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What changed in SYNAPTICS Inc's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of SYNAPTICS 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.

+364 added−591 removedSource: 10-K (2025-08-21) vs 10-K (2024-08-23)

Top changes in SYNAPTICS Inc's 2025 10-K

364 paragraphs added · 591 removed · 169 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

61 edited+33 added−88 removed9 unchanged
Biggest changeInformation about our Executive Officers The following table sets forth certain information regarding our executive officers as of August 16, 2024: Name Age Position Michael Hurlston 57 President and Chief Executive Officer Ken Rizvi 49 Senior Vice President and Chief Financial Officer Lisa Bodensteiner 62 Senior Vice President, Chief Legal Officer and Secretary Vikram Gupta 55 Senior Vice President and General Manager, IoT Processors and Chief Product Officer Satish Ganesan 49 Senior Vice President and General Manager of Intelligent Sensing Division and Chief Strategy Officer Michael Hurlston has been the President and Chief Executive Officer of our company since August 19, 2019.
Biggest changeOur Board of Directors receives periodic updates from Nominations and Corporate Governance Committee and management on our CGS performance. 6 Table o f Con tents Information about our Executive Officers The following table sets forth certain information regarding our executive officers as of August 15, 2025: Name Age Position Rahul Patel 56 President and Chief Executive Officer Lisa Bodensteiner 63 Senior Vice President, Chief Legal Officer and Secretary Satish Ganesan 50 Senior Vice President and General Manager of Intelligent Sensing Division and Chief Strategy Officer Vikram Gupta 56 Senior Vice President and General Manager, IoT Processors and Chief Product Officer Ken Rizvi 50 Senior Vice President and Chief Financial Officer Rahul Patel has been the President and Chief Executive Officer since June 2, 2025.
These reports are available on our website promptly after their electronic filing with the SEC. You can also read these SEC filings and reports over the Internet at the SEC’s website at www.sec.gov.
Our filings with the SEC are available on our website promptly after their electronic filing with the SEC. You can also read these SEC filings and reports over the Internet at the SEC’s website at www.sec.gov.
We invest in our employees, and their professional development by providing opportunities to learn though technical, compliance and other professional training, including through semi-annual development conversations between employees and managers to ensure employees have individualized career discussions that align both with organizational and employee professional development goals.
We invest in our employees and their professional development by providing opportunities to learn though technical, compliance and other professional training, including through semi-annual development conversations between employees and managers to ensure employees have individualized career discussions that align both with organizational and professional development goals.
("Poly") from October 2020 to October 2022. Ms. Bodensteiner served as a Principal of MDAC, LLC, a family-owned real estate company, from June 2016 to October 2020, and Executive Vice President, General Counsel and Chief Compliance Officer at SunPower Corporation, a global energy company and provider of solar power solutions, from June 2012 to May 2016. Before joining SunPower, Ms.
Bodensteiner served as a Principal of MDAC, LLC, a family-owned real estate company, from June 2016 to October 2020, and Executive Vice President, General Counsel and Chief Compliance Officer at SunPower Corporation, a global energy company and provider of solar power solutions, from June 2012 to May 2016. Before joining SunPower, Ms.
We also intend to evaluate the potential acquisitions of companies and assets in order to expand our technological expertise and to establish or strengthen our presence and product offerings in selected target markets. Fabless Semiconductor Manufacturing We selectively partner with foundries and backend processors to solidify our longstanding key supply chain relationships.
We also intend to evaluate potential acquisitions of companies and assets to expand our technological expertise and to establish or strengthen our presence and product offerings in selected target markets. Fabless Semiconductor Manufacturing We selectively partner with foundries and backend processors to solidify our longstanding key supply chain relationships.
We consider both the OEMs and their contract manufacturers or supply chain partners to be our customers, as well as in some cases, our distributors. Both the OEMs and their partners may determine the design and pricing requirements and make the overall decision regarding the use of our human experience semiconductor product solutions in their products.
We consider both the OEMs and their contract manufacturers or supply chain partners to be our customers, as well as in some cases, our distributors. Both the OEMs and their partners may determine the design and pricing requirements and make the overall decision regarding the use of our semiconductor product solutions in their products.
Research and Development We conduct ongoing research and development programs that focus on advancing our existing technologies, improving our current product solutions, developing new products, improving design and manufacturing processes, enhancing the quality and performance of our product solutions, and expanding our technologies to serve new markets.
Research and Development We conduct ongoing R&D programs that focus on advancing our existing technologies, improving our current product solutions, developing new products, improving design and manufacturing processes, enhancing the quality and performance of our product solutions and expanding our technologies to serve new markets.
We intend to build upon our existing innovative and intuitive and intelligent semiconductor product solutions portfolio and continue to address the evolving portability, connectivity, security, and functionality requirements of these new markets.
We will build upon our existing innovative, intuitive and intelligent semiconductor product solutions portfolio and continue to address the evolving portability, connectivity, security and functionality requirements of these new markets.
The semiconductor industry is driving transformation across applications with the use of AI. Our solutions help customers to integrate AI in their edge devices and applications. Since 2017, Synaptics has developed products with integrated neural processing engines to help customers accelerate their AI capabilities. We intend to capitalize on edge AI opportunities with our processor solutions.
The semiconductor industry is driving transformation across applications with the use of AI. Our solutions help customers to integrate AI into their Edge devices and applications. Since 2017, Synaptics has developed products with integrated neural processing engines to help customers in advancing their AI capabilities. We intend to capitalize on the Edge AI opportunities with our processor solutions.
We believe our engineering know-how and electronic systems expertise provide significant benefits to our customers by enabling them to concentrate on their core competencies of production and marketing.
We believe our engineering know-how and electronic systems expertise provide meaningful benefits to our customers by enabling them to concentrate on their core competencies of production and marketing.
Our goal is to provide our customers with innovative solutions that address their needs and improve their competitive positions. Our research and development programs focus on the development of accurate, easy to use, reliable, and intuitive human experiences for electronic devices.
Our goal is to provide our customers with innovative solutions that address their needs and improve their competitive positions. Our R&D programs focus on the development of accurate, easy-to-use, reliable and intuitive human experiences for electronic devices.
Our research, design, and engineering teams frequently work directly with our customers to design custom solutions for specific applications. We focus on enabling our customers to overcome their technical barriers and enhance the performance of their products.
Our research, design and engineering teams frequently work directly with our customers to design solutions for specific applications. We focus on enabling our customers to overcome technical barriers and improve the performance of their products.
Our Board of Directors and its committees provide oversight on certain workforce management matters including, among other aspects, leadership development, management depth and strength assessment, diversity, equity, inclusion and belonging, and our employee experience survey results. The Audit Committee is responsible for monitoring our business risks and our company’s Code of Business Conduct and Ethics.
Our Board of Directors and its committees provide oversight on certain workforce management matters including, among other aspects, leadership development, management depth and strength assessment, people engagement and inclusion, and our employee experience survey results. The Audit Committee is responsible for monitoring our business risks and our company’s Code of Business Conduct and Ethics.
Gupta was the SVP and GM of IoT Compute and Wireless Business Lines for Infineon Technologies, a manufacturer of semiconductor solutions, from April 2020 to November 2022, where he led the integration and transformation efforts for the $1B+ multi-site business with three product lines following Infineon’s acquisition of Cypress Semiconductor, where he served as VP of Engineering of the IoT Business Unit from 2016 to 2019 and SVP and 12 GM of the IoT Business Unit from 2019 to 2020.
Gupta was the SVP and GM of IoT Compute and Wireless Business Lines for Infineon Technologies, a manufacturer of semiconductor solutions, from April 2020 to November 2022, where he led the integration and transformation efforts for the over $1.0 billion multi-site business with three product lines following Infineon’s acquisition of Cypress Semiconductor, where he served as VP of Engineering of the IoT Business Unit from 2016 to 2019 and SVP and GM of the IoT Business Unit from 2019 to 2020.
Our fiscal year is the 52- or 53-week period ending on the last Saturday in June. The fiscal years presented in this report are the 53-week period ended June 29, 2024 and 52-week periods ended June 24, 2023, and June 25, 2022.
Our fiscal year is the 52- or 53-week period ending on the last Saturday in June. The fiscal years presented in this report are the 52-week periods ended June 28, 2025 and June 24, 2023, and the 53-week period ended June 29, 2024.
We align executive compensation with our corporate strategies, business objectives and the creation of long-term value for our stockholders without encouraging unnecessary or excessive risk-taking. We are committed to proactively caring for the well-being of our employees in an engaging and meaningful way.
We align executive compensation with our corporate strategies, business objectives and the creation of long-term value for our stockholders without encouraging unnecessary or excessive risk-taking. 5 Table o f Con tents We are committed to proactively caring for the well-being of our employees in an engaging and meaningful way.
The Nominations and Corporate Governance Committee oversees our ESG strategy including talent attraction and retention and inclusion and diversity. The Compensation Committee provides oversight of our overall compensation philosophy, policies, and programs, and assesses whether our compensation establishes appropriate incentives for executive officers and other employees.
The Nominations and Corporate Governance Committee oversees our Corporate, Governance and Sustainability (“CGS”) strategy, including talent attraction, retention and inclusion and belonging. The Compensation Committee provides oversight of our overall compensation philosophy, policies and programs and assesses whether our compensation establishes appropriate incentives for executive officers and other employees.
We believe that our technologies enable us to provide customers with product solutions that have significant advantages over alternative technologies in terms of functionality, size, power consumption, durability, and reliability. We also intend to pursue strategic relationships and acquisitions to enhance our research and development capabilities, leverage our technology, and shorten our time to market with new technological applications.
We believe our technologies enable us to provide customers with product solutions that offer advantages over alternative technologies in terms of functionality, size, power consumption, durability and reliability. We also intend to pursue strategic relationships and acquisitions to enhance our R&D capabilities, leverage our technology and shorten our time to market with new technological applications.
Human Capital Our company has been built on the collective contributions from people of many countries, religions, and ethnic backgrounds. People are our most critical asset and are the core component behind our success. We want to attract, develop, and retain the world’s best talent. As of June 2024, we employed 1,716 employees.
Human Capital and Workforce Management Our company has been built on the collective contributions from people of many countries, religions and ethnic backgrounds. People are our most critical asset and are the core component behind our success. We want to attract, develop and retain the world’s best talent. As of June 2025, we employed approximately 1,700 employees.
Key aspects of our strategy to achieve this objective include those set forth below. Extend Our Technological Leadership We plan to utilize our extensive intellectual property portfolio, engineering know-how, and technological expertise to extend the functionality of our current product solutions and offer new and innovative product solutions to customers across multiple markets.
Key aspects of our strategy to achieve this objective include those set forth below: Extend Our Technological Leadership We capitalize on our extensive intellectual property portfolio, engineering know-how and technological expertise to extend the functionality of our product solutions and offer new and differentiated product solutions to customers across multiple markets.
We believe our company attributes differentiate us in the market and have resulted in a lower voluntary attrition rate relative to benchmark data and a higher retention rate in fiscal 2024. Our employee average tenure globally is 5.0 years.
We believe our company attributes differentiate us in the market and have resulted in a lower voluntary attrition rate relative to benchmark data and a higher retention rate in fiscal 2025. Our employee average tenure globally is approximately eight years.
We will offer our solutions to existing and potential customers to enable increased functionality, reduced size, lower cost, simplified security, enhanced industrial design features, and to enhance the user experience of our OEMs’ products. We plan to utilize our existing technologies as well as aggressively pursue new technologies as new markets evolve that demand new solutions.
We will offer our solutions to existing and potential customers to enable increased functionality, reduced size, lower cost, simplified security, enhanced industrial design features and to expand the user experience of our OEMs’ products. We plan to use our existing technologies, as well as proactively pursue new technologies as new markets evolve, demanding new solutions.
We believe our strong relationship with our OEM customers, many of which are also currently developing product solutions which are focused in several of our target markets, will continue to position us as a source of supply for their product offerings. We generally supply our products to OEMs through their contract manufacturers, supply chain or distributors.
We believe our strong relationship with our OEM customers, many of which are also currently developing product solutions, aligned with our target markets, will continue to position us as a preferred partner. We generally supply our products to OEMs through their contract manufacturers, supply chain partners or distributors.
Our workforce is distributed globally across 15 countries with 22% of our employees located in North America, 61% located in Asia Pacific and 17% located in Europe and the Middle East.
Our workforce is distributed globally across 15 countries with 21% of our employees located in North America, 69% located in Asia Pacific and 10% located in Europe and the Middle East.
Almost 50% of our workforce participated in events last year such as global virtual runs and our annual outstep the CEO competition, promoting healthy behavior while raising money for local charities. We also provided opportunities for employees to donate or volunteer their time through various philanthropic programs and events.
The majority of our workforce participated in health and wellness related events last year, such as global virtual runs and quarterly challenges, promoting healthy behavior while raising money for local charities. We also provided opportunities for employees to donate or volunteer their time through various philanthropic programs and events.
Our fabless semiconductor manufacturing strategy allows us to maintain a variable cost model, in which we do not incur most of our manufacturing costs until our product solutions have been shipped and invoiced to our customers. Products Our family of product solutions allows our customers to solve their interface needs and differentiate their products from those of their competitors.
Our fabless semiconductor manufacturing strategy allows us to maintain a variable cost model in which we do not incur most of our manufacturing costs until our product solutions have been shipped and invoiced to our customers.
We have adopted a supplier and vendor code of conduct, and businesses in our supply chain are contractually obligated to comply with and support the Responsible Business Alliance (RBA) Code of Conduct.
Within our supply chain, we have adopted a supplier and vendor code of conduct and require our business partners to comply with and support the Responsible Business Alliance (RBA) Code of Conduct.
The contract manufacturers and distributors place orders with us for the purchase of our products, take title to the products purchased upon delivery by us, and pay us directly for those purchases. The majority of these customers do not have return rights except for warranty provisions.
The contract manufacturers and distributors place product purchase orders with us, take title to the products upon delivery and pay us directly for those purchases. The majority of these customers do not have return rights except under applicable warranty provisions. Sales and Marketing We sell our product solutions for incorporation into the products of our OEM customers.
We believe our innovative interface technologies can be applied to many diverse products, and we believe the interface is a key factor in the differentiation of many products. AI-at-the-edge is a focus area for us in enabling better performance and enhancing user experience in many of these products.
Our interface technologies are designed to enhance a diverse array of products, and we believe the interface is a key factor in the differentiation of many of our products. AI-at-the-edge is a focus area for us in enabling improved performance and enhanced user experience in many of these products.
After processing and testing, the die and ASICs are consigned to various contract manufacturers for assembly or are shipped directly to our customers. During the assembly process, our die or ASIC is either combined with other components to complete the module for our custom product solutions or the ASIC is maintained as a standalone finished good.
During the assembly process, our die or ASIC is either combined with other components to complete the module for our custom product solutions or the ASIC is maintained as a standalone finished good. The finished assembled product is subsequently shipped directly to our customers or to our contract manufacturers for integration into their products.
The Nominations and Corporate Governance Committee has oversight of ESG strategy and receives regular updates from management on our ESG performance. The Audit Committee provides oversight of business risks and our company’s Code of Conduct. Our Board of Directors receives periodic updates from Nominations and Corporate Governance Committee and management on our ESG performance.
The Nominations and Corporate Governance Committee has oversight of CGS strategy and receives regular reports from management on progress and performance. The Audit Committee oversees our broader business risks and our company’s Code of Conduct.
Our demonstrated track record of technological leadership, design innovation, product performance, cost-effectiveness, and on-time deliveries have resulted in our leadership position in providing human experience semiconductor product solutions.
Our demonstrated track record of technological leadership, design innovation, product performance, cost-effectiveness and on-time deliveries has contributed to our position as a go-to supplier of human experience semiconductor product solutions.
Rizvi served as Senior Vice President and Chief Financial Officer of SMART Global Holdings, Inc., a diversified business focused on providing high-performance, high-availability solutions to enterprise customers, from February 2021 to June 2024. Prior to joining SMART Global Holdings, Mr.
Rizvi served as Senior Vice President and Chief Financial Officer of Penguin Solutions, Inc. (previously named SMART Global Holdings), a company that designs, builds, deploys and manages high-performance, high-availability enterprise solutions for its customers, from February 2021 to June 2024. Prior to joining Penguin Solutions, Mr.
Periodically, we purchase inventory from our contract manufacturers when a customer delays its delivery schedule or cancels its order. In those circumstances in which our customer has cancelled its order and we purchase inventory from our contract manufacturers, we consider a write-down to reduce the carrying value of the inventory purchased to its net realizable value.
We may establish relationships with other contract manufacturers in order to reduce our dependence on any single source of supply. Periodically, we purchase inventory from our contract manufacturers when a customer delays its delivery schedule or cancels its order. In such circumstances, we consider a write-down to reduce the carrying value of the inventory purchased to its net realizable value.
Our goal is to cultivate an environment that not only allows for, but also encourages, everyone to collaborate and participate equally to foster individual and company 11 growth. As of June 2024, 20% of global employees, 20% senior executive leadership positions and 38% of our Board of Directors identified as female.
Our goal is to cultivate an environment that allows for and encourages all employees to collaborate and participate equally to foster individual and company growth and innovation. As of J une 2025, 19% of global employees, 20% senior executive leadership positions and 38% of our B oard of Directors identified as female.
The contents of our website, including the content contained in any website addresses or links included elsewhere in this report, are not incorporated into or deemed to be a part of this report. We were initially incorporated in California in 1986 and were re-incorporated in Delaware in 2002.
The contents of our website, including the content contained in any website addresses or links included elsewhere in this report, are not incorporated into or deemed to be a part of this report. 8 Table o f Con tents
We also record a liability and charge to cost of revenue for estimated losses on inventory we are obligated to purchase from our contract manufacturers when such losses become probable from customer delays or order cancellations. In addition, the impact of entering into long-term capacity agreements could create significant inventory write-down if the end customer demand substantially declines.
We also record a liability and charge to cost of revenue the estimated losses on inventory we are obligated to purchase from our contract manufacturers when such losses become probable from customer delays or order cancellations.
We have implemented internal programs and initiatives to reinforce our commitment to reduce our natural resource consumption, improving sustainability, disposing of end-of-life products in an environmentally safe manner, reducing waste, and increasing reuse and recycling programs company-wide.
As part of our environmental efforts, we have implemented company-wide initiatives to reduce our natural resource consumption, minimize waste, promote reuse and recycling and dispose of end-of-life products in an environmentally safe manner.
Our vendors and suppliers are also required to obtain and maintain all required health and safety permits, provide reasonable working and living conditions, have incident management systems and emergency preparedness and response protocols. Our Board of Directors is responsible for overseeing our ESG policies and practices generally.
Our vendors and suppliers are also required to obtain and maintain all required health and safety permits, provide reasonable working and living conditions and implement incident management systems and emergency preparedness protocols. Oversight of CGS matters is embedded at the Board level.
Bodensteiner holds a Juris Doctor degree from Santa Clara University School of Law and a Bachelor of Science in Business Administration in Accounting from the University of Nevada Vikram Gupta has been the Senior Vice President and General Manager of IoT Processors and Chief Product Officer since January 2023. Prior to joining Synaptics, Mr.
Bodensteiner holds a Juris Doctor degree from Santa Clara University School of Law and a Bachelor of Science in Business Administration in Accounting from the University of Nevada. Satish Ganesan has been the Senior Vice President and General Manager of Intelligent Sensing Division since February 2024. Mr. Ganesan joined Synaptics in November 2019 as our Chief Strategy Officer.
We currently utilize third-party semiconductor wafer manufacturers to supply us with silicon wafers integrating our proprietary design specifications. The completed silicon wafers are forwarded to third-party package and test processors for further processing into die and packaged ASICs, as applicable, which are then utilized in our custom module products or processed as our ASIC-based solution.
The completed silicon wafers are forwarded to third-party package and test processors for further processing into die and packaged ASICs, as applicable, which are then used in our custom module products or processed as our ASIC-based solutions. After processing and testing, the die and ASICs are consigned to various contract manufacturers for assembly or shipped directly to our customers.
We intend to continue utilizing our technological expertise to reduce the overall size, cost, and power consumption of our product solutions while increasing their applications, capabilities, and performance. We plan to continue enhancing the ease of use and functionality of our solutions.
We intend to continue utilizing our technological expertise to reduce the overall size, cost and power consumption of our product solutions while increasing their applications, capabilities and performance. Grow in the IoT Market We intend to capitalize on the growth of the IoT market, including connectivity and processor solutions, AI-native applications, extended reality and wearables.
Ganesan joined Synaptics in November 2019 as our Chief Strategy Officer. Prior to joining our Company, Mr. Ganesan served as Chief Product Officer of Keyssa Inc., a wireless startup focused on short range connectivity, from May 2017 to October 2018.
Prior to joining our Company, Mr. Ganesan served as Chief Product Officer of Keyssa Inc., a wireless startup focused on short range connectivity, from May 2017 to October 2018. Before that, he held several executive positions focused on IoT and mobile strategy and product marketing at Broadcom Limited from August 2007 to November 2010 and January 2014 to February 2016.
Hurlston holds Bachelor of Science and Master of Science degrees in Electrical Engineering and a Master of Business Administration degree from the University of California, Davis. Ken Rizvi has been the Chief Financial Officer of our company since July 15, 2024. Prior to joining our company, Mr.
He holds a Bachelor’s degree in Electrical and Electronics Engineering from Birla Institute of Technology & Science in India and a Master’s Degree in Electrical Engineering from the University of Hawaii at Manoa. 7 Table o f Con tents Ken Rizvi has been the Chief Financial Officer of our company since July 15, 2024. Prior to joining our company, Mr.
Our website also includes corporate governance information, including our Code of Conduct, our Code of Ethics for the Chief Executive Officer and Senior Financial Officers, and our Board Committee Charters.
Available Information On the Investor Relations pages of our website, www.synaptics.com, we make available, free of charge, all our Securities and Exchange Commission (“SEC”) filings, corporate governance information, including our Code of Conduct, our Code of Ethics for our Chief Executive Officer and Senior Financial Officers and our Board Committee Charters.
Additionally, we provided new mental health resources and conducted team building and well-being activities onsite in our global offices. We also conduct organizational health surveys designed to assess employee engagement, leadership, work environment, and culture. We held an average response rate of 90% for fiscal 2024, which we view as indicative of a high-level of employee engagement.
Additionally, we provided a new platform to access resources and learning across physical, mental, nutritional, financial and social health topics. We continuously provide team building and well-being activities onsite in our global offices. We conduct organizational health surveys designed to assess employee engagement, leadership, work environment and culture.
The finished assembled product is subsequently shipped directly to our customers or by our contract manufacturers directly to our customers for integration into their products. We believe our third-party manufacturing strategy provides a scalable business model, enables us to concentrate on our core competencies of research and development, technological advances, and product design and engineering, and reduces our capital investment.
We believe our third-party manufacturing strategy provides a scalable business model, enables us to concentrate on our core competencies of research and development, technological advances and product design and engineering and reduces our capital investment. Our third-party contract manufacturers and semiconductor fabricators are predominately Asia-based organizations. We generally provide our contract manufacturers with six-month rolling forecasts of our production requirements.
Sales and Marketing We sell our product solutions for incorporation into the products of our OEM customers. We generate sales through direct sales employees as well as outside sales representatives, distributors and value-added resellers.
We generate sales through direct sales employees as well as outside sales representatives, distributors and value-added resellers. Our sales personnel receive substantial technical assistance and support from our internal technical marketing and engineering resources due to the highly technical nature of our product solutions.
We also make customized learning pathways available through a global platform where all employees can take courses to grow their skill sets. To ensure we are building leadership strength and capabilities, we have robust talent assessment discussions where high-performing and high potential employees are identified for future growth opportunities, as well as succession planning for future critical leadership positions.
To ensure we are building leadership strength and capabilities for the future, we have robust talent assessment discussions where high-performing and high potential employees are identified for future growth opportunities as well as succession planning for future critical leadership positions. We strive to provide a rich and inclusive environment that values a wide array of skills, backgrounds and perspectives.
Our sales personnel receive substantial technical assistance and support from our internal technical marketing and engineering resources because of the highly technical nature of our product solutions. Sales frequently result from multi-level sales efforts that involve senior management, design engineers, and our sales personnel interacting with our customers' decision makers throughout the product development and order process.
Sales frequently result from multi-level engagement that involve our senior management, design engineers and sales personnel interacting with our customers’ decision makers throughout the product development and order process. See “Part II – Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 18.
Carey School of Business at Arizona State University and a Bachelor of Arts in Economics from Yale University. Lisa Bodensteiner has been Senior Vice President, Chief Legal Officer and Secretary since November 2023. Prior to joining our company, Ms. Bodensteiner was Executive Vice President, Chief Legal Officer, Compliance Officer and Corporate Secretary of Plantronics, Inc.
Patel holds an M.B.A. from Santa Clara University, an M.S. in Computer Science and Engineering from Arizona State University and a B. Tech in Electronics and Communications Engineering from National Institute of Technology in Warangal, India. Lisa Bodensteiner has been Senior Vice President, Chief Legal Officer and Secretary since November 2023. Prior to joining our company, Ms.
Our reliance on these parties exposes us to vulnerability owing to our dependence 9 on a few sources of supply. In some cases, we have alternative sources of supply to mitigate supplier risk. We may establish relationships with other contract manufacturers in order to reduce our dependence on any single source of supply.
As a result of past supply constraints and capacity shortages affecting the global semiconductor industry, we entered into long-term capacity and pricing agreements with some suppliers. Our reliance on these parties exposes us to vulnerability owing to our dependence on a few sources of supply. In some cases, we have alternative sources of supply to mitigate supplier risk.
Our Strategy Our objective is to continue to enhance our position as a leading supplier of premium semiconductor product solutions for each of the target markets in which we operate, including the core IoT applications market, the enterprise and automotive product applications market, and the mobile product applications markets, with a key focus on expanding our market share.
Business Combinations and Asset Acquisitions” for additional information on our acquisitions. 2 Table o f Con tents Our Strategy Through our investments in product technologies, we will continue to enhance our position as a leading supplier of premium semiconductor product solutions for each of the target markets in which we operate.
Our sales are almost exclusively denominated in U.S. dollars. See Note 15. Segment, Customers, and Geographic Information in the notes to the consolidated financial statements for additional information on revenue by geographic location and product category. Manufacturing We employ a fabless semiconductor manufacturing platform through third-party relationships.
Segment and Other Information” for additional information on revenue by geographic location and product category. Manufacturing We employ a fabless semiconductor manufacturing platform through third-party relationships. We currently utilize third-party semiconductor wafer manufacturers to supply silicon wafers integrating our proprietary design specifications.
Our proprietary firmware and software, including source code, are also protected by copyright laws and applicable trade secret laws. Our extensive array of technologies includes those related to ICs, firmware, software, and mechanical hardware. Our products rely on a combination of these technologies, making it difficult to use any single technology as the basis for replicating our products.
Our proprietary firmware and software, including source code, are protected by copyright laws and trade secret laws. Our technology portfolio spans ICs, firmware, software and mechanical hardware. The combination of these technologies within our products, along with the complexity of customer-specific customizations and the length of design cycles, provides a further barrier to replication and unauthorized use.
He spent his early career in various engineering roles at Xilinx, and holds more than 10 US patents. Mr. Ganesan received his Bachelor of Science in Electrical and Electronics Engineering from BITS, India and his Master of Science in Computer Engineering from the University of Cincinnati 13
He also served as Director, Product Management & Product Marketing at Tilera Corporation from December 2011 to December 2013. He spent his early career in various engineering roles at Xilinx and holds more than 10 US patents. Mr.
Wireless Connectivity Our wireless connectivity solutions include state-of-the-art Wi-Fi, Bluetooth, Bluetooth Low Energy, Zigbee, Thread, Matter, GPS, GNSS, and ULE to address broad IoT market applications including home automation, multimedia streamers, security sensors, surveillance cameras, wireless speakers, games, drones, printers, wearable and fitness devices, in addition to numerous other applications which require a wireless connection.
Our devices help users connect seamlessly to multiple devices, such as home automation, multimedia streamers, security sensors, surveillance cameras, wireless speakers, games, drones, printers, wearable and fitness devices, and numerous other applications requiring a wireless connection.
Furthermore, the lengths of our customers’ design cycles and the customizations required within the products we provide to our customers also serve to protect our intellectual property rights. 8 Customers Our customers include many of the world’s largest mobile and PC OEMs, based on unit shipments, as well as many large IoT OEMs, automotive manufacturers and a variety of consumer electronics manufacturers.
We conduct R&D activities in the United States with additional design and development teams located in various countries that perform specific activities under the direction of our U.S. headquarters. 3 Table o f Con tents Customers Our customers include many of the world’s largest mobile and PC OEMs, based on unit shipments, as well as many large IoT OEMs, automotive manufacturers and a variety of consumer electronics manufacturers.
Astra TM Our Astra family of AI solutions include a scalable portfolio of intelligent edge processors, ranging from highly integrated MPUs to high-performance MCUs architected for an AI-enabled IoT system, a standards-based open software framework, rapid prototyping kits, full-featured AI/ML toolkits, and Synaptics’ Wi-Fi ® and Bluetooth ® connectivity solutions.
Processors Our Synaptics Astra™ family of AI solutions include a scalable portfolio of intelligent edge processors designed to reduce latency, lower bandwidth usage and enhance security. Applications range from highly integrated microprocessor units (“MPU”) to high-performance microcontroller units (“MCU”) architected for AI-enabled IoT systems.
We rely on a combination of patents, trademarks, trade secrets, copyrights, confidentiality agreements, and other statutory and contractual provisions to protect our intellectual property, but these measures may provide only limited protection. As of June 2024, we held 2,603 active patents and 555 pending patent applications worldwide that expire between 2024 and 2044.
While we rely on a combination of patents, trademarks, copyrights, trade secrets, confidentiality agreements and other legal and contractual protections, no single measure offers complete assurance and these measures may provide only limited protection. Accordingly, we continuously evaluate our IP protections and practices to safeguard our innovation assets in a dynamic global environment.
He holds a Bachelor’s degree in Electrical and Electronics Engineering from Birla Institute of Technology & Science in India and a Master’s Degree in Electrical Engineering from the University of Hawaii at Manoa. Satish Ganesan has been the Senior Vice President and General Manager of Intelligent Sensing Division since February 2024. Mr.
Ganesan received his Bachelor of Science in Electrical and Electronics Engineering from BITS, India and his Master of Science in Computer Engineering from the University of Cincinnati. Vikram Gupta has been the Senior Vice President and General Manager of IoT Processors and Chief Product Officer since January 2023. Prior to joining Synaptics, Mr.
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ITEM 1. B USINESS Overview We are a leading worldwide developer and fabless supplier of premium mixed signal semiconductor solutions that enable people to engage with connected devices and data, engineering exceptional experiences throughout the home, at work, in the car and on the go.
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ITEM 1. BUSINESS Overview Synaptics designs and delivers AI-enabled edge solutions that bring AI closer to end users and transform how we engage with intelligent connected devices, whether at home, at work or on the move.
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We provide our customers with sensing, processing, and connecting solutions, which represent the three foundational elements of the Internet of Things, or IoT. We supply connectivity, sensors, and artificial intelligence, or AI, enhanced processor solutions to original equipment manufacturers, or OEMs, that design IoT products and devices for automobiles, enterprise workspace devices, virtual reality, smartphones, tablets, and notebook computers.
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We are a strategic partner for many global original equipment manufacturers, (“OEM”), offering custom silicon and software platforms for edge AI, wireless connectivity and human interface technologies. Our Synaptics Astra™ AI-native and Veros™ wireless solutions combine embedded compute, connectivity and multimodal sensing to support intuitive, secure and seamless digital experiences.
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Our currently served markets include IoT, personal computer, or PC, Enterprise and Automotive, and Mobile. Our solutions either contain or consist of our wireless, voice and speech, video processing, fingerprint, authentication, display driver, or touch semiconductor solutions, which include our hardware, and, where applicable, firmware and software. Our website is located at www.synaptics.com .
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From touch, display and biometrics to AI-enabled wireless connectivity, video, vision, audio, speech and security processing, our solutions support the next generation of intelligent devices that enhance how people live, work and interact with technology. We were initially incorporated in California in 1986 and were re-incorporated in Delaware in 2002.
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Through our website, we make available, free of charge, all our Securities and Exchange Commission, or SEC, filings, including our annual reports on Form 10-K, our proxy statements, our quarterly reports on Form 10-Q, and our current reports on Form 8-K, as well as Form 3, Form 4, and Form 5 Reports for our directors, officers, and principal stockholders, together with amendments to those reports filed or furnished pursuant to Sections 13(a), 15(d), or 16 under the Securities Exchange Act of 1934, as amended, or the Exchange Act.
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Target Markets and Products We are a leader in human interface technologies, enabling innovative and intuitive user experiences across a wide range of intelligent devices. Our portfolio includes touch, display, biometrics, voice, audio, processor, wireless and multimedia products built on rich research and development (“R&D”), a broad intellectual property portfolio and established supply chain partnerships.
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Core IoT Applications Market Our Core IoT market solutions center around three foundational elements of IoT devices: sensing, processing, and connecting. We Sense, Process, and Connect by capturing critical data with diverse sensors, processing it efficiently at the device’s edge, and ensuring seamless device connectivity. Our integrated approach delivers a dependable and innovative IoT experience, powering a smarter, connected world.
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Designed for mobile, personal computers (“PC”), smart home, industrial and automotive applications, our solutions combine ease of use, functionality, performance and aesthetics to help make digital lives more productive, secure and enjoyable. We focus on three primary markets.
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Our solutions broadly consist of wireless connectivity (Wi-Fi, Bluetooth, Bluetooth Low Energy, Zigbee, Thread, global positioning system, or GPS, and Ultra Low Energy, or ULE) products, System-on-Chip, or SoC, products, and our Astra family of AI-native edge processors.
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Our product offerings within those target markets are as follows: Core IoT Applications Markets Wireless Our Veros™ family of wireless connectivity solutions include advanced Wi-Fi®, Bluetooth®, Bluetooth Low Energy (“BLE”), Zigbee, Thread, Matter, Global Positioning System (“GPS”), Global Navigation Satellite System (“GNSS”), Ultra-Wideband (“UWB”) and Ultra Low Energy (“ULE”) to address broad Internet of Things (“IoT”) applications.
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Our products enable smart devices at the edge of a network such as smart assistant speakers, over-the-top multimedia devices, wireless speakers, appliances, set-top boxes, high-speed connectivity for virtual reality devices, video surveillance and voice over IP SoCs.
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We also provide a standards-based open software framework, rapid prototyping kits, full-featured artificial intelligence (“AI”) /machine learning (“ML”) toolkits and integration with Synaptics’ Wi-Fi® and Bluetooth® connectivity solutions. Our Astra™ Machina™ Foundation Series Modular development kits support the Synaptics SL-Series of high-performance embedded processors as well as the Synaptics Machina Micro development kit for the SR100 Series of MCUs.
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We continue to expand our footprint in various devices by bringing converged video, vision, audio, and voice technologies coupled with artificial intelligence and wireless connectivity capabilities.
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Integrated solutions with Astra, Veros and Human Interface products By combining the AI processing power of the Astra™ family with the robust wireless capabilities of the Veros™ portfolio and our Human Interface products (primarily Touch), Synaptics delivers complete end-to-end solutions for intelligent, connected devices.
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Our deep investment in far-field voice technology, our intellectual property portfolio for video, vision, audio and security, and our significant experience enabling Android-based platforms for service providers, coupled with our focus on enabling high performance, low power, and highly secure SoC solutions enable us to effectively serve our existing customers and position us to grow our addressable market.
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This powerful integration enables OEMs to accelerate innovation across diverse IoT applications—such as smart home, industrial, consumer, and automotive—by leveraging low-latency AI processing at the edge alongside secure, seamless wireless connectivity.
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Enterprise and Automotive Product Applications Market Our Enterprise product applications include solutions for PCs, a wide range of audio and video products and solutions for enterprise workspaces. We provide custom and semi-custom product solutions for navigation, cursor control, access to devices or applications through fingerprint authentication, and user presence detection solutions, for many of the world’s premier PC OEMs.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe Credit Agreement includes certain covenants that limit (subject to certain exceptions) our ability to, among other things: (i) incur or guarantee additional indebtedness; (ii) incur or suffer to exist liens securing indebtedness; (iii) make investments; (iv) consolidate, merge or transfer all or substantially all of our assets; (v) sell assets; (vi) pay dividends or other distributions on, redeem or repurchase capital stock; (vii) enter into transactions with affiliates; (viii) amend, modify, prepay or redeem subordinated indebtedness; (ix) enter into certain restrictive agreements; and (x) engage in a new line of business.
Biggest changeAdditionally, the covenants in our credit agreement impose restrictions on our ability to incur or guarantee additional indebtedness, create liens, make certain investments, merge or transfer assets, pay dividends or repurchase capital stock, enter into transactions with affiliates, amend subordinated debt, or enter into new lines of business.
Such defects, errors or security vulnerabilities could give rise to significant costs, including costs related to developing solutions, recalling products, repairing or replacing defective products, writing down defective inventory or indemnification obligations under our agreements, and could result in the loss of sales and divert the attention of our personnel from our product development efforts.
Such defects, errors or security vulnerabilities could give rise to significant costs (including costs related to developing solutions, recalling products, repairing or replacing defective products, writing down defective inventory or indemnification obligations under our agreements), could result in the loss of sales and divert the attention of our personnel from our product development efforts.
In connection with our acquisition in July 2017 of Conexant Systems, we agreed to assume certain environmental liabilities, including remediation of environmental impacts at a property formerly owned and operated by Conexant (the “Conexant Site”) and for potential future claims alleging personal injury or property damage related to the environmental impacts at and about the Conexant Site.
In connection with our acquisition in July 2017 of Conexant Systems, we agreed to assume certain environmental liabilities, including remediation of environmental impacts at a property formerly owned and operated by Conexant (“Conexant Site”) and for potential future claims alleging personal injury or property damage related to the environmental impacts at and about the Conexant Site.
The theft, loss or misuse of PII collected, used, stored or transferred by us, our any inability, or perceived inability, to adequately address privacy and data protection concerns, even if unfounded, or our failure to comply with applicable laws, regulations, policies, industry standards, contractual obligations or other legal obligations, could result in additional cost and liability to us, including litigation, which could have an adverse effect on our business, operating results, cash flows, and financial condition.
The theft, loss or misuse of PII collected, used, stored or transferred by us, or any inability, or perceived inability, to adequately address privacy and data protection concerns, even if unfounded, or our failure to comply with applicable laws, regulations, policies, industry standards, contractual obligations or other legal obligations, could result in additional cost and liability to us, including litigation, which could have an adverse effect on our business, operating results, cash flows and financial condition.
A number of our customers have adopted, or may adopt, procurement policies that include ESG provisions or requirements 31 that their suppliers should comply with, or they may seek to include such provisions or requirements in their procurement terms and conditions. An increasing number of investors are also requiring companies to disclose ESG-related policies, practices and metrics.
A number of our customers have adopted, or may adopt, procurement policies that include ESG provisions or requirements that their suppliers should comply with or they may seek to include such provisions or requirements in their procurement terms and conditions. An increasing number of investors are also requiring companies to disclose ESG-related policies, practices and metrics.
Additionally we may be subject to litigation and claims by third parties or regulatory bodies that our stated ESG initiatives and objectives have not been achieved or implemented appropriately. Our actual or perceived failure to achieve our ESG-related initiatives could negatively impact our reputation or harm our business.
Additionally, we may be subject to litigation and claims by third parties or regulatory bodies that our stated CGS initiatives and objectives have not been achieved or implemented appropriately. Our actual or perceived failure to achieve our CGS-related initiatives could negatively impact our reputation or harm our business.
Any of the foregoing, or the perception any of them has occurred, could have a material adverse impact on our business, operations and financial results. In addition, any compromise of security from a security breach or cyberattack could deter customers or business partners from entering into transactions that involve providing confidential information to us.
Any of the foregoing, or the perception any of them has occurred, could have a material adverse impact on our business, operations and financial 14 Table o f Con tents results. In addition, any compromise of security from a security breach or cyberattack could deter customers or business partners from entering into transactions that involve providing confidential information to us.
ITEM 1A. RI SK FACTORS Investing in our securities involves a high degree of risk.
ITEM 1A. RISK FACTORS Investing in our securities involves a high degree of risk.
A weakening of the U.S. dollar could cause our overseas vendors to require renegotiation of either the prices or currency we pay for their goods and services. In the future, customers may negotiate pricing and make payments in non-U.S. currencies.
Conversely, a weakening of the U.S. dollar could increase our cost of goods sold and operating expenses and cause our overseas vendors to require renegotiation of either the prices or currency we pay for their goods and services. In the future, customers may negotiate pricing and make payments in non-U.S. currencies.
Without these “design wins,” we would have difficulty selling our products. If a customer designs another supplier’s product into one of its product platforms, it is more difficult for us to achieve future design wins with that platform because changing suppliers involves significant cost, time, effort, and risk on the part of that customer.
If a customer designs another supplier’s product into one of its product platforms, it is more difficult for us to achieve future design wins with that platform because changing suppliers involves significant cost, time, effort and risk on the part of that customer.
Competition for qualified personnel in our industry is extremely intense, particularly for engineering and other technical personnel. Our compensation program, which includes cash and share-based compensation award components, has been instrumental in attracting, hiring, motivating, and retaining qualified personnel.
Competition for qualified personnel in our industry is extremely intense, particularly for engineering and other technical personnel. This challenge is amplified by our significant presence in Silicon Valley, where competition for talent is particularly fierce. Our compensation program, which includes cash and share-based compensation award components, has been instrumental in attracting, hiring, motivating, and retaining qualified personnel.
Although we have implemented security procedures and controls to address these threats, our systems may still be vulnerable to data theft, computer viruses, programming errors, ransomware, and other attacks by third parties, or similar disruptive problems.
We face risks associated with security breaches or cyberattacks of our computer systems or those of our third-party representatives, vendors and service providers. Although we have implemented security procedures and controls to address these threats, our systems may still be vulnerable to data theft, computer viruses, programming errors, ransomware and other attacks by third parties or similar disruptive problems.
We are subject to governmental laws, regulations and other legal obligations related to privacy and data protection. We collect, use, and store personally identifiable information, or PII, as part of our business and operations. We are subject to federal, state, and international laws relating to the collection, use, retention, security, and transfer of PII.
We collect, use and store personally identifiable information (“PII”) as part of our business and operations. We are subject to federal, state and international laws relating to the collection, use, retention, security and transfer of PII.
Our success depends on our continued ability to use our share-based compensation programs to effectively compete for engineering and other technical personnel and professional talent without significantly increasing cash compensation costs.
Our compensation programs, which include cash and share-based compensation award components, has been instrumental in attracting, hiring, motivating and retaining qualified personnel. Our success depends on our continued ability to use our share-based compensation programs to effectively compete for engineering and other technical personnel and professional talent without significantly increasing cash compensation costs.
If we are unable to obtain stockholder approval of share-based compensation award programs or additional shares for such programs, we could be at a competitive disadvantage in the marketplace for qualified personnel or may be required to increase the cash element of our compensation program.
Such turnover can also disrupt long-term customer relationships, strategic execution or internal governance. 15 Table o f Con tents If we are unable to obtain stockholder approval of share-based compensation award programs or additional shares for such programs, we could be at a competitive disadvantage in the marketplace for qualified personnel or may be required to increase the cash element of our compensation program.
For example, under these conditions or expectation of such conditions, our customers may cancel orders, delay purchasing decisions or reduce their use of our services. In addition, these economic conditions could result in higher inventory levels and the possibility of resulting excess capacity charges from our manufacturing partners if we need to slow production to reduce inventory levels.
During periods of slowing growth or heightened uncertainty, customers may cancel, reduce or defer orders, reduce inventory levels, or adjust production forecasts. In addition, these economic conditions could result in higher inventory levels and the possibility of resulting excess capacity charges from our manufacturing partners if we need to slow production to reduce inventory levels.
Hedging foreign currencies can be difficult, especially if the currency is not freely traded. We cannot predict the impact of future exchange rate fluctuations on our operating results.
Exchange rate movements may also lead to gains or losses on intercompany balances, supplier payments or cash held in foreign subsidiaries. Hedging foreign currencies can be difficult, especially if the currency is not freely traded. We cannot predict the impact of future exchange rate fluctuations on our operating results.
If our overseas vendors or customers require us to transact business in non-U.S. currencies, fluctuations in foreign currency exchange rates could affect our cost of goods, operating expenses, and operating margins, and could result in exchange losses. In addition, currency devaluation could result in a loss to us if we hold deposits of that currency.
If our overseas vendors or customers require us to transact business in non-U.S. currencies, fluctuations in foreign currency exchange rates could affect our cost of goods, operating expenses and operating margins and could result in exchange losses. Moreover, our reliance on contract manufacturers and suppliers based in Asia subjects us to risks if their local currencies appreciate significantly.
Any claims, with or without merit, could result in significant litigation costs and diversion of resources, including the attention of management, and could require us to enter into royalty or licensing agreements, any of which could have a material adverse effect on our business.
Any claims, with or without merit, could result in significant litigation costs and diversion of resources, including the attention of management, and could require us to enter into royalty or licensing agreements, which may include terms that may not be commercially reasonable, which could have a material adverse effect on our business. 13 Table o f Con tents In addition, we license certain technology used in and for our products from third parties, including open source components.
Risks Related to Our Employees • We depend on key personnel who would be difficult to replace, and our business will likely be harmed if we lose their services or cannot hire additional qualified personnel.
The failure of any acquisition or alliance to achieve its intended benefits could adversely affect our growth, competitiveness, or financial results. Risks Related to Our Employees We depend on key personnel who would be difficult to replace and our business will likely be harmed if we lose their services, cannot hire additional qualified personnel or do not manage transitions effectively.
Risks Related to Our Industry and Business We currently depend on our solutions for the IoT, Enterprise and Automotive and Mobile product applications markets for a substantial portion of our revenue, and any downturn in sales of these products would adversely affect our business, revenue, operating results, and financial condition.
Risks Related to Our Industry and Business We depend on the IoT, Enterprise and Automotive and Mobile product applications markets for a substantial portion of our revenue. These are cyclical, competitive and evolving markets that are subject to volatility, economic risk and uncertain growth, which may materially affect our business, revenue, operating results and financial condition.
Qualifying new contract manufacturers, and specifically semiconductor foundries, is time consuming and might result in unforeseen manufacturing and operations problems. We may also encounter lower manufacturing yields and longer delivery schedules in commencing volume production of new products that we introduce, which could increase our costs or disrupt our supply of such products.
We may also encounter lower manufacturing yields and longer delivery schedules in commencing volume production of new products that we introduce, which could increase our costs or disrupt our supply of such products. In addition, a foundry or supplier may become unavailable to us as a result of economic or political instability.
We cannot be certain that our technologies and products do not and will not infringe issued patents or other third-party proprietary rights.
We rely on a combination of patents, trade secrets, trademarks, copyrights, and confidentiality agreements to protect our proprietary technologies. However, we cannot be certain that our technologies and products do not and will not infringe issued patents or other third-party proprietary rights. Patents may be challenged, invalidated, or circumvented.
Further, in the event of a recession or threat of a recession, our manufacturing partners, suppliers, distributors, and other third-party partners may suffer their own financial and economic challenges, and as a result they may demand pricing accommodations, delay payment, or become insolvent, which could harm our ability to meet our customer demands or collect revenue or otherwise harm our business.
Macroeconomic conditions can also disrupt our supply chain and increase operational costs. If our manufacturing partners, suppliers, distributors and other third-party partners experience financial challenges, they may demand pricing accommodations, delay payment or become insolvent, which could harm our ability to meet our customer demands or collect revenue.
As a result, they may be able to devote greater resources to the promotion and sale of products, negotiate lower prices for raw materials and components, deliver competitive products at lower prices, and introduce new product solutions and respond to customer requirements more quickly than we can.
As a result, they may be able to devote greater resources to promotion, negotiate lower prices for raw materials and components, deliver products at lower prices, or respond more quickly to customer requirements. To compete effectively, we must win design opportunities with OEM customers, meet their development timelines, and align our solutions with their technical and commercial objectives.
This risk is particularly pronounced in markets where there are only a few potential customers and in the Automotive market, where, due to the longer design cycles involved, failure to win a design-in could prevent access to a customer for several years.
This risk is particularly pronounced in markets such as Automotive, where long design cycles, combined with failure to win a design-in, could lock us out of a customer for several years.
Further, our business liability insurance may be inadequate, may not cover the claims, and future coverage may be unavailable on acceptable terms, which could adversely impact our financial results. Our use of open source software in certain products and services could materially adversely affect our business, financial condition, operating results and cash flow.
Further, our business liability insurance may be inadequate, may not cover the claims, and future coverage may be unavailable on acceptable terms, which could adversely impact our financial results. Our customers often integrate our solutions into devices that interact with untrusted systems or process large volumes of data.
Risks Related to Acquisitions Any acquisitions that we undertake could be difficult to integrate, disrupt our business, dilute stockholder value, and harm our operating results. We expect to continue to pursue opportunities to acquire other businesses and technologies in order to complement our current solutions, expand the breadth of our markets, enhance our technical capabilities, or otherwise create growth opportunities.
We expect to continue to pursue opportunities to acquire other businesses or technologies, or to engage in strategic alliances, related to other businesses and technologies to complement our current solutions, expand into existing or new markets, enhance our technical capabilities or otherwise accelerate growth.
If we fail to manage our growth effectively, our infrastructure, management, and resources could be strained, our ability to effectively manage our business could be diminished, and our operating results could suffer. The failure to manage our planned growth effectively could strain our resources, which would impede our ability to increase revenue.
If we fail to manage our growth and scale our operations effectively, our infrastructure and resources could be strained, our ability to effectively manage our business could be diminished and our operating results could suffer. As we expand our product portfolio and customer base, we must scale our global organization efficiently to meet increasing demand.
We are subject to U.S. federal, state, and foreign income taxes in the various jurisdictions in which we do business. In addition, we are required to pay U.S. federal taxes on the operating earnings of certain of our foreign subsidiaries.
General Risk Factors Changes in U.S. and foreign tax laws, implementation of Pillar Two and OBBBA, or adverse audit outcomes could materially affect our effective tax rate, financial position, and cash flows. We are subject to U.S. federal, state and foreign income taxes in the various jurisdictions in which we do business, including U.S. taxes on certain foreign subsidiary earnings.
Risks Related to Our Intellectual Property • Our ability to compete successfully and continue growing as a company depends on our ability to adequately protect our proprietary technology and confidential information. Risks Related to Acquisitions • Any acquisitions that we undertake could be difficult to integrate, disrupt our business, dilute stockholder value, and harm our operating results.
Risks Related to Acquisitions and Strategic Alliances Any acquisitions or strategic alliances that we undertake could be difficult to execute or integrate, may not achieve expected results, and could disrupt our business or dilute stockholder value.
If we violate these covenants and are unable to obtain waivers, our debt under the Credit Agreement would be in default and could be accelerated, and could permit, in the case of secured debt, the lenders to foreclose on our assets securing the Credit Agreement.
The credit agreement also contains financial covenants which limit the consolidated total net leverage ratio and the consolidated net interest coverage ratio. If we fail to comply with these covenants and are unable to obtain waivers, we may be in default, which could result in acceleration of our obligations and potential foreclosure on secured assets.
In addition, we license certain technology used in and for our products from third parties. These third-party licenses are granted with restrictions, and there can be no assurances that such third-party technology will remain available to us on commercially acceptable terms.
Also, there can be no assurances that such third-party technology will remain available to us on commercially acceptable terms. We cannot be certain that our products do not infringe third-party intellectual property rights. If third parties assert claims of infringement, we could be subject to significant litigation expenses, damage awards, or injunctions.
In the past, we did not consistently require our employees and consultants to enter into confidentiality, employment, or proprietary information and invention assignment agreements. Therefore, our former employees and consultants may try to claim some ownership interest in our technologies and products or may use our technologies and products competitively and without appropriate limitations.
In the past, we have not always required all employees, consultants, suppliers, or partners to enter into formal written agreement for the protection of our technology including confidentiality or invention assignment agreements, and some may seek to assert rights in our technologies or use them without authorization.
The failure of these alliances to achieve their objectives may impede our ability to introduce new products and enter new markets. We may incur material environmental liabilities as a result of prior operations at an acquired company.
The trading price of the 2031 Notes may also be volatile due to fluctuations in our common stock price, and there is currently no active trading market for the 2031 Notes. We may incur material environmental liabilities as a result of prior operations at an acquired company.
Even after a design win, the customer is not obligated to purchase our products and can choose at any time to reduce or cease use of our products, for example, if its own products are not commercially successful, or for any other reason.
Customers may reduce or cease purchases at any time—for example, if their products are not commercially successful. If we fail to convert design wins into sales, our operating results could be materially and adversely affected. Even if we secure a design win, our revenue depends on the commercial success of the customer’s product.
As a result of this, our success depends almost entirely upon the widespread market acceptance of our OEM customers’ products that incorporate our solutions. Even if our technologies successfully meet our customers' price and performance goals, our sales could decline or fail to develop if our customers do not achieve commercial success in selling their products that incorporate our solutions.
Even when we meet our customers’ technical and pricing requirements, our success ultimately depends on the commercial success of their products that incorporate our solutions. If those products fail to gain market acceptance or are discontinued, or if customers decide not to continue with follow-on projects, our revenue may decline.
As a global company headquartered in the U.S., we are subject to U.S. laws and regulations, including import, export, and economic sanction laws.
Changes to international trade policies, export controls, and foreign operations expose us to legal, regulatory, and operational risks. As a global company headquartered in the U.S., we are subject to U.S. and foreign laws and regulations governing import, export, and economic sanctions. These restrictions may prohibit sales to certain countries, entities, or individuals, or require export licenses for certain technologies.
These selection processes can be lengthy and require us to incur significant design and development expenditures, with no guarantee of winning a contract or generating revenue. Failure to win new design projects and delays in developing new products with anticipated technological advances or in commencing volume shipments of these products may have an adverse effect on our business.
One of our core business strategies is to win competitive bid selection processes with OEM customers to design our products into their platforms. These selection processes are often lengthy and require significant design and development investment, with no assurance of winning a contract or generating revenue.
We will report Pillar Two related costs, if any, as period costs in our financial statements beginning in fiscal 2025. Based on current legislation, Pillar Two is not expected to significantly affect our effective tax rate or cash flows in the next fiscal year.
We currently do not anticipate a material impact to our fiscal 2026 tax rate or cash flows, but we will continue to monitor legislative developments and recognize any Pillar Two-related amounts as period costs. In addition, effective July 4, 2025, the enactment date for U.S.
Our operating results could be adversely affected by fluctuations in the value of the U.S. dollar against foreign currencies. We transact business predominantly in U.S. dollars, and we invoice and collect our sales in U.S. dollars.
Although we transact business predominantly in U.S. dollars and we invoice and collect our sales in U.S. dollars, fluctuations in exchange rates can materially impact our results of operations and financial position. A strengthening U.S. dollar could reduce the local currency revenue of our international customers, potentially weakening demand or triggering pricing pressure.
Our competitors may also offer bundled solutions offering a more complete solution despite the technical merits or advantages of our products. We also face increased competition as a result of China actively promoting its domestic semiconductor industry through policy changes and investment.
In addition, unfavorable developments with respect to global laws and regulations—including those affecting artificial intelligence and data governance—could slow or limit adoption of products in these markets, impede our strategic plans, or require changes to our offerings. We also face increased competition as a result of China actively promoting its domestic semiconductor industry through policy changes and investment.
We cannot predict the timing, strength, or duration of any industry slowdown or economic recovery. If the industry and markets in which we operate deteriorate, our business, financial condition, and results of operations may be materially and adversely affected. We face intense competition that could result in our losing or failing to gain market share and suffering reduced revenue.
Our growth depends on the successful development of emerging markets, including Core IoT, which may be slower, more competitive, or more regulated, which could result in our losing or failing to gain market share and suffering reduced revenue. We face uncertainty in the development and growth of new and emerging markets, such as Core IoT.
We serve intensely competitive markets that are characterized by price erosion, rapid technological change, and competition from major domestic and international companies. We expect that the market for our products will continually evolve and will be subject to rapid technological change.
Failure to comply could result in fines, reputational harm, or limitations on our ability to operate in key international markets. We face intense competition and our success depends on our ability to deliver innovative, high-performance solutions. We operate in intensely competitive markets characterized by price erosion, rapid technological change, and competition from major domestic and international companies.
Our products are incorporated in numerous consumer devices, and demand for such products is ultimately driven by consumer demand for products such as smartphones, tablets, notebook computers, automobiles and virtual reality products. Many of these purchases are discretionary.
For example, our products are embedded in discretionary consumer and industrial devices such as smartphones, tablets, notebooks, virtual reality systems, and automobiles. As a result, demand in these markets can fluctuate sharply based on factors such as inflation, interest rates, trade restrictions, or recessionary conditions.
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Summary of Risk Factors Risks Related to Our Industry and Business • We currently depend on our solutions for the IoT, Enterprise and Automotive and Mobile product applications markets for a substantial portion of our revenue, and any downturn in sales of these products would adversely affect our business, revenue, operating results, and financial condition. • In many of the markets in which we compete, we depend on winning selection processes, and failure to be selected could adversely affect our business in those market segments. • We rely on OEMs and ODMs to design our products into their end products. • A significant portion of our sales comes from one or more large customers, the loss of which could harm our business, financial condition, and operating results. • We face risks related to recessions, inflation, stagflation and other macroeconomic conditions. • We are exposed to industry downturns and cyclicality in our target markets that may result in fluctuations in our operating results. • We face intense competition that could result in our losing or failing to gain market share and suffering reduced revenue. • We cannot assure you that our product solutions for new markets will be successful or that we will be able to continue to generate significant revenue from these markets. • If we fail to maintain and build relationships with our customers, or our customers’ products that utilize our solutions do not gain widespread market acceptance, our revenue may stagnate or decline. • Our gross margin and results of operations may be adversely affected in the future by a number of factors, including decreases in our average selling prices of products over time, shifts in our product mix, or price increases of certain components or third-party services due to inflation, supply chain constraints, or other reasons. • We are subject to order and shipment uncertainties.
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We derive a substantial portion of our revenue from our solutions for the Core IoT, Enterprise and Automotive and Mobile markets. These markets are highly competitive and subject to significant volatility, driven by macroeconomic conditions, evolving technical standards, shifting customer preferences, and rapid technological changes.
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If we are unable to accurately predict customer demand, we may hold excess or obsolete inventory, which would reduce our gross margin.
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Cyclical patterns in our end markets, particularly consumer electronics and automotive, have historically resulted in reduced demand, price erosion, overcapacity and increased inventory. These cycles are difficult to predict and may result in substantial fluctuations in our operating results. Moreover, each market presents unique risks.
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Conversely, we may have insufficient inventory or be unable to obtain the supplies or contract manufacturing capacity to meet that demand, which would result in lost revenue opportunities and potential loss of market share as well as damaged customer relationships. • If we fail to manage our growth effectively, our infrastructure, management, and resources could be strained, our ability to effectively manage our business could be diminished, and our operating results could suffer.
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For example, the automotive industry is especially sensitive to inflation, interest rates and tariffs, all of which may raise vehicle production costs and depress consumer demand. Existing, new or retaliatory tariffs on automobiles and automobile components imported into the United States could disrupt the automotive supply chain and, in turn, adversely affect our growth rate in that industry.
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Risks Related to Our Supply Chain • We depend on third parties to maintain satisfactory manufacturing yields and delivery schedules, and their inability to do so could increase our costs, disrupt our supply chain, and result in our inability to deliver our products, which would adversely affect our operating results. 14 • Shortages of components and materials may delay or reduce our sales and increase our costs, thereby harming our operating results.
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Our financial results are also subject to pricing pressure, changes in product mix, and limited ability to control input costs. Average selling prices of our products have historically declined, and we expect this trend to continue. To win business or retain key customers, we may offer price concessions that reduce gross margins.
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Risks Related to Product Development • We are subject to lengthy development periods and product acceptance cycles, which can result in development and engineering costs without any future revenue. • Failures in our solutions, or in our customers’ products, including resulting from security vulnerabilities, defects or errors, could harm our business.
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Our more recently introduced products often carry higher development and production costs, and increased sales of lower-margin products in emerging markets may dilute overall profitability. Because we do not operate our own manufacturing, assembly, testing or packaging facilities, we may lack flexibility to scale or reduce costs quickly in response to changing demand.
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Risks Related to International Sales and Operations • Changes to import, export and economic sanction laws may expose us to liability, increase our costs and adversely affect our operating results. • Changes to international trade policy and rising concerns of international tariffs, including tariffs applied to goods traded between the U.S. and China, could materially and adversely affect our business and results of operations.
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Our reliance on third-party partners also makes us more vulnerable to inflationary input costs, capacity constraints and supply chain disruptions. In addition, deterioration in the financial condition of our contract manufacturers or suppliers could limit our ability to secure components or achieve cost efficiencies.
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Risks Factors Related to Our Indebtedness • Our indebtedness could adversely affect our financial condition or operating flexibility and prevent us from fulfilling our obligations outstanding under our credit agreement, our 4.000% senior notes due 2029, or the Senior Notes, and other indebtedness we may incur from time-to-time.
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Our future revenue growth also depends, in part, on our ability to maintain and expand our position in these key markets while responding to customer product transitions, emerging competitive solutions, and ongoing technology shifts. If these markets experience slower than expected growth or if demand for our solutions weakens, our revenue and profitability could be materially impacted.
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General Risk Factors • Our business is dependent upon the proper functioning of our internal business processes and information systems and modification or interruption of such systems may disrupt our business. • We face risks associated with security breaches or cyberattacks. • If tax laws change in the jurisdictions in which we do business or if we receive a material tax assessment in connection with an examination of our income tax returns, our consolidated financial position, results of operations and cash flows could be adversely affected. • Our effective tax rate may be volatile from period to period and impact our net income. • We are subject to governmental laws, regulations and other legal obligations related to privacy and data protection. • The market price of our common stock has been and may continue to be volatile.
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Many of our customers, suppliers and contract manufacturers are foreign companies or have significant foreign operations, and many of the components used in our products are sourced from Asia. 9 Table o f Con tents Tariffs on imported components, especially from Asia, could increase our production costs, disrupt supply chains, or make our products and our customers’ end products less competitive in global markets.
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We currently depend on our solutions for the Core IoT, Enterprise and Automotive and Mobile product applications markets for a substantial portion of our revenue. Any downturn in sales of our products into any of these markets would adversely affect our business, revenue, operating results, and financial condition.
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For example, in the first quarter of calendar 2025, the U.S. government announced new tariffs on imports from several countries, prompting reciprocal tariffs. Tariffs on our customers’ products may reduce their global competitiveness, particularly in China. Some OEMs in our industry have responded with short-term price adjustments and shifted production and sourcing outside of China.
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Similarly, a softening of demand in any of these markets, or a slowdown of growth in any of these markets because of changes in customer preferences, the emergence of 15 applications not including our solutions, or other factors would cause our business, operating results, and financial position to suffer.
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Additionally, on August 6, 2025, the U.S. government proposed a 100% tariff on imported semiconductors and chips, with possible exemptions for companies that invest in U.S. manufacturing. While still in the proposal phase, this policy could materially impact our sourcing strategy and component costs, depending on scope and implementation.
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Our future revenue growth, if any, will depend in part on our ability to further penetrate into, and expand beyond, these markets. Demand in these markets fluctuates significantly, driven by consumer spending, consumer preferences, the development of new technologies and prevailing economic conditions.
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We rely on global foundry partners, many based in Asia, for a significant portion of our silicon. If adopted, these tariffs could increase our manufacturing costs or require changes to our supply chain operations. We are actively evaluating strategies to mitigate such risks, including potential sourcing diversification or partnerships with U.S.-based manufacturers.
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We cannot provide any assurance that our customers’ products which incorporate our solutions will be successful and such products may experience price erosion or other competitive factors that affect the price customers are willing to pay us. Each of these markets presents distinct and substantial risks.
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Geopolitical instability, including in the Middle East, Taiwan, or U.S.-China relations, could disrupt access to critical markets or destabilize key supply chain and logistics corridors. On June 13, 2025, Israel launched a strike on Iranian military and nuclear sites, followed by Iranian retaliation.
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If any of these markets do not develop as we currently anticipate, or if we are unable to penetrate them successfully, it could materially and adversely affect our revenue and revenue growth rate, if any.
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On June 21, 2025, the U.S. conducted targeted air strikes, which Iran answered with attacks on U.S. interests. Although a ceasefire has been reached, there is no assurance that hostilities will not escalate or recur. This military escalation between Israel and Iran has increased geopolitical tensions and uncertainty across the broader region.
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In many of the markets in which we compete, we depend on winning selection processes, and failure to be selected could adversely affect our business in those market segments. One of our business strategies is to participate in and win competitive bid selection processes to develop products for use in our customers’ products.
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Escalations of hostilities could also trigger new or expanded U.S. sanctions or export controls affecting parties or regions with which we do business. The developments could lead to delayed shipments, increased costs, or reduced revenue in impacted markets.
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Our failure to win a sufficient number of these bids could result in reduced revenue and hurt our competitive position in future selection processes because we may not be perceived as being a technology or industry leader, each of which could have a material adverse effect on our business, financial condition and results of operations.
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Further escalation in global or U.S.–China trade tensions could weaken China’s economy and reduce demand from customers located in China or selling into that market, which may affect our revenue and operations. Although we have not yet seen widespread tariff-related price increases passed through to us, our customers may respond by requesting pricing accommodations or shifting demand to alternative suppliers.
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We rely on OEMs and ODMs to design our products into their end products. Our products are not sold directly to the end user but are components or subsystems of other products. As a result, we rely on OEMs and ODMs to select our products from among alternative offerings to be designed into their equipment.
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Changes in trade policies or future tariffs could lead to further volatility in customer demand and order behavior. We may also experience fluctuations in order timing as customers adjust their purchases in response to tariffs or logistics concerns, including pulling forward orders into earlier quarters. These shifts may not reflect actual demand and could reduce volumes in future periods.
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Also, achieving a design win with a customer does not ensure that we will receive revenue from that customer.
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Additionally, our international operations, including in Taiwan, China, South Korea, Hong Kong, and throughout Europe and Asia, expose us to risks such as unexpected regulatory changes, labor law shifts, currency fluctuations, public health emergencies, and environmental compliance burdens. Export control regulations are also evolving.
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We may not continue to achieve design wins or to convert design wins into actual sales, and failure to do so could materially and adversely affect our operating results.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeBased on the risk assessment, appropriate security measures are implemented. We conduct annual and ongoing security awareness and behavioral change training for employees to educate them on cybersecurity best practices and train them to recognize phishing attempts.
Biggest changeWe also leverage third party service providers to test and validate our existing processes and procedures. We conduct annual and ongoing security awareness and behavioral change training for employees to educate them on cybersecurity best practices and train them to recognize phishing attempts.
We have an Information Security Management Steering Committee (the “ISMS Committee”), comprised of our CISO, as well as members of our executive team, including our Chief Information Office and Chief Legal Officer. Our Chief Information Officer and CISO, in coordination with the ISMS Committee, work collaboratively to implement our enterprise-wide cybersecurity strategy, policy, standards, architecture, and processes.
We have an Information Security Management Steering Committee (“ISMS Committee”), comprised of our Chief Information Security Officer (“CISO”), as well as members of our executive team, including our Chief Information Office and Chief Legal Officer. Our Chief Information Officer and CISO, in coordination with the ISMS Committee, work collaboratively to implement our enterprise-wide cybersecurity strategy, policy, standards, architecture and processes.
We describe whether and how risks from cybersecurity threats have materially affected or are reasonably likely to materially affect us, our business strategy, results of operations, or financial condition under the heading “We face risks associated with security breaches or cyberattacks," included as part of our risk factors disclosures in Item 1A.
We describe whether and how risks from cybersecurity threats have materially affected or are reasonably likely to materially affect us, our business strategy, our results of operations or our financial condition under the heading “We face risks associated with security breaches or cyberattacks” included as part of our risk factors disclosures in “Item 1A.
Risk Factors of this Annual Report on Form 10-K. In the last three fiscal years, we have not experienced a cybersecurity incident which has been determined to be material, and the expenses we have incurred from cybersecurity incidents and threats were immaterial, including penalties and settlements, of which there were none.
Risk Factors” of this Annual Report on Form 10-K. We have not experienced a cybersecurity incident which has been determined to be material and the expenses we have incurred from cybersecurity incidents and threats were immaterial, including penalties and settlements, of which there were none.
Our Information Security team monitors events, analyzes threats, and coordinates our incident response pursuant to our incident response plan, which includes the process to be followed for reporting of incidents. Our cybersecurity risk management involves identifying information assets and potential threats, assessing and prioritizing risks, employing various tools and techniques, including vulnerability scanning and penetration testing.
Our Information Security team monitors events, analyzes threats and coordinates our incident response pursuant to our incident response plan, which includes the process to be followed for reporting of incidents. Our cybersecurity risk management involves identifying information assets, assessing and prioritizing risks and employing various tools and techniques to identify and remediate threats.
The Audit Committee also receives a report containing information security risk posture details, remediation plan execution progress and pertinent threat intelligence updates from the Chief Information Security Officer (“CISO”) and Sr. Director of Internal Audit on a biannual basis.
The Audit Committee also receives a report containing information security risk posture details, remediation plan execution progress and pertinent threat intelligence updates from the heads of the IT Security and Internal Audit departments on a regular basis, typically biannually.
Our InfoSec team communicates with and reports to the CISO, enabling the CISO, CIRT, and ISMS Committee to monitor the prevention, detection, mitigation, and remediation of cybersecurity incidents. Our CISO has over 28 years of experience managing global IT operations, including strategy, applications, infrastructure, information security, support and execution. ITEM 2.
Our InfoSec team communicates with and reports to the CISO, enabling the CISO, Cyber Incident Response Team and ISMS Committee to monitor the prevention, detection, mitigation and remediation of cybersecurity incidents. Our CISO has significant experience managing global IT operations, including strategy, applications, infrastructure, information security, support and execution. 19 Table o f Con tents
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P ROPERTIES Our principal executive offices, as well as our principal research and development, sales, marketing, and administrative functions, are located in San Jose, California, where we lease office space of approximately 111,000 square feet.
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We also have other U.S. based research and development functions in leased offices in California, Georgia, and Massachusetts. 34 Our facilities outside of the U.S. include two Asia Pacific offices located in leased offices in Hong Kong and Japan, where we have sales, operations, and research and development functions.
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We have a leased facility with logistics operations in Taiwan, leased facilities with sales and support operations in China, Hong Kong, Japan, Korea, Switzerland, and Taiwan, and leased facilities with engineering design support operations in China, France, Germany, India, Israel, Japan, Korea, Poland, Switzerland, Taiwan and the U.K.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS We are party to various litigation matters and claims arising from time-to-time in the ordinary course of business. While the results of such matters cannot be predicted with certainty, we believe that the final outcome of such matters will not have a material adverse effect on our business, financial condition, results of operations or cash flows.
Biggest changeWhile the results of such matters cannot be predicted with certainty, we believe that the final outcome of such matters will not have a material adverse effect on our business, financial condition, results of operations or cash flows. For further information regarding current legal proceedings, see “Part II – Item 8.
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For further information regarding current legal proceedings, see Note 10, Indemnifications and Contingencies in the notes to the consolidated financial statements.
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ITEM 3. LEGAL PROCEEDINGS We are party to various litigation matters and claims arising from time to time in the ordinary course of business.
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Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 12. Commitments and Contingencies.”

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe graph assumes an investment of $100 on June 30, 2019. The calculations of cumulative stockholder return on the Nasdaq Composite Index and the Russell 2000 Index include reinvestment of dividends. The calculation of cumulative stockholder return on our common stock does not include reinvestment of dividends because we did not pay any dividends during the measurement period.
Biggest changeThe graph assumes an investment of $100 on June 30, 2020. The calculations of cumulative stockholder return on the Nasdaq Composite Index, the Russell 2000 Index and the PHLX Semiconductor Sector Index include the assumed reinvestment of any dividends.
We currently plan to retain all earnings to finance the growth of our business, make our debt payments, or purchase shares under our common stock repurchase program. Payments of any cash dividends in the future will depend on our financial condition, operating results, and capital requirements, as well as other factors deemed relevant by our Board of Directors.
We currently plan to retain all earnings to finance the growth of our business, make debt payments or purchase shares under our common stock repurchase program. Payments of any cash dividends in the future will depend on our financial condition, operating results and capital requirements as well as other factors deemed relevant by our Board of Directors.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED ST OCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information on Common Stock Our common stock has been listed on the Nasdaq Global Select Market (formerly the Nasdaq National Market) under the symbol "SYNA" since January 29, 2002. Prior to that time, there was no public market for our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information on Common Stock Our common stock has been listed on the Nasdaq Global Select Market (formerly the Nasdaq National Market) under the symbol “SYNA” since January 29, 2002. Prior to that time, there was no public market for our common stock.
Stockholders As of August 16, 2024, there were approximately 110 holders of record of our common stock. The closing price of our common stock as quoted on the Nasdaq Global Select Market, as of August 16, 2024, was $76.38. Dividends We have never declared or paid cash dividends on our common stock.
Stockholders As of August 12, 2025, there were approximately 110 holders of record of our common stock. The closing price of our common stock as quoted on the Nasdaq Global Select Market as of August 12, 2025, was $67.49. Dividends We have never declared or paid cash dividends on our common stock.
Our Credit Agreement and the indenture governing our Senior Notes also place restrictions on the payment of any dividends. For a further description of the terms of the Credit Agreement and our Senior Notes indenture, see Note 8. Debt to the consolidated financial statements contained elsewhere in this report.
Our Credit Agreement and the indenture governing our Senior Notes also place restrictions on the payment of any dividends. For a further description of the terms of the Credit Agreement and our Senior Notes indenture, see “Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 8.
The historical performance shown is not necessarily indicative of future performance. The performance graph above shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section.
Stockholders’ Equity.” 21 Table o f Con tents Share Performance Graph This performance graph shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section.
The performance graph above will not be deemed incorporated by reference into any filing of our company under the Exchange Act or the Securities Act. ITEM 6. RESERVED 37
The performance graph will not be deemed incorporated by reference into any filing of our company under the Exchange Act or the Securities Act. In fiscal 2025, the Philadelphia Semiconductor Sector Index (“PHLX”) was selected as the most appropriate comparator index for the Company based on the characteristics of its constituents.
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Stock-Based Compensation For information on securities authorized for issuance under our equity compensation plans, see Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
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Debt and Revolving Credit Facility.” Issuer Purchases of Equity Securities During fiscal year 2025, we conducted repurchases under our previously authorized stock repurchase programs. The most recent of these programs expired in July 2025.
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Issuer Purchases of Equity Securities From April 2005 through April 2023, our Board of Directors cumulatively authorized the repurchase of up to $2.3 billion for our common stock under our stock repurchase program, which expires in July 2025. As of the end of fiscal 2024, the remaining amount authorized for repurchase under our stock repurchase program was $893.9 million.
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As a result, on August 5, 2025, our Board of Directors authorized a new stock repurchase program to repurchase up to $150 million of our common stock. This program does not have an expiration date; however, the Board will periodically review the authorization to assess its continued appropriateness in light of the Company’s capital allocation priorities and market conditions.
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During the three-month period ended June 29, 2024, there were no repurchases under the stock repurchase program. 36 Performance Graph The following line graph compares cumulative total stockholder returns for the five years ended June 29, 2024 for (i) our common stock, (ii) the Nasdaq Composite Index and (iii) the Russell 2000 Index.
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Repurchases may be made in the open market or through privately negotiated transactions and are intended to comply with Rule 10b‑18 under the Exchange Act. The number of shares repurchased and the timing of repurchases depend on the level of our cash balances, general business and market conditions and other factors, including alternative investment opportunities.
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During the three-month period ended June 28, 2025, repurchases under the previously authorized stock repurchase programs were as follows: Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of shares that May Yet Be Purchased Under the Plans or Programs (1) March 30, 2025 - April 26, 2025 319,783 49.91 319,783 $ 765,642,720 April 27, 2025 - May 24, 2025 — — — $ 765,642,720 May 25, 2025 - June 28, 2025 — — — $ 765,642,720 Total 319,783 (1) The most recent of the stock repurchase program expired in July 2025.
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On August 5, 2025, the Board of Directors authorized a new stock repurchase program to repurchase up to $150.0 million of our common stock. See “Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 13.
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This will be the last year that we present the Nasdaq Composite Index in the performance graph. We operate on a 52 or 53-week fiscal year which ends on the last Saturday in June. Accordingly, the last day of our fiscal year varies.
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For consistent presentation and comparison to the industry indices shown herein, we have calculated our stock performance graph assuming a June 30 year end. The following graph shows a five-year comparison of cumulative total return on our common stock, the Philadelphia Semiconductor Sector Index, Nasdaq Composite Index and the Russell 2000 Index from June 30, 2020 through June 30, 2025.
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The calculation of cumulative stockholder return on our common stock does not include the assumed reinvestment of dividends because we did not pay any dividends during the measurement period. The historical performance shown is not necessarily indicative of future performance.
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The performance was plotted using the following data: Fiscal Years Ended Company/Index 2020 2021 2022 2023 2024 2025 Synaptics Incorporated $100 $259 $196 $142 $147 $108 PHLX Semiconductor $100 $168 $128 $184 $274 $278 NASDAQ Composite Index $100 $144 $110 $137 $176 $203 Russell 2000 Index $100 $160 $119 $131 $142 $151

Item 7. Management's Discussion & Analysis

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

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Biggest changeIf these conditions continue or worsen, they could adversely impact our future financial and operating results. 43 Results of Operations The following sets forth certain of our consolidated statements of operations data for fiscal 2024 and 2023 along with comparative information regarding the absolute and percentage changes in these amounts (in millions, except percentages): 2024 2023 $ Change % Change Enterprise and Automotive product applications $ 570.0 $ 853.7 $ (283.7 ) (33.2 %) Core IoT product applications 177.6 309.9 (132.3 ) (42.7 %) Mobile product applications 211.8 191.5 20.3 10.6 % Net revenue 959.4 1,355.1 (395.7 ) (29.2 %) Gross margin 439.8 715.9 (276.1 ) (38.6 %) Operating expenses: Research and development 336.3 351.2 (14.9 ) (4.2 %) Selling, general, and administrative 161.3 175.0 (13.7 ) (7.8 %) Acquired intangibles amortization 17.3 35.4 (18.1 ) (51.1 %) Intangible asset impairment charge 16.0 — 16.0 100.0 % Restructuring costs 10.5 — 10.5 100.0 % Operating (loss)/income (101.6 ) 154.3 (255.9 ) (165.8 %) Interest and other income 42.3 27.2 15.1 55.5 % Interest expense (65.3 ) (55.5 ) (9.8 ) (17.7 %) (Loss)/income before provision for income taxes (124.6 ) 126.0 (250.6 ) (198.9 %) (Benefit)/provision for income taxes (250.2 ) 52.4 (302.6 ) (577.5 %) Net income $ 125.6 $ 73.6 $ 52.0 70.7 % The following sets forth certain of our consolidated statements of operations data as a percentage of net revenues for fiscal 2024 and 2023: Percentage Point Increase/ 2024 2023 (Decrease) Enterprise and Automotive product applications 59.4 % 63.0 % (3.6 %) Core IoT product applications 18.5 % 22.9 % (4.4 %) Mobile product applications 22.1 % 14.1 % 8.0 % Net revenue 100.0 % 100.0 % 0.0 % Gross margin 45.8 % 52.8 % (7.0 %) Operating expenses: Research and development 35.1 % 25.9 % 9.2 % Selling, general, and administrative 16.8 % 12.9 % 3.9 % Acquired intangibles amortization 1.8 % 2.6 % (0.8 %) Intangible asset impairment charge 1.7 % 0.0 % 1.7 % Restructuring costs 1.1 % 0.0 % 1.1 % Operating (loss)/income (10.7 %) 11.4 % (22.1 %) Interest and other income 4.4 % 2.0 % 2.4 % Interest expense (6.8 %) (4.1 %) (2.7 %) (Loss)/income before provision for income taxes (13.1 %) 9.3 % (22.4 %) (Benefit)/provision for income taxes (26.1 %) 3.9 % (30.0 %) Net income 13.0 % 5.4 % 7.6 % Fiscal 2024 Compared with Fiscal 2023 Net Revenue.
Biggest changeResults of Operations The following sets forth certain of our consolidated statements of operations data for fiscal 2025 and 2024 along with comparative information regarding the absolute and percentage changes in these amounts (in millions, except percentages): 2025 % of net sales 2024 % of net sales Enterprise and Automotive product applications $ 610.1 56.8 % $ 570.0 59.4 % Core IoT product applications 272.4 25.4 % 177.6 18.5 % Mobile product applications 191.8 17.8 % 211.8 22.1 % Net revenue 1,074.3 100.0 % 959.4 100.0 % Gross margin 480.4 44.7 % 439.8 45.8 % Operating expenses: Research and development 346.8 32.3 % 336.3 35.1 % Selling, general and administrative 180.3 16.8 % 161.3 16.8 % Acquired intangibles amortization 16.7 1.5 % 17.3 1.8 % Intangible asset impairment charge 13.8 1.3 % 16.0 1.7 % Restructuring costs 16.9 1.6 % 10.5 1.1 % Total operating expenses 574.5 53.5 % 541.4 56.5 % Operating (loss)/income (94.1) (8.8 %) (101.6) (10.6 %) Interest and other income 26.9 2.5 % 42.3 4.4 % Interest expense (39.8) (3.7 %) (65.3) (6.8 %) Loss on early retirement of debt (6.5) (0.6 %) — — % (Loss)/income before provision for income taxes (113.5) (10.6 %) (124.6) (13.0 %) (Benefit)/provision for income taxes (65.7) (6.2 %) (250.2) (26.1 %) Net (loss)/income $ (47.8) (4.4) % $ 125.6 13.1 % Fiscal 2025 Compared with Fiscal 2024 Net Revenue.
The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws themselves are subject to change as a result of changes in fiscal policy, changes in legislation, and the evolution of regulations and court rulings and tax audits.
The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws themselves are subject to change as a result of changes in fiscal policy, changes in legislation and the evolution of regulations, court rulings and tax audits.
Our future capital requirements will depend on many factors, including our revenue, the timing and extent of spending to support product development efforts, costs associated with restructuring activities net of projected savings from those activities, costs related to protecting our intellectual property, the expansion of sales and marketing activities, timing of introduction of new products and enhancements to existing products, costs to ensure access to adequate manufacturing, costs of maintaining sufficient space for our workforce, the continuing market acceptance of our product solutions, our common stock repurchase program, and the amount and timing of our investments in, or acquisitions of, other technologies or companies.
Our future capital requirements will depend on many factors, including our revenue, the timing and extent of spending to support product development efforts, costs associated with restructuring activities net of projected savings from those activities, costs related to protecting our intellectual property, the expansion of sales and marketing activities, the timing of introduction of new products and enhancements to existing products, costs to ensure access to adequate manufacturing, costs of maintaining sufficient space for our workforce, the continuing market acceptance of our product solutions, our common stock repurchase program and the amount and timing of our investments in, or acquisitions of, other technologies or companies.
We estimate the fair value based upon assumptions we believe to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed.
We estimate the fair value of assets acquired and liabilities assumed based upon assumptions we believe to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed.
We believe our results to date reflect the combination of our customer focus and the strength of our intellectual property and our engineering know-how, which allow us to develop or engineer products that meet the demanding design specifications of our OEMs.
We believe our results to date reflect the combination of our customer focus and the strength of our intellectual property and our engineering know-how, which allow us to develop or engineer products and solutions that meet the demanding design specifications of our OEMs.
Working Capital Needs. We believe our existing cash and cash equivalents, anticipated cash flows from operating activities, anticipated cash flows from financing activities, and available credit under our revolving credit facility, will be sufficient to meet our working capital and other cash requirements, including small tuck-in acquisitions, and our debt service obligations for at least the next 12 months.
We believe our existing cash and cash equivalents, anticipated cash flows from operating activities and available credit under our revolving credit facility will be sufficient to meet our working capital and other cash requirements, including small tuck-in acquisitions, and our debt service obligations for at least the next 12 months.
We also record a liability and charge to cost of revenue for estimated losses on inventory we are obligated to purchase from our contract manufacturers when such losses become probable from customer delays, order cancellations, or other factors.
We also record a charge to cost of revenue for estimated losses for inventory we are obligated to purchase from our contract manufacturers when such losses become probable from customer delays, order cancellations or other factors.
Because we sell our technology solutions in designs that are generally unique or specific to an OEM customer’s application, gross margin varies on a product-by-product basis, making our cumulative gross margin a blend of our product specific designs. As a fabless manufacturer, our gross margin percentage is generally not materially impacted by our shipment volume.
Goodwill and Acquired Intangible Assets.” Because we sell our technology solutions in designs that are generally unique or specific to an OEM customer’s application, gross margin varies on a product-by-product basis, making our cumulative gross margin a blend of our product specific designs. As a fabless manufacturer, our gross margin percentage is generally not materially impacted by our shipment volume.
We consider almost all earnings of our foreign subsidiaries as not indefinitely reinvested overseas and have made appropriate provisions for income or withholding taxes, that may result from a future repatriation of those earnings. As of the end of fiscal 2024, $274.0 million of cash and cash equivalents was held by our foreign subsidiaries.
We consider almost all earnings of our foreign subsidiaries as not indefinitely reinvested overseas and have made appropriate provisions for income or withholding taxes that may result from a future repatriation of those earnings. As of the end of fiscal 2025, $341.3 million of cash and cash equivalents was held by our foreign subsidiaries.
A change in the assessment of the realizability of deferred tax assets may materially impact our tax provision in the period in which a change of assessment occurs. As a multinational corporation, we conduct our business in many countries and are subject to taxation in many jurisdictions.
A change in the assessment of the realizability of deferred tax assets may materially impact our tax provision in the period in which a change of assessment occurs. 28 Table o f Con tents As a multinational corporation, we conduct our business in many countries and are subject to taxation in many jurisdictions.
The undistributed earnings of our foreign subsidiaries are not currently required to meet our United States working capital and other cash requirements, but should we repatriate a portion of these earnings, we may be required to pay certain previously accrued state and foreign taxes, which would impact our cash flows. Contractual Obligations and Commercial Commitments.
The undistributed earnings of our foreign subsidiaries are not currently required to meet our U.S. working capital and other cash requirements, but should we repatriate a portion of these earnings, we may be required to pay certain previously accrued state and foreign taxes, which would impact our cash flows.
If these funds are needed for our operations in the U.S., we will be able to repatriate these funds without a material impact on our provision for income taxes. Cash Flows from Operating Activities. Operating activities during fiscal 2024 generated $135.9 million compared with $331.5 million net cash generated in fiscal 2023.
If these funds are needed for our operations in the United States, we will be able to repatriate these funds without a material impact on our provision for income taxes. Cash Flows from Operating Activities. Operating activities during fiscal 2025 generated $142.0 million compared with $135.9 million net cash generated in fiscal 2024.
This process involves estimating our actual tax exposure together with assessing temporary differences resulting from the differing treatment of certain items for tax return and financial statement purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheets. We recognize income taxes using an asset and liability approach.
This process involves estimating our actual tax exposure together with assessing temporary differences resulting from the differing treatment of certain items for tax return and financial statement purposes. We recognize income taxes using an asset and liability approach.
Net cash used in financing activities for fiscal 2024 was $25.1 million compared with $221.3 used in financing activities for fiscal 2023.
Net cash used in financing activities for fiscal 2025 was $331.4 million compared with $25.1 million used in financing activities for fiscal 2024.
Acquired Intangibles Amortization. Acquired intangibles amortization reflects the amortization of intangibles acquired through recent acquisitions. See Note 7. Goodwill and Acquired Intangible Assets in the notes to the consolidated financial for additional information on acquired intangibles amortization. Intangible asset impairment charge. Intangible asset impairment reflects the impairment of certain indefinite-lived intangible assets. See Note 7.
Acquired Intangibles Amortization. Acquired intangibles amortization reflects the amortization of intangibles acquired through recent acquisitions. See “Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 7. Goodwill and Acquired Intangible Assets.” Intangible asset impairment charge. Intangible asset impairment reflects the impairment of certain indefinite-lived intangible assets. See “Item 8.
We base our estimates on historical experience, applicable laws and regulations, and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the bases for making judgments about the carrying values of assets and liabilities.
The following factors influence our estimates: changes to or cancellations of customer orders, unexpected or sudden decline in demand, rapid product improvements, technological advances, and termination or changes by our OEM customers of any product offerings incorporating our product solutions. Periodically, we purchase inventory from our contract manufacturers when a customer delays its delivery schedule or cancels its order.
The following factors influence our estimates: changes to, or cancellations of, customer orders, unexpected or sudden decline in demand, rapid product improvements, technological advances and termination or changes by our OEM customers of any product offerings incorporating our product solutions.
Net cash used in investing activities for fiscal 2024 was $157.7 million compared with cash used in investing activities of $6.0 million during fiscal 2023.
Cash Flows from Investing Activities. Net cash used in investing activities for fiscal 2025 was $297.9 million compared with cash used in investing activities of $157.7 million during fiscal 2024.
These headcount-related costs included personnel in operations, research and development, and selling, general and administrative functions. Restructuring costs incurred in fiscal 2024 were $10.5 million. There were no restructuring costs incurred during fiscal 2023. See Note 16. Restructuring Activities in the notes to the consolidated financial statements for additional information on restructuring costs. Non-Operating Income. Interest and Other Income.
These headcount-related costs included personnel in operations, research and development and selling, general and administrative functions. Restructuring costs incurred in fiscal 2025 and fiscal 2024 were $16.9 million and $10.5 million, respectively. See “Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 19. Restructuring Activities.” Non-Operating Income. Interest and Other Income.
Under most circumstances, revenue from license-based arrangements are accretive to our gross margin. Operating Expenses. Research and Development Expenses. Research and development expenses decreased $14.9 million, to $336.3 million, for fiscal 2024 compared with fiscal 2023.
Under most circumstances, revenue from license-based arrangements is fully accretive to our gross margin. Operating Expenses. Research and Development Expenses. Research and development expenses increased $10.5 million, to $346.8 million, for fiscal 2025 compared with $336.3 million in fiscal 2024.
The measurement of current and deferred taxes is based on the provisions of enacted tax law and the effects of future changes in tax laws or rates are not anticipated. Taxes payable on Global Intangible Low-Taxed Income, or GILTI, inclusions in the U.S. are recognized as a current period expense when incurred.
The measurement of current and deferred taxes is based on the provisions of enacted tax law and the effects of future changes in tax laws or rates are not anticipated.
Actual results may differ from these estimates under different assumptions or conditions. The methods, estimates, interpretations, and judgments we use in applying our most critical accounting policies can have a significant impact on the results that we report in our consolidated financial statements.
The preparation of our consolidated financial statements requires us to make estimates and judgments in applying our most critical accounting policies that can have a significant impact on the results we report in our consolidated financial statements.
Trends and Uncertainties Current Economic Conditions As a majority of our sales and manufacturing occurs outside of the United States, we are exposed to and impacted by global macroeconomic factors, U.S. and foreign government policies and foreign exchange fluctuations.
Our share repurchase program expired in July 2025 and a new repurchase program of $150.0 million was authorized thereafter, with no expiration date. 23 Table o f Con tents Trends and Uncertainties Current Economic Conditions As a majority of our sales and manufacturing occurs outside of the U.S., we are exposed to and impacted by global macroeconomic factors, U.S. and foreign government policies and foreign exchange fluctuations.
Any unpaid tax liabilities, including the interest and penalties, are released pursuant to a final settlement with tax authorities, completion of audit or expiration of various statutes of limitation. The material jurisdictions in which we are subject to potential examination by tax authorities throughout the world include Japan, India, Hong Kong, United Kingdom, Israel and the United States.
The material jurisdictions in which we are subject to potential examination by tax authorities throughout the world include Japan, Hong Kong, United Kingdom, Israel and the United States.
The (benefit)/provision for income taxes of ($250.2) million and $52.4 million in fiscal 2024 and 2023, respectively, represented estimated federal, foreign, and state income taxes.
Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 8. Debt and Revolving Credit Facility.” (Benefit)/Provision for Income Taxes. The (benefit)/provision for income taxes of $(65.7) million and $(250.2) million in fiscal 2025 and 2024, respectively, represented estimated federal, foreign and state income taxes.
Of our fiscal 2024 net revenue, $177.6 million, or 18.5%, of net revenue was from Core IoT product applications market, $570.0 million, or 59.4%, of net revenue was from Enterprise and Automotive product applications, and $211.8 million, or 22.1%, of net revenue was from Mobile product applications market.
Of this net revenue, $610.1 million, or 56.8%, was from Enterprise and Automotive product applications, $272.4 million, or 25.4%, was from the Core IoT product applications market and $191.8 million, or 17.8%, was from the Mobile product applications market. Revenue increased in most of our product applications in fiscal 2025.
The valuation of intangible assets requires that we use valuation techniques such as the income approach that includes the use of a discounted cash flow model, which includes discounted cash flow scenarios and requires the following significant estimates: future expected revenue, expenses, capital expenditures and other costs, and 41 discount rates.
Items involving significant assumptions, estimates and judgments include the following: • Fair value of consideration paid or transferred and • Intangible assets, including valuation methodology such as the income approach that includes the use of a discounted cash flow model, estimates of future revenues and costs, discount and royalty rates.
Liquidity and Capital Resources Our cash and cash equivalents were $876.9 million as of the end of fiscal 2024 compared with $924.7 million as of the end of fiscal 2023, a decrease of $47.8 million. The decrease primarily reflected cash flows provided by operating activities of $135.9 million, offset by $157.7 million of cash used in investing activities.
Liquidity and Capital Resources Our cash and cash equivalents were $391.5 million as of the end of fiscal 2025 compared with $876.9 million as of the end of fiscal 2024, a decrease of $485.4 million.
Net revenue was $959.4 million for fiscal 2024 compared with $1,355.1 for fiscal 2023, a decrease of $395.7 million, or 29.2%.
Net revenue was $1,074.3 million for fiscal 2025 compared with $959.4 million for fiscal 2024, an increase of $114.9 million, or 12.0%.
The 700 basis point decrease in gross margin was primarily due to an increase in the excess obsolescence reserve and product sales mix, partially offset by an increase in revenue from the licensing of certain of our IP.
The increase in revenue from Enterprise and Automotive product applications was partially offset by a decrease of $30.0 million in revenue from the licensing of certain of our IP.
The SEC considers an entity’s most critical accounting policies to be those policies that are both most important to the portrayal of the entity’s financial condition and results of operations and those that require the entity’s most difficult, subjective, or complex judgments, often as a result of the need to make assumptions and estimates about matters that are inherently uncertain.
The SEC has defined critical accounting estimates as those that are both most important to the portrayal of our financial condition and results and which require our most difficult, complex or subjective judgments or estimates. We evaluate our estimates on an on-going basis, including those related to our revenue, inventory valuation, business combinations, goodwill and income taxes.
Goodwill and Acquired Intangible Assets in the notes to the consolidated financial statements for additional information on intangible asset impairment charge. Restructuring Costs. Restructuring costs primarily reflect employee severance costs and facilities consolidation costs related to the restructuring of operations, improve efficiencies in our operational activities and gain synergies from acquisitions.
Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 7. Goodwill and Acquired Intangible Assets.” Restructuring Costs. Restructuring costs primarily reflect employee severance costs and facilities consolidation costs related to the restructuring action we initiated in the first quarter of fiscal 2025.
We recognize revenue when control of the promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to receive in exchange for those goods or services.
Revenue recognition We recognize revenue upon the transfer of control of goods to our customers in an amount that reflects the consideration we expect to receive. Our pricing terms are negotiated independently with each customer on a stand-alone basis.
The decrease in research and development expenses primarily reflected a $12.4 million decrease in payroll related costs from restructuring actions initiated during fiscal 2024, a $6.6 million decrease in variable compensation partially offset by an increase in stock-based compensation charges of $7.9 million. Selling, General, and Administrative Expenses.
The increase in research and development expenses primarily reflected a $19.8 million increase in variable compensation related to bonus accruals and a $7.9 million increase in stock-based compensation charges primarily driven by the charges related to the awards granted to the Broadcom employees we onboarded during the third quarter of fiscal 2025.
Interest expense primarily includes interest on our debt and amortization of debt discount and issuance costs. Interest expense increased by $9.8 million to $65.3 million during fiscal 2024 as compared to $55.5 million during fiscal 2023.
Interest and other income decreased $15.4 million, to $26.9 million in fiscal 2025 compared with $42.3 million in fiscal 2024. The decrease was primarily driven by an overall decrease in our invested cash and cash equivalents of approximately $400.0 million. Interest Expense . Interest expense primarily includes interest on our debt and amortization of debt discount and issuance costs.
We estimate the amount of variable consideration for such arrangements based on the expected value to be provided to customers, and we do not believe that there will be significant changes to our estimates of variable consideration.
We estimate variable consideration based on the historical data and experience with returns, rebates and credits. We believe these amounts to be immaterial to total revenue and do not anticipate significant changes to our estimates.
The decrease in net revenue from Core IoT product applications was primarily driven by a 40.1% decrease in the units sold as well as a 4.4% decrease in average selling prices.
The increase in net revenue from Core IoT product applications was driven by an increase in units sold (which increased 40.8%) and an increase in average selling prices (which increased 8.9%) due to our product sales mix compared to the same period a year ago, inclusive of the contribution from the Broadcom transaction.
Acquisition-related expenses and related restructuring costs are recognized separately from the business combination and are expensed as incurred. Income Taxes We estimate our income taxes in each of the jurisdictions in which we operate.
Due to the subjectivity and reliance on forward-looking inputs, these acquisition-related estimates qualify as critical accounting estimates. Income Taxes We estimate our income taxes in each of the jurisdictions in which we operate.
The net change in operating assets and liabilities was primarily attributable to a $22.4 million decrease in accounts receivable primarily related to the normal variations in the timing of collections and billings, a $6.5 million decrease in gross inventories as we continue our efforts to control inventory investment while turning over the inventories we accumulated during fiscal 2023 and a $38.9 million increase in accounts payable due to the timing of payments made to our vendors, partially offset by a $18.1 million decrease in accrued compensation primarily related to the payment of our annual bonus in the first quarter of fiscal 2024 and a true-up to the bonus accrual, which will be paid in the first quarter of fiscal 2025 and a $19.1 million decrease in income taxes payable.
The primary drivers of the change in operating assets and liabilities relate to a decrease in income taxes payable primarily related to net tax payments of approximately $43.3 million made to various tax jurisdictions and an increase in net inventory of $25.1 million, related to the availability of supply and the impact of variations between forecasted and actual demand, offset by a decrease in accounts receivable of $12.3 million, primarily related to the timing of collections and billings, and an increase of $31.5 million in accrued compensation primarily related to the accrual of our annual bonus.
Selling, general, and administrative expenses decreased by $13.7 million, to $161.3 million, for fiscal 2024 compared with fiscal 2023. The decrease in selling, general, and administrative expenses primarily reflected a $12.2 million decrease in stock-based compensation charges primarily driven by the resignation of certain members of our executive team during fiscal 2024 and a $3.0 million decrease in variable compensation.
These increases were partially offset by a $16.3 million decrease in payroll related costs primarily driven by the restructuring action we initiated in the first quarter of fiscal 2025. Selling, General and Administrative Expenses. Selling, general and administrative expenses increased by $19.0 million, to $180.3 million, for fiscal 2025 compared with $161.3 million in fiscal 2024.
The decrease in net revenue from Enterprise and Automotive product applications was driven by a 22.2% decrease in the units sold as well as a decrease of 14.2% in average selling prices. The increase in mobile product applications was driven by a 57.5% increase in the units sold, partially offset by a 29.8% decrease in average selling prices.
The decrease in revenue from Mobile product applications was partially offset by an increase of $4.5 million in revenue from the licensing of certain of our IP. Gross Margin. Gross margin as a percentage of net revenue was 44.7% in fiscal 2025 compared with 45.8% in fiscal 2024.
The effective tax rate for fiscal 2024 diverged from the combined U.S. federal and state statutory tax rate primarily due to a one-time deferred tax benefit of $263.0 million arising from the domestication of certain foreign subsidiaries and the onshoring of certain intellectual property during the fourth quarter of fiscal 2024, partially offset by foreign income taxed at higher rates, the research and development capitalization rules increasing our global intangible low-taxed income, or GILTI, resulting from the U.S.
The effective tax rate for fiscal 2025 diverged from the combined U.S. federal and state statutory tax rate primarily due to a one-time tax benefit related to a U.S.
In determining the transaction price, we evaluate whether the price is subject to refund or adjustment to determine the net consideration which we expect to receive for the sale of such products.
In evaluating the transaction price, we assess whether it is subject to adjustment or refund, such as stock rotation rights, price protection or volume-based incentives, and we estimate the resulting variable consideration accordingly. Although such arrangements occur in limited circumstances, they require judgment to determine the net consideration to which we expect to be entitled.
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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward-Looking Statements and Factors That May Affect Results You should read the following discussion and analysis in conjunction with our financial statements and related notes contained elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties, and assumptions.
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Item 7. Management’s Discussion and Analysis of Financial Conditions and Results of Operations” in our fiscal 2024 Annual Report on Form 10-K for the fiscal year ended June 29, 2024. Overview We are a leading worldwide developer and fabless supplier of premium mixed signal semiconductor solutions.
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Our actual results may differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those set forth elsewhere in this report and under Item 1A. Risk Factors.
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We develop solutions that integrate the audio, touch and vision interfaces with embedded processing capabilities that are paired with wireless connectivity.
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Overview We are a leading worldwide developer and fabless supplier of premium mixed signal semiconductor solutions changing the way humans engage with connected devices and data, engineering exceptional experiences throughout the home, at work, in the car and on the go.
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In fiscal 2025, we achieved revenue growth with net revenue increasing 12% to $1,074.3 million compared to $959.4 million in fiscal 2024. The growth was primarily driven by strong execution in our Core IoT product category. Net revenue from Core IoT of $272.4 million increased by 53% compared to $177.6 million a year ago.
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Nearly all of our revenue, except an inconsequential amount, is recognized at a point in time, either on shipment or delivery of the product, depending on customer terms and conditions. Revenue recognition from the licensing of our IP is dependent on the nature and terms of each agreement.
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This growth was fueled primarily by strong demand for our wireless connectivity products and the inclusion of sales from our Broadcom transaction. Enterprise and Automotive net revenue of $610.1 million increased by 7% compared to $570.0 million a year ago.
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We recognize revenue from the licensing of our IP upon delivery of the IP if there are no substantive future obligations to perform under the arrangement.
Added
The net increase was primarily driven by growth across our enterprise product portfolio, partially offset by a decrease in automotive revenue due to softness in the automotive sector. Mobile net revenue of $191.8 million decreased by 9% compared to $211.8 million a year ago, primarily as a result of the end-of-life shipments to a large U.S. mobile customer.
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Sales-based or usage-based royalties from the license of IP are recognized at the later of the period the sale or usage occurs, or the satisfaction of the performance obligation to which some or all of the sales-based or usage-based royalties have been allocated.
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During the year, we launched multiple products expanding our product portfolios and accelerated our position in Edge AI and wireless connectivity through partnerships and licensing transactions. We are collaborating with Google’s research team to build the next-generation platform for Edge AI devices.
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Many of our customers have manufacturing operations in China, and many of our OEM customers have established design centers in Asia.
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We executed an agreement with Broadcom in the third quarter of fiscal 2025 to acquire certain assets and obtain non-exclusive licenses relating to Broadcom’s Wi-Fi technology. We acquired these set of assets in order to solidify our leadership position for end-to-end AI IoT connectivity.
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With our global presence, including offices in China, France, Germany, Hong Kong, India, Israel, Japan, Korea, Poland, Switzerland, Taiwan, the U.K., and the U.S., we are well positioned to provide local sales, operational, and engineering support services to our existing customers, as well as potential new customers, on a global basis.
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Acquiring these assets allows us to expand our portfolio of Wi-Fi 8 combination devices that include advanced Bluetooth features, additional Wi-Fi 7 combination devices, ultrawide band intellectual property (which we can integrate into future IoT devices) and combination front-end modules.
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Our manufacturing operations are based on a variable cost model in which we outsource all of our production requirements and generally drop ship our products directly to our customers from our contract manufacturers’ facilities, eliminating the need for significant capital expenditures and allowing us to minimize our investment in inventories.
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This transaction expands our field of use, allowing all our Wi-Fi products to compete in AR/VR, Android smartphones and consumer audio markets and secures our wireless roadmap for the next five years. We introduced the S3930 touch controller, featuring multi-frequency-region parallel sensing and the industry’s smallest high-performance footprint. This innovation enables consistent, low-latency touch performance in ultra-thin, bendable devices.
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This approach requires us to work closely with our contract manufacturers and semiconductor fabricators to ensure adequate production capacity to meet our forecasted volume requirements. We use third-party wafer manufacturers to supply wafers and third-party packaging manufacturers to package our proprietary ASICs.
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The new solution is more cost-effective for applications such as foldable phones and large screens. Cash, cash equivalents and short-term investments at the end of fiscal 2025 and fiscal 2024 totaled $391.5 million and $876.9 million, respectively.
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In certain cases, we rely on a single source, or a limited number of suppliers, to provide other key components of our products.
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Our net total debt outstanding at the end of fiscal 2025 was $834.8 million compared to $972.9 million at the end of fiscal 2024. We repaid our $582.0 million Term Loan Facility through a combination of a $450.0 million convertible senior note offering and balance sheet cash.
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Our cost of revenue includes all costs associated with the production of our products, including materials; logistics; amortization of intangibles related to acquired developed technology; backlog; supplier arrangements; manufacturing, assembly, royalties paid to third-party intellectual property providers and test costs paid to third-party manufacturers; and related overhead costs associated with our indirect manufacturing operations personnel.
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We executed a capped call transaction to mitigate dilution up to a stock price of $150.48. During fiscal 2025, we returned $128.3 million to shareholders through repurchase of approximately 1.8 million shares.
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Additionally, we charge all warranty costs, losses on inventory purchase obligations, and the provision for excess and obsolete inventories to cost of revenue. Our gross margin generally reflects the combination of the added value we bring to our OEM customers’ products by meeting their custom design requirements and the impact of our ongoing cost-improvement programs.
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In particular, a substantial portion of our revenue is derived from customers located in international markets, especially in the Asia-Pacific region, including China, Japan, South Korea and Taiwan, where many of our OEM customers and contract manufacturers are based.
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These cost-improvement programs include reducing materials and component costs and implementing design and process improvements. Our newly introduced products may have lower margins than our more mature products, which have realized greater benefits associated with our ongoing cost-improvement programs. As a result, new product introductions may initially negatively impact our gross margin.
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As a result, fluctuations in foreign exchange rates, especially relative to the U.S. dollar, can materially impact our reported revenue and profitability. We continue to monitor changes in international trade policies, particularly increased tariffs and other barriers or restrictions between the United States and other countries, including China.
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Our research and development expenses include costs for supplies and materials related to product development, as well as the engineering costs incurred to design ASICs and human experience solutions for OEM customers prior to and after our OEMs’ commitment to incorporate those solutions into their products.
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Our current operations suggest limited tariff exposure given our current import and export practices. However, some of our customers and suppliers may be impacted by evolving tariff regimes depending on their own supply chain strategies and sourcing locations. We continue to monitor for any potential customer and supplier impacts, ranging from supply chain realignments to changes in end demand.
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In addition, we expense in-process research and development projects acquired as part of an asset acquisition, which have not yet reached technological feasibility, and which have no foreseeable alternative future use.
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While the broader implications of these activities remain uncertain, based on our current lead times and order activity, we are not seeing unusual activity that would suggest any acceleration or delays in orders due to tariffs that would be likely to impact our near-term financial performance.
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We continue to commit to the technological and design innovation required to maintain our position in our existing markets, and to adapt our existing technologies or develop new technologies for new markets. 38 Selling, general, and administrative expenses include expenses related to sales, marketing, and administrative personnel; internal sales and outside sales representatives’ commissions; market and usability research; outside legal, accounting, and consulting costs; and other marketing and sales activities.
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We will continue to assess the short-term and long-term effects of these international trade policies and restrictions on our financial and operational performance.
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Acquired intangibles amortization, included in operating expenses, consists primarily of amortization of customer relationship and tradename intangible assets recognized under the purchase method for business combinations. Intangible asset impairment charges during fiscal 2024 were $16.0 million.
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Net revenue from Enterprise and Automotive product applications increased as a result of an increase in units sold (which increased 10.4%) and an increase in average selling prices (which increased 2.4%) due to our product sales mix compared 24 Table o f Con tents to the same period a year ago.
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During fiscal 2024, we recorded an indefinite-lived intangible asset impairment charge of $16 million on our in-process research and development, or IPR&D, from our December 2021 acquisition of DSPG. See Note 7. Goodwill and Acquired Intangible Assets in the notes to the consolidated financial statements for additional information.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+3 added−3 removed1 unchanged
Biggest changeThe sensitivity analysis disregards the possibility that U.S. dollar and other exchange rates can move in opposite directions and that gains from one currency may or may not be offset by losses from another currency.
Biggest changeThe sensitivity analysis disregards the possibility that U.S. dollar and other exchange rates can move in opposite directions and that gains from one currency may or may not be offset by losses from another currency. Interest Rate Risk on Cash and Cash Equivalents Our exposure to market risk for changes in interest rates relates primarily to our investment portfolio.
ITEM 7A. QUANTITATIVE AND QUALITAT IVE DISCLOSURES ABOUT MARKET RISK We are exposed to certain market risks in the ordinary course of our business. These risks primarily include: Foreign Currency Exchange Risk Our total net revenue for fiscal 2024 and 2023 was denominated in U.S. dollars.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to certain market risks in the ordinary course of our business. These risks primarily include: Foreign Currency Exchange Risk Our total net revenue for fiscal 2025 and 2024 was denominated in U.S. dollars.
A hypothetical weighted-average change of 10% in currency exchange rates would have changed our operating income before taxes by approximately $18.1 million and our net income by approximately $22.1 million for fiscal 2024, assuming no offsetting hedge positions. However, this quantitative measure has inherent limitations.
A hypothetical weighted-average change of 10% in currency exchange rates would have changed our operating income before taxes and our net income by approximately $20.0 million for fiscal 2025, assuming no offsetting hedge positions. However, this quantitative measure has inherent limitations.
Costs denominated in foreign currencies were approximately 17% and 13% of our total costs in fiscal 2024 and 2023, respectively. We face the risk that our accounts payable and acquisition-related liabilities denominated in foreign currencies will increase if such foreign currencies strengthen quickly and significantly against the U.S. dollar.
Costs denominated in foreign currencies were approximately 17% of our total costs in fiscal 2025 and 2024. We face the risk that our accounts payable and monetary liabilities denominated in foreign currencies will increase if such foreign currencies strengthen quickly and significantly against the U.S. dollar.
Approximately 5% and 12% of our accounts payable were denominated in foreign currencies in June 2024 and June 2023, respectively.
Approximately 3% and 5% of our accounts payable were denominated in foreign currencies as of June 2025 and June 2024, respectively.
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Interest Rate Risk on Cash, Cash Equivalents Our exposure to market risk for changes in interest rates relates primarily to our cash and cash equivalents and short-term investments. We do not use our investment portfolio for trading or other speculative purposes.
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Our investment portfolio consists of cash and cash equivalents (money market funds and short-term investments). Our primary aim with our investment portfolio is to invest available cash while preserving principal and meeting liquidity needs. Our cash equivalent investments have short-term maturity periods that mitigate the impact of market or interest rate risk.
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There have been no significant changes in the maturity dates and average interest rates for our cash equivalents subsequent to fiscal 2024. Interest Rate Risk on Debt With our outstanding debt, we are exposed to various forms of market risk, including the potential losses arising from adverse changes in interest rates on our outstanding Term Loan. See Note 8.
Added
Based on our results of operations for fiscal 2025, a hypothetical reduction in the interest rates on our cash, cash equivalents and short-term investments of a hypothetical increase or decrease of 50 basis points in rates compared to rates at the end of fiscal 2025 would result in a corresponding increase or decrease in interest income of approximately $2.0 million.
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Debt for further information. A hypothetical increase in the interest rate by 1% would result in an increase in annual interest expense by approximately $5.8 million.
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Interest Rate Risk on Debt As of June 2025, all of our outstanding long-term debt had fixed interest rates. Consequently, our exposure to market risk for changes in interest rates on reported interest expense and corresponding cash flows is minimal. 30 Table o f Con tents

Other SYNA 10-K year-over-year comparisons