Financial Analysis

Commitments and Contingencies Litigation The Company is involved in various legal proceedings that have arisen in the normal course of business. While the ultimate results cannot be predicted with certainty, the Company does not expect them to have a material adverse effect on its Consolidated Financial Statements.

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Debt Credit Facility The Company and certain of its domestic subsidiaries (the Guarantors) have a $400 million revolving credit facility, as amended on June 30, 2023, with a maturity date of June 30, 2028. The credit facility includes a $25 million letter of credit sublimit and a $10 million swingline loan sublimit. The Company also has an option to increase the size of the borrowing capacity by up to the greater of an aggregate of $250 million and 100% of EBITDA of the last four fiscal quarters, plus an amount that would not cause a secured net leverage ratio (funded debt secured by assets/EBITDA) to exceed 3.50 to 1.00, subject to certain conditions. The credit facility, other than swingline loans, will bear interest at the Adjusted Term Secured Overnight Financing Rate (SOFR) plus an applicable margin or, at the option of the Company, a base rate (defined as the highest of the Wells Fargo prime rate, the Federal Funds rate plus 0.50% and the Adjusted Term SOFR plus 1.00%) plus an applicable margin. Swingline loans accrue interest at the base rate plus the applicable margin for base rate loans. The applicable margins for the Adjusted Term SOFR loans range from 1.00% to 1.75% and for base rate loans range from 0.00% to 0.75%, depending in each case, on the leverage ratio as defined in the credit facility. The credit facility contains various conditions, covenants and representations with which the Company must be in compliance in order to borrow funds and to avoid an event o …

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The following represents revenue by product category (in thousands): Year Ended January 3, 2026 December 28, 2024 December 30, 2023 Industrial & Commercial $ 444,914 $ 338,528 $ 496,578 Home & Life 339,850 245,858 285,680 $ 784,764 $ 584,386 $ 782,258 The following disaggregates the Companys revenue by sales channel (in thousands): Year Ended January 3, 2026 December 28, 2024 December 30, 2023 Distributors $ 560,335 $ 393,148 $ 611,332 Direct customers 224,429 191,238 170,926 $ 784,764 $ 584,386 $ 782,258 …

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Stock-Based Compensation The Company has two active stock plans, the 2009 Stock Incentive Plan (the 2009 Plan) and the 2009 Employee Stock Purchase Plan (the 2009 ESPP) that have been amended and approved by shareholders from time to time. The 2009 Plan allows for grants of stock options, stock appreciation rights, performance shares, performance stock units, restricted stock units (RSUs), restricted stock awards (RSAs), performance-based stock units (PSUs) and other awards (collectively, awards). All awards deduct one share from the 2009 Plan shares available for issuance for each share granted. Awards granted under the 2009 Plan contain vesting provisions mostly ranging from three to four years. To the extent awards granted under the 2009 Plan terminate, expire, or lapse for any reason, or are settled in cash, shares subject to such awards will again be available for grant. The 2009 ESPP allows eligible employees to purchase a limited number of shares of the Companys common stock at no less than 85% of the fair market value of a share of common stock at prescribed purchase intervals during an offering period. Each offering period is comprised of a series of one or more successive and/or overlapping purchase intervals and has a maximum term of 27 months. 2009 Plan The Company granted to its employees 0.8 million, 0.7 million and 0.5 million shares of full value awards from the 2009 Plan during fiscal 2025, 2024 and 2023, respectively. Full value awards include RSUs, MSUs, an …

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Fair Value of Financial Instruments The following summarizes the valuation of the Companys financial instruments (in thousands). The tables do not include either cash on hand or assets and liabilities that are measured at historical cost or any basis other than fair value. Fair Value Measurements at January 3, 2026 Using Total Description Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Cash equivalents: Money market funds $ 206,051 $ $ 206,051 Time deposit 5,595 5,595 Total cash equivalents $ 206,051 $ 5,595 $ 211,646 Short-term investments: Government debt securities $ $ 79,400 $ 79,400 Total short-term investments $ $ 79,400 $ 79,400 Total $ 206,051 $ 84,995 $ 291,046 Fair Value Measurements at December 28, 2024 Using Total Description Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Cash equivalents: Money market funds $ 188,057 $ $ 188,057 Total cash equivalents $ 188,057 $ $ 188,057 Short-term investments: Corporate debt securities $ $ 13,514 $ 13,514 Government debt securities 87,040 87,040 Total short-term investments $ $ 100,554 $ 100,554 Total $ 188,057 $ 100,554 $ 288,611 Valuation methodology The Companys cash equivalents and short-term investments that are classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; qu …

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Other Intangible Assets, Net The gross carrying amount and accumulated amortization of other intangible assets, net are as follows (in thousands): Weighted-Average Amortization Period (Years) January 3, 2026 December 28, 2024 Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Developed technology 7 $ 161,427 $ (138,297) $ 189,987 $ (153,488) Trademarks 0 910 (910) Total intangible assets 7 $ 161,427 $ (138,297) $ 190,897 $ (154,398) The following table presents details of intangible asset amortization expense recognized in the Consolidated Statements of Operations (in thousands): Year Ended January 3, 2026 December 28, 2024 December 30, 2023 Research and development $ 13,369 $ 22,996 $ 25,298 Selling, general and administrative 38 76 $ 13,369 $ 23,034 $ 25,374 The estimated aggregate amortization expense for intangible assets subject to amortization for each of the five succeeding fiscal years is as follows (in thousands): Fiscal Year 2026 $ 9,178 2027 9,178 2028 4,039 2029 735 2030 …

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Income Taxes Loss, inclusive of equity-method loss and before income taxes, includes the following components (in thousands): Year Ended January 3, 2026 December 28, 2024 December 30, 2023 Domestic $ (25,449) $ (33,032) $ (14,539) Foreign (32,463) (121,781) (12,034) $ (57,912) $ (154,813) $ (26,573) The provision for income taxes consists of the following (in thousands): Year Ended January 3, 2026 Current: Federal $ 182 State and local 86 Foreign 5,846 Total Current 6,114 Deferred: Federal 109 State and local (150) Foreign 922 Total Deferred 881 Provision for income taxes $ 6,995 Year Ended December 28, 2024 December 30, 2023 Current: Domestic $ (252) $ 3,291 Foreign 6,978 15,599 Total Current 6,726 18,890 Deferred: Domestic 29,745 (9,036) Foreign (274) (1,911) Total Deferred 29,471 (10,947) Provision for income taxes $ 36,197 $ 7,943 The reconciliation of the federal statutory tax rate to the Companys effective tax rate is as follows ($ in thousands): Year Ended January 3, 2026 U.S. federal tax at statutory rate $ (12,161) 21.0 % State and local income taxes, net of federal income tax effect (1) (64) 0.1 % Foreign tax effects: Singapore Statutory tax rate difference 2,254 (3.9) % Changes in valuation allowance 10,128 (17.5) % Effect of cross-border tax laws 652 (1.1) % Nontaxable or nondeductible items: Enhanced research deduction (1,741) 3.0 % Nondeductible amortization expense 1,230 (2.1) % Other (716) 1.2 % India Effect of cross-border tax laws 662 (1.1) % Other 1,225 (2. …

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Leases The Company leases certain facilities under operating lease agreements that expire at various dates through 2031. Some of these arrangements contain renewal options and require the Company to pay taxes, insurance and maintenance costs. Lease costs for operating leases were $7.6 million, $7.7 million and $7.8 million during fiscal 2025, 2024 and 2023, respectively. Supplemental Lease Information Balance Sheet Information (in thousands) Consolidated Balance Sheet Classification January 3, 2026 December 28, 2024 Operating lease right-of-use assets Other assets, net $ 22,866 $ 21,535 Operating lease liabilities Other current liabilities $ 6,930 $ 5,878 Operating lease liabilities Other non-current liabilities $ 17,026 $ 15,549 Year Ended Cash Flow Information (in thousands) January 3, 2026 December 28, 2024 Cash paid for operating lease liabilities $ 7,387 $ 7,883 Right-of-use assets obtained in exchange for operating lease obligations $ 7,384 $ 13,867 Operating Lease Information January 3, 2026 December 28, 2024 Weighted-average remaining lease term 4.7 years 5.3 years Weighted-average discount rate 5.17 % 4.87 % The maturities of operating lease liabilities as of January 3, 2026 were as follows (in thousands): Fiscal Year 2026 $ 7,445 2027 6,347 2028 5,233 2029 5,198 2030 5,276 Thereafter 3,230 Total lease payments 32,729 Less imputed interest (8,773) Total lease liabilities $ 23,956 Lease income The Company leases a portion of its headquarter facilities to other tenants …

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Adoption of New Accounting Standard The Company adopted FASB ASU 2023-09, Income Taxes (Topic 740)Improvements to Income Tax Disclosures on January 3, 2026 on a prospective basis. This ASU requires that reporting entities disclose specific categories in the effective tax rate reconciliation as well as information about income taxes paid. The authoritative guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The requirements of this ASU are disclosure-related and did not have an impact on the Companys consolidated financial position and results of operations. See Note 16, Income Taxes , for the updated income tax disclosures as a result of adopting this ASU. Recent Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) . This ASU requires that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. The prescribed categories include purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion. This authoritative guidance is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the effect of this new guidance on its conso …

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Employee Benefit Plan The Company maintains a defined contribution or 401(k) Plan for its qualified U.S. employees. Participants may contribute a percentage of their compensation on a pre-tax basis, subject to a maximum annual contribution imposed by the Internal Revenue Code. The Company may make discretionary matching contributions as well as discretionary profit-sharing contributions to the 401(k) Plan. The Company contributed $3.0 million, $3.0 million and $3.3 million to the 401(k) Plan during fiscal 2025, 2024 and 2023, respectively.

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Revenues The Company groups its products as Industrial & Commercial or Home & Life based on the target markets they address. The following represents revenue by product category (in thousands): Year Ended January 3, 2026 December 28, 2024 December 30, 2023 Industrial & Commercial $ 444,914 $ 338,528 $ 496,578 Home & Life 339,850 245,858 285,680 $ 784,764 $ 584,386 $ 782,258 A portion of the Companys sales are made to distributors under agreements allowing certain rights of return and/or price protection related to the final selling price to the end customers. These factors impact the timing and uncertainty of revenues and cash flows. During fiscal 2025, 2024, and 2023, the impact of revenue related to performance obligations that were satisfied in previous reporting periods was insignificant. The following disaggregates the Companys revenue by sales channel (in thousands): Year Ended January 3, 2026 December 28, 2024 December 30, 2023 Distributors $ 560,335 $ 393,148 $ 611,332 Direct customers 224,429 191,238 170,926 $ 784,764 $ 584,386 $ 782,258 …

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Segment Information The Company has one operating segment, mixed-signal analog intensive products, consisting of numerous product areas. The Companys chief operating decision maker (CODM) is its Chief Executive Officer. The CODM allocates resources and assesses performance of the business and other activities at the operating segment level. The CODM assesses performance for the operating segment and decides how to allocate resources based on net loss that is also reported on the Consolidated Statement of Operations as Consolidated Net loss. The measure of segment assets is reported on the Consolidated Balance Sheets as Total assets. The CODM uses net loss to evaluate income generated in deciding whether to reinvest profits into the segment or to use such profits for other purposes, such as for acquisitions or share repurchases. Net loss is used to monitor budget versus actual results. The CODM also uses net loss in competitive analyses by benchmarking to the Companys competitors. The competitive analysis along with the monitoring of budget versus actual results are used in assessing performance of the segment, and in establishing management and variable compensation. The Company groups its products into two categories, based on the target markets they address. See Note 13, Revenues , for a summary of the Companys revenue by product category. Revenue is attributed to a geographic area based on the shipped-to location. The following summarizes the Companys revenue by geographic …

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Significant Accounting Policies Basis of Presentation and Principles of Consolidation The Company prepares financial statements on a 52- or 53-week fiscal year that ends on the Saturday closest to December 31. Fiscal 2025, had 53 weeks with the extra week occurring in the first quarter of the year. Fiscal 2024 and 2023 had 52 weeks. Fiscal 2025, 2024, and 2023 ended on January 3, 2026, December 28, 2024, and December 30, 2023, respectively. The accompanying Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Foreign Currency Transactions The Companys foreign subsidiaries are considered to be extensions of the U.S. Company. The functional currency of the foreign subsidiaries is the U.S. dollar. Accordingly, gains and losses resulting from remeasuring transactions denominated in currencies other than U.S. dollars are included in interest income and other, net in the Consolidated Statements of Operations. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to inventories, goodwill, acquired intangible assets, other long-lived assets, revenue recogniti …

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Subsequent Events On February 4, 2026, the Company entered into an Agreement and Plan of Merger (the Merger Agreement) with Texas Instruments Incorporated, a Delaware corporation (Parent), and Caldwell Merger Corp., a Delaware corporation and wholly-owned direct subsidiary of Parent (Merger Subsidiary), pursuant to which Merger Subsidiary will merge with and into the Company (the Merger), and the Company will survive the Merger as a wholly-owned direct subsidiary of Parent. At the effective time of the Merger, each share of the Companys common stock outstanding as of immediately prior to the effective time (other than dissenting shares or any shares of the Companys common stock held by the Company as treasury stock or owned by Parent or any of the Companys or Parents subsidiaries) will be cancelled and converted into the right to receive $231.00 in cash, without interest. The transactions contemplated by the Merger Agreement were unanimously approved by the Companys board of directors, and the Merger is expected to close in the first half of 2027, subject to customary closing conditions, including approval by the Companys stockholders and the receipt of required regulatory approvals. …

SubsequentEventsTextBlock · excerpt; the full note is in the filing