SIGNIFICANT CUSTOMERS AND GEOGRAPHIC NET REVENUES

9 Months Ended

Sep. 30, 2024

SIGNIFICANT CUSTOMERS AND GEOGRAPHIC NET REVENUES

SIGNIFICANT CUSTOMERS AND GEOGRAPHIC NET REVENUES

8. SIGNIFICANT CUSTOMERS AND GEOGRAPHIC NET REVENUES:

Segment Reporting

The Company is organized and operates as one reportable segment, the design, development, manufacture and marketing of integrated circuits and related components for use primarily in the high-voltage power-conversion market. The Company’s chief operating decision maker, the Chief Executive Officer, reviews financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance.

Customer Concentration

The Company’s top ten customers accounted for approximately 78% of net revenues for both the three and nine months ended September 30, 2024, and 83% and 81% in the corresponding periods of 2023. A significant portion of these revenues are attributable to sales of the Company’s products to distributors of electronic components. These distributors sell the Company’s products to a broad, diverse range of end users, including original equipment manufacturers (“OEMs”) and merchant power-supply manufacturers. Similarly, merchant power-supply manufacturers sell power supplies incorporating the Company’s products to a broad range of OEMs. Sales to distributors were $80.5 million and

$220.4 million in the three and nine months ended September 30, 2024, respectively, and $93.2 million and $238.7 million in the corresponding periods of 2023. Direct sales to OEMs and power-supply manufacturers accounted for the remainder.

The following customers represented 10% or more of the Company’s net revenues for the respective periods:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
Customer	2024		2023		2024		2023
Avnet	31	%	28	%	30	%	26	%
Honestar Technologies Co., Ltd.	10	%	23	%	11	%	17	%
Salcomp Group	*		*		*		11	%

* Total customer revenue was less than 10% of net revenues.

No other customers accounted for 10% or more of the Company’s net revenues in the periods presented.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash investments and trade receivables. The Company does not have any off-balance-sheet credit exposure related to its customers.

As of September 30, 2024 and December 31, 2023, 84% and 86% of accounts receivable were concentrated with the Company’s top ten customers.

The following customers represented 10% or more of accounts receivable at September 30, 2024 and December 31, 2023:

	September 30,		December 31,
Customer	2024		2023
Avnet	33	%	39	%
Salcomp Group	12	%	10	%
Flextronics Group	10	%	*
Honestar Technologies Co., Ltd.	*		20	%

* Total customer accounts receivable was less than 10% of accounts receivable.

No other customers accounted for 10% or more of the Company’s accounts receivable in the periods presented.

Geographic Net Revenues

The Company markets its products globally through its sales personnel and a worldwide network of independent sales representatives and distributors. Geographic net revenues by region and country with 5% or more of the Company’s revenue during any of the periods presented, based on “bill to” customer locations were as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In thousands)	2024		2023		2024		2023
Americas:	$	5,507	$	5,557	$	15,793	$	17,643
EMEA:
Germany		5,321		5,741		16,269		19,290
Other EMEA		6,190		8,498		18,450		20,912
APAC:
Hong Kong/China		65,425		79,735		178,229		215,829
India		8,571		9,697		20,351		27,738
Korea		9,762		4,308		28,215		17,425
Taiwan		7,471		4,949		17,523		11,453
Other APAC		7,590		7,026		18,893		24,741
Total net revenues	$	115,837	$	125,511	$	313,723	$	355,031