SUNNYVALE, Calif.--(BUSINESS WIRE)--Alpha and Omega Semiconductor to Participate in 17th Annual CEO Investor Summit 2025. ...

PART I [Item 1. Business](index=5&type=section&id=Item%201.%20Business) AOSL is a global power semiconductor designer and supplier, integrating R&D and manufacturing for diverse markets [Forward Looking Statements](index=5&type=section&id=Forward%20Looking%20Statements) The report contains forward-looking statements subject to 'safe harbor' provisions, based on management's beliefs and assumptions, which involve known and unknown risks and uncertainties that could cause actual results to differ materially[13](index=13&type=chunk) [Overview](index=5&type=section&id=Overview) - AOSL is a designer, developer, and global supplier of approximately **2,800** power semiconductors, introducing over **100** new products in **FY25**[14](index=14&type=chunk) - The company expanded its MOSFET portfolio and developed new technologies for consumer, communications, industrial markets, IGBTs, and power ICs for PC, advanced computing, and gaming applications[15](index=15&type=chunk) - AOSL's ownership in the JV Company (Chongqing Fab) was reduced to approximately **39.2%** as of **June 30, 2025**, following an investment by a third party[17](index=17&type=chunk)[18](index=18&type=chunk) - A **$76.8 million impairment** of the equity method investment in the JV Company was recognized as of **June 30, 2025**, due to its fair value being lower than carrying value, based on an implied valuation from a planned sale of **20.3% interest for $150 million**[19](index=19&type=chunk) [Our Industry](index=6&type=section&id=Our%20industry) - The semiconductor industry is segmented into analog and digital, with analog semiconductors processing physical signals and having longer product life cycles due to design complexity[21](index=21&type=chunk)[22](index=22&type=chunk) - Power semiconductors, a subset of analog, manage and switch electricity, comprising discrete devices (MOSFETs) and integrated circuits (Power ICs)[23](index=23&type=chunk)[24](index=24&type=chunk) - Market drivers include demand for power efficiency in consumer/computing electronics (low voltage MOSFETs, Power ICs), energy conservation in AC-DC power supplies (medium/high voltage MOSFETs), and motor control in white goods/industrial applications (IGBTs)[25](index=25&type=chunk)[26](index=26&type=chunk) [Our Strategies](index=7&type=section&id=Our%20strategies) - AOSL aims to balance proprietary technology development at in-house facilities (Oregon Fab) with the use of third-party foundries to accelerate new product introduction and improve financial performance[29](index=29&type=chunk) - The company is diversifying its business beyond the Computing market into consumer, communications, and industrial sectors, while also expanding its computing business into new areas like AI[30](index=30&type=chunk) - Strategies include expanding the product portfolio to increase bill-of-materials content, leveraging power semiconductor expertise for new technology platforms, and increasing direct relationships with OEM and ODM customers, especially Tier 1[31](index=31&type=chunk)[32](index=32&type=chunk)[34](index=34&type=chunk) - AOSL maintains a strong relationship with the JV Company for foundry capacity, with a guaranteed monthly wafer production capacity[35](index=35&type=chunk) [Our Products](index=8&type=section&id=Our%20products) - AOSL's product portfolio includes power discretes (low, medium, high voltage MOSFETs, IGBTs, **1200V** SiC products) and power ICs (DrMOS, SPS, EZBuck, smart load switch, multiphase controllers)[36](index=36&type=chunk)[37](index=37&type=chunk)[38](index=38&type=chunk) - Power ICs leverage proprietary MOSFET and advanced packaging technologies for integrated solutions, offering higher power density and faster product updates[43](index=43&type=chunk) Product Families and Typical Applications | Product Family | Description | Product Categories within Product Type | Typical Application | | :--- | :--- | :--- | :--- | | Power Discretes | Low on-resistance switch used for routing current and switching voltages in power control circuits; High power switches used for power circuits | DC-DC for CPU/GPU, DC-AC conversion, AC-DC conversion, Load switching, Motor control, Battery protection, Power factor correction | Smart phone chargers, battery packs, notebooks, desktop and servers, data centers, base stations, graphics card, game boxes, TVs, AC adapters, power supplies, motor control, power tools, E-vehicles, white goods and industrial motor drives, UPS systems, solar inverters and industrial welding | | Power ICs | Integrated devices used for power management and power delivery; Analog power devices used for circuit protection and signal switching | DC-DC Buck conversion, DC-DC Boost conversion, Smart load switching, DrMOS power stage, Transient voltage protection, Analog switch, Electromagnetic interference filter | Flat panel displays, TVs, Notebooks, graphic cards, servers, AI datacenters, DVD/Blu-Ray players, set-top boxes, and networking equipment; Notebooks, desktop PCs, tablets, flat panel displays, TVs, smart phones, and portable electronic devices | [New Product Introduction](index=9&type=section&id=New%20Product%20Introduction) - In **Q4 FY25**, AOSL launched mega IPM-7 series (BLDC motor drives), AOTL66935 (**100V** AlphaSGT MOSFET for AI servers), Gen3 **1200V** αSiC MOSFETs, AMD SVI3 multiphase controller, and **25V** MOSFET in **DFN3.3x3.3** source-down packaging[46](index=46&type=chunk)[47](index=47&type=chunk) - **Q3 FY25** saw the introduction of a **16-phase** controller for AI servers/graphic cards and new advanced MOSFET package options for high-current applications[48](index=48&type=chunk) - **Q2 FY25** product releases included the AOZ23567QI EZBuck™ Regulator for Intel Arrow Lake and the AOZ73004CQI, the first **4-phase** controller for Blackwell GPUs[49](index=49&type=chunk) - **Q1 FY25** introduced the highly robust **LFPAK 5x6** package for high-reliability applications and an ideal diode protection switch for multiport USB-C applications[50](index=50&type=chunk) [Distributors and Customers](index=10&type=section&id=Distributors%20and%20customers) - AOSL maintains direct relationships with key OEMs (e.g., Dell, HP, Samsung) and ODMs (e.g., Compal, Foxconn), with most products sold through distributors[50](index=50&type=chunk)[51](index=51&type=chunk)[52](index=52&type=chunk) Revenue Contribution from Largest Distributors | Distributor | FY2025 Revenue Share | FY2024 Revenue Share | FY2023 Revenue Share | | :---------- | :------------------- | :------------------- | :------------------- | | WPG Holdings Limited | 51.3% | 46.0% | 35.6% | | Promate Electronic Co. Ltd. | 22.1% | 25.0% | 21.6% | [Sales and Marketing](index=10&type=section&id=Sales%20and%20marketing) - The marketing division identifies high-growth markets and applications, supported by field application engineers (FAEs) who provide local technical support and facilitate design-ins[53](index=53&type=chunk) - The sales team is strategically positioned globally, with offices in Asia, Europe, and the US, complemented by application centers[54](index=54&type=chunk) - The sales cycle typically ranges from **six to eighteen months**, with power discrete and Power IC products in Computing and Consumer segments having shorter cycles, while IGBT and Module products for industrial applications have longer cycles[55](index=55&type=chunk) [Competition](index=11&type=section&id=Competition) - The power semiconductor industry is highly competitive and fragmented, with major competitors including Infineon, ON Semiconductor, STMicroelectronics, Toshiba, Diodes, and Vishay for power discretes, and Monolithic Power Systems, Richtek, Semtech, and Texas Instruments for power ICs[56](index=56&type=chunk) - AOSL competes through its integrated technology platform, design capabilities, extensive patent portfolio, strategic global business model, expanding product suites, diversified customer base, and efficient time-to-market[57](index=57&type=chunk) [Seasonality](index=11&type=section&id=Seasonality) - AOSL's business is subject to seasonal fluctuations, particularly due to its involvement in consumer electronic products, with historically weaker sequential revenue growth in the March and December quarters[58](index=58&type=chunk) [Research and Development](index=12&type=section&id=Research%20and%20development) Research and Development Expenditures | Fiscal Year Ended June 30, | Expenditure (Millions USD) | | :------------------------- | :------------------------- | | **2025** | **$94.3** | | **2024** | **$89.9** | | **2023** | **$88.1** | - R&D focuses on advanced packaging technologies for smaller form factors and higher power density, specialized process technology (e.g., vertical DMOS, Shielded Gate Trench, SuperJunction, trench-stop IGBTs, BCDMOS), and new product platforms across low, medium, and high voltage power discretes, IGBT, and power ICs[61](index=61&type=chunk)[62](index=62&type=chunk)[64](index=64&type=chunk) [Operations](index=12&type=section&id=Operations) - Wafer fabrication is split between the in-house Oregon Fab (critical for proprietary technology) and third-party foundries, with third-party accounts supplying around **30%** of total wafer supply[65](index=65&type=chunk)[66](index=66&type=chunk) - Packaging and testing are primarily handled by in-house facilities in Shanghai, China, and partially by the JV Company, with additional outsourcing to subcontractors[67](index=67&type=chunk)[68](index=68&type=chunk) - In-house packaging and testing capabilities provide a competitive advantage in proprietary technology, new package introductions, cost reduction, and profit margin improvement, with a combined capacity of over **600 million parts per month**[69](index=69&type=chunk) [Quality Assurance](index=13&type=section&id=Quality%20assurance) - Manufacturing operations in China and Oregon are certified to ISO9001 and IATF16949:2016 quality management standards, and products comply with RoHS **3.0**[70](index=70&type=chunk) - A supplier management and process engineering team monitors third-party foundries and subcontractors to ensure compliance with process controls and product requirements[71](index=71&type=chunk) - Raw materials, including silicon wafers, gold, copper, and various chemicals, are sourced from numerous suppliers, with strict qualification processes[72](index=72&type=chunk) [Intellectual Property Rights](index=13&type=section&id=Intellectual%20property%20rights) - AOSL's intellectual property portfolio includes **949** issued US patents (**855** active, expiring **2025-2043**) and **961** foreign patents (expiring **2025-2043**), along with **165** pending patent applications globally[73](index=73&type=chunk)[74](index=74&type=chunk) - In **February 2023**, the company entered a license agreement for its proprietary SiC technology and engineering services for **$45.0 million**, with all revenue recognized and consideration received by **June 30, 2025**[73](index=73&type=chunk) - The company relies on patents, trademarks, copyrights, trade secret laws, and contractual provisions to protect its IP, acknowledging the risk of infringement claims as it diversifies its product portfolio[73](index=73&type=chunk)[75](index=75&type=chunk)[77](index=77&type=chunk) [Human Capital Resources](index=14&type=section&id=Human%20Capital%20Resources) - As of **June 30, 2025**, AOSL had **2,428** employees globally, with **770** in the US, **1,475** in China, and **183** elsewhere[78](index=78&type=chunk) - The company invests in employee training and development, promotes from within (over **50%** managerial positions filled internally), and fosters an open, diverse, and people-oriented culture[79](index=79&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk) - AOSL offers competitive compensation and benefits, including base salary, bonuses, an employee stock purchase plan, and long-term equity compensation, with independent consulting firms evaluating executive compensation[82](index=82&type=chunk) [Environmental Matters](index=14&type=section&id=Environmental%20matters) - AOSL's manufacturing processes generate air emissions, liquid wastes, and industrial wastes, managed by pollution control equipment and recycling systems in China and Oregon facilities[83](index=83&type=chunk) - Manufacturing facilities in China and Oregon have implemented ISO 14001 environmental management systems, and products comply with RoHS in Electrical and Electronic Equipment and QC080000 certification[85](index=85&type=chunk)[86](index=86&type=chunk) - The company has been in material compliance with applicable environmental regulations and standards, and with conflict minerals rules as of **June 30, 2025**, **2024**, and **2023**[84](index=84&type=chunk)[87](index=87&type=chunk) [Export Control](index=15&type=section&id=Export%20Control) - AOSL is subject to export and import control laws and trade regulations, and has implemented revised processes and training programs to ensure compliance[88](index=88&type=chunk) [Executive Officers](index=15&type=section&id=Executive%20Of%20icers) Executive Officers as of August 15, 2025 | Name | Age | Position | | :--- | :-- | :--- | | Stephen C. Chang | 48 | Chief Executive Officer and Director | | Mike F. Chang, Ph.D. | 80 | Chairman of the Board and Executive Vice President of Strategic Initiatives | | Yifan Liang | 61 | Chief Financial Officer and Corporate Secretary | | Wenjun Li, Ph.D. | 56 | Chief Operating Officer | | Bing Xue, Ph.D. | 61 | Executive Vice President of Worldwide Sales and Business Development | [Corporate Information](index=16&type=section&id=Corporate%20Information) - AOSL was incorporated in Bermuda on **September 27, 2000**, with its registered office in Hamilton, Bermuda, and a U.S. office in Sunnyvale, CA[95](index=95&type=chunk) [Available Information](index=16&type=section&id=Available%20Information) - SEC filings and company information are available free of charge electronically on AOSL's website (www.aosmd.com) and the SEC's website (www.sec.gov)[96](index=96&type=chunk) [Item 1A. Risk Factors](index=17&type=page&id=Item%201A.%20Risk%20Factors) AOSL faces risks from industry downturns, PC market volatility, geopolitical tensions, operational challenges, and IP disputes [Risk Factor Summary](index=17&type=section&id=Risk%20Factor%20Summary) - The summary highlights risks related to business operations, including industry downturns, PC market decline, diversification challenges, geopolitical conflicts, and operational issues[98](index=98&type=chunk) - Specific risks related to doing business in China, such as tax changes, trade tensions, and regulatory policies, are also summarized[99](index=99&type=chunk)[102](index=102&type=chunk) - Risks concerning the corporate structure and common shares, including stock price volatility and anti-takeover provisions, are noted[100](index=100&type=chunk)[102](index=102&type=chunk) [Risks Related to Our Business](index=17&type=section&id=Risks%20Related%20to%20Our%20Business) - Operating results are vulnerable to semiconductor industry downturns, end-market demand shifts, and macroeconomic trends, with the PC market decline posing a material adverse effect[100](index=100&type=chunk)[103](index=103&type=chunk) - Diversification into new market segments (consumer, communications, industrial) may not succeed as expected and could strain resources[104](index=104&type=chunk)[105](index=105&type=chunk) - Revenue can fluctuate significantly due to distributor ordering patterns, seasonality, and the inability to introduce new products or win sufficient designs in a timely manner[110](index=110&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) - Operational risks include significant fixed manufacturing costs at the Oregon Fab, potential product defects, rapid decline in average selling prices, and challenges in accurate demand forecasting[117](index=117&type=chunk)[118](index=118&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk) - Reliance on third-party foundries and the JV Company for manufacturing capacity exposes AOSL to risks of supply constraints, quality issues, and lack of control[130](index=130&type=chunk)[131](index=131&type=chunk)[134](index=134&type=chunk)[135](index=135&type=chunk) - The recent sale of equity interest in the JV Company is subject to closing conditions, and failure to meet them could adversely affect financial results and reputation[140](index=140&type=chunk) - Dependence on distributors (WPG and Promate accounted for **73.4%** of **FY25** revenue) carries risks related to inventory write-downs, price adjustments, and sales efforts[141](index=141&type=chunk)[142](index=142&type=chunk) - Cybersecurity threats and disruptions to IT systems, loss of key personnel, and failure to protect intellectual property are ongoing risks[152](index=152&type=chunk)[155](index=155&type=chunk)[156](index=156&type=chunk) [Risks Related to Doing Business in China](index=18&type=section&id=Risks%20Related%20to%20Doing%20Business%20in%20China) - AOSL is exposed to increased income taxes and changes in tax rules across multiple jurisdictions, including potential Bermuda corporate income tax from **January 1, 2025**, if revenue thresholds are met[174](index=174&type=chunk)[176](index=176&type=chunk)[180](index=180&type=chunk)[181](index=181&type=chunk) - China's economic, political, and social conditions, government policies, and evolving foreign investment laws (e.g., Foreign Investment Law, Negative List) could significantly impact business operations and growth[190](index=190&type=chunk)[191](index=191&type=chunk)[193](index=193&type=chunk)[201](index=201&type=chunk)[204](index=204&type=chunk) - Continuing trade tensions between the U.S. and China, including increased tariffs, could adversely affect supply chain, costs, product margins, and business relationships[196](index=196&type=chunk)[197](index=197&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk) - Limitations on transferring funds to and from China subsidiaries due to currency exchange controls and government restrictions on investment repatriation could impact liquidity and expansion[207](index=207&type=chunk)[208](index=208&type=chunk)[209](index=209&type=chunk)[210](index=210&type=chunk) - PRC labor laws, including the Labor Contract Law and regulations on paid annual leave, may increase employee-related costs and affect workforce management[214](index=214&type=chunk)[215](index=215&type=chunk)[216](index=216&type=chunk) - Relations between Taiwan and China could negatively affect AOSL's business due to significant customer and personnel presence in both regions[217](index=217&type=chunk) [Risks Related to Our Corporate Structure and Our Common Shares](index=18&type=section&id=Risks%20Related%20to%20Our%20Corporate%20Structure%20and%20Our%20Common%20Shares) - The company's share price may be volatile and subject to wide fluctuations due to operating results, market conditions, analyst expectations, and other factors[218](index=218&type=chunk)[219](index=219&type=chunk) - Anti-takeover provisions in the company's bye-laws could make an acquisition more difficult and prevent shareholder attempts to replace management[222](index=222&type=chunk)[223](index=223&type=chunk) - As a Bermuda company, shareholder rights under Bermuda law may differ from U.S. laws, potentially complicating enforcement of judgments[224](index=224&type=chunk) [Item 1B. Unresolved Staff Comments](index=35&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) No unresolved staff comments were reported - No unresolved staff comments were reported[226](index=226&type=chunk) [Item 1C. Cybersecurity](index=36&type=section&id=Item%201C.%20Cybersecurity) AOSL manages cybersecurity risks with technical solutions, policies, training, and board oversight, following NIST framework [Risk Management and Strategy](index=40&type=section&id=Risk%20Management%20and%20Strategy) - AOSL utilizes technical solutions, security policies, employee training, and regular security audits to manage cybersecurity threats, including advanced monitoring tools, firewalls, and encryption protocols[227](index=227&type=chunk) - The company has established incident response procedures to contain threats and restore operations, and conducts periodic risk assessments based on the NIST Cybersecurity Framework[227](index=227&type=chunk)[228](index=228&type=chunk) - Stringent processes are in place to oversee cybersecurity risks with third-party service providers, including risk assessments and compliance monitoring[229](index=229&type=chunk) [Governance](index=40&type=section&id=Governance) - The senior management team, including the cybersecurity team, is responsible for day-to-day implementation and management of cybersecurity risk processes[231](index=231&type=chunk) - The Board of Directors, through its Audit Committee and a Cybersecurity Subcommittee, provides active oversight of the company's cybersecurity risks[232](index=232&type=chunk) - The Cybersecurity Subcommittee's responsibilities include oversight of security policies, IT systems quality, incident response preparation, and public disclosures related to cybersecurity[233](index=233&type=chunk) [Item 2. Properties](index=42&type=section&id=Item%202.%20Properties) AOSL's principal properties include R&D, wafer fabrication in Oregon, and packaging/testing facilities in China Principal Properties as of July 31, 2025 | Location | Square Footage | Primary Use | | :--- | :--- | :--- | | Sunnyvale, California, USA | **57,000** | Research and development, marketing, sales and administration | | Hillsboro, Oregon, USA | **252,950** | Wafer fabrication facility | | Shanghai, China (Songjiang District) | **221,301** | Packaging and testing, manufacturing support | | Shanghai, China (Songjiang Export Process Zone) | **250,198** | Packaging and testing, manufacturing support | - All properties are leased except for the wafer fabrication facility in Hillsboro, Oregon, which was acquired in **January 2012**[234](index=234&type=chunk) [Item 3. Legal Proceedings](index=43&type=section&id=Item%203.%20Legal%20Proceedings) AOSL settled a Department of Commerce investigation for $4.25 million, with no impact on operations - AOSL reached a settlement agreement with the Department of Commerce on **July 2, 2025**, to close an administrative investigation, involving a one-time payment of **$4.25 million**[236](index=236&type=chunk) - The settlement does not impact the company's ongoing business operations[236](index=236&type=chunk) - The semiconductor industry is characterized by frequent claims and litigation, including intellectual property rights and hiring practices, which could result in significant defense costs[237](index=237&type=chunk) [Item 4. Mine Safety Disclosures](index=43&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to AOSL - Mine Safety Disclosures are not applicable to the registrant[238](index=238&type=chunk) PART II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=44&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) AOSL common shares trade on NASDAQ; no cash dividends paid, earnings retained for operations, no Q4 FY25 share repurchases [Dividend Policy](index=44&type=section&id=Dividend%20Policy) - AOSL has never declared or paid cash dividends on its common shares and intends to retain all available funds and future earnings for business operations[241](index=241&type=chunk) [Securities Authorized for Issuance Under Equity Compensation Plans](index=44&type=section&id=Securities%20Authorized%20for%20Issuance%20Under%20Equity%20Compensation%20Plans) - Information regarding securities authorized for issuance under equity compensation plans is incorporated by reference from Part III, Item 12 of this report[242](index=242&type=chunk) [Share Performance Graph](index=44&type=section&id=Share%20Performance%20Graph) - A graph compares the total cumulative shareholder return of AOSL's common shares with the NASDAQ Composite Index and the Philadelphia Semiconductor Index for the last **five fiscal years** ended **June 30, 2025**[243](index=243&type=chunk) [Purchases of Equity Securities by the Issuer and Affiliated Purchasers](index=44&type=section&id=Purchases%20of%20Equity%20Securities%20by%20the%20Issuer%20and%20Affiliated%20Purchasers) - The company did not repurchase any common shares during the **fourth quarter of FY25**[247](index=247&type=chunk) [Item 6. [Reserved]](index=45&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no content [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=46&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Revenue increased **5.9%** to **$696.2 million**, but gross margin declined to **23.1%**; significant JV impairment recorded [Overview](index=46&type=section&id=Overview) - AOSL is a global supplier of power semiconductors, including MOSFET, SiC, IGBT, IPM, TVS, HV Gate Drivers, Power IC, and Digital Power products, with approximately **2,800** products and over **100** new introductions in **FY25**[250](index=250&type=chunk) - The company's ownership in the JV Company was reduced to approximately **39.2%** as of **June 30, 2025**, following a RMB **500 million** (**$68.5 million**) investment by a third party[254](index=254&type=chunk) - AOSL entered an agreement on **July 14, 2025**, to sell an additional **20.3%** equity interest in the JV Company for **$150 million**, expected to close by end of calendar year **2025**, providing significant capital for future investments[255](index=255&type=chunk)[256](index=256&type=chunk) [Other Factors Affecting Our Performance](index=47&type=section&id=Other%20Factors%20Affecting%20Our%20Performance) - AOSL's performance is significantly impacted by global/regional economic conditions and the PC market, which accounted for approximately **46.6%** of total revenue in **FY25**[103](index=103&type=chunk)[258](index=258&type=chunk) - Gross margin is affected by manufacturing costs, facility utilization, product mix, wafer pricing from third-party foundries, and raw material costs[260](index=260&type=chunk) - The company aims to offset average selling price (ASP) erosion by introducing new, higher-value products, expanding existing products, and reducing manufacturing costs[261](index=261&type=chunk) - Success depends on timely introduction of new products that meet customer specifications, especially for Tier 1 OEMs, and managing fluctuations from distributor ordering patterns and seasonality[262](index=262&type=chunk)[263](index=263&type=chunk)[264](index=264&type=chunk) [Principal Line Items of Statements of Operations](index=48&type=section&id=Principal%20line%20items%20of%20statements%20of%20operations) - Revenue is primarily generated from power semiconductor sales (power discretes and power ICs), with a small portion from packaging and testing services and license/development services[265](index=265&type=chunk) - Revenue is reported net of estimated stock rotation returns and price adjustments provided to distributors, which are variable considerations estimated based on inventory levels, forecasted selling prices, and demand[266](index=266&type=chunk) - A **$45.0 million** SiC technology license and development agreement, entered in **February 2023**, was fully recognized by **June 30, 2025**, with **$13.8 million** recognized in **FY25**[267](index=267&type=chunk) - Cost of goods sold includes wafer, packaging, testing, personnel, and overhead costs, with the goal of improving factory utilization through market diversification and product growth[268](index=268&type=chunk) - Operating expenses (R&D, SG&A) are expected to fluctuate as a percentage of revenue, with ongoing investment in R&D for new technologies and products[269](index=269&type=chunk)[270](index=270&type=chunk) - Income tax expense involves significant judgment due to complex tax laws across multiple jurisdictions, with a valuation allowance recorded against deferred tax assets if realization is unlikely[272](index=272&type=chunk)[273](index=273&type=chunk) - The Bermuda Corporate Income Tax Act **2023**, effective **January 1, 2025**, could impose a **15%** corporate income tax if the company meets the €**750 million** annual revenue threshold[274](index=274&type=chunk)[275](index=275&type=chunk) - A **$76.8 million** other-than-temporary impairment of the equity method investment in the JV Company was recognized in **FY25** due to its fair value being lower than carrying value[281](index=281&type=chunk) [Results of Operations](index=50&type=section&id=Results%20of%20Operations) Consolidated Statements of Operations Summary (FY2025 vs FY2024) | Metric | FY2025 (Millions USD) | FY2024 (Millions USD) | Change (Millions USD) | Change (%) | | :------------------------------------------------- | :-------------------- | :-------------------- | :-------------------- | :--------- | | Revenue | $696.2 | $657.3 | $38.9 | 5.9% | | Cost of goods sold | $535.2 | $485.4 | $49.8 | 10.3% | | Gross profit | $161.0 | $171.9 | ($10.9) | (6.3)% | | Operating expenses | $189.4 | $175.7 | $13.8 | 7.8% | | Operating loss | ($28.4) | ($3.8) | ($24.7) | 657.1% | | Net loss before income taxes and equity method investment loss | ($27.8) | ($2.6) | ($25.2) | 951.7% | | Income tax expense (benefit) | ($8.6) | $3.6 | ($12.3) | (336.4)% | | Equity method investment loss | ($77.8) | ($4.8) | ($73.0) | 1524.7% | | Net loss | ($97.0) | ($11.1) | ($85.9) | 775.1% | Revenue by Product Type (FY2025 vs FY2024) | Product Type | FY2025 (Millions USD) | FY2024 (Millions USD) | Change (Millions USD) | Change (%) | | :----------------------------- | :-------------------- | :-------------------- | :-------------------- | :--------- | | Power discrete | $449.5 | $426.1 | $23.4 | 5.5% | | Power IC | $229.9 | $205.8 | $24.1 | 11.7% | | Packaging and testing services | $2.9 | $4.1 | ($1.2) | (29.9)% | | License and development services | $13.8 | $21.2 | ($7.4) | (34.8)% | | **Total Revenue** | **$696.2** | **$657.3** | **$38.9** | **5.9%** | Revenue by End Market (FY2025 vs FY2024) | End Market | FY2025 (Millions USD) | FY2024 (Millions USD) | Change (Millions USD) | Change (%) | | :------------------------ | :-------------------- | :-------------------- | :-------------------- | :--------- | | Computing | $324.1 | $282.4 | $41.7 | 14.8% | | Consumer | $102.3 | $106.4 | ($4.1) | (3.8)% | | Communication | $123.9 | $114.2 | $9.7 | 8.5% | | Power Supply and Industrial | $129.1 | $129.0 | $0.2 | 0.1% | | Packaging and testing services | $2.9 | $4.1 | ($1.2) | (29.9)% | | License and development services | $13.8 | $21.2 | ($7.4) | (34.8)% | | **Total Revenue** | **$696.2** | **$657.3** | **$38.9** | **5.9%** | - Research and development expenses increased by **$4.3 million** (**4.8%**) to **$94.3 million** in **FY25**, driven by higher share-based compensation and employee costs[288](index=288&type=chunk) - Selling, general and administrative expenses increased by **$9.4 million** (**11.0%**) to **$95.2 million** in **FY25**, primarily due to a **$4.3 million** DOC settlement fee and a **$4.2 million** increase in share-based compensation[289](index=289&type=chunk) - An impairment of **$1.0 million** related to purchased manufacturing equipment was recorded in SG&A expenses in **FY25**[289](index=289&type=chunk) - Income tax expense shifted from a **$3.6 million** expense in **FY24** to an **($8.6 million)** benefit in **FY25**, largely due to a **$12.5 million** tax benefit from the **$77.8 million** equity method investment loss[296](index=296&type=chunk) [Liquidity and Capital Resources](index=56&type=section&id=Liquidity%20and%20Capital%20Resources) - AOSL finances operations and capital expenditures through cash generated from operations and borrowings, including a **$6.5 million** outstanding debt financing for machinery and a **$20.3 million** term loan for the Oregon Fab (paid in full in **August 2025**)[299](index=299&type=chunk)[300](index=300&type=chunk)[301](index=301&type=chunk) - Chinese government currency exchange controls restrict the transfer of funds out of China, with approximately **$93.9 million** (**11.4%** of total consolidated net assets) of net assets in China subsidiaries restricted as of **June 30, 2025**[303](index=303&type=chunk)[304](index=304&type=chunk)[305](index=305&type=chunk) - The company expects to receive **$150 million** from the sale of a **20.3%** equity interest in the JV Company by the end of calendar year **2025**, with the majority (**$94 million**) in **Q1 FY26**, to be invested in technology, R&D, and asset acquisitions[306](index=306&type=chunk) Cash, Cash Equivalents and Restricted Cash | Metric | June 30, 2025 (Millions USD) | June 30, 2024 (Millions USD) | | :---------------------------------------- | :--------------------------- | :--------------------------- | | Cash, cash equivalents and restricted cash | $153.5 | $175.5 | | Net decrease | ($22.0) | ($20.1) | Cash Flows Summary | Activity | FY2025 (Millions USD) | FY2024 (Millions USD) | | :----------------------------------- | :-------------------- | :-------------------- | | Net cash provided by operating activities | $29.7 | $25.7 | | Net cash used in investing activities | ($36.4) | ($35.7) | | Net cash used in financing activities | ($15.5) | ($9.9) | [Commitments](index=58&type=section&id=Commitments) - Commitments are detailed in Note **15** of the consolidated financial statements[314](index=314&type=chunk) [Critical Accounting Estimates](index=59&type=section&id=Critical%20Accounting%20Estimates) - Key accounting estimates include reserves for stock rotation returns and price adjustments, valuation of inventories (excess and obsolete), income taxes, leases, and share-based compensation[315](index=315&type=chunk)[317](index=317&type=chunk)[318](index=318&type=chunk) - Revenue recognition involves estimating variable consideration for price adjustments based on distributor inventory, forecasted selling prices, and demand[317](index=317&type=chunk) - Inventory valuation requires assessing salability, obsolescence, historical usage, and forecasted demand, with potential for future write-downs if estimates are inaccurate[318](index=318&type=chunk) [Recently Issued Accounting Pronouncements](index=59&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) - ASU No. **2023-07**, 'Segment Reporting,' was adopted in **Q4 FY25** with no significant impact on consolidated financial statements[439](index=439&type=chunk) - ASU No. **2023-09**, 'Income Taxes,' effective for annual periods beginning after **December 15, 2024**, will enhance income tax disclosures[440](index=440&type=chunk) - ASU No. **2024-03**, 'Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures,' effective for annual periods beginning after **December 15, 2026**, will provide more detailed expense information[441](index=441&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=60&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) AOSL faces foreign currency, interest rate, and commodity price risks, with no formal hedging strategies [Foreign Currency Risk](index=60&type=section&id=Foreign%20currency%20risk) - AOSL's functional currency is the U.S. dollar, with most transactions settled in USD, but foreign currencies (primarily RMB) are needed for overseas operations[320](index=320&type=chunk) - Management believes exposure to foreign currency translation risk is not significant, based on a **10%** sensitivity analysis, due to the limited net assets denominated in foreign currencies[320](index=320&type=chunk) [Interest Rate Risk](index=60&type=section&id=Interest%20rate%20risk) - AOSL's interest-bearing assets are mainly short-term bank balances, managed with various short-term maturities[321](index=321&type=chunk) - As of **June 30, 2025**, the company had **$26.7 million** outstanding under loans and **$2.3 million** under financing leases, which are subject to interest rate fluctuations[321](index=321&type=chunk) - A hypothetical **10%** increase in the interest rate would result in an estimated **$0.1 million** in additional annual interest expense[321](index=321&type=chunk) [Commodity Price Risk](index=60&type=section&id=Commodity%20Price%20Risk) - AOSL is exposed to fluctuating market prices of commodity raw materials, particularly gold and silver, used in its manufacturing process[322](index=322&type=chunk) - A **10%** increase or decrease in the costs of these raw materials would decrease or increase current year's net earnings by **$1.0 million**, assuming no impact on selling prices[322](index=322&type=chunk) - The company does not enter into formal hedging arrangements to mitigate commodity risk[322](index=322&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=61&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) Consolidated financial statements and supplementary data are referenced in Part IV, Item 15 - Consolidated financial statements and supplementary data are filed as part of Part IV, Item **15** of this Annual Report on Form **10-K**[323](index=323&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=61&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) No changes or disagreements with accountants on financial disclosure were reported - No changes in or disagreements with accountants on accounting and financial disclosure were reported[324](index=324&type=chunk) [Item 9A. Controls and Procedures](index=61&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management and auditors affirmed effective disclosure and internal controls over financial reporting as of **June 30, 2025** [Evaluation of Disclosure Controls and Procedures](index=61&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - AOSL's management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of **June 30, 2025**, concluding they were effective[325](index=325&type=chunk)[326](index=326&type=chunk) [Management's Annual Report on Internal Control over Financial Reporting](index=61&type=section&id=Management%27s%20Annual%20Report%20on%20Internal%20Control%20over%20Financial%20Reporting) - Management is responsible for establishing and maintaining adequate internal control over financial reporting, which was assessed as effective as of **June 30, 2025**, based on the COSO **2013** framework[327](index=327&type=chunk)[328](index=328&type=chunk) - Deloitte & Touche LLP audited and expressed an unqualified opinion on the effectiveness of the company's internal control over financial reporting[329](index=329&type=chunk)[334](index=334&type=chunk)[335](index=335&type=chunk) [Changes in Internal Control Over Financial Reporting](index=61&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) - No changes materially affecting internal control over financial reporting occurred during the **fourth fiscal quarter** ended **June 30, 2025**[330](index=330&type=chunk) [Inherent Limitations on the Effectiveness of Controls](index=61&type=section&id=Inherent%20Limitations%20on%20the%20Effectiveness%20of%20Controls) - Control systems provide reasonable, not absolute, assurance and may not prevent or detect all errors and fraud due to inherent limitations[331](index=331&type=chunk)[332](index=332&type=chunk)[338](index=338&type=chunk)[339](index=339&type=chunk) [Item 9B. Other Information](index=60&type=section&id=Item%209B.%20Other%20Information) No other information is reported under this item - No other information is reported under this item[341](index=341&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.](index=60&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections.) This item is not applicable to AOSL - Disclosure regarding foreign jurisdictions that prevent inspections is not applicable to the registrant[341](index=341&type=chunk) PART III [Item 10. Directors, Executive Officers and Corporate Governance](index=61&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is referenced from the **2025** Proxy Statement - Information on directors, executive officers, Section **16** compliance, and corporate governance is incorporated by reference from Part I and the **2025** Proxy Statement[344](index=344&type=chunk) [Item 11. Executive Compensation](index=61&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation information is incorporated by reference from the **2025** Proxy Statement - Information on executive compensation is incorporated by reference from the **2025** Proxy Statement[345](index=345&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=61&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership and equity compensation plan information is incorporated by reference from the **2025** Proxy Statement - Information on security ownership of beneficial owners and management, and equity compensation plan information, is incorporated by reference from the **2025** Proxy Statement[346](index=346&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=61&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Related party transactions and director independence information is incorporated by reference from the **2025** Proxy Statement - Information on related party transactions and director independence is incorporated by reference from the **2025** Proxy Statement[347](index=347&type=chunk) [Item 14. Principal Accountant Fees and Services](index=61&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Principal accountant fees and services information is incorporated by reference from the **2025** Proxy Statement - Information on principal accountant fees and services is incorporated by reference from the **2025** Proxy Statement[348](index=348&type=chunk) PART IV [Item 15. Exhibits and Financial Statement Schedule](index=62&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedule) This section details consolidated financial statements, supplementary data, and exhibits, including auditor reports - The section includes the Report of Independent Registered Public Accounting Firm from Deloitte & Touche LLP for **FY25** and Baker Tilly US, LLP for **FY24**[351](index=351&type=chunk)[354](index=354&type=chunk)[365](index=365&type=chunk) - Consolidated financial statements include Balance Sheets, Statements of Operations, Comprehensive Income (Loss), Equity, and Cash Flows, along with accompanying notes[351](index=351&type=chunk) - Schedule II – Valuation and Qualifying accounts is also filed as part of this annual report[351](index=351&type=chunk) - A comprehensive list of exhibits, including organizational documents, agreements, and certifications, is provided[352](index=352&type=chunk)[527](index=527&type=chunk)[528](index=528&type=chunk)[529](index=529&type=chunk) [Signatures](index=111&type=section&id=Signatures) This section contains required signatures of the CEO, CFO, and directors, affirming the report filing - The report is duly signed on behalf of Alpha and Omega Semiconductor Limited by its Chief Executive Officer, Stephen C. Chang, and Chief Financial Officer, Yifan Liang, along with other directors[533](index=533&type=chunk)[534](index=534&type=chunk)[537](index=537&type=chunk)[538](index=538&type=chunk)

Core Viewpoint - AOSemi has launched the new AOZ17517QI series 60A electronic fuse, designed for optimizing server power supplies, featuring industry-leading performance and a low on-resistance of 0.65mΩ [5][6]. Group 1: Product Overview - The AOZ17517QI series electronic fuse is designed for 12V hot-swappable applications, specifically targeting the power protection needs of servers, data centers, and telecom infrastructure [6]. - The product features a compact 5mm x 5mm QFN package, enhancing system space utilization while providing efficient and reliable power management solutions [6][7]. Group 2: Technical Features - The electronic fuse continuously monitors current through an intelligent power switch, limiting current to safe levels upon detecting overload conditions, thus preventing damage to downstream loads [6][7]. - It incorporates innovative co-packaging technology, integrating high-performance control ICs with high SOA trench MOSFETs, offering superior circuit protection and power management capabilities [7]. - The device supports a wide operating voltage range of 4.5V to 20V and can withstand a maximum absolute voltage of 27V, effectively protecting against transient voltage spikes [7]. Group 3: Protection Mechanisms - The AOZ17517QI series includes multiple protection features such as overcurrent protection (OCP), short-circuit protection (SCP), undervoltage lockout (UVLO), overvoltage clamp (OVP), thermal shutdown protection (TSD), adjustable external soft start, and SOA protection during startup [7]. - The product is particularly suitable for high-reliability systems and telecom applications, where input bus protection is critical, and it replaces traditional hot-swap controllers combined with discrete FETs with advanced eFuse technology [7].

Financial Performance - Alpha and Omega Semiconductor (AOSL) reported quarterly earnings of $0.02 per share, exceeding the Zacks Consensus Estimate of a loss of $0.01 per share, and compared to earnings of $0.09 per share a year ago, representing an earnings surprise of +300.00% [1] - The company posted revenues of $176.48 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.81%, and compared to year-ago revenues of $161.3 million [2] Market Performance - Alpha and Omega shares have declined approximately 29.6% since the beginning of the year, while the S&P 500 has gained 7.1% [3] - The current consensus EPS estimate for the upcoming quarter is $0.10 on revenues of $180.8 million, and for the current fiscal year, it is $0.13 on revenues of $697 million [7] Industry Outlook - The Electronics - Semiconductors industry, to which Alpha and Omega belongs, is currently ranked in the bottom 39% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor decisions [5]

Financial Data and Key Metrics Changes - Total revenue for Q4 2025 was $176.5 million, representing a 9.4% year-over-year increase and a 7.2% sequential increase [6][16] - Non-GAAP gross margin was 24.4%, up from 22.5% in the previous quarter but down from 26.4% a year ago [17] - Non-GAAP EPS was $0.20, compared to a loss of $0.10 in the previous quarter and $0.09 a year ago [18] - Operating cash flow was negative $2.8 million, down from $7.4 million in the prior quarter [19] Business Line Data and Key Metrics Changes - Computing segment revenue increased by 29.7% year-over-year and 17.9% sequentially, accounting for 52.6% of total revenue [8] - Consumer segment revenue decreased by 5.8% year-over-year but increased by 23.9% sequentially, representing 15.1% of total revenue [10] - Communication segment revenue was down 1.7% year-over-year and 5.2% sequentially, making up 15.2% of total revenue [11] - Power supply and industrial segment revenue was up 7.3% year-over-year but down 9.8% sequentially, accounting for 16.8% of total revenue [12] Market Data and Key Metrics Changes - Strong demand in computing was driven by tariff-related pull-ins for PCs and growth in AI and graphics applications [5][6] - The consumer segment saw growth in wearables and gaming, while the communication segment faced challenges due to a decline in smartphone demand in China [10][11] - The power supply and industrial segment experienced weaker demand from power tools and e-mobility [12] Company Strategy and Development Direction - The company aims to transition from a component supplier to a total solutions provider, leveraging customer relationships to expand market share [7][14] - The strategic sale of 20.3% of its joint venture in Chongqing, China, for $150 million is expected to provide additional capital for technology investments and acquisitions [7][21] - The company is focused on execution, innovation, and delivering sustainable value amid a fluid geopolitical and macroeconomic environment [14] Management's Comments on Operating Environment and Future Outlook - Management noted uncertainties regarding the macro economy and geopolitics but expressed confidence in the company's ability to execute and grow [7][14] - The company anticipates a digestion period in the computing segment as initial demand for AI programs is absorbed, with expectations for low single-digit sequential growth in the next quarter [9] - Despite challenges, management remains optimistic about growth opportunities in AI, graphics, and other segments [14] Other Important Information - The company recorded an impairment charge of $76.8 million related to the equity investment in the Chongqing joint venture [22] - CapEx for the quarter was $14.3 million, with expectations for $11 million to $13 million in the next quarter [20][21] Q&A Session Summary Question: Can you provide more color on the computing segment and the digestion mentioned? - Management indicated that the digestion is related to initial shipments of a new AI program and that additional programs are in design to support future growth [25][27] Question: How much did AI contribute to growth this quarter? - AI and graphics together account for approximately 25% of the computing segment [30][31] Question: What are the expectations for gross margins moving forward? - Management expects gross margins to remain flat in the next quarter, reflecting a similar product mix and production level [32][36] Question: How will the $150 million cash inflow be prioritized? - The company plans to invest in business growth, technology, and potential M&A opportunities, with shareholder returns also being evaluated [39][41] Question: How does the company view internal capacity versus third-party foundries? - Management stated that they will continue to evaluate both internal production and third-party sourcing based on needs, emphasizing flexibility [45][47] Question: How are customers reacting to demand and tariffs? - Demand varies by market, with the computing segment seeing more caution due to tariffs, while AI and graphics remain strong [52][53]

[Introduction](index=1&type=section&id=1.%20Introduction) This section introduces Alpha and Omega Semiconductor (AOS) and announces its financial results for fiscal Q4 and full year 2025 [Report Announcement](index=1&type=section&id=1.1.%20Report%20Announcement) **Alpha and Omega Semiconductor Limited (AOS)** reported financial results for the fiscal fourth quarter and fiscal year ended **June 30, 2025**[1](index=1&type=chunk) [About Alpha and Omega Semiconductor](index=4&type=section&id=1.2.%20About%20Alpha%20and%20Omega%20Semiconductor) AOS is a global supplier of power semiconductor devices, including discrete power devices, wide bandgap power devices, power management ICs, and modules, leveraging integrated technology for high-performance solutions - **AOS** designs, develops, and supplies a broad range of discrete power devices, wide bandgap power devices, power management ICs, and modules[19](index=19&type=chunk) - The company's product portfolio includes **Power MOSFET, SiC, IGBT, IPM, TVS, HV Gate Drivers, Power IC, and Digital Power products**[19](index=19&type=chunk) - **AOS** differentiates itself by integrating its semiconductor process technology, product design, and advanced packaging know-how to develop high-performance power management solutions[19](index=19&type=chunk) - Target applications include personal computers, graphics cards, data centers, AI servers, smartphones, consumer and industrial motor controls, TVs, lighting, automotive electronics, and power supply units[19](index=19&type=chunk) [Fiscal Fourth Quarter 2025 Financial Performance](index=1&type=section&id=2.%20Fiscal%20Fourth%20Quarter%202025%20Financial%20Performance) AOS's fiscal Q4 2025 saw revenue growth to **$176.5 million**, with improved sequential gross margins, a higher GAAP operating loss, but a positive non-GAAP operating income and EPS [GAAP Quarterly Financial Comparison](index=1&type=section&id=2.1.%20GAAP%20Quarterly%20Financial%20Comparison) In Q4 Fiscal Year 2025, AOS reported revenue of $176.5 million, with a GAAP gross margin of 23.4%, recording a GAAP operating loss of $11.6 million and a net loss of $77.1 million, resulting in a diluted net loss per share of $2.58 GAAP Quarterly Financial Comparison | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Revenue | $176.5M | $164.6M | $161.3M | | Gross Margin | 23.4% | 21.4% | 25.7% | | Operating Loss | $(11.6)M | $(10.7)M | $(1.5)M | | Net Loss | $(77.1)M | $(10.8)M | $(2.7)M | | Net Loss Per Share - Diluted | $(2.58) | $(0.37) | $(0.09) | [Non-GAAP Quarterly Financial Comparison](index=1&type=section&id=2.2.%20Non-GAAP%20Quarterly%20Financial%20Comparison) For Q4 Fiscal Year 2025, AOS's non-GAAP results showed revenue of $176.5 million and a non-GAAP gross margin of 24.4%, achieving a non-GAAP operating income of $2.3 million and a non-GAAP net income of $0.7 million, leading to a diluted non-GAAP net income per share of $0.02 Non-GAAP Quarterly Financial Comparison | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Revenue | $176.5M | $164.6M | $161.3M | | Non-GAAP Gross Margin | 24.4% | 22.5% | 26.4% | | Non-GAAP Operating Income (Loss) | $2.3M | $(2.7)M | $3.2M | | Non-GAAP Net Income (Loss) | $0.7M | $(2.9)M | $2.6M | | Non-GAAP Net Income (Loss) Per Share - Diluted | $0.02 | $(0.10) | $0.09 | [Key Financial Highlights (Q4 2025)](index=2&type=section&id=2.3.%20Key%20Financial%20Highlights%20%28Q4%202025%29) AOS's fiscal Q4 2025 revenue reached **$176.5 million**, showing growth, with GAAP gross margin at **23.4%** and non-GAAP at **24.4%**, leading to a substantial GAAP net loss but positive non-GAAP EPS - **Revenue was $176.5 million**, an increase of **9.4% year-over-year** and **7.2% quarter-over-quarter**[11](index=11&type=chunk) - **GAAP gross margin was 23.4%**, down from **25.7% year-over-year** but up from **21.4% quarter-over-quarter**[11](index=11&type=chunk) - **Non-GAAP gross margin was 24.4%**, down from **26.4% year-over-year** but up from **22.5% quarter-over-quarter**[11](index=11&type=chunk) - **GAAP operating loss was $11.6 million**, increasing from **$1.5 million year-over-year** and **$10.7 million quarter-over-quarter**[11](index=11&type=chunk) - **Non-GAAP operating income was $2.3 million**, compared to **$3.2 million year-over-year** and an operating loss of **$2.7 million quarter-over-quarter**[11](index=11&type=chunk) - **GAAP net loss per share was $2.58**, compared to **$0.37** in the prior quarter and **$0.09 year-over-year**[11](index=11&type=chunk) - **Non-GAAP earnings per share was $0.02**, compared to a **$0.10 net loss per share** in the prior quarter and **$0.09 net earnings per share year-over-year**[11](index=11&type=chunk) [Management Commentary on Q4 Results](index=3&type=section&id=2.4.%20Management%20Commentary%20on%20Q4%20Results) CEO Stephen Chang highlighted that Q4 results met the high-end of guidance, driven by strong performance in Computing, with record A.I. and graphics revenue, and PC-related pull-ins due to tariff uncertainties, alongside continued momentum in wearables - Fiscal **Q4 results were at the high-end of guidance**, driven by strength in Computing, with **record A.I. and graphics revenue**[12](index=12&type=chunk) - **PC-related pull-ins**, a result of tariff uncertainties, also contributed to Q4 performance[12](index=12&type=chunk) - **Continued momentum in wearables** further supported the strong results[12](index=12&type=chunk) - The CEO underscored the company's ability to execute in a dynamic environment and the growing impact of its total solutions strategy across high-performance applications[12](index=12&type=chunk) [Fiscal Year 2025 Financial Performance](index=2&type=section&id=3.%20Fiscal%20Year%202025%20Financial%20Performance) AOS's fiscal year 2025 saw revenue growth to **$696.2 million**, but a significant increase in GAAP operating and net losses, while non-GAAP metrics remained positive but declined [GAAP Annual Financial Comparison](index=2&type=section&id=3.1.%20GAAP%20Annual%20Financial%20Comparison) For the fiscal year ended June 30, 2025, AOS reported revenue of $696.2 million, an increase from the prior year, but GAAP gross margin declined to 23.1%, and the company experienced a significant increase in operating loss to $28.4 million and net loss to $97.0 million, resulting in a diluted net loss per share of $3.30 GAAP Annual Financial Comparison | Metric | Year Ended June 30, 2025 | Year Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $696.2M | $657.3M | | Gross Margin | 23.1% | 26.2% | | Operating Loss | $(28.4)M | $(3.8)M | | Net Loss | $(97.0)M | $(11.1)M | | Net Loss Per Share - Diluted | $(3.30) | $(0.39) | [Non-GAAP Annual Financial Comparison](index=2&type=section&id=3.2.%20Non-GAAP%20Annual%20Financial%20Comparison) In fiscal year 2025, AOS's non-GAAP revenue was $696.2 million, with a non-GAAP gross margin of 24.2% and non-GAAP operating income of $10.4 million, leading to a non-GAAP net income of $7.0 million and diluted non-GAAP net income per share of $0.22 Non-GAAP Annual Financial Comparison | Metric | Year Ended June 30, 2025 | Year Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $696.2M | $657.3M | | Non-GAAP Gross Margin | 24.2% | 27.2% | | Non-GAAP Operating Income | $10.4M | $21.7M | | Non-GAAP Net Income | $7.0M | $18.5M | | Non-GAAP Net Income Per Share - Diluted | $0.22 | $0.62 | [Business Outlook for Fiscal Q1 2026](index=3&type=section&id=4.%20Business%20Outlook%20for%20Fiscal%20Q1%202026) AOS projects continued revenue growth for Fiscal Q1 2026, driven by seasonal strength and stable demand, with specific financial guidance provided for key metrics [Management Outlook](index=3&type=section&id=4.1.%20Management%20Outlook) Management anticipates continued growth in the September quarter, driven by seasonal strength in Communications and stable demand in PCs and wearables, positioning AOS for long-term growth despite macroeconomic uncertainties - Anticipates **continued growth in the September quarter**, led by seasonal strength in Communications and steady demand in PCs and wearables[12](index=12&type=chunk) - Despite macroeconomic and geopolitical uncertainties, **AOS is positioned for long-term growth** through **differentiated technology**, **broadening product portfolio**, and **deepening customer relationships**[12](index=12&type=chunk) [Financial Guidance](index=3&type=section&id=4.2.%20Financial%20Guidance) For Fiscal Q1 ending September 30, 2025, AOS projects revenue to be approximately $183 million, with GAAP gross margin around 23.8% and non-GAAP gross margin around 24.4%, alongside specific operating expense and tax expense ranges Financial Guidance for Fiscal Q1 Ending September 30, 2025 | Metric | Guidance for Fiscal Q1 Ending September 30, 2025 | | :--- | :--- | | Revenue | $183 million (plus or minus $10 million) | | GAAP Gross Margin | 23.8% (plus or minus 1%) | | Non-GAAP Gross Margin | 24.4% (plus or minus 1%) | | GAAP Operating Expenses | $47.5 million (plus or minus $1 million) | | Non-GAAP Operating Expenses | $41.0 million (plus or minus $1 million) | | Interest Income vs. Expense | Interest income expected to be $0.5 million higher than interest expense | | Tax Expense | $1.0 million to $1.3 million | [Consolidated Financial Statements (GAAP)](index=5&type=section&id=5.%20Consolidated%20Financial%20Statements%20%28GAAP%29) The GAAP consolidated financial statements provide detailed breakdowns of AOS's operations, balance sheet, and cash flows for fiscal year 2025, highlighting significant losses and asset changes [Condensed Consolidated Statements of Operations](index=5&type=section&id=5.1.%20Condensed%20Consolidated%20Statements%20of%20Operations) The condensed consolidated statements of operations show a fiscal year 2025 revenue of $696.2 million, with a GAAP gross margin of 23.1%, and a significant operating loss of $28.4 million and net loss of $97.0 million for the year, largely impacted by an impairment of equity method investment Condensed Consolidated Statements of Operations (in thousands) | Metric | Q4 2025 (3 Months) | FY 2025 (Year) | FY 2024 (Year) | | :--- | :--- | :--- | :--- | | Revenue | $176,484 | $696,162 | $657,274 | | Cost of goods sold | $135,194 | $535,158 | $485,356 | | Gross profit | $41,290 | $161,004 | $171,918 | | Gross margin | 23.4% | 23.1% | 26.2% | | Total operating expenses | $52,908 | $189,440 | $175,674 | | Operating loss | $(11,618) | $(28,436) | $(3,756) | | Impairment of equity method investment | $(76,784) | $(76,784) | — | | Net loss | $(77,059) | $(96,976) | $(11,081) | | Diluted Net loss per common share | $(2.58) | $(3.30) | $(0.39) | [Condensed Consolidated Balance Sheets](index=6&type=section&id=5.2.%20Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, AOS reported total assets of $1,032.7 million, a decrease from the prior year, primarily due to a reduction in cash and cash equivalents and equity method investment, with total liabilities also decreasing to $210.4 million and total shareholders' equity at $822.3 million Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $153,079 | $175,127 | | Accounts receivable, net | $34,772 | $12,546 | | Inventories | $189,677 | $195,750 | | Total current assets | $394,551 | $398,001 | | Property, plant and equipment, net | $314,097 | $336,619 | | Equity method investment | $279,122 | $356,039 | | Total assets | $1,032,692 | $1,145,013 | | Total current liabilities | $152,896 | $154,233 | | Total liabilities | $210,360 | $253,406 | | Total shareholders' equity | $822,332 | $891,607 | [Selected Cash Flow Information](index=7&type=section&id=5.3.%20Selected%20Cash%20Flow%20Information) For fiscal year 2025, AOS generated $29.7 million in net cash from operating activities, an increase from the prior year, but used $36.4 million in investing activities and $15.5 million in financing activities, resulting in a net decrease in cash, cash equivalents, and restricted cash of $22.0 million Selected Cash Flow Information (in thousands) | Metric | Fiscal Year Ended June 30, 2025 | Fiscal Year Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $29,668 | $25,710 | | Net cash used in investing activities | $(36,441) | $(35,744) | | Net cash used in financing activities | $(15,496) | $(9,903) | | Net decrease in cash, cash equivalents and restricted cash | $(22,042) | $(20,063) | | Cash, cash equivalents and restricted cash at end of year | $153,498 | $175,540 | - **Consolidated cash flow used in operating activities was $2.8 million in Q4 2025**, compared to **$7.4 million provided in the prior quarter**[16](index=16&type=chunk) - The Company closed Q4 2025 with **$153.1 million of cash and cash equivalents**[16](index=16&type=chunk) [Non-GAAP Financial Measures and Reconciliation](index=4&type=section&id=6.%20Non-GAAP%20Financial%20Measures%20and%20Reconciliation) This section details AOS's use of non-GAAP financial measures and provides comprehensive reconciliations to their GAAP equivalents for historical periods and future outlook [Use of Non-GAAP Financial Measures](index=4&type=section&id=6.1.%20Use%20of%20Non-GAAP%20Financial%20Measures) AOS utilizes non-GAAP financial measures to supplement its GAAP consolidated financial statements, excluding specific items not indicative of core operating results to provide a clearer view for internal performance comparison and external benchmarking - **Non-GAAP measures** (gross profit, gross margin, operating expenses, operating income/loss, net income/loss, diluted EPS, EBITDAS) are used to supplement GAAP statements[18](index=18&type=chunk) - These measures **exclude items** such as share-based compensation, legal and professional fees related to government investigation, amortization of purchased intangibles, impairment of long-lived assets, and equity method investment loss/income[18](index=18&type=chunk) - The purpose is to provide useful information to management and investors by excluding items not indicative of core operating results or normal business operations, aiding in performance comparison and benchmarking[18](index=18&type=chunk) - A **detailed reconciliation of GAAP and non-GAAP measures** is provided to address limitations and ensure transparency[18](index=18&type=chunk) [Reconciliation of GAAP to Non-GAAP Financial Measures (Historical)](index=9&type=section&id=6.2.%20Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures%20%28Historical%29) The reconciliation tables detail adjustments made to GAAP figures to arrive at non-GAAP results for both quarterly and annual periods, significantly impacting gross profit, operating income, and net income, providing a different perspective on the company's underlying operational performance Non-GAAP Gross Profit Reconciliation (in thousands) | Metric | Q4 2025 | Q3 2025 | Q4 2024 | FY 2025 | FY 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP gross profit | $41,290 | $35,177 | $41,437 | $161,004 | $171,918 | | Share-based compensation | $1,039 | $1,047 | $294 | $4,224 | $3,434 | | Amortization of purchased intangible | $811 | $812 | $812 | $3,247 | $3,247 | | **Non-GAAP gross profit** | **$43,140** | **$37,036** | **$42,543** | **$168,475** | **$178,599** | | **Non-GAAP gross margin %** | **24.4%** | **22.5%** | **26.4%** | **24.2%** | **27.2%** | Non-GAAP Operating Income (Loss) Reconciliation (in thousands) | Metric | Q4 2025 | Q3 2025 | Q4 2024 | FY 2025 | FY 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP operating loss | $(11,618) | $(10,658) | $(1,499) | $(28,436) | $(3,756) | | Share-based compensation | $7,581 | $7,136 | $3,567 | $29,569 | $21,641 | | Amortization of purchased intangible | $811 | $812 | $812 | $3,247 | $3,247 | | Settlement and legal costs | $4,461 | $54 | $352 | $4,977 | $524 | | Impairment of long-lived assets | $1,045 | — | — | $1,045 | — | | **Non-GAAP operating income (loss)** | **$2,280** | **$(2,656)** | **$3,232** | **$10,402** | **$21,656** | | **Non-GAAP operating margin %** | **1.3%** | **(1.6)%** | **2.0%** | **1.5%** | **3.3%** | Non-GAAP Net Income (Loss) Reconciliation (in thousands) | Metric | Q4 2025 | Q3 2025 | Q4 2024 | FY 2025 | FY 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP net loss | $(77,059) | $(10,807) | $(2,732) | $(96,976) | $(11,081) | | Share-based compensation | $7,581 | $7,136 | $3,567 | $29,569 | $21,641 | | Amortization of purchased intangible | $811 | $812 | $812 | $3,247 | $3,247 | | Impairment of equity method investment | $76,784 | — | — | $76,784 | — | | Income tax effect of non-GAAP adjustments | $(12,584) | $148 | $(78) | $(12,670) | $(627) | | **Non-GAAP net income (loss)** | **$737** | **$(2,902)** | **$2,625** | **$6,997** | **$18,493** | | **Non-GAAP diluted net income (loss) per share** | **$0.02** | **$(0.10)** | **$0.09** | **$0.22** | **$0.62** | [Reconciliation of GAAP to Non-GAAP Outlook (Q1 2026)](index=11&type=section&id=6.3.%20Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Outlook%20%28Q1%202026%29) For the fiscal Q1 2026 outlook, AOS provides a reconciliation for gross margin and operating expenses, where non-GAAP figures are derived by adjusting GAAP numbers for estimated share-based compensation expense Reconciliation of GAAP to Non-GAAP Outlook for Fiscal Q1 Ending September 30, 2025 (in millions, except percentages) | Metric | Value | | :--- | :--- | | GAAP gross margin | 23.8% | | Estimated impact of share-based compensation expense | 0.6% | | **Non-GAAP gross margin** | **24.4%** | | GAAP operating expenses | $47.5 | | Estimated stock-based compensation expense | $(6.5) | | **Non-GAAP operating expenses** | **$41.0** | [Additional Information](index=3&type=section&id=7.%20Additional%20Information) This section provides details on the investor conference call, forward-looking statement disclaimers, and contact information for inquiries [Conference Call and Webcast](index=3&type=section&id=7.1.%20Conference%20Call%20and%20Webcast) AOS hosted an investor teleconference and live webcast on August 6, 2025, to discuss the financial results for the fiscal fourth quarter and full fiscal year ended June 30, 2025, with access details provided for the live call and webcast replay - **AOS held an investor teleconference and live webcast on August 6, 2025**, to discuss **fiscal Q4 and full fiscal year 2025 financial results**[14](index=14&type=chunk) - Access details for the live conference call (dial-in numbers and access code) and webcast (Company's investor relations website) were provided[14](index=14&type=chunk) - A webcast replay and management's prepared remarks were made available on the investor relations website[14](index=14&type=chunk) [Forward-Looking Statements](index=3&type=section&id=7.2.%20Forward-Looking%20Statements) This press release contains forward-looking statements based on management's current expectations, estimates, forecasts, and projections, which involve risks and uncertainties that could cause actual results to differ materially, and AOS disclaims any obligation to update such information - The press release includes **forward-looking statements** based on management's current expectations, estimates, forecasts, and projections[15](index=15&type=chunk) - These statements involve **risks and uncertainties** that may cause actual results to differ materially, such as the state of the semiconductor industry, decline of PC markets, and geopolitical uncertainties[15](index=15&type=chunk) - Other risks include difficulties in executing diversification strategy, changes in regulatory environment (tariffs), and the ability to introduce new products[15](index=15&type=chunk) - **AOS undertakes no duty to update** such information, except as required by applicable law[15](index=15&type=chunk) [Investor and Media Inquiries](index=4&type=section&id=7.3.%20Investor%20and%20Media%20Inquiries) Contact information for investor and media inquiries is provided through The Blueshirt Group, with specific contacts Gary Dvorchak and Steven Pelayo - Investor and media inquiries can be directed to **The Blueshirt Group**, with contacts **Gary Dvorchak and Steven Pelayo**[21](index=21&type=chunk)

Core Viewpoint - Alpha and Omega Semiconductor (AOS) has agreed to sell 20.3% of its joint venture in Chongqing, China for $150 million in cash, with the transaction expected to complete by the end of 2025. This move is aimed at reinvesting in talent, tools, and intellectual property to expand its product portfolio while maintaining its manufacturing capabilities and protecting proprietary technology [3][4]. Group 1: Company Overview - AOS, founded in 2000 and headquartered in Silicon Valley, is a semiconductor company involved in the design, wafer manufacturing, and packaging/testing of power semiconductor devices. It has R&D centers in the U.S., Taiwan, and Shanghai, with production bases in the U.S., Shanghai, and Chongqing [4][5]. - The Chongqing facility, established in April 2016, is the first 12-inch power semiconductor chip manufacturing and packaging/testing base in China and the second globally. The total investment for this project was $1 billion [4][5]. Group 2: Joint Venture and Production Capacity - The Chongqing joint venture, which AOS holds a 39.2% stake in, has a monthly production capacity of approximately 10,000 12-inch wafers and nearly 400 million power devices for packaging and testing. Future plans include increasing the capacity to 50,000 wafers and 1.25 billion devices per month within 3-5 years [6][7]. - The facility has developed advanced manufacturing and packaging/testing technologies for power semiconductor products, including MOSFETs and IGBTs, which are widely used in consumer, industrial, and automotive applications [5][6]. Group 3: Regulatory Issues - AOS has agreed to pay $4.25 million to settle allegations of violating export regulations by shipping goods to Huawei without authorization in 2019. This settlement concludes a five-year investigation by the U.S. government, which did not result in any criminal charges [8][9]. - The company has emphasized its commitment to compliance with regulatory requirements and has strengthened its processes to ensure ongoing adherence to export control regulations [9][10].

Company Overview - Alpha and Omega Semiconductor (AOSL) is positioning itself as an emerging total solution provider in a market exceeding $70 billion[5,48] - The company aims for consistent execution to approach its target model[5,48] Market and Growth Drivers - The power semiconductor market is large and growing[6], with a total addressable market (SAM) exceeding $10 billion in growth areas[20] - Computing accounts for 40% of focused markets, followed by Consumer at 24%, Power Supply/Industrial at 18%, and Communications at 15%[25] - The company is targeting $1 billion in revenue by CY2025/2026[21,45] Financial Performance - Revenue for the December quarter of 2023 is guided at $165 million[34] - Non-GAAP EPS for the December quarter of 2023 is projected at $0.15[35] - The company's target model includes a gross margin exceeding 30% and operating expenses around 20%[45] Joint Venture - The Chongqing JV has a total capitalization of $428 million, with AOS holding a 42.2% equity interest[41] - A sale of 2.1% JV equity interest was completed for $16.9 million, implying a valuation exceeding $800 million for the JV[42]

Group 1 - Alpha and Omega Semiconductor (AOS) has experienced a significant decline in its fortunes recently, indicating potential challenges in the power semiconductor industry [1] - The company is a supplier of a diverse range of devices for the power semiconductor sector, which suggests its role in a critical industry [1] Group 2 - The article reflects an alternative viewpoint on the company's current situation, suggesting that there may be differing opinions on its performance and future prospects [1]

Technical Analysis - Alpha and Omega Semiconductor (AOSL) has recently reached a key level of support and has overtaken the 50-day moving average, indicating a short-term bullish trend [1] - The 50-day simple moving average is a significant technical indicator that helps identify support or resistance levels for securities [1] Performance Metrics - AOSL has moved 13% higher over the last four weeks, suggesting potential for further gains [2] - The company currently holds a Zacks Rank 3 (Hold), indicating a neutral outlook [2] Earnings Estimates - There have been 2 positive earnings estimate revisions for AOSL for the current fiscal year, with no downward revisions, leading to an upward movement in the consensus estimate [2][3] - The combination of positive earnings estimate revisions and favorable technical indicators suggests that AOSL may experience additional gains in the near future [3]