Allegro MicroSystems(ALGM) - 2026 Q1 - Quarterly Report

Forward-Looking Statements Summary of Forward-Looking Statements The report contains forward-looking statements involving risks and uncertainties that may cause actual results to differ - Forward-looking statements cover future results of operations, financial position, business strategy, and prospective products[9] - Such statements are identifiable by terms like 'aim,' 'may,' 'will,' 'expect,' 'plan,' and 'anticipate'[10] - Actual results may differ materially due to factors identified in the MD&A and Risk Factors sections[11] PART I. Financial Information Item 1. Condensed Consolidated Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements for the three months ended June 27, 2025 - The accompanying unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP[29] - These interim financial statements should be read in conjunction with the 2025 Annual Report on Form 10-K[29] - The results reported are not necessarily indicative of results that may be expected for the entire year[29] Condensed Consolidated Balance Sheets Total assets, liabilities, and stockholders' equity decreased slightly from March 28, 2025, to June 27, 2025 Condensed Consolidated Balance Sheets | Metric | June 27, 2025 (in thousands) | March 28, 2025 (in thousands) | | :--- | :--- | :--- | | Total assets | $1,389,208 | $1,420,961 | | Total liabilities | $464,951 | $489,861 | | Total stockholders' equity | $924,257 | $931,100 | Condensed Consolidated Statements of Operations The company reported increased net sales and a reduced net loss for the three months ended June 27, 2025 Condensed Consolidated Statements of Operations | Metric | Three-Month Period Ended June 27, 2025 (in thousands) | Three-Month Period Ended June 28, 2024 (in thousands) | Change (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net sales | $203,405 | $166,919 | $36,486 | 21.9% | | Gross profit | $91,302 | $74,771 | $16,531 | 22.1% | | Operating loss | $(2,740) | $(10,630) | $7,890 | (74.2)% | | Net loss | $(13,162) | $(17,613) | $4,451 | (25.3)% | | Net loss attributable to Allegro MicroSystems, Inc. | $(13,227) | $(17,675) | $4,448 | (25.2)% | | Basic Net loss per common share | $(0.07) | $(0.09) | $0.02 | (22.2)% | | Diluted Net loss per common share | $(0.07) | $(0.09) | $0.02 | (22.2)% | Condensed Consolidated Statements of Comprehensive Loss Comprehensive loss improved significantly due to a positive foreign currency translation adjustment Condensed Consolidated Statements of Comprehensive Loss | Metric | Three-Month Period Ended June 27, 2025 (in thousands) | Three-Month Period Ended June 28, 2024 (in thousands) | | :--- | :--- | :--- | | Net loss | $(13,162) | $(17,613) | | Foreign currency translation adjustment, net of tax | $4,596 | $(3,188) | | Comprehensive loss | $(8,631) | $(20,863) | Condensed Consolidated Statements of Changes in Equity Total stockholders' equity decreased slightly due to net loss, partially offset by stock-based compensation Condensed Consolidated Statements of Changes in Equity | Metric | March 28, 2025 (in thousands) | June 27, 2025 (in thousands) | | :--- | :--- | :--- | | Total Stockholders' Equity | $931,100 | $924,257 | | Net loss | $(13,227) | $(13,162) | | Stock-based compensation | $10,728 | $10,734 | | Foreign currency translation adjustment | $4,579 | $4,596 | Condensed Consolidated Statements of Cash Flows The company generated significantly higher cash from operations, resulting in a net increase in cash and equivalents Condensed Consolidated Statements of Cash Flows | Metric | Three-Month Period Ended June 27, 2025 (in thousands) | Three-Month Period Ended June 28, 2024 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $61,618 | $34,196 | | Net cash used in investing activities | $(10,600) | $(10,977) | | Net cash used in financing activities | $(44,190) | $(60,378) | | Net increase (decrease) in cash and cash equivalents and restricted cash | $8,272 | $(37,984) | Notes to Unaudited Condensed Consolidated Financial Statements These notes provide essential details for the unaudited condensed consolidated financial statements - The Company is a leading global fabless manufacturer of sensing and power solutions for automotive and industrial markets[28] - The financial statements are prepared in accordance with GAAP and should be read with the annual 10-K[29] - The first quarter of fiscal year 2026 ended June 27, 2025, and the first quarter of fiscal year 2025 ended June 28, 2024[30] Note 1. Nature of the Business and Basis of Presentation Allegro MicroSystems is a global fabless manufacturer of sensing and power solutions for key growth markets - Company Profile: A leading global designer, developer, fabless manufacturer, and marketer of sensing and power solutions[28] - Fiscal Periods: First quarter of fiscal 2026 ended June 27, 2025; first quarter of fiscal 2025 ended June 28, 2024[30] Note 2. Summary of Significant Accounting Policies This note outlines key accounting policies, including the use of estimates and segment information - Use of Estimates: Management makes estimates for intangible asset valuation, goodwill, inventory, and income taxes[31] - Credit Risk: No single customer accounted for 10% or more of trade accounts receivable or total net sales[32] - Segment Information: The Company operates as one reportable segment[33] - Recent Accounting Pronouncements: ASU 2024-03 and ASU 2023-09 will be effective in future annual periods[34][35] Note 3. Revenue from Contracts with Customers Net sales grew 21.9%, driven by strong performance in Automotive and Industrial markets, particularly in Greater China Net Sales by Market (in thousands) | Market | June 27, 2025 | June 28, 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Automotive | $144,264 | $127,394 | $16,870 | 13.2% | | Industrial and other | $59,141 | $39,525 | $19,616 | 49.6% | | Total Net Sales | $203,405 | $166,919 | $36,486 | 21.9% | Net Sales by Product (in thousands) | Product | June 27, 2025 | June 28, 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Magnetic sensors | $129,166 | $115,109 | $14,057 | 12.2% | | Power integrated circuits | $74,239 | $51,810 | $22,429 | 43.3% | | Total Net Sales | $203,405 | $166,919 | $36,486 | 21.9% | Net Sales by Geography (in thousands) | Geography | June 27, 2025 | June 28, 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Americas | $32,622 | $27,491 | $5,131 | 18.7% | | EMEA (Europe) | $30,473 | $26,906 | $3,567 | 13.3% | | Asia (Greater China) | $57,569 | $31,860 | $25,709 | 80.7% | | Asia (Japan) | $33,653 | $40,643 | $(6,990) | (17.2)% | | Asia (South Korea) | $19,603 | $21,773 | $(2,170) | (10.0)% | | Asia (Other Asia) | $29,485 | $18,246 | $11,239 | 61.6% | | Total Net Sales | $203,405 | $166,919 | $36,486 | 21.9% | - An immaterial misclassification of net sales by market was identified and corrected with no impact on total net sales[38][39] Note 4. Fair Value Measurements Financial assets measured at fair value totaled $44.5 million, primarily in money market funds and time deposits Fair Value Measurement of Assets (in thousands) | Asset Category | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Money market fund deposits | $41,419 | $40,587 | | Time deposits | $3,065 | $0 | | Total Assets | $44,484 | $40,587 | - The fair value of the Company's debt was $310.4 million as of June 27, 2025, classified as Level 2[45] Note 5. Trade Accounts Receivable, net Net trade accounts receivable increased to $89.4 million as of June 27, 2025 Trade Accounts Receivable, net (in thousands) | Metric | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Trade accounts receivable | $124,038 | $119,071 | | Less: Provision for expected credit losses | $(1,192) | $(618) | | Less: Returns and sales allowances | $(33,467) | $(33,855) | | Total | $89,379 | $84,598 | Note 6. Inventories Total inventories decreased to $173.8 million, primarily due to a reduction in finished goods Inventories (in thousands) | Category | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Raw materials and supplies | $7,306 | $7,354 | | Work in process | $131,972 | $127,651 | | Finished goods | $34,518 | $48,909 | | Total | $173,796 | $183,914 | - The Company recorded inventory provisions totaling $2.9 million for the three-month period ended June 27, 2025[47] Note 7. Property, Plant and Equipment, net Net property, plant and equipment increased slightly, with $16.5 million in assets classified as held for sale Property, Plant and Equipment, net (in thousands) | Category | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Total cost | $841,831 | $828,774 | | Less accumulated depreciation | $(536,636) | $(525,855) | | Total | $305,195 | $302,919 | - Assets held for sale were measured at $16.5 million as of June 27, 2025[50] - Total depreciation expense amounted to $9.2 million for the three-month period ended June 27, 2025[48] Note 8. Goodwill and Intangible Assets Goodwill increased slightly due to foreign currency translation, while net intangible assets decreased Goodwill and Intangible Assets (in thousands) | Metric | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Goodwill | $203,328 | $202,475 | | Net Intangible assets | $256,414 | $262,115 | - Intangible assets amortization expense was $6.7 million for the three-month period ended June 27, 2025[51] Note 9. Debt and Other Borrowings Total debt decreased to $312.3 million due to repayments on the 2025 Refinanced Loans Debt Obligations (in thousands) | Metric | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Term Loan Facility | $310,000 | $345,000 | | Unamortized debt issuance costs | $(5,211) | $(6,071) | | Finance lease liabilities | $7,536 | $7,197 | | Total debt | $312,325 | $346,126 | - The Company entered into a Third Amendment for a new $375 million tranche of term loans maturing in 2030[54] - Payments totaling $35.0 million were applied to the outstanding balance of the 2025 Refinanced Loans[55] - The Company was in compliance with its debt covenants as of June 27, 2025[55][59] Note 10. Commitments and Contingencies The company is not aware of any material pending legal proceedings that could adversely affect its financial condition - An accrual for legal contingencies is recorded when a liability is probable and reasonably estimable[60] - The Company is not aware of any pending legal proceeding that could have a material adverse effect on its business[60] Note 11. Net Loss per Share Basic and diluted net loss per common share improved to $(0.07) from $(0.09) in the prior year Net Loss per Common Share (in thousands, except per share amounts) | Metric | Three-Month Period Ended June 27, 2025 | Three-Month Period Ended June 28, 2024 | | :--- | :--- | :--- | | Net loss attributable to Allegro MicroSystems, Inc. | $(13,227) | $(17,675) | | Basic net loss per common share | $(0.07) | $(0.09) | | Diluted net loss per common share | $(0.07) | $(0.09) | | Basic weighted average common shares | 184,587,027 | 193,465,708 | | Diluted weighted average common shares | 184,587,027 | 193,465,708 | - Contingently issuable shares under RSUs and PSUs were excluded from diluted EPS calculation due to their antidilutive effect[61] Note 12. Common Stock and Stock-Based Compensation Total pre-tax stock-based compensation expense increased to $10.8 million for the quarter Stock-Based Compensation Expense (in thousands) | Expense Category | Three-Month Period Ended June 27, 2025 | Three-Month Period Ended June 28, 2024 | | :--- | :--- | :--- | | Cost of goods sold | $888 | $561 | | Research and development | $2,911 | $3,735 | | Selling, general and administrative | $6,963 | $5,822 | | Total pre-tax stock-based compensation expense | $10,762 | $10,118 | - As of June 27, 2025, 3.3 million RSUs were outstanding with $80.6 million in unrecognized compensation expense[62] - As of June 27, 2025, 2.4 million PSUs were outstanding with $20.5 million in unrecognized compensation cost[63] Note 13. Income Taxes The income tax provision was $3.2 million, resulting in an effective tax rate of (31.7)% Income Tax Provision | Metric | Three-Month Period Ended June 27, 2025 | Three-Month Period Ended June 28, 2024 | | :--- | :--- | :--- | | Income tax provision | $3,169 | $1,040 | | Effective tax rate | (31.7)% | (6.3)% | - The effective income tax rate fluctuates due to the mix of U.S. and foreign income and discrete transactions[66] - The 'One Big Beautiful Bill Act' (OBBB) was enacted on July 4, 2025, with impacts not included in the current quarter's results[68] Note 14. Restructuring The company incurred $0.6 million in restructuring costs, with the January 2025 plan now materially complete - The Company incurred $0.6 million in severance and other restructuring costs during the quarter[69] - Cumulative costs associated with the January 2025 Restructuring reached $6.4 million[69] - The January 2025 restructuring is materially complete, and no additional material charges are expected[69] Note 15. Related Party Transactions The company engaged in significant share repurchases with Sanken Electric, which remains a major shareholder - The Company repurchased 38.8 million shares from Sanken Electric for an aggregate consideration of $853.8 million[70][73][74] - The share repurchase resulted in a loss of $34.8 million on the change in fair value of the forward repurchase contract[75] - As of June 27, 2025, Sanken held approximately 32.3% of the Company's outstanding common stock[77] - The Short-Term Distribution Agreement with Sanken was extended by 12 months on March 31, 2025[79] - The Company owns approximately 10.2% of Polar Semiconductor, LLC (PSL)[80] - Purchases of in-process products from PSL totaled $8.3 million for the three-month period ended June 27, 2025[82] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section analyzes financial performance, condition, and cash flows for the three months ended June 27, 2025 - This discussion should be read in conjunction with the unaudited condensed consolidated financial statements[84] - The discussion contains forward-looking statements that involve risks, uncertainties, and assumptions[85] - The Company operates on a 52- or 53-week fiscal year ending on the last Friday of March[86] Overview Allegro MicroSystems is a leading global designer of sensor and power ICs for automotive and industrial markets - Allegro MicroSystems is a leading global designer, developer, and fabless manufacturer of sensor and power ICs[87] - The Company ships over 1.5 billion units annually to more than 10,000 customers worldwide[88] - For the three-month period ended June 27, 2025, total net sales were $203.4 million and net loss was $13.2 million[88] Other Key Factors and Trends Affecting Our Operating Results Operating results are influenced by inflation, design wins, customer demand fluctuations, and industry cyclicality - Inflation has led to higher labor, material, transportation, and energy costs[89] - Future sales are highly dependent on winning new design mandates from customers[90] - Customer demand is highly dependent on end-market conditions and is subject to seasonality and cyclicality[91] - Gross margin is affected by ASPs, product mix, material costs, and manufacturing efficiencies[92] - The semiconductor industry is highly cyclical and characterized by rapid technological change[93] Results of Operations This section details financial performance, showing increased net sales and gross profit, and a reduced net loss Summary of Results of Operations (in thousands, except percentages) | Metric | June 27, 2025 | % of Net Sales | June 28, 2024 | % of Net Sales | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total net sales | $203,405 | 100.0% | $166,919 | 100.0% | $36,486 | 21.9% | | Cost of goods sold | $112,103 | 55.1% | $92,148 | 55.2% | $19,955 | 21.7% | | Gross profit | $91,302 | 44.9% | $74,771 | 44.8% | $16,531 | 22.1% | | Total operating expenses | $94,042 | 46.2% | $85,401 | 51.2% | $8,641 | 10.1% | | Operating loss | $(2,740) | (1.3)% | $(10,630) | (6.4)% | $7,890 | (74.2)% | | Loss before income taxes | $(9,993) | (4.9)% | $(16,573) | (9.9)% | $6,580 | (39.7)% | | Net loss | $(13,162) | (6.5)% | $(17,613) | (10.6)% | $4,451 | (25.3)% | Total net sales Total net sales increased by 21.9% to $203.4 million, driven by growth in data center and e-Mobility products Total Net Sales (in thousands) | Period | Amount | % Change YoY | | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $203,405 | 21.9% | | Three-Month Period Ended June 28, 2024 | $166,919 | | - The increase was primarily driven by data center applications, industrial automation, and e-Mobility products (ADAS and EV)[96] Sales Trends by Market Automotive net sales grew 13.2% and Industrial and other net sales surged by 49.6% Net Sales by Market (in thousands) | Market | June 27, 2025 | June 28, 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Automotive | $144,264 | $127,394 | $16,870 | 13.2% | | Industrial and other | $59,141 | $39,525 | $19,616 | 49.6% | | Total Net Sales | $203,405 | $166,919 | $36,486 | 21.9% | - Automotive net sales increased primarily due to an increase in e-Mobility products, including ADAS and EV[99] - Industrial and other net sales increased primarily due to demand for data center and medical applications[100] Sales Trends by Product Magnetic sensors sales increased by 12.2%, while Power integrated circuits sales grew significantly by 43.3% Net Sales by Product (in thousands) | Product | June 27, 2025 | June 28, 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Magnetic sensors ("MS") | $129,166 | $115,109 | $14,057 | 12.2% | | Power integrated circuits ("PIC") | $74,239 | $51,810 | $22,429 | 43.3% | | Total Net Sales | $203,405 | $166,919 | $36,486 | 21.9% | - The increase in MS sales was primarily due to demand for magnetic speed and TMR sensor solutions[102] - The increase in PIC sales was primarily driven by demand for motor products and high-performance power products[102] Sales Trends by Geographic Location Greater China sales surged by 80.7%, while Japan and South Korea experienced declines in net sales Net Sales by Geographic Location (in thousands) | Geography | June 27, 2025 | June 28, 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Americas | $32,622 | $27,491 | $5,131 | 18.7% | | Europe | $30,473 | $26,906 | $3,567 | 13.3% | | Greater China | $57,569 | $31,860 | $25,709 | 80.7% | | Japan | $33,653 | $40,643 | $(6,990) | (17.2)% | | South Korea | $19,603 | $21,773 | $(2,170) | (10.0)% | | Other Asia | $29,485 | $18,246 | $11,239 | 61.6% | | Total Net Sales | $203,405 | $166,919 | $36,486 | 21.9% | - Greater China net sales increased primarily driven by an increase in net sales of ADAS and EV[104] - Japan net sales declined primarily in automotive, specifically in safety, comfort, and convenience applications[104] - South Korea net sales declined in automotive, primarily in ADAS and EV[104] Cost of goods sold Cost of goods sold increased by 21.7% to $112.1 million due to higher production volume Cost of Goods Sold (in thousands) | Period | Amount | % of Net Sales | % Change YoY | | :--- | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $112,103 | 55.1% | 21.7% | | Three-Month Period Ended June 28, 2024 | $92,148 | 55.2% | | - The increase was primarily due to higher production volume in support of higher product sales[105] - The decrease as a percentage of total net sales was primarily due to the increase in production volume[105] Gross profit and gross margin Gross profit increased by 22.1% to $91.3 million, with gross margin improving slightly to 44.9% Gross Profit and Gross Margin (in thousands) | Period | Gross Profit | Gross Margin | % Change YoY (Gross Profit) | | :--- | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $91,302 | 44.9% | 22.1% | | Three-Month Period Ended June 28, 2024 | $74,771 | 44.8% | | - The increase in gross profit and gross margin was primarily due to the increase in net sales and a change in product mix[106] Research and development expenses R&D expenses increased by 2.9% to $46.5 million, primarily due to higher personnel costs Research and Development Expenses (in thousands) | Period | Amount | % of Net Sales | % Change YoY | | :--- | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $46,500 | 22.9% | 2.9% | | Three-Month Period Ended June 28, 2024 | $45,204 | 27.1% | | - R&D expenses increased primarily due to the increase of R&D personnel costs[107] - R&D expenses as a percentage of total net sales decreased primarily due to the increase in net sales[107] Selling, general and administrative expenses SG&A expenses increased by 18.3% to $47.5 million, mainly due to higher outside service and personnel costs Selling, General and Administrative Expenses (in thousands) | Period | Amount | % of Net Sales | % Change YoY | | :--- | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $47,542 | 23.4% | 18.3% | | Three-Month Period Ended June 28, 2024 | $40,197 | 24.1% | | - SG&A expenses increased primarily due to an increase in outside service and personnel costs[108] - The decrease in SG&A as a percentage of net sales was primarily due to the increase in net sales[109] Interest expense Interest expense increased by 18.3% to $6.4 million due to higher interest payments on the term loan facility Interest Expense (in thousands) | Period | Amount | % Change YoY | | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $(6,359) | 18.3% | | Three-Month Period Ended June 28, 2024 | $(5,377) | | - Interest expense increased due to higher interest payments on the Refinanced 2023 Term Loan Facility[110] Interest income Interest income decreased by 52.6% to $0.2 million, primarily due to lower cash and cash equivalent balances Interest Income (in thousands) | Period | Amount | % Change YoY | | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $234 | (52.6)% | | Three-Month Period Ended June 28, 2024 | $494 | | - Interest income decreased primarily due to lower cash and cash equivalent balances[111] Other expense, net Other expense, net, slightly increased to $1.1 million, primarily due to foreign currency losses Other Expense, Net (in thousands) | Period | Amount | % Change YoY | | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $(1,128) | 6.4% | | Three-Month Period Ended June 28, 2024 | $(1,060) | | - The foreign currency loss was primarily due to the U.S. Dollar weakening against the Euro[112] - The Company recorded a gain of $0.8 million related to its investment in marketable securities and money market funds[113] Income tax provision The income tax provision increased significantly to $3.2 million, resulting in an effective tax rate of (31.7)% Income Tax Provision (in thousands) | Period | Amount | Effective Tax Rate | % Change YoY | | :--- | :--- | :--- | :--- | | Three-Month Period Ended June 27, 2025 | $3,169 | (31.7)% | 204.7% | | Three-Month Period Ended June 28, 2024 | $1,040 | (6.3)% | | - The change in the effective tax rate results mainly from a decrease in GAAP loss before taxes and increased non-deductible items[114] Liquidity and Capital Resources The company had $129.1 million in cash and believes existing liquidity is sufficient for the next 12 months Liquidity Metrics (in thousands) | Metric | June 27, 2025 | March 28, 2025 | | :--- | :--- | :--- | | Cash and cash equivalents | $129,106 | $121,334 | | Working capital | $326,400 | $370,800 | - Primary liquidity requirements include working capital, capital expenditures, and debt payments[116] - The capital deployment strategy is to utilize cash to support growth initiatives and potential acquisitions[116] - The Company believes existing cash will be sufficient to finance operations for the next 12 months[117] Cash Flows from Operating, Investing and Financing Activities The company experienced a net increase in cash of $8.3 million, driven by strong operating cash flow Summary of Cash Flows (in thousands) | Activity | Three-Month Period Ended June 27, 2025 | Three-Month Period Ended June 28, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $61,618 | $34,196 | | Net cash used in investing activities | $(10,600) | $(10,977) | | Net cash used in financing activities | $(44,190) | $(60,378) | | Net increase (decrease) in cash and cash equivalents and restricted cash | $8,272 | $(37,984) | Operating Activities Net cash from operating activities increased to $61.6 million due to a reduced net loss and noncash charges - Net cash provided by operating activities was $61.6 million for the three-month period ended June 27, 2025[119][120] - The increase was primarily from a net loss of $(13.2) million, noncash charges of $26.2 million, and a $48.5 million decrease in net operating assets[119] Investing Activities Net cash used in investing activities was $10.6 million, consisting entirely of capital expenditures - Net cash used in investing activities was $10.6 million for the three-month period ended June 27, 2025[121] - These activities consisted solely of purchases of property, plant, and equipment[121] Financing Activities Net cash used in financing activities decreased to $44.2 million due to lower payments on term loans - Net cash used in financing activities was $44.2 million for the three-month period ended June 27, 2025[122][123] - Key uses included $35.0 million in payments on 2025 Refinanced Loans and $9.0 million for taxes related to equity awards[122] Debt Obligations This section refers to Note 9 for detailed information on the company's debt obligations - Detailed information regarding the Company's debt obligations is provided in Note 9, 'Debt and Other Borrowings'[124] Recent Accounting Pronouncements This section refers to Note 2 for a full description of recent accounting pronouncements - A full description of recent accounting pronouncements is provided in Note 2, 'Summary of Significant Accounting Policies'[125] Critical Accounting Estimates There have been no material changes in the company's critical accounting policies and estimates since March 28, 2025 - There have been no material changes in the Company's critical accounting policies and estimates since March 28, 2025[126] - Significant accounting policies are described in Note 2 of the consolidated financial statements in the 2025 Annual Report[126] Item 3. Quantitative and Qualitative Disclosures About Market Risk There have been no material changes in the company's exposures to market risk since March 28, 2025 - There have not been any material changes in the Company's exposures to market risk since March 28, 2025[127] - Details on market risks are available in the 2025 Annual Report[127] Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 27, 2025 - Management evaluated the effectiveness of disclosure controls and procedures as of June 27, 2025[129] - Disclosure controls and procedures were concluded to be effective at the reasonable assurance level[129] - There were no material changes in internal control over financial reporting during the period[130] PART II. Other Information Item 1. Legal Proceedings The company is not currently a party to any material legal proceedings - The Company is not currently party to any material legal proceedings[133] - The Company is not aware of any pending legal proceeding that could have a material adverse effect on its business[133] Item 1A. Risk Factors There have been no material changes to the risk factors previously disclosed in the 2025 Annual Report - There have been no material changes to the risk factors previously disclosed in the Company's 2025 Annual Report[134] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities or use of proceeds occurred during the reporting period - None[135] Item 5. Other Information No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter - No director or officer adopted or terminated a 'Rule 10b5-1 trading arrangement' during the three-month period ended June 27, 2025[136] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including certifications and XBRL documents - Exhibits include certifications of the Principal Executive Officer and Principal Financial Officer[138] - Includes Inline XBRL Instance Document and Taxonomy Extension Schema[138] - Lists an amendment to the Distribution Agreement with Sanken Electric Co, Ltd[138] Signatures Summary of Signatures The report is duly signed by the CEO and CFO on behalf of Allegro MicroSystems, Inc on August 1, 2025 - The report is signed by Michael C. Doogue, President and Chief Executive Officer[143] - The report is signed by Derek P. D'Antilio, Executive Vice President, Chief Financial Officer and Treasurer[143] - The signing date for the report is August 1, 2025[143]