse effect on us.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties UCT’s headquarters is located in Hayward, California. This facility provides administrative, sales and support, engineering and technology development and manufacturing operations. This lease expires in 2027. The Company has manufacturing and engineering facilities in California, Texas, Arizona, Israel, Oregon, China, Malaysia, Singapore, the United Kingdom, Philippines and Czechia.
Biggest changeItem 2. Properties UCT’s headquarters is located in Hayward, California. This facility provides administrative, sales and support, engineering and technology development and manufacturing operations. This lease expires in 2027. The Company has manufacturing and engineering facilities in California, Texas, Arizona, Israel, Oregon, China, Malaysia, Singapore, the United Kingdom, Thailand, Philippines and Czechia.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Removed
On June 7, 2024, UCT received a subpoena from the SEC related to the material weaknesses identified in our 2022 and 2023 Forms 10-K and the change of our independent auditors. We are fully cooperating with the SEC investigation. We cannot predict the duration, scope, or outcome of this matter at this time.
Added
As previously disclosed in our Quarterly Report on Form 10-Q for the quarterly period ended March 28, 2025, on March 24, 2025, a putative securities class action was filed against the Company and certain of its officers in the United States District Court for the Northern District of California, and on August 1, 2025, a derivative suit was filed against the Company's Board of Directors and the Company in the Superior Court of California, County of Alameda.
Added
Both lawsuits have been voluntarily dismissed on December 16, 2025 and December 26, 2025, respectively.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe stock performance shown on the following graph represents historical stock performance and is not necessarily indicative of future stock price performance. 27 Table of Contents The following table sets forth for the periods indicated the high and low sales prices per share of our common stock as reported by the NASDAQ Global Market: High Low Fiscal year 2023 First quarter $ 38.84 $ 29.01 Second quarter $ 39.15 $ 26.59 Third quarter $ 40.80 $ 28.04 Fourth quarter $ 35.54 $ 22.15 Fiscal year 2024 First quarter $ 49.25 $ 31.01 Second quarter $ 50.51 $ 38.16 Third quarter $ 56.47 $ 32.33 Fourth quarter $ 41.84 $ 32.08
Biggest changeThe following table sets forth for the periods indicated the high and low sales prices per share of our common stock as reported by the NASDAQ Global Market: High Low Fiscal year 2024 First quarter $ 49.25 $ 31.01 Second quarter $ 50.51 $ 38.16 Third quarter $ 56.47 $ 32.33 Fourth quarter $ 41.84 $ 32.08 Fiscal year 2025 First quarter $ 40.10 $ 21.91 Second quarter $ 23.22 $ 16.66 Third quarter $ 29.72 $ 21.28 Fourth quarter $ 31.11 $ 21.49
Repurchases of Common Stock On October 20, 2022, the Board of Directors approved a share repurchase program authorizing the Company to purchase up to an aggregate of $150.0 million of the Company’s common stock over a three-year period.
Repurchases of Common Stock On October 20, 2022, the Board of Directors approved a share repurchase program authorizing the Company to purchase up to an aggregate of $150.0 million of the Company’s common stock over a three-year period. On October 23, 2025, the Board of Directors approved a renewal of the share repurchase program.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Stock Exchange Listing Our common stock has been traded on the NASDAQ Global Market under the symbol “UCTT” since March 25, 2004. As of February 21, 2025, there were five holders of record of UCTT common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Stock Exchange Listing Our common stock has been traded on the NASDAQ Global Market under the symbol “UCTT” since March 25, 2004. As of February 17, 2026 there were four holders of record of UCTT common stock.
Stock Price Performance Graph The following stock performance graph and related information shall not be deemed “soliciting material” or “filed” with the Securities and Exchange Commission, nor shall such information be incorporated by reference into any future filings under the Securities Act of 1933 or the Exchange Act, each as amended, except to the extent that we specifically incorporate it by reference into such filing.
No shares were repurchased under this program for the three months ended December 26, 2025, Stock Price Performance Graph The following stock performance graph and related information shall not be deemed “soliciting material” or “filed” with the Securities and Exchange Commission, nor shall such information be incorporated by reference into any future filings under the Securities Act of 1933 or the Exchange Act, each as amended, except to the extent that we specifically incorporate it by reference into such filing.
The following stock performance graph compares the cumulative total stockholder returns during the period from December 27, 2019 to December 27, 2024, of our common stock to the NASDAQ Composite Index and the RDG Semiconductor Composite Index. The comparison assumes $100 was invested on December 27, 2019, in our common stock and in each of the foregoing indices.
The following stock performance graph compares the cumulative total stockholder returns during the period from December 25, 2020 to December 26, 2025, of our common stock to the NASDAQ Composite Index, the RDG Semiconductor Composite Index, and the PHLX Semiconductor Index.
This program may be suspended or discontinued at any time and does not obligate the Company to acquire any amount of common stock. No shares were repurchased under this program in fiscal 2024.
The renewed program authorizes the Company to repurchase up to $150.0 million of the Company's common stock over a three year period. This program may be suspended or discontinued at any time and does not obligate the Company to acquire any amount of common stock.
Added
In addition to the RDG Semiconductor Composite Index, we have added the PHLX Semiconductor Index, which we believe better represents overall semiconductor industry performance. The comparison assumes $100 was invested on December 25, 2020, in our common stock and in each of the foregoing indices.
Added
The stock performance shown on the following graph represents historical stock performance and is not necessarily indicative of future stock price performance. 28 Table of Contents *Assumes $100 invested on December 25, 2020 in stock or index, including reinvestment of dividends. Indexes calculated on month-end basis.

Item 7. Management's Discussion & Analysis

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

62 edited+26 added−10 removed46 unchanged
Biggest changeGeneral and Administrative Year Ended (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 General and administrative $ 179.5 10.8% $ 162.0 (12.1)% $ 184.3 General and administrative as a percentage of total revenues 8.6 % 9.3 % 7.8 % General and administrative expenses increased $17.5 million in fiscal year 2024 over fiscal year 2023, primarily driven by increases in spending for certain third party professional services of $5.8 million, stock-based compensation expense of $4.4 million, amortization of intangible assets acquired through business combinations of $3.6 million, in addition to a combination of other factors, none of which were individually significant. 34 Table of Contents Interest and Other Income (Expense), net Year Ended (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Interest income $ 4.8 17.1% $ 4.1 355.6% $ 0.9 Interest expense $ (46.5) (4.7)% $ (48.8) 44.0% $ (33.9) Other income (expense), net $ 17.7 n/m $ (1.8) (300.0)% $ 0.9 n/m - not meaningful Interest income increased $0.7 million in fiscal year 2024 over fiscal year 2023 due to higher interest income earned on cash and cash equivalent balances attributed to higher interest rates in the current period.
Biggest changeSales and marketing expenses increased by $3.9 million in fiscal year 2025 compared to fiscal year 2024, primarily due to higher restructuring costs, including expenses for involuntary separations and a voluntary early retirement program, as well as higher personnel costs and other operating expenses, including travel and office-related costs. 35 Table of Contents General and Administrative Year Ended (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 General and administrative $ 186.0 3.6% $ 179.5 10.8% $ 162.0 General and administrative as a percentage of total revenues 9.1 % 8.6 % 9.3 % General and administrative expenses increased $6.5 million in fiscal year 2025 over fiscal year 2024, primarily driven by increase in stock-based compensation, a separation payment made to the prior CEO, and increased restructuring activities, including both involuntary separations and a voluntary early retirement program.
We continually apply judgment when performing these evaluations and continuously monitor for events and circumstances that could negatively impact the key assumptions in determining fair value, including long-term revenue growth projections, undiscounted cash flows, discount rates, recent market valuations from transactions by comparable companies, volatility in our market capitalization and general industry, market and macroeconomic conditions.
We continually apply judgment when performing these evaluations and continuously monitor for events and circumstances that could negatively impact the key assumptions in determining fair value, including long-term revenue growth projections, projected cash flows, discount rates, recent market valuations from transactions by comparable companies, volatility in our market capitalization and general industry, market and macroeconomic conditions.
We consider certain accounting policies related to revenue recognition, inventory valuation, accounting for income taxes, business combinations, valuation of goodwill, intangible assets and long-lived assets to be critical policies due to the estimates and judgments involved in each. 29 Table of Contents Revenue Recognition Our revenues for fiscal years 2024, 2023 and 2022, were highly concentrated with a small number of OEM customers in the semiconductor capital equipment industry.
We consider certain accounting policies related to revenue recognition, inventory valuation, accounting for income taxes, business combinations, valuation of goodwill, intangible assets and long-lived assets to be critical policies due to the estimates and judgments involved in each. 30 Table of Contents Revenue Recognition Our revenues for fiscal years 2025, 2024 and 2023, were highly concentrated with a small number of OEM customers in the semiconductor capital equipment industry.
If we raise additional funds through the issuance of equity or convertible debt securities, our stockholders’ equity interest will be diluted and these securities might have rights, preferences and privileges senior to 36 Table of Contents those of our current stockholders. We may also require the consent of our new lenders to raise additional funds through equity or debt financings.
If we raise additional funds through the issuance of equity or convertible debt securities, our stockholders’ equity interest will be diluted and these securities might have rights, preferences and privileges senior to those of our current stockholders. We may also require the consent of our new lenders to raise additional funds through equity or debt financings.
A discussion regarding our financial condition and results of operations for fiscal 2023, compared to fiscal 2022, can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 29, 2023, filed with the SEC on February 27, 2024, which is available on the SEC’s website at www.sec.gov and our Investor Relations website at www.uct.com/investors.
A discussion regarding our financial condition and results of operations for fiscal 2024, compared to fiscal 2023, can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 27, 2024, filed with the SEC on February 25, 2025, which is available on the SEC’s website at www.sec.gov and our Investor Relations website at www.uct.com/investors.
Our potential liability arising out of intellectual property infringement claims by any third party is generally uncapped. As of December 27, 2024 , we have not incurred significant costs to defend lawsuits or settle claims related to these indemnification arrangements. As a result, we believe the estimated fair value of these arrangements is minimal.
Our potential liability arising out of intellectual property infringement claims by any third party is generally uncapped. As of December 26, 2025 , we have not incurred significant costs to defend lawsuits or settle claims related to these indemnification arrangements. As a result, we believe the estimated fair value of these arrangements is minimal.
Our Services segment provides ultra-high purity parts cleaning, process tool part recoating, surface encapsulation and high sensitivity micro contamination analysis primarily for the semiconductor device makers and wafer fabrication equipment (“WFE”) markets. We ship a majority of our products and provide most of our services to U.S. registered customers with both domestic and international locations.
Our Services segment provides ultra-high purity parts cleaning, process tool part recoating, surface encapsulation and high sensitivity micro contamination analysis primarily for the semiconductor device makers and WFE markets. We ship a majority of our products and provide most of our services to U.S. registered customers with both domestic and international locations.
Sales and Marketing Year Ended (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Sales and marketing $ 57.3 10.6% $ 51.8 (4.8)% $ 54.4 Sales and marketing as a percentage of total revenues 2.7 % 3.0 % 2.3 % Sales and marketing expenses consist primarily of salaries and commissions paid to our sales employees, salaries paid to our engineers who partner with sales and service employees to help determine the components and configuration requirements for new products and other costs related to the sales of our products.
Sales and Marketing Year Ended (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Sales and marketing $ 61.2 6.8% $ 57.3 10.6% $ 51.8 Sales and marketing as a percentage of total revenues 3.0 % 2.7 % 3.0 % Sales and marketing expenses consist primarily of salaries and commissions paid to our sales employees, salaries paid to our engineers who partner with sales and service employees to help determine the components and configuration requirements for new products and other costs related to the sales of our products.
For the year ended December 27, 2024, the Company concluded that a full valuation allowance against its U.S. federal and state net deferred tax assets continues to be necessary. The Company also concluded that some of its foreign deferred tax assets require a valuation allowance.
For the year ended December 26, 2025, the Company concluded that a full valuation allowance against its U.S. federal and state net deferred tax assets continues to be necessary. The Company also concluded that some of its foreign deferred tax assets require a valuation allowance.
Interest on the Term Loan is payable on (1) in the case of such ABR term loans, the last day of each calendar quarter 37 Table of Contents and (2) in the case of such Eurodollar term loans, the last day of each relevant interest period and, in the case of any interest period longer than three months, on each successive date three months after the first day of such interest period.
Interest on the Term Loan is payable on (1) in the case of such ABR term loans, the last day of each calendar quarter and (2) in the case of such Term SOFR loans, the last day of each relevant interest period and, in the case of any interest period longer than three months, on each successive date three months after the first day of such interest period.
Our Products segment primarily designs, engineers and manufactures production tools, components and parts, and modules and subsystems for the semiconductor and display capital equipment markets. Products include chemical delivery modules, frame assemblies, gas delivery systems, fluid delivery systems, precision robotics, process modules as well as other high-level assemblies.
Our Products segment primarily designs, engineers and manufactures production tools, components and parts, and modules and subsystems for the semiconductor and display capital equipment markets. Products include chemical delivery modules, frame assemblies, gas delivery systems, fluid delivery systems, precision robotics, process modules as well as other high-level assemblies for wafer fabrication equipment (“WFE”) and sub-fab support equipment.
The applicable margin for the Term Loan is equal to a rate per annum to either (i) at any time that the Company’s corporate family rating is Ba3 (with a stable outlook) or higher from Moody’s and BB (with a stable outlook) or higher from S&P, (x) 3.00% for such Eurodollar term loans and (y) 2.00% for such ABR term loans or (ii) at all other times, (x) 3.25% for such Eurodollar term loans and (y) 2.25% for such ABR term loans.
The applicable margin for the Term Loan is equal to a rate per annum equal to either (i) at any time that the Company’s corporate family rating is Ba3 (with a stable outlook) or higher from Moody’s and BB- (with a stable outlook) or higher from S&P, (x) 2.50% for such Term SOFR loans and (y) 1.50% for such ABR term loans or (ii) at all other times, (x) 2.75% for such Term SOFR loans and (y) 1.75% for such ABR term loans.
Research and Development Year Ended (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Research and development $ 28.3 —% $ 28.3 (0.7)% $ 28.5 Research and development as a percentage of total revenues 1.3 % 1.6 % 1.2 % Research and development expenses consist primarily of activities related to new component testing and evaluation, test equipment and fixture development, product design, the advancement of cleaning and coating and analytical processes, and other product-development activities.
Research and Development Year Ended (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Research and development $ 32.0 13.1% $ 28.3 —% $ 28.3 Research and development as a percentage of total revenues 1.6 % 1.3 % 1.6 % Research and development expenses consist primarily of activities related to new component testing and evaluation, test equipment and fixture development, product design, the advancement of cleaning and coating and analytical processes, and other product-development activities.
For fiscal year 2024, our effective tax rate was higher than the federal statutory rate of 21.0% primarily due to the valuation allowance in the U.S. and earnings in our foreign subsidiaries subject to local statutory tax rates.
For fiscal year 2025, our effective tax rate was lower than the federal statutory rate of 21.0% primarily due to the valuation allowance in the U.S., impairment of goodwill and earnings in our foreign subsidiaries subject to local statutory tax rates.
Recently Issued and Adopted Accounting Pronouncement For a description of recent accounting pronouncements, including the expected dates of adoption and estimated effects, if any, on UCT’s Consolidated Financial Statements, see Note 1, “Organization and Significant Accounting Policies,” of the Notes to Consolidated Financial Statements. 38 Table of Contents
Recently Issued and Adopted Accounting Pronouncement For a description of recent accounting pronouncements, including the expected dates of adoption and estimated effects, if any, on UCT’s Consolidated Financial Statements, see Note 1 of the Notes to Consolidated Financial Statements.
Under the Credit Agreement, the Company may elect that the Term Loan bear interest at a rate per annum equal to either (a) “ABR” (as defined in the Credit Agreement), plus the applicable margin or (b) the “Eurodollar Rate” (as defined in the Credit Agreement), based on SOFR, plus the applicable margin.
Under the Credit Agreement, the Company may elect that the Term Loan bear interest at a rate per annum equal to either (a) “ABR” (as defined in the Credit Agreement), plus the applicable margin or (b) the “Term SOFR” (as defined in the Credit Agreement), plus the applicable margin.
Year Ended Revenues by Geography (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 United States $ 566.5 7.5% $ 526.8 (28.6)% $ 738.0 International 1,531.1 26.8% 1,207.7 (26.2)% 1,636.3 Total revenues $ 2,097.6 20.9% $ 1,734.5 (26.9)% $ 2,374.3 United States as a percentage of total revenues 27.0 % 30.4 % 31.1 % International as a percentage of total revenues 73.0 % 69.6 % 68.9 % Revenues by geographic area are categorized based on the customer’s location to which the products were shipped or services were performed.
Year Ended Revenues by Geography (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 United States $ 495.4 (12.6)% $ 566.5 7.5% $ 526.8 International 1,558.6 1.8% 1,531.1 26.8% 1,207.7 Total revenues $ 2,054.0 (2.1)% $ 2,097.6 20.9% $ 1,734.5 United States as a percentage of total revenues 24.1 % 27.0 % 30.4 % International as a percentage of total revenues 75.9 % 73.0 % 69.6 % Revenues by geographic area are categorized based on the customer’s location to which the products were shipped or services were performed.
In assessing our future taxable income, we have considered all sources of future taxable income available to realize our deferred tax assets, including the taxable income from future reversal of existing temporary differences, carryforwards, and tax-planning strategies.
Our ability to realize deferred tax assets depends on our ability to generate sufficient future taxable income. In assessing our future taxable income, we have considered all sources of future taxable income available to realize our deferred tax assets, including the taxable income from future reversals of existing temporary differences, carryforwards, and tax-planning strategies.
In determining whether the realization of these deferred tax assets may be impaired, we make judgments with respect to whether we are likely to generate sufficient future taxable income to realize these assets. In order to reverse a valuation allowance, U.S.
In determining whether the realization of these deferred tax assets may be impaired, we make judgments with respect to whether we are likely to generate sufficient future taxable income to realize these assets.
As of December 27, 2024, we have cash of approximately $273.1 million in our foreign subsidiaries. Borrowing Arrangements December 27, 2024 December 29, 2023 (Dollars in millions) Amount Weighted- Average Interest Rate Amount Weighted- Average Interest Rate U.S.
As of December 26, 2025, we have cash of approximately $253.0 million in our foreign subsidiaries. Borrowing Arrangements December 26, 2025 December 27, 2024 (Dollars in millions) Amount Weighted- Average Interest Rate Amount Weighted- Average Interest Rate U.S.
We recognize liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any.
The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is 31 Table of Contents more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any.
No assurance can be given that additional financing will be available or that, if available, such financing can be obtained on terms favorable to our stockholders and us. As of December 27, 2024, we had undistributed earnings of approximately $555.0 million from our foreign subsidiaries that are indefinitely invested outside of the U.S.
No assurance can be given that additional financing will be available or that, if available, such financing can be obtained on terms favorable to our stockholders and us. As of December 26, 2025, we had undistributed earnings of approximately $596.7 million from our foreign subsidiaries, $577.3 million of which are indefinitely reinvested outside of the U.S.
Gross Margin Year Ended Gross Profit by Segment (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Products $ 284.0 34.5% $ 211.1 (41.8)% $ 362.4 Services 72.3 9.2% 66.2 (35.5)% 102.6 Gross profit $ 356.3 28.5% $ 277.3 (40.4)% $ 465.0 Gross Margin by Segment Products 15.3 % 14.1 % 17.5 % Services 29.6 % 28.4 % 34.2 % Total Company 17.0 % 16.0 % 19.6 % Gross profit and gross margins fluctuate with revenue levels, product mix, material costs, and labor costs.
Gross Margin Year Ended Gross Profit by Segment (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Products $ 252.3 (11.2)% $ 284.0 34.5% $ 211.1 Services 70.6 (2.4)% 72.3 9.2% 66.2 Gross profit $ 322.9 (9.4)% $ 356.3 28.5% $ 277.3 Gross Margin by Segment Products 14.0 % 15.3 % 14.1 % Services 27.7 % 29.6 % 28.4 % Total Company 15.7 % 17.0 % 16.0 % Gross profit and gross margins fluctuate with revenue levels, product mix, material costs, and labor costs.
If changes occur in the assumptions underlying our tax planning strategies or in the scheduling of the reversal of our deferred tax liabilities, the valuation allowance may need to be adjusted in the future. The Company remitted earnings from one of its subsidiaries in Singapore in 2024.
If changes occur in the assumptions underlying our tax planning strategies or in the scheduling of the reversal of our deferred tax liabilities, the valuation allowance may need to be adjusted in the future.
Capital Expenditures Capital expenditures were $63.5 million for the year ended December 27, 2024 and were primarily attributable to the capital invested in our manufacturing facilities worldwide as well as costs associated with the ongoing design and implementation of our new enterprise resource planning system.
Capital Expenditures Capital expenditures were $50.3 million for the fiscal year ended December 26, 2025 and were primarily attributable to the capital invested in our manufacturing facilities worldwide as well as costs associated with the ongoing design and 39 Table of Contents implementation of our new enterprise resource planning system.
As of December 27, 2024, the Company had $3.5 million of outstanding letters of credit and $46.5 million of available commitments remaining under the letter of credit facility.
As of December 26, 2025, the Company had $3.4 million of outstanding letters of credit and $46.6 million of available commitments remaining under the letter of credit facility.
Contractual Obligations We have commitments to various third parties to primarily purchase inventories and property, plant and equipment totaling approximately $460.5 million on December 27, 2024.
Contractual Obligations We have commitments to various third parties to primarily purchase inventories and property, plant and equipment totaling approximately $443.6 million on December 26, 2025.
As of December 27, 2024, the Company’s total bank debt was $492.5 million, net of unamortized debt issuance costs of $7.2 million. As of December 27, 2024, the Company had $146.5 million, $0.1 million and $7.3 million available to draw from its credit facilities in the U.S., Israel and Czechia, respectively.
As of December 26, 2025, the Company’s total bank debt was $476.9 million, net of unamortized debt issuance costs of $4.5 million. As of December 26, 2025, the Company had $146.6 million, $5.0 million and $6.5 million available to draw from its credit facilities in the U.S., Israel and Czechia, respectively.
Provision for Income Taxes Year Ended (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Provision for income taxes $ 32.7 200.0% $ 10.9 (71.2)% $ 37.9 Effective tax rate 48.7 % -96.5 % 42.9 % The change in tax rates in fiscal year 2024 reflects, primarily, the changes in the geographic distribution of our worldwide earnings.
Provision for Income Taxes Year Ended (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Provision for income taxes $ 25.9 (20.8)% $ 32.7 200.0% $ 10.9 Effective tax rate -17.8 % 48.7 % n/m The change in tax rates in fiscal year 2025 reflects, primarily, changes in the geographic distribution of our worldwide earnings.
The Company expensed third party transaction costs and the previously capitalized costs of extinguished debt of $3.6 million which was included in the other income (expense), net in the Consolidated Statements of Operations for the year ended December 27, 2024.
The Company capitalized $2.5 million of additional costs related to this amendment, continued to defer previously capitalized costs of $5.2 million and expensed third party transaction costs and the previously capitalized costs of extinguished debt of $3.6 million in the other income (expense), net in the Consolidated Statements of Operations for the fiscal year ended December 27, 2024.
At December 27, 2024, the Company had an outstanding amount under the Term Loan of $493.8 million, gross of unamortized debt issuance costs of $7.2 million. As of December 27, 2024, the interest rate on the outstanding Term Loan was 7.8%.
At December 26, 2025, the Company had an outstanding amount under the Term Loan of $481.4 million, gross of unamortized debt issuance costs of $4.5 million. As of December 26, 2025, the interest rate on the outstanding Term Loan was 6.7%.
The Company pays a quarterly fee in arrears equal to 2.5% (subject to certain adjustments to the Term Loan) of the dollar equivalent of all outstanding letters of credit, and a fronting fee equal to 0.125% of the undrawn and unexpired amount of each letter of credit.
The Company pays a quarterly fee in arrears equal to the dollar equivalent of all outstanding letters of credit equal to the applicable margin for the revolving credit facility, and a fronting fee equal to 0.125% of the undrawn and unexpired amount of each letter of credit.
With the possible exception of this Singapore subsidiary, the Company has no plans to remit other foreign earnings. We may change our intent to reinvest certain of our undistributed foreign earnings indefinitely, which could require us to accrue or pay taxes on some or all of these undistributed earnings.
We may change our intent to reinvest certain of our undistributed foreign earnings indefinitely, which could require us to accrue or pay taxes on some or all of these undistributed earnings.
Pursuant to the Sixth Amendment, the Existing Credit Agreement was amended to, among other things, (i) extend the final maturity date of the term loan and revolving credit facilities under the Credit Agreement by 30 months; (ii) reduce the interest rate applicable to the term loan facility under the Credit Agreement by 0.25% per annum; and (iii) increase the outstanding amount under the Term Loan of $475.4 million to $500 million.
The amendment (i) extended the maturity date of the term loan and revolving credit facilities by 30 months; (ii) reduced the 38 Table of Contents interest rate applicable to the term loan facility under the Credit Agreement by 0.25% per annum; and (iii) increased the outstanding amount under the Term Loan of $475.4 million to $500 million.
Liquidity and Capital Resources Cash and cash equivalents The following table summarizes our cash and cash equivalents: Year Ended (In millions) December 27, 2024 December 29, 2023 Increase Total cash and cash equivalents $ 313.9 $ 307.0 $ 6.9 The increase in cash and cash equivalents in fiscal year 2024, compared to fiscal year 2023, was primarily due to cash provided by operating and financing activities of $65.0 million and $9.8 million, respectively offset by cash used in investing activities of $63.5 million. 35 Table of Contents Cash Flows Year Ended (In millions) December 27, 2024 December 29, 2023 December 30, 2022 Operating activities $ 65.0 $ 135.9 $ 47.2 Investing activities (63.5) (119.7) (96.2) Financing activities 9.8 (69.9) (56.0) Effects of exchange rate changes on cash and cash equivalents (4.4) 1.9 (2.7) Net increase (decrease) in cash and cash equivalents $ 6.9 $ (51.8) $ (107.7) Our primary cash inflows and outflows were as follows: • We generated net cash from operating activities of $65.0 million in fiscal year 2024 , compared to $135.9 million in fiscal year 2023 .
Cash Flows Year Ended (In millions) December 26, 2025 December 27, 2024 December 29, 2023 Operating activities $ 65.6 $ 65.0 $ 135.9 Investing activities (47.0) (63.5) (119.7) Financing activities (21.2) 9.8 (69.9) Effects of exchange rate changes on cash and cash equivalents 0.5 (4.4) 1.9 Net increase (decrease) in cash and cash equivalents $ (2.1) $ 6.9 $ (51.8) Our primary cash inflows and outflows were as follows: • Net cash provided by operating activities remained consistent year over year, as changes in working capital and non-cash items were largely offset by changes in net income. • Cash used in investing activities was $47.0 million in fiscal year 2025 compared to $63.5 million in fiscal year 2024 .
We evaluate our goodwill and indefinite life tradename for impairment, at the reporting unit level, on an annual basis, and whenever events or changes in circumstances indicate that the carrying value may not be fully recoverable.
We evaluate our goodwill for impairment at the reporting unit level on an annual basis, and more frequently if events or changes in circumstances indicate that the carrying amount may exceed its fair value.
During fiscal year 2023 , net cash used for investing activities primarily consisted of $75.8 million related to purchases of property, plant and equipment and $46.1 million related to an acquisition. • Cash provided by financing activities was $9.8 million in fiscal year 2024 compared to cash used of $69.9 million in fiscal year 2023 .
During fiscal year 2024 , net cash used in investing activities was $63.5 million for purchases of property, plant and equipment. • Cash used by financing activities was $21.2 million in fiscal year 2025 compared to cash provided of $9.8 million in fiscal year 2024 .
Fiscal 2024, 2023 and 2022 each contained 52 weeks . 31 Table of Contents A discussion regarding our financial condition and results of operations for fiscal 2024, compared to fiscal 2023, is presented below. The results of operations for 2023, and the discussion below reflect two months of activity resulting from the acquisition of HIS.
Fiscal 2025, 2024 and 2023 each contained 52 weeks . A discussion regarding our financial condition and results of operations for fiscal 2025, compared to fiscal 2024, is presented below.
As of December 27, 2024, we maintained a full valuation allowance on our U.S. federal and state and on certain of our foreign deferred tax assets in the amount of $96.3 million as we believe it is more likely than not that these deferred tax assets will not be realized. 30 Table of Contents In addition, the calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of complex tax laws.
As of December 26, 2025, we maintained a full valuation allowance on our U.S. federal and state and on certain of our foreign deferred tax assets in the amount of $104.2 million as we believe it is more likely than not that these deferred tax assets will not be realized.
Discussion of Results of Operations Revenues Year Ended Revenues by Segment (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Products $ 1,853.7 23.4% $ 1,501.6 (27.6)% $ 2,074.7 Services 243.9 4.7% 232.9 (22.3)% 299.6 Total revenues $ 2,097.6 20.9% $ 1,734.5 (26.9)% $ 2,374.3 Products as a percentage of total revenues 88.4 % 86.6 % 87.4 % Services as a percentage of total revenues 11.6 % 13.4 % 12.6 % Products revenues increased $352.1 million in fiscal year 2024 over fiscal year 2023, primarily due to an increase in customer demand, along with an overall market improvement in the semiconductor industry and in part due to the acquisition of HIS in October 2023.
Discussion of Results of Operations Revenues Year Ended Revenues by Segment (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Products $ 1,799.3 (2.9)% $ 1,853.7 23.4% $ 1,501.6 Services 254.7 4.4% 243.9 4.7% 232.9 Total revenues $ 2,054.0 (2.1)% $ 2,097.6 20.9% $ 1,734.5 Products as a percentage of total revenues 87.6 % 88.4 % 86.6 % Services as a percentage of total revenues 12.4 % 11.6 % 13.4 % Products revenues decreased by $54.4 million in fiscal year 2025 over fiscal year 2024, primarily driven by lower customer demand, reflecting a slowdown in customer purchasing activity in response to short-term market conditions.
The Company was in compliance with all financial covenants as of the fiscal year ended December 27, 2024. The Company has a credit agreement with a local bank in the Czechia that provides for a revolving credit facility in the aggregate of up to 7.0 million euros (approximately $7.3 million).
The Company was in compliance with all financial covenants as of the fiscal year ended December 26, 2025. The Company maintains credit agreements with a local bank in Czechia and with a financial institution in Israel, which provide for revolving credit facilities of up to 7.0 million euros (approximately $8.2 million) and $5.0 million, respectively.
Term Loan $ 493.8 8.7 % $ 479.3 8.8 % Fluid Solutions Debt Facilities 5.9 7.4 % 6.0 9.4 % Debt issuance costs (7.2) (6.5) $ 492.5 $ 478.8 On April 4, 2024, the Company entered into a Sixth Amendment (the “Sixth Amendment”) to the Credit Agreement dated as of August 27, 2018 (as amended as of October 1, 2018, March 31, 2021, August 19, 2022, June 29, 2023 and July 27, 2023 (the “Existing Credit Agreement”), and the Existing Credit Agreement as further amended by the Sixth Amendment, the “Credit Agreement”).
Term Loan $ 481.4 7.5 % $ 493.8 8.7 % Fluid Solutions Debt Facilities — — % 5.9 7.4 % Debt issuance costs (4.5) (7.2) $ 476.9 $ 492.5 On April 4, 2024, the Company entered into a Sixth Amendment to the Credit Agreement dated as of August 27, 2018.
The Company pays monthly interest payments in arrears and quarterly principal payments of 0.625% of the outstanding principal balance as of October 8, 2024, with the remaining principal paid upon maturity. The revolving credit facility has an available commitment of $150.0 million and a maturity date of August 27, 2027.
The revolving credit facility has an available commitment of $150.0 million and a maturity date of August 27, 2027. The Company pays a quarterly commitment fee in arrears equal to 0.25% of the average daily available commitment outstanding.
For the year ended December 27, 2024, capital expenditures for our Products and Services segments were $40.4 million and $23.1 million, respectively, representing 2.2% and 9.5% of the respective segment revenues.
For the fiscal year ended December 26, 2025, capital expenditures for our Products and Services segments were $31.7 million and $18.6 million, respectively, representing 1.8% and 7.3% of the respective segment revenues.
International revenues increased compared to the prior year primarily as a result of market improvement driving higher customer demand. 32 Table of Contents Cost of Revenues Year Ended Cost of revenues by Segment (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Products $ 1,569.7 21.6% $ 1,290.5 (24.6)% $ 1,712.3 Services 171.6 2.9% 166.7 (15.4)% 197.0 Total Cost of revenues $ 1,741.3 19.5% $ 1,457.2 (23.7)% $ 1,909.3 Products cost as a percentage of total Products revenues 84.7 % 85.9 % 82.5 % Services cost as a percentage of total Services revenues 70.4 % 71.6 % 65.8 % Total cost of revenues increased $284.1 million in fiscal year 2024 over fiscal year 2023, due to higher demand for both Products and Services driven by higher customer spending within the semiconductor industry globally.
As a result, international revenues as a percentage of total revenues increased compared to the prior year. 33 Table of Contents Cost of Revenues Year Ended Cost of revenues by Segment (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Products $ 1,547.0 (1.4)% $ 1,569.7 21.6% $ 1,290.5 Services 184.1 7.3% 171.6 2.9% 166.7 Total Cost of revenues $ 1,731.1 (0.6)% $ 1,741.3 19.5% $ 1,457.2 Products cost as a percentage of total Products revenues 86.0 % 84.7 % 85.9 % Services cost as a percentage of total Services revenues 72.3 % 70.4 % 71.6 % Cost of Products revenues consists of purchased materials, direct labor and manufacturing overhead.
It is possible that changes in such circumstances, or in the variables associated with the judgments, assumptions and estimates used in assessing fair value, would require us to record a non-cash impairment charge. Results of Operations Fiscal Year Our fiscal year is the 52 or 53 week period ending on the Friday nearest December 31.
It is possible that changes in such circumstances, or in the variables associated with the judgments, assumptions and estimates used in assessing fair value, would require us to record a non-cash impairment charge. During the second quarter of 2025, the Company experienced a sustained decline in the market price of its common stock.
During fiscal year 2024 , net cash provided by financing activities primarily due to the $23.5 million net cash proceeds from the amended credit agreement, a decrease of $28.4 million in principal payments on bank borrowings, and a $29.4 million decrease in share repurchases offset partially by the additional $2.5 million payment of debt issuance costs.
The $31.0 million increase in n et cash used by financing activities was primarily due to the absence of $23.5 million of net cash proceeds from bank borrowings related to a prior-period debt modification, an $8.0 million increase in principal payments on bank borrowings, and a $3.4 million increase in share repurchases, partially offset by a $1.9 million decrease in payment of debt issuance costs.
The Sixth Amendment resulted in the receipts of an additional $67.7 million of debt, net of $1.1 million related lender fees from new or existing syndicate lenders which was offset by syndicate lenders who reduced their positions by $44.2 million.
The Company received $67.7 million of additional debt, net of $1.1 million in lender fees, offset by $44.2 million in reduced syndicate positions.
During fiscal year 2024 , net cash used for investing activities primarily consisted of $63.5 million related to purchases of property, plant and equipment.
During fiscal year 2025 , net cash used for investing activities primarily consisted of $50.3 million related to 37 Table of Contents purchases of property, plant and equipment, partially offset by an asset-related government grant of $2.9 million.
On October 8, 2024, the Company entered a Seventh Amendment (the “Seventh Amendment”) to the Credit Agreement to further reduce the interest rate applicable to the term loan facility under the Credit Agreement by 0.25% per annum. The Term Loan has a maturity date of February 25, 2028.
On October 8, 2024, the Company entered a Seventh Amendment further reducing the interest rate applicable to the term loan facility by 0.25% per annum. On September 15, 2025, the Company entered into the Eighth Amendment, reducing the interest rate applicable to the term loan facility by an additional 0.50% per annum.
Services revenues increased $11.0 million in fiscal year 2024 over fiscal year 2023, primarily due to increase in demand across its customer base.
Services revenues increased by $10.8 million in fiscal year 2025 over fiscal year 2024, driven by higher demand across its customer base.
The letter of credit facility has an available commitment of $50.0 million and a maturity date of August 27, 2027.
Outstanding letters of credit reduce the availability of the revolving credit facility and, as of December 26, 2025, the Company had $146.6 million, net of $3.4 million of outstanding letters of credit, available under this revolving credit facility. The letter of credit facility has an available commitment of $50.0 million and a maturity date of August 27, 2027.
Interest expense decreased $2.3 million in fiscal year 2024 over fiscal year 2023 due to lower interest rates and due to lower amortization of debt issuance costs due to debt modification.
Interest expense decreased $8.2 million in fiscal year 2025 over fiscal year 2024 due to lower interest rates and reduced amortization of debt issuance costs. Other income (expense), net, for fiscal year 2025 primarily consisted of unrealized foreign exchange losses of $4.9 million and debt modification-related costs of $1.1 million, partially offset by government grants of $2.2 million.
During fiscal year 2023 , net cash provided by financing activities primarily consisted of debt repayment of $38.6 million and $29.4 million of shares repurchased. We believe we have sufficient capital to fund our working capital needs, satisfy our debt obligations, maintain our existing capital equipment, purchase new capital equipment and make strategic acquisitions from time to time.
We believe we have sufficient capital to fund our working capital needs, satisfy our debt obligations, maintain our existing capital equipment, purchase new capital equipment and make strategic acquisitions from time to time. As of December 26, 2025, we had cash and cash equivalents of $311.8 million compared to $313.9 million as of December 27, 2024.
Cost of Services revenues consists of direct labor, manufacturing overhead and materials (such as chemicals, gases and consumables). Cost of services revenues increased $4.9 million in fiscal 2024 compared to the prior year driven by higher volumes of service orders, resulting in increase in material costs and overhead costs.
Cost of services revenues increased by $12.5 million in fiscal 2025 compared to the prior year, driven by higher volumes of service orders and increases in headcount, overtime and employee-related expenses, resulting in an additional $8.8 million of costs, as well as higher overhead costs and restructuring-related activities.
Services gross profit increased in fiscal year 2024 compared to fiscal year 2023 due to higher revenue levels. 33 Table of Contents Operating Margin Year Ended Operating Profit by Segment (Dollars in millions) December 27, 2024 Percent Change December 29, 2023 Percent Change December 30, 2022 Products $ 79.4 165.6% $ 29.9 (66.9)% $ 90.4 Services 11.8 122.6% 5.3 (82.3)% 30.0 Operating profit $ 91.2 159.1% $ 35.2 (70.8)% $ 120.4 Operating Margin by Segment Products 4.3 % 2.0 % 4.4 % Services 4.8 % 2.3 % 10.0 % Total Company 4.3 % 2.0 % 5.1 % Operating profit and operating margin of Products increased in fiscal year 2024 compared to fiscal year 2023 primarily due to increases in business volumes and customer demand partially offset by increases in share-based compensation expense, in outside service spending, and in the amortization of intangible assets in conjunction with the acquisition of HIS.
Services gross profit decreased in fiscal year 2025 compared to fiscal year 2024, primarily due to higher cost of revenues driven by increased labor and compensation-related costs, as well as higher overhead and restructuring-related costs. 34 Table of Contents Operating Margin Year Ended Operating Profit by Segment (Dollars in millions) December 26, 2025 Percent Change December 27, 2024 Percent Change December 29, 2023 Products $ (46.2) (158.2)% $ 79.4 165.6% $ 29.9 Services (61.2) (618.6)% 11.8 122.6% 5.3 Operating profit $ (107.4) (217.8)% $ 91.2 159.1% $ 35.2 Operating Margin by Segment Products (2.6 %) 4.3 % 2.0 % Services (24.0 %) 4.8 % 2.3 % Total Company (5.2 %) 4.3 % 2.0 % Operating results for both Products and Services reflected an operating loss and a negative operating margin in fiscal year 2025, compared to operating profit and a positive operating margin in fiscal year 2024.
Operating profit and operating margin of Services increased in fiscal year 2024 compared to fiscal year 2023 primarily due to the higher gross profit resulting from increased customer demand.
Products gross profit and gross margin decreased in fiscal year 2025 compared to fiscal year 2024, primarily due to higher employee and restructuring-related costs.
Other income (expense), net, decreased $19.5 million in fiscal year 2024 over fiscal year 2023, due to the gain from the change of the fair value of contingent earn-out of $31.0 million offset partially by the $4.0 million of debt financing costs and by $7.0 million unfavorable foreign exchange transactions and remeasurements.
For fiscal year 2024, the Company recognized a $29.0 million gain from the fair value adjustment of the contingent earn-out liability associated with the HIS acquisition, partially offset by foreign exchange losses of $7.6 million and debt modification costs of $4.0 million.
The total U.S. and foreign valuation allowances for deferred tax assets were $79.1 million and $17.2 million, respectively as of December 27, 2024, and $49.8 million and $8.1 million, respectively as of December 29, 2023. Our ability to realize deferred tax assets depends on our ability to generate sufficient future taxable income.
The total U.S. and foreign valuation allowances for deferred tax assets were $88.4 million and $15.8 million, respectively as of December 26, 2025, and $79.1 million and $17.2 million, respectively as of December 27, 2024. 36 Table of Contents In July 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law in the U.S.
In both segments, costs of revenue as a percent of revenue decreased as certain fixed costs remain regardless of volume.
In both segments, costs of revenue increased as a percentage of revenue, primarily due to fixed costs that do not scale with volume.
As of December 27, 2024, we had cash and cash equivalents of $313.9 million compared to $307.0 million as of December 29, 2023. Our cash and cash equivalents, cash generated from operations and borrowings under our term loan described below, were our principal sources of liquidity as of December 27, 2024.
Our cash and cash equivalents, cash generated from operations and borrowings under our term loan described below, were our principal sources of liquidity as of December 26, 2025. In the second quarter of fiscal year 2025, we entered into a factoring agreement with a financial institution to sell certain accounts receivables under a non-recourse agreement.
The increase in U.S. revenues in fiscal year 2024 compared to fiscal year 2023 was primarily due to the acquisition of HIS in October 2023, whose customers are primarily U.S. based.
The decrease in U.S. revenues as a percentage of total revenues in fiscal year 2025 compared to fiscal year 2024 was primarily attributable to a shift in product revenues from U.S. locations to international locations.
Removed
GAAP suggests that we review our recent cumulative income/loss as well as determine our ability to generate sufficient future taxable income to realize our net deferred tax assets.
Added
In addition, the calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of complex tax laws. We recognize liabilities for uncertain tax positions based on a two-step process.
Removed
Cost of Products revenues consists of purchased materials, direct labor and manufacturing overhead. Cost of products revenues increased $279.2 million for fiscal 2024 compared to fiscal 2023. The increase was due to higher sales volume driving increased material costs of $241.0 million, higher direct labor spending of $24.4 million, and unfavorable absorption of overhead costs of $13.8 million.
Added
As a result, the Company’s market capitalization became much closer to, and at times fell below, the carrying value of its net assets.
Removed
Products gross profit and gross margin increased in fiscal year 2024 compared to fiscal year 2023 due to higher revenue levels, product shift and volume shift from higher to lower cost regions.
Added
The decline in market capitalization, combined with other factors specific to each reporting unit, such as changes in market conditions and financial performance, was identified as a triggering event under ASC 350, Intangibles—Goodwill and Other, requiring the Company to perform an interim goodwill impairment test.
Removed
Research and development expenses were consistent in fiscal year 2024 compared to fiscal year 2023.
Added
The Company performed a quantitative goodwill impairment test for each of its four reporting units by comparing the estimated fair value of each reporting unit to its respective carrying value.
Removed
Sales and marketing expenses increased $5.5 million in fiscal year 2024 over fiscal year 2023, due to an increase in headcount.
Added
Based on the results of this assessment performed in the second quarter of 2025, the Company recorded a total goodwill impairment charge of $151.1 million, of 32 Table of Contents which $77.6 million was attributable to the Fluid Solutions reporting unit and $73.5 million was attributable to the Services reporting unit.
Removed
The $70.9 million decrease in net cash from operating activities was driven by a $127.0 million on unfavorable change in net working capital and by a decrease of $0.6 million from non-cash items offset in part by $56.7 million increase in net income. • The major contributors to the net change in operating assets and liabilities, net of effects of acquisition, in fiscal year 2024 were as follows: ◦ Accounts receivable increased $60.3 million primarily due to timing of shipments and collections, inventories and prepaid expenses increased $6.5 million and $3.2 million, respectively due to increased production levels. ◦ Accounts payable increased $26.4 million, income taxes payable increased $1.0 million, accrued compensation and related benefits increased $2.4 million and other liabilities increased $1.3 million, primarily due to the timing of payments. • Cash used in investing activities was $63.5 million in fiscal year 2024 compared to $119.7 million in fiscal year 2023 .
Added
As a result, there is no remaining goodwill in the Fluid Solutions reporting unit or in the Services reporting unit. No impairments were identified in the Core Products or Fluid Delivery Systems reporting units, whose fair values remained substantially in excess of their respective carrying values.
Removed
We have an existing factoring arrangement with a financial institution in which a portion of its accounts receivable are sold on a nonrecourse basis. As of December 27, 2024, there were outstanding customer invoices amounting to $6.7 million that we factored under this arrangement.
Added
In connection with our annual goodwill impairment assessment in the fourth quarter of 2025, the Company performed qualitative impairment assessments for each of the Company's reporting units. The qualitative assessments indicated that it was more likely than not that the fair values of its reporting units exceeded its carrying value and, therefore, did not result in an additional impairment.
Removed
The Company capitalized additional $2.5 million of costs related to this amendment and continued to defer previously capitalized costs of $5.2 million.
Added
Prior to testing goodwill for impairment, the Company evaluated the recoverability of its long-lived assets under ASC 360, Property, Plant, and Equipment, and determined that no impairment of long-lived assets was required. Results of Operations Fiscal Year Our fiscal year is the 52 or 53 week period ending on the Friday nearest December 31.
Removed
The Company pays a quarterly commitment fee in arrears equal to 0.25% of the average daily available commitment outstanding. Outstanding letters of credit reduce the availability of the revolving credit facility and, as of December 27, 2024, the Company had $146.5 million, net of $3.5 million of outstanding letters of credit, available under this revolving credit facility.
Added
Cost of products revenues decreased by $22.7 million for fiscal 2025 compared to fiscal 2024. The decrease was primarily driven by lower sales volume, which led to a $33.3 million reduction in material costs, partially offset by higher overhead costs and restructuring-related costs. Services Cost of revenues consists of direct labor, overhead and materials such as chemicals, gases and consumables.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

6 edited+0 added−1 removed5 unchanged
Biggest changeWe have adopted credit policies and standards intended to accommodate industry growth and inherent risk. We believe credit risks are moderated by the financial stability of our major customers. We assess credit risk through quantitative and qualitative analysis.
Biggest changeFor more information about the customers that represent our accounts receivable balance and our consideration related to credit losses, see Note 12 of Notes to the Consolidated Financial Statements.. We have adopted credit policies and standards intended to accommodate industry growth and inherent risk. We believe credit risks are moderated by the financial stability of our major customers.
From these analyses, we establish shipping and credit limits and determine whether we will seek to use one or more credit support protection devices, such as obtaining a parent guarantee, prepayment or standby letter of credit.
We assess credit risk through quantitative and qualitative analysis. From these analyses, we establish shipping and credit limits and determine whether we will seek to use one or more credit support protection devices, such as obtaining a parent guarantee, prepayment or standby letter of credit.
A hypothetical 100 basis points increase in our borrowing rates at the end of fiscal 2024, would result in approximately $4.9 million annual increase in interest expense on this existing principal balance. 39 Table of Contents
A hypothetical 100 basis points increase in our borrowing rates at the end of fiscal 2025, would result in approximately $4.8 million annual increase in interest expense on this existing principal balance. 41 Table of Contents
Our Credit Facility is comprised of a Term B loan and a revolving credit agreement with interest rates as described under Note 7 of Notes to the Consolidated Financial Statements. At the end of fiscal 2024, the Term B loan had a balance of $493.8 million.
Our Credit Facility is comprised of a Term B loan and a revolving credit agreement with interest rates as described under Note 6 of Notes to the Consolidated Financial Statements. At the end of fiscal 2025, the Term B loan had a balance of $481.4 million.
We believe the three largest customer net accounts receivable balances (41.9% as of December 27, 2024) do not represent a significant credit risk, based on cash flow forecasts, balance sheet analysis, and past collection experience. For more information about the customers that represent our accounts receivable balance and our consideration related to credit losses, see Note 13, Revenue Recognition.
We believe the three largest customer gross accounts receivable balances (36.0% as of December 26, 2025) do not represent a significant credit risk, based on cash flow forecasts, balance sheet analysis, and past collection experience.
However, we do not expect foreign currency exchange rate fluctuations to have a material effect on our results of operations. We use derivative instruments, such as foreign currency exchange contracts, to hedge certain exposures to fluctuations in foreign currency exchange rates.
However, we do not expect foreign currency exchange rate fluctuations to have a material effect on our results of operations. 40 Table of Contents Interest Rate Risk We are exposed to market risk due to changing interest rates under our credit facilities.
Removed
These contracts reduce, but do not entirely eliminate the impact of currency exchange rates movement on our assets and liabilities. Interest Rate Risk We are exposed to market risk due to changing interest rates under our credit facilities.

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