Note 8 - Commitments and Contingencies

3 Months Ended

Mar. 31, 2025

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

8. COMMITMENTS AND CONTINGENCIES

Product Warranties and Rework

The Company generally provides either a one- or two-year warranty against defects in materials and workmanship and will repair the products, provide replacements at no charge to customers or issue a refund. As they are considered assurance-type warranties, the Company does not account for them as separate performance obligations. Historically, our warranty obligations have not been material. The Company may also incur rework costs associated with product-related claims. We accrue for warranty and rework costs upon evaluation of customer specific claims.

The changes in warranty reserves were as follows (in thousands):

	Three Months Ended March 31,
	2025			2024
Balance at beginning of period	$	5,401		$	16,906
Warranties issued		90			100
Repairs, replacement and refund		(799	)		(4,015	)
Changes in liability for pre-existing warranties		(1,167	)		(118	)
Balance at end of period	$	3,525		$	12,873

Changes in liability for pre-existing warranties result from changes in estimates for warranties issued in prior periods.

Purchase Commitments

The Company has outstanding purchase obligations with its suppliers and other parties that require the purchases of goods or services. The purchase obligations primarily consist of wafer and other inventory purchases, assembly and other manufacturing services, construction of manufacturing and R&D facilities, purchases of production and other equipment, and license arrangements.

In May 2022, the Company entered into a long-term supply agreement in order to secure manufacturing production capacity for silicon wafers over a four-year period. As of March 31, 2025, the Company had remaining prepayments under this agreement of $60.0 million reported in other current assets on the Condensed Consolidated Balance Sheets.

Total estimated future unconditional purchase commitments to all suppliers and other parties, net of the $60.0 million prepayment, as of March 31, 2025 were as follows (in thousands):

2025	$	410,273
2026		107,384
2027		28,841
Total	$	546,498

Litigation

The Company is a party to actions and proceedings in the ordinary course of business, including challenges to the enforceability or validity of its intellectual property, claims that the Company’s products infringe on the intellectual property rights of others, and employment matters. The Company has also been subject to litigation initiated by its stockholders. These proceedings often involve complex questions of fact and law and may require the expenditure of significant funds and the diversion of other resources to prosecute and defend. The Company defends itself vigorously against any such claims. As of March 31, 2025, there were no material pending legal proceedings to which the Company was a party.