Risk Factors Update Summary

• Risks related to demand, supply, and manufacturing have been updated to emphasize the importance of accurately estimating customer demand to prevent mismatches. This change highlights the potential harm to the business and the need for proper estimation. This could lead to significant expenses if not managed properly.
• Difficulty in realizing benefits of acquisitions, including integrating technology, systems, and employees.
• Export controls and licensing requirements imposed by the USG, affecting products destined to certain customers and regions.
• Risks related to international sales and operations have been expanded to include potential risks arising from economic, political, and business changes in the regions where the company operates. This change underscores the exposure to various risks that could harm the business.
• Concentration risk: Sales to Customer A represented 13% of total revenue for fiscal year 2024.
• Increased regulatory scrutiny and restrictions on AI technologies globally, impacting business operations and financial results.
• Compliance with evolving government regulations related to AI ethics, potentially increasing costs and changing operations.
• The company has increased its supply, including inventory on hand, and capacity purchases with existing suppliers, added new vendors, and entered into prepaid manufacturing and capacity agreements. This change indicates a strategic shift towards securing more supply to meet demand, potentially impacting the company's financial results and operations.
• Revenue concentration: One indirect customer represented approximately 19% of total revenue for fiscal year 2024.
• Increased focus on corporate sustainability practices and disclosures, potentially leading to additional costs or risks.