Financial Performance - For the six months ended June 30, 2021, the company incurred net losses of approximately $2.6 million, with an accumulated deficit of approximately $245.2 million[75]. - Product revenue for the three months ended June 30, 2021 decreased by 39% to $1,017,000 compared to $1,679,000 in the same period of 2020[86]. - Royalty and other revenue for the three months ended June 30, 2021 decreased by 48% to $151,000 compared to $289,000 in the same period of 2020[87]. - Gross profit for the three months ended June 30, 2021 decreased by 47% to $724,000 compared to $1,364,000 in the same period of 2020[88]. Expenses - Research and development expenses for the three months ended June 30, 2021 increased by 24% to $1,222,000 compared to $985,000 in the same period of 2020[90]. - Selling, general and administrative expenses for the three months ended June 30, 2021 increased by 34% to $1,287,000 compared to $964,000 in the same period of 2020[92]. - Interest expense for the three months ended June 30, 2021, was $0, a decrease of $54, representing a 100% reduction compared to the same period in 2020[94]. - Interest expense for the six months ended June 30, 2021, was $30, down $134 or 82% from $164 in the same period in 2020[94]. Cash Flow and Financing - As of June 30, 2021, the company had cash, cash equivalents, and investments totaling $23.1 million, with working capital of $19.9 million[96]. - Net cash used in operating activities for the first six months of 2021 was $2.8 million, primarily due to a net loss of $2.6 million[97]. - Net cash used in investing activities for the six months ended June 30, 2021, was $9.6 million, representing purchases of investments[99]. - Net cash provided by financing activities for the six months ended June 30, 2021, was $20.0 million, primarily from direct offerings of common stock[100]. - The company completed two registered direct offerings generating net proceeds of approximately $18.8 million during the six months ended June 30, 2021[104]. - The company expects cash expenditures to exceed receipts in 2021, as revenues will not be sufficient to offset working capital requirements[104]. - The company had approximately $23.1 million in cash and investments and no debt as of June 30, 2021[104]. - The company has primarily financed operations through multiple offerings of common stock and asset sale transactions[75]. Future Outlook - The company expects continued negative impacts on revenues due to the COVID-19 pandemic for the remainder of 2021[79]. - The company anticipates that total research and development expenses will increase in 2021 compared to 2020 due to increased development costs for the VAE IP[91]. - The company is developing a new product line, the Virtual Accelerator Engine (VAE), which will consist of software, firmware, and IP available for license[74]. - The company does not maintain any off-balance sheet arrangements that could materially affect its financial condition[107].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 000-32929 MOSYS, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction (I.R.S. Employer of Incorpor ...

Financial Performance - The company recorded a net loss of approximately $3.8 million for the year ended December 31, 2020, with an accumulated deficit of approximately $242.7 million[75]. - The company expects a decrease in 1T-SRAM royalty revenues compared to historical results, with no guarantee that IC product revenues will replace these losses in the near future[104]. - For the year ended December 31, 2020, the company's three largest customers accounted for approximately 66% of total revenue, up from 61% in 2019, indicating high revenue concentration risks[105]. - At December 31, 2020, four customers represented 79% of total trade receivables, posing credit risks that could negatively affect cash flow and financial condition[107]. - The semiconductor industry is cyclical, and downturns can negatively impact revenue and profitability, with past downturns lasting several years[103]. - The company had over $200 million of net operating loss (NOL) carryforwards for U.S. federal tax purposes as of December 31, 2020[126]. - The company may incur additional debt in the future, which could negatively impact its financial condition if it violates terms of indebtedness[125]. Strategic Objectives - The ongoing development of the Virtual Accelerator Engine (VAE) product line is a principal strategic objective, involving significant risks and resource allocation[84]. - Future revenue growth is dependent on winning designs with existing and new customers, as well as retaining current customers[88]. - The company faces challenges in product development, manufacturing, and market acceptance, which could hinder revenue growth and strategic objectives[98]. Manufacturing and Supply Chain Risks - The company relies on TSMC for manufacturing, and any issues with yields or quality could negatively impact operating margins and customer relationships[91]. - The company relies on third-party contract manufacturers for a significant portion of revenue, and any financial difficulties faced by these manufacturers could adversely affect sales[113]. - The reliance on independent foundries and contractors for manufacturing poses risks, as any failure to deliver could damage customer relationships and sales[114]. - The company has experienced increased lead times for wafers and substrates due to COVID-19 but has managed to satisfy customer orders timely[77]. Market and Competitive Landscape - The design win process for IC products is lengthy and competitive, with no guarantee of revenue, which poses risks to the company's financial results[89]. - The lengthy sales cycle for IC products ranges from six to 24 months, making it difficult to predict revenue timing and success in the market[102]. - The company has not actively pursued new license arrangements for 1T-SRAM technologies, leading to anticipated declines in royalty revenue[104]. Intellectual Property and Employment - The company relies on a combination of patents, trademarks, and trade secret laws to protect its intellectual property rights, but existing patents may not provide sufficient protection[123]. - The company has not entered into employment agreements with key personnel, which could negatively affect technology development and strategic relationships[124]. Financial and Regulatory Risks - The company may face financial risks from future acquisitions, including increased costs and potential dilution of earnings per share[129]. - The company is subject to continued listing requirements on the Nasdaq, including a minimum stockholders' equity of $2.5 million and a market value of listed securities of at least $35 million[137]. - If the company experiences an "ownership change," it may face limitations on utilizing its NOL carryforwards, potentially resulting in substantial expirations[126]. - The company could face significant adverse consequences if it were to be delisted from the Nasdaq, including reduced liquidity of its common stock[139]. - The company’s common stock may be less attractive to investors due to its status as a "smaller reporting company," leading to reduced disclosure obligations[136]. COVID-19 Impact - The impacts of COVID-19 on operations and financial performance remain uncertain, with potential long-term effects on business continuity[76].