UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2025~~2026

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 000-51026

Monolithic Power Systems, Inc.

(Exact name of registrant

as specified in its charter)

Delaware	77-0466789
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
1555 Palm Beach Lakes Blvd., West Palm Beach, Florida 33401 (Address of principal executive offices)(Zip Code)1	5808 Lake Washington Blvd. NE, Kirkland, Washington 98033 (Address of principal executive offices)(Zip Code)1
1555 Palm Beach Lakes Blvd., West Palm Beach, Florida 33401 (Address of principal executive offices)(Zip Code)(1)

(~~425~~561) ~~296~~ 839-~~9956~~3999

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.001 per share	MPWR	The NASDAQ Global Select Market
Common Stock, $0.001 par value per share	MPWR	The NASDAQ Global Select Market

(1 ) We have operations in multiple locations in the USU.S., Europe and Asia. ~~Accordingly,~~and wehave do not ~~maintain~~identified a single location as the Company’s headquarters. We are including ~~these~~this ~~addresses~~address ~~solely~~to ~~for~~comply ~~the~~with ~~purpose of satisfying~~ the Securities and Exchange Commission’s requirements.

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒	Accelerated filer ☐	Non-accelerated filer ☐
Smaller reporting company ☐	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 4749,~~907~~130,000 shares of the registrant’s common stock issued and outstanding as of ~~October~~April 2927, ~~2025~~2026.

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MONOLITHIC POWER SYSTEMS, INC.

Form 10-Q

For the Quarter Ended ~~September~~March 3031, ~~2025~~2026

TABLE OF CONTENTS

		PAGE
PART I. FINANCIAL INFORMATION		4
Item 1.	Financial Statements (unaudited)	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations	5
	Condensed Consolidated Statements of Comprehensive Income	6
	Condensed Consolidated Statements of Stockholders’ Equity	7
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2521
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3228
Item 4.	Controls and Procedures	3228
PART II. OTHER INFORMATION		3329
Item 1.	Legal Proceedings	3329
Item 1A.	Risk Factors	3329
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3430
Item 3.	Defaults Upon Senior Securities	3430
Item 4.	Mine Safety Disclosures	3430
Item 5.	Other Information	3430
Item 6.	Exhibits	3531

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

MONOLITHIC POWER SYSTEMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

(Unaudited)

	September 30,			December 31,
	March 31,			December 31,
	2025			2024
	2026			2025
ASSETS
Current assets:
Cash and cash equivalents	$	1,~~081~~062,~~251~~930		$	~~691~~1,~~816~~099,302
Short-term investments		~~188~~304,~~233~~179			~~171~~157,~~130~~243
Accounts receivable, net		~~241~~302,~~560~~138			~~172~~255,~~518~~626
Inventories		~~505~~619,~~680~~159			~~419~~564,~~611~~649
Other current assets		9642,~~021~~689			~~109~~106,~~978~~982
Total current assets		2,~~112~~331,~~745~~095			12,~~565~~183,~~053~~802
Property and equipment, net		~~597~~693,~~311~~864			~~494~~627,~~945~~689
Acquisition-related intangible assets, net		98,~~077~~503			98,~~938~~790
Goodwill		25,944			25,944
Deferred tax assets, net		1,~~300~~182,~~260~~845			1,~~326~~182,~~840~~883
Other long-term assets		~~161~~206,~~055~~615			~~194~~165,~~377~~091
Total assets	$	4,~~206~~448,~~392~~866		$	34,~~617~~194,~~097~~199
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	~~141~~174,~~689~~499		$	~~102~~138,~~526~~272
Accrued compensation and related benefits		9998,~~602~~768			6385,~~918~~963
Other accrued liabilities		~~201~~213,~~513~~691			~~128~~145,~~123~~130
Total current liabilities		~~442~~486,~~804~~958			~~294~~369,~~567~~365
Income tax liabilities		7875,~~261~~022			6575,~~193~~022
Other long-term liabilities		117,380			111,570
Deferred tax liabilities		90,316			90,480
Total liabilities		638,445			471,330
Other long-term liabilities		119,160			127,835
Commitments and contingencies (Note 8)
Total liabilities		771,456			662,702
Commitments and contingencies (Note 7)
Stockholders’ equity:
Common stock and additional paid-in capital: $0.001 par value; shares authorized: 150,000; shares issued and outstanding: 47,905 and 47,823, respectively		885,123			706,817
Common stock and additional paid-in capital: $0.001 par value; shares authorized: 150,000; shares issued and outstanding: 49,129 and 48,709, respectively		983,926			936,998
Retained earnings		2,~~705~~703,~~527~~596			2,~~487~~609,~~461~~651
Accumulated other comprehensive loss		(2210,~~703~~112	)		(4815,~~511~~152	)
Total stockholders’ equity		3,~~567~~677,~~947~~410			3,~~145~~531,~~767~~497
Total liabilities and stockholders’ equity	$	4,~~206~~448,~~392~~866		$	34,~~617~~194,~~097~~199

See accompanying notes to unaudited condensed consolidated financial statements.

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MONOLITHIC POWER SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per-share amounts)

(Unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

2025

2024

2025

2024

2026

2025

Revenue

~~737~~804,~~176~~185

~~620~~637,~~119~~554

~~2,039,304~~

~~1,585,435~~

Cost of revenue

~~330~~359,~~948~~120

~~276~~284,~~676~~324

~~913,830~~

~~708,973~~

Gross profit

~~406~~445,~~228~~065

~~343~~353,~~443~~230

~~1,125,474~~

~~876,462~~

Operating expenses:

Research and development

98100,~~173~~566

8592,~~051~~227

~~286,666~~

~~238,986~~

Selling, general and administrative

~~112~~103,~~872~~347

9492,~~364~~244

~~310,108~~

~~261,425~~

Total operating expenses

~~211~~203,~~045~~913

~~179~~184,~~415~~471

~~596,774~~

~~500,411~~

Operating income

~~195~~241,~~183~~152

~~164~~168,~~028~~759

~~528,700~~

~~376,051~~

Other income, net

106,~~392~~030

105,~~278~~131

~~27,743~~

~~27,330~~

Income before income taxes

~~205~~247,~~575~~182

~~174~~173,~~306~~890

~~556,443~~

~~403,381~~

Income tax expense

2753,~~301~~956

2938,~~876~~838

~~110,652~~

~~66,044~~

Net income

~~178~~193,~~274~~226

~~144~~135,~~430~~052

~~445,791~~

~~337,337~~

Net income per share:

Basic

3.7294

2.9682

~~9.31~~

~~6.93~~

Diluted

3.7192

2.9581

~~9.28~~

~~6.89~~

Weighted-average shares outstanding:

Basic

4749,~~898~~097

4847,~~757~~851

~~47,879~~

~~48,692~~

Diluted

4849,~~042~~242

48,~~964~~006

~~48,022~~

~~48,945~~

See accompanying notes to unaudited condensed consolidated financial statements.

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MONOLITHIC POWER SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	Three Months Ended March 31,
	2025		2024		2025		2024
	2026		2025
Net income	$	~~178~~193,~~274~~226	$	~~144~~135,~~430~~052	$	~~445,791~~	$	~~337,337~~
Other comprehensive income, net of tax:
Other comprehensive income, net of tax
Foreign currency translation adjustments		~~919~~5,039		225,~~321~~139		~~25,692~~		~~4,186~~
Change in unrealized gains and losses on available-for-sale securities, net of tax of $17, $37, $17 and $(161), respectively		69		977		116		1,680
Net change in unrealized gains and losses on available-for-sale securities		1		48
Other comprehensive income, net of tax		~~988~~5,040		235,~~298~~187		~~25,808~~		~~5,866~~
Comprehensive income	$	~~179~~198,~~262~~266	$	~~167~~140,~~728~~239	$	~~471,599~~	$	~~343,203~~

See accompanying notes to unaudited condensed consolidated financial statements.

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MONOLITHIC POWER SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except per-share amounts)

(Unaudited)

										Accumulated
	Common Stock and									Other			Total
	Additional Paid-in Capital						Retained			Comprehensive			Stockholders’
Three Months Ended September 30, 2025	Shares			Amount			Earnings			Loss			Equity
Three Months Ended March 31, 2026	Shares			Amount			Earnings			Loss			Equity
Balance as of July 1, 2025		47,892		$	822,582		$	2,603,177		$	(23,691	)	$	3,402,068
Balance as of January 1, 2026		48,709		$	936,998		$	2,609,651		$	(15,152	)	$	3,531,497
Net income		-			-			~~178~~193,~~274~~226			-			~~178~~193,~~274~~226
Other comprehensive income		-			-			-			~~988~~5,040			~~988~~5,040
Dividends and dividend equivalents declared ($1.56 per share)		-			-			(75,924	)		-			(75,924	)
Dividends and dividend equivalents declared ($2.00 per share)		-			-			(99,281	)		-			(99,281	)
Common stock issued		15420			35,~~885~~830			-			-			35,~~885~~830
Repurchases of common stock		(2	)		(2,017	)		-			-			(2,017	)
Stock-based compensation expense		-			41,098			-			-			41,098
Stock-based compensation expense		-			60,673			-			-			60,673
Balance as of March 31, 2026		49,129		$	983,926		$	2,703,596		$	(10,112	)	$	3,677,410
Balance as of September 30, 2025		47,905		$	885,123		$	2,705,527		$	(22,703	)	$	3,567,947

										Accumulated
	Common Stock and									Other			Total
	Additional Paid-in Capital						Retained			Comprehensive			Stockholders’
Three Months Ended September 30, 2024	Shares			Amount			Earnings			Loss			Equity
Three Months Ended March 31, 2025	Shares			Amount			Earnings			Loss			Equity
Balance as of July 1, 2024		48,698		$	1,224,144		$	1,016,208		$	(44,494	)	$	2,195,858
Balance as of January 1, 2025		47,823		$	706,817		$	2,292,819		$	(48,511	)	$	2,951,125
Net income		-			-			~~144~~135,~~430~~052			-			~~144~~135,~~430~~052
Other comprehensive income		-			-			-			235,~~298~~187			235,~~298~~187
Dividends and dividend equivalents declared ($1.25 per share)		-			-			(61,879	)		-			(61,879	)
Dividends and dividend equivalents declared ($1.56 per share)		-			-			(75,877	)		-			(75,877	)
Common stock issued		8854			45,~~121~~335			-			-			45,~~121~~335
Repurchases of common stock		(7	)		(5,534	)		-			-			(5,534	)
Stock-based compensation expense		-			52,807			-			-			52,807
Stock-based compensation expense		-			51,396			-			-			51,396
Balance as of March 31, 2025		47,877		$	764,959		$	2,351,994		$	(43,324	)	$	3,073,629
Balance as of September 30, 2024		48,779		$	1,274,127		$	1,098,759		$	(21,196	)	$	2,351,690

										Accumulated
	Common Stock and									Other			Total
	Additional Paid-in Capital						Retained			Comprehensive			Stockholders’
Nine Months Ended September 30, 2025	Shares			Amount			Earnings			Loss			Equity
Balance as of January 1, 2025		47,823		$	706,817		$	2,487,461		$	(48,511	)	$	3,145,767
Net income		-			-			445,791			-			445,791
Other comprehensive income		-			-			-			25,808			25,808
Dividends and dividend equivalents declared ($4.68 per share)		-			-			(227,725	)		-			(227,725	)
Common stock issued		88			9,220			-			-			9,220
Repurchases of common stock		(6	)		(4,501	)		-			-			(4,501	)
Stock-based compensation expense		-			173,587			-			-			173,587
Balance as of September 30, 2025		47,905		$	885,123		$	2,705,527		$	(22,703	)	$	3,567,947

										Accumulated
	Common Stock and									Other			Total
	Additional Paid-in Capital						Retained			Comprehensive			Stockholders’
Nine Months Ended September 30, 2024	Shares			Amount			Earnings			Loss			Equity
Balance as of January 1, 2024		48,028		$	1,129,937		$	947,064		$	(27,062	)	$	2,049,939
Net income		-			-			337,337			-			337,337
Other comprehensive income		-			-			-			5,866			5,866
Dividends and dividend equivalents declared ($3.75 per share)		-			-			(185,642	)		-			(185,642	)
Common stock issued		770			8,727			-			-			8,727
Repurchases of common stock		(19	)		(14,160	)		-			-			(14,160	)
Stock-based compensation expense		-			149,623			-			-			149,623
Balance as of September 30, 2024		48,779		$	1,274,127		$	1,098,759		$	(21,196	)	$	2,351,690

See accompanying notes to unaudited condensed consolidated financial statements.

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MONOLITHIC POWER SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024
	2026			2025
Cash flows from operating activities:
Net income	$	~~445~~193,~~791~~226		$	~~337~~135,~~337~~052
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		3815,~~270~~106			2611,~~387~~449
Amortization of discount on available-for-sale securities		(3,894	)		(16,684	)
Loss on deferred compensation plan investments		1,588			1,350
Gain on deferred compensation plan investments		(8,023	)		(9,180	)
Deferred taxes, net		(152	)		7,170
Deferred taxes, net		26,736			(6,598	)
Stock-based compensation expense		41,098			52,806
Stock-based compensation expense		173,581			149,630
Other		(696	)		(748	)
Other		(390	)		50
Changes in operating assets and liabilities:
Accounts receivable		(6946,~~033~~512	)		15(42,~~148~~338	)
Inventories		(8654,~~057~~507	)		(4035,~~535~~180	)
Other assets		7317,~~172~~525			5778,~~781~~005
Accounts payable		3329,~~901~~730			4421,~~210~~296
Accrued compensation and related benefits		3312,~~866~~576			2410,~~450~~609
Income tax liabilities		5325,~~684~~973			1321,~~345~~471
Other accrued liabilities		2115,~~688~~298			25(4,~~388~~555	)
Net cash provided by operating activities		~~733~~250,~~292~~253			~~620~~256,~~729~~387
Cash flows from investing activities:
Purchases of property and equipment		(~~131~~70,~~000~~849	)		(8140,~~316~~342	)
Purchases of intangible assets		(2,528	)		(18,175	)
Sales of property and equipment		6,422			-
Purchases of investments		(~~395~~161,~~533~~809	)		(~~941~~357,~~451~~633	)
Maturities and sales of investments		~~384~~14,~~640~~437			~~779~~141,~~861~~065
Cash paid for acquisition, net of cash acquired		-			(33,283	)
Contributions to deferred compensation plan		(523	)		(575	)
Contributions to deferred compensation plan		(1,297	)		(1,764	)
Net cash used in investing activities		(212,322	)		(257,485	)
Net cash used in investing activities		(145,718	)		(296,128	)
Cash flows from financing activities:
Property and equipment purchased on extended payment terms		(2,~~106~~697	)		(21,~~654~~243	)
Proceeds from common stock issued under the employee stock purchase plan		9,220			8,727
Proceeds from common stock issued		5,830			5,335
Repurchases of common stock		(5,703	)		(14,160	)
Dividends and dividend equivalents paid		(78,399	)		(60,008	)
Dividends and dividend equivalents paid		(209,978	)		(178,766	)
Net cash used in financing activities		(75,266	)		(55,916	)
Net cash used in financing activities		(208,567	)		(186,853	)
Effect of change in exchange rates		961			2,555
Effect of change in exchange rates		10,445			1,552
Net decrease in cash, cash equivalents and restricted cash		(36,374	)		(54,459	)
Net increase in cash, cash equivalents and restricted cash		389,452			139,300
Cash, cash equivalents and restricted cash, beginning of period		1,099,521			691,941
Cash, cash equivalents and restricted cash, beginning of period		691,941			561,181
Cash, cash equivalents and restricted cash, end of period	$	1,063,147		$	637,482
Cash, cash equivalents and restricted cash, end of period	$	1,081,393		$	700,481
Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets:
Cash and cash equivalents	$	1,062,930		$	637,354
Restricted cash included in other long-term assets		217			128
Total cash, cash equivalents, and restricted cash	$	1,063,147		$	637,482
Supplemental disclosures for cash flow information:
Cash paid for income taxes, net	$	21,968		$	58,614
Cash paid (refunded) for income taxes, net	$	31,438		$	(218	)
Non-cash investing and financing activities:
Liability accrued for property and equipment purchases	$	11,~~701~~038		$	914,~~577~~611
Liability accrued for dividends and dividend equivalents	$	7899,~~407~~312		$	6375,~~922~~939

See accompanying notes to unaudited condensed consolidated financial statements.

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MONOLITHIC POWER SYSTEMS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Monolithic Power Systems, Inc., a Delaware corporation, and its wholly owned subsidiaries (the “Company” or “MPS”) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted in accordance with these accounting principles, rules and regulations. All intercompany accounts and transactions have been eliminated. The information in this report should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, ~~2024~~2025, filed with the SEC on ~~March~~February 327, ~~2025~~2026.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the interim periods presented. The financial statements contained in this Quarterly Report on Form 10-Q are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2025~~2026 or for any other future periods.

Summary of Significant Accounting Policies There have been no changes to the Company’s significant accounting policies during the three ~~and nine~~ months ended ~~September~~March 3031, ~~2025~~2026 from those described in the Company’s audited consolidated financial statements included in the Annual Report on Form 10-K for the year ended December 31, ~~2024~~2025.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions used in these condensed consolidated financial statements primarily include those related to income tax valuation allowances, ~~inventory valuation~~ and stock-based compensation. Actual results could differ from these estimates and assumptions, and any such differences may be material to the Company’s condensed consolidated financial statements.

New Accounting Pronouncements Not Yet Adopted as of ~~September~~March 3031, ~~2025~~2026

In ~~December~~November ~~2023~~2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ~~2023~~2024-0903, Income ~~Taxes~~Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (~~Topic~~Subtopic ~~740~~220-40): ~~Improvements~~Disaggregation toof Income ~~Tax~~Statement ~~Disclosures~~Expenses, which aims to ~~improve~~provide anmore ~~entity’s~~detailed ~~income~~information ~~tax~~about ~~disclosures~~the ~~around~~types ~~its effective rate reconciliation, income taxes paid, disaggregation~~ of ~~income~~expenses ~~before~~in ~~income~~commonly ~~taxes~~presented ~~and income tax~~ expense captions. The Company will adopt this standard in its Form 10-K for the fiscal year ending December 31, ~~2025~~2027. The ~~adoption~~Company ofis ~~this~~evaluating ~~standard~~the ~~will result in~~impact ~~expanded disclosures~~of inadoption ~~the~~on ~~Notes~~its to Consolidated Financial Statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which aims to provide more detailed information about the types of expenses in commonly presented expense captions. The Company will adopt this standard in its Form 10-K for the fiscal year ending December 31, 2027. The Company is evaluating the impact of adoption on its Consolidated Financial Statements.

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2. REVENUE RECOGNITION

Revenue from Product Sales

The Company generates revenue primarily from product sales, which include assembled and tested integrated circuits (“ICs”), power modules as well as dies in wafer form. The remaining revenue, which primarily consists of royalty revenue from licensing arrangements and revenue from wafer testing services performed for third parties, was not significant in any of the periods presented. ~~See Note 7~~ ~~to our unaudited condensed consolidated financial statements for the disaggregation of the Company’s revenue by geographic region.~~

The Company ~~sells~~derives ~~its~~a ~~products~~majority ~~to end customers primarily through third-party distributors and value-added resellers. For the three months ended September 30, 2025 and 2024, 85% and 88%, respectively,~~ of ~~the~~its ~~Company’s~~revenue ~~total~~ from sales ~~were~~to ~~made~~customers ~~through~~located ~~distribution~~outside ~~arrangements.~~North ~~For the nine months ended September 30~~America, ~~2025 and~~with ~~2024, 84%~~geographic ~~and 89%,~~revenue ~~respectively,~~based ofon the ~~Company~~customers’~~s total~~ ~~sales were made through distribution arrangements. These distribution arrangements contain enforceable rights and obligations specific~~ ship-to ~~those distributors and not the end customers~~locations. ~~Purchase~~The ~~orders,~~following ~~which~~is ~~are~~a ~~generally~~summary ~~governed by sales agreements or the Company’s standard terms~~ of ~~sale,~~revenue ~~set~~by ~~the~~geographic ~~final~~region ~~terms~~ for ~~unit price, quantity, shipping and payment agreed between~~ the ~~Company~~periods ~~and~~presented ~~the~~(in customer. The Company considers purchase orders to be the contracts with customers. The unit price stated on purchase orders is considered to be the observable, stand-alone selling price for customer sales arrangements.thousands):

	Three Months Ended March 31,
Country or Region	2026		2025
China	$	411,153	$	363,720
Taiwan		181,616		116,341
South Korea		81,806		64,364
Southeast Asia		40,749		32,706
Europe		35,799		24,992
U.S.		29,774		15,249
Japan		23,184		20,101
Other		104		81
Total	$	804,185	$	637,554

The Company sells its products to end customers primarily through third-party distributors and value-added resellers. For the three months ended March 31, 2026 and 2025, 88% and 83%, respectively, of the Company’s total sales were made through distribution arrangements. These distribution arrangements contain enforceable rights and obligations specific to those distributors and not the end customers.

The following table summarizes those customers with sales equal to 10% or more of the Company’s total revenue for the periods presented:

	Three Months Ended March 31,
Customer	2026			2025
Distributor A		26	%		24	%
Distributor B		16	%		19	%
Distributor C		*			11	%

*Represents less than 10%.

The Company’s agreements with these third-party distributors were made in the ordinary course of business and may be terminated with or without cause by these distributors with advance notice. Although the Company may experience a short-term disruption in the distribution of its products and a short-term decline in revenue if its agreement with any of the distributors were terminated, the Company believes that such termination would not have a material adverse effect on its financial statements because it would be able to engage alternative distributors, resellers and other distribution channels to deliver its products to end customers within a relatively short period following any termination of the agreement with a distributor.

Purchase orders, which are generally governed by sales agreements or the Company’s standard terms of sale, set the final terms for unit price, quantity, shipping and payment agreed upon between the Company and the customer. The Company considers purchase orders to be contracts with the customers. The unit price as stated on the purchase orders is considered the observable, stand-alone selling price for the contracts.

The Company recognizes revenue when it satisfies a performance obligation by transferring control of the promised goods or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company excludes taxes assessed by government authorities, such as sales taxes, from revenue.

Product sales consist of a single performance obligation that the Company satisfies at a point in time. The Company recognizes product revenue from distributors and direct end customers when the following events have occurred: (a) the Company has transferred physical possession of the products, (b) the Company has a present right to payment, (c) the customer has legal title to the products, and (d) the customer bears significant risks and rewards of ownership of the products. In accordance with the shipping terms specified in the contracts, these criteria are generally met when the products are shipped from the Company’s facilities (such as the “Ex Works” shipping term) or delivered to the customers’ locations (such as the “Delivered Duty Paid” shipping term).

Under certain consignment agreements, the Company recognizes revenue when customers consume products from the consigned inventory locations, at which time control transfers to the customers and the Company issues invoices.

Variable Consideration

The Company accounts for price adjustments and stock rotation rights as variable consideration that reduces the transaction price and recognizes that reduction in the same period the associated revenue is recognized. Certain ~~U.S.-based~~ distributors have ~~price~~limited ~~adjustment~~stock rotation rights ~~when~~that ~~they~~permit ~~sell~~ the ~~Company’s~~return ~~products~~of ~~to their customers at~~ a ~~price~~small ~~that~~percentage isof ~~lower than~~ the ~~distribution~~previous ~~price~~six months’ ~~invoiced~~purchases byin ~~the~~accordance ~~Company.~~with ~~When~~ the ~~Company~~contract ~~receives claims from the distributors that products have been sold to the end customers at the lower prices, the Company issues the distributors credit memos for the price adjustments~~terms. The Company estimates the ~~price~~stock ~~adjustments~~rotation returns using the expected value method based on an analysis of historical ~~claims~~returns, atand ~~both~~ the ~~distributor~~current ~~and~~level ~~product~~of ~~level,~~inventory asin ~~well~~the asdistribution anchannel. ~~assessment~~The ofCompany ~~any~~records ~~known~~a ~~trends~~liability offor ~~product~~the ~~sales~~stock ~~mix.~~rotation ~~Other~~reserve, ~~U.S.~~with ~~distributors~~a ~~and~~corresponding ~~non-U~~reduction to revenue.S. ~~distributors~~In doaddition, ~~not~~the ~~have~~Company ~~price~~recognizes ~~adjustment~~an ~~rights.~~asset ~~The~~for ~~Company~~product ~~records~~returns awhich ~~credit~~represents ~~against~~the ~~accounts~~right ~~receivable~~to ~~for~~recover products from the ~~estimated~~customers ~~price~~related ~~adjustments~~ to stock rotations, with a corresponding reduction to cost of revenue.

Certain distributors have limited stock rotation rights that permit the return of a small percentage of the previous six months’ purchases in accordance with the contract terms. The Company estimates the stock rotation returns using the expected value method based on an analysis of historical returns, and the current level of inventory in the distribution channel. The Company records a liability for the stock rotation reserve, with a corresponding reduction to revenue. In addition, the Company recognizes an asset for product returns which represents the right to recover products from the customers related to stock rotations, with a corresponding reduction to cost of revenue.

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Contract Balances

Accounts Receivable:

The Company records a receivable when it has an unconditional right to receive consideration after the performance obligations are satisfied. The Company’s accounts receivable are short-term, with standard payment terms generally ranging from 30 to 90 days. The Company does not require its customers to provide collateral to support accounts receivable. The Company assesses collectability by reviewing accounts receivable on a customer-by-customer basis. To manage credit risk, management performs ongoing credit evaluations of the customers’ financial condition, monitors payment performance, and assesses current economic conditions, as well as reasonable and supportable forecasts of future economic conditions, that may affect collectability of the outstanding receivables. For certain customers, the Company requires standby letters of credit or advance payments prior to shipments of goods. The Company did not recognize any write-offs of accounts receivable or record any allowance for credit losses for the periods presented.

~~Contract~~The ~~Liabilities~~following table summarizes those customers with accounts receivable equal to 10% or more of the Company’s total accounts receivable:

For customers without credit terms, the Company requires cash payments two weeks before the products are scheduled to be shipped to the customers. The Company records these payments received in advance of performance as customer prepayments within other accrued liabilities. As of September 30, 2025 and December 31, 2024, customer prepayments totaled $9.4 million and $6.9 million, respectively. All of the customer prepayment balance as of December 31, 2024 has been fulfilled by the Company during the nine months ended September 30, 2025.

	March 31,			December 31,
Customer	2026			2025
Distributor A		30	%		35	%
Value-added reseller A		17	%		*
Distributor B		13	%		14	%

*Represents less than 10%.

Practical Expedients

The Company has elected the practical expedient to expense sales commissions as incurred because the amortization period would have been one year or less.

The Company’s standard payment terms generally require customers to pay 30 to 90 days after the Company satisfies the performance obligations. For this reason, the Company has elected not to determine whether contracts with customers contain significant financing components.

The Company’s unsatisfied performance obligations primarily include products held in consignment arrangements and customer purchase orders for products that the Company has not yet shipped. Because the Company expects to fulfill these performance obligations within one year, the Company has elected not to disclose the amount of these remaining performance obligations.

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3. STOCK-BASED COMPENSATION

2014 Equity Incentive Plan

In April 2013, the Board of Directors adopted the Company’s 2014 Equity Incentive Plan (the “2014 Plan”), which the Company’s stockholders approved in June 2013. In October 2014, the Board of Directors approved certain amendments to the 2014 Plan. The amended 2014 Plan became effective on November 13, 2014 and provided for the issuance of up to 5.5 million shares. In April 2020, the Board of Directors further amended and restated the amended 2014 Plan (the “Amended and Restated 2014 Plan”), which the Company’s stockholders approved in June 2020. The Amended and Restated 2014 Plan became effective on June 11, 2020 and provides for the issuance of up to 10.5 million shares. The Amended and Restated 2014 Plan will cease being available for new awards on June 11, 2030. As of ~~September~~March 3031, ~~2025~~2026, 3.64 million shares remained available for future issuance under the Amended and Restated 2014 Plan.

Stock-Based Compensation Expense

The Company recognized stock-based compensation expense as follows for the periods presented (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

2025

2024

2025

2024

2026

2025

Cost of revenue

1,~~916~~474

1,~~576~~673

~~5,502~~

~~4,585~~

Research and development (“R&D”)

1211,~~578~~275

11,~~331~~678

~~36,725~~

~~33,460~~

Selling, general and administrative (“SG&A”)

4628,~~183~~349

3839,~~491~~455

~~131,354~~

~~111,585~~

Total stock-based compensation expense

6041,~~677~~098

5152,~~398~~806

~~173,581~~

~~149,630~~

Tax benefit related to stock-based compensation (1)

~~756~~758

~~766~~460

~~1,919~~

~~2,272~~

(1)

Amount reflects the tax benefit related to stock-based compensation recorded for equity awards that are expected to generate tax deductions when they vest in future periods. Equity awards granted to the Company’s executive officers are subject to the tax deduction limitations set by Section 162(m) of the Internal Revenue Code.

Restricted Stock Units (“RSUs”)

The Company’s RSUs include time-based RSUs, RSUs with performance conditions (“PSUs”), and RSUs with market conditions (“MSUs”)~~, and RSUs with both market and performance conditions (“MPSUs”)~~. Vesting of awards with performance conditions or market conditions is subject to the achievement of pre-determined performance or market goals and the approval of such achievement by the Compensation Committee of the Board of Directors (the “Compensation Committee”). All awards include service conditions which require continued employment with or service to the Company.

A summary of RSU activity is presented in the table below (in thousands, except per-share amounts):

	Time-Based RSUs							PSUs and MPSUs						MSUs					Total
	Total Time-based RSUs, PSUs and MSUs
					Weighted-							Weighted-					Weighted-					Weighted-
	Number of Shares					Weighted-Average Grant Date Fair Value Per Share
					Average							Average					Average					Average
Outstanding at January 1, 2026		771				$	535.78
					Grant Date							Grant Date					Grant Date					Grant Date
Granted		208		(1)		$	958.65
	Number of				Fair Value			Number of				Fair Value		Number of			Fair Value		Number of			Fair Value
Vested		(64	)			$	398.06
	Shares				Per Share			Shares				Per Share		Shares			Per Share		Shares			Per Share
Forfeited		(14	)			$	543.83
Outstanding at January 1, 2025		85			$	516.12			681			$	524.08		938		$	203.32		1,704		$	347.01
Outstanding at March 31, 2026		901				$	677.43
Granted		38			$	650.32			274		(1)	$	564.69		-		$	-		312		$	574.95
Vested		(33	)		$	477.06			(40	)		$	400.90		-		$	-		(73	)	$	435.39
Forfeited		(5	)		$	565.80			(4	)		$	526.65		(11	)	$	297.45		(20	)	$	413.13
Outstanding at September 30, 2025		85			$	589.21			911			$	541.13		927		$	202.25		1,923		$	379.76

(1)	Amount reflects the number of awards that may ultimately be earned based on management’s probability assessment of the achievement of performance conditions at each reporting period.

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The ~~intrinsic~~fair value related to vested RSUs, as of their respective vesting dates, was $4975.6 2 million and $~~494~~31.4 0 million for the ~~nine~~three months ended ~~September~~March 3031, ~~2025~~2026 and ~~2024~~2025, respectively. ~~The decrease in the intrinsic value was primarily due to the timing of vested RSUs.~~ As of ~~September~~March 3031, ~~2025~~2026, ~~the~~unamortized ~~total~~compensation ~~intrinsic~~expense ~~value~~related of to all outstanding RSUs was $1390.~~7 billion, based~~2 onmillion ~~the~~with ~~closing~~a ~~stock~~weighted-average ~~price~~remaining recognition period of ~~$920~~approximately two years.~~64.~~ RSUs Asgenerally ofvest ~~September~~over ~~30,~~four ~~2025,~~years ~~unamortized~~for ~~compensation~~non-executive ~~expense~~employees, ~~related~~three toyears ~~all~~for ~~outstanding~~executives, and ~~RSUs~~one ~~was~~year ~~$260.7~~for ~~million~~directors, ~~with~~all asubject ~~weighted-average~~to ~~remaining~~continued ~~recognition~~service ~~period~~with ofthe ~~approximately two years~~Company.

~~Time-Based~~2026 ~~RSUs~~Executive PSUs:

~~For~~In ~~the~~February ~~nine~~2026, ~~months~~the ~~ended~~Compensation ~~September~~Committee 30granted 42,000 ~~2025~~PSUs to the executive officers, which represent the ~~Compensation~~target ~~Committee~~number ~~granted~~of 38shares that can be earned based on the degree of achievement of two sets of independent performance goals (the “2026 Executive PSUs”). For the first goal,~~000~~ ~~RSUs~~the ~~with~~executive ~~service~~officers ~~conditions~~can earn up to ~~non~~300% of the target number of the 2026 Executive PSUs based on the achievement of the Company’s three-~~executive~~year ~~employees~~(2026 ~~and~~through ~~non~~2028) average revenue growth rate in excess of the analog industry’s three-~~employee~~year ~~directors~~average revenue growth rate as published by the Semiconductor Industry Association (the “SIA”). ~~The~~For ~~RSUs~~the ~~generally~~second ~~vest~~goal, ~~over~~the ~~four~~executive ~~years~~officers ~~for~~can ~~employees~~earn ~~and~~up ~~one~~to 200% of the target number of the 2026 Executive PSUs if the Company secures manufacturing capacity that can support a specified level of annual revenue at the end of the three-year ~~for~~performance ~~directors~~period. For both goals, ~~subject~~a percentage of the 2026 Executive PSUs will fully vest on December 31, 2028, depending on the degree to ~~continued~~which ~~service~~the ~~with~~pre-determined goals are met during the ~~Company~~performance period. Assuming the achievement of the highest level of the performance goals, the total stock-based compensation cost for the 2026 Executive PSUs will be $208.2 million.

~~2025~~The 2026 Executive PSUs contain a purchase price feature, which requires the executives to pay the Company up to $300 per share upon vesting of the shares. The $300 purchase price requirement for executives is deemed satisfied and fully waived if the Company’s stock price on the last trading day of the applicable performance period is $300 higher than the grant date stock price of $1,164.83. The Company determined the grant date fair value of the 2026 Executive PSUs using a Monte Carlo simulation model with the following assumptions: stock price of $1,164.83, simulation term of three years, expected volatility of 53.39%, risk-free interest rate of 3.60%, and expected dividend yield of 0.69%. There is no illiquidity discount because the awards do not contain any post-vesting sales restrictions.

In February 2025, the Compensation Committee granted 50,000 PSUs to the executive officers, which represent the target number of shares that can be earned based on the degree of achievement of two sets of independent performance goals (“2025 Executive PSUs”). For the first goal, the executive officers can earn up to 300% of the target number of the 2025 Executive PSUs based on the achievement of the Company’s three-year (2025 through 2027) average revenue growth rate in excess of the analog industry’s three-year average revenue growth rate as published by the Semiconductor Industry Association (the “SIA”). For the second goal, the executive officers can earn up to 200% of the target number of the 2025 Executive PSUs based on the achievement of the Company’s three-year (2025 through 2027) total stockholder return percentile ranking relative to the constituent entities in the Philadelphia Semiconductor Sector Index (the “PHLX Index”). For both goals, a percentage of the 2025 Executive PSUs will fully vest on December 31, 2027, depending on the degree to which the pre-determined goals are met during the performance period. Assuming the achievement of the highest level of the performance goals, the total stock-based compensation cost for the 2025 Executive PSUs will be $138.5 million. In February 2025, the Compensation Committee granted 11,000 PSUs to certain non-executive employees, which represent the target number of shares that can be earned based on the degree of achievement of the Company’s 2026 revenue goals for certain regions or product line divisions, or based on the degree of achievement of the Company’s two-year (2025 and 2026) average revenue growth rate compared against the analog industry’s two-year average revenue growth rate as published by the SIA (“2025 Non-Executive PSUs”). The maximum number of shares that an employee can earn is either 200% or 300% of the target number of the 2025 Non-Executive PSUs, depending on the job classification of the employee. 50% of the 2025 Non-Executive PSUs will vest in the first quarter of 2027 depending on the degree to which the pre-determined goals are met during the performance period. The remaining 2025 Non-Executive PSUs will vest over the following two years on a quarterly or annual basis. Assuming the achievement of the highest level of performance goals, the total stock-based compensation cost for the 2025 Non-Executive PSUs will be $16.5 million. The 2025 Executive PSUs and the 2025 Non-Executive PSUs contain a purchase price feature, which requires the employees to pay the Company $30 per share upon vesting of the shares. The $30 purchase price requirement is deemed satisfied and waived if the Company’s stock price on the last trading day of the performance period is $30 higher than the grant date stock price of $656.29. The Company determined the grant date fair value of the 2025 Executive PSUs and the 2025 Non-Executive PSUs using a Monte Carlo simulation model with the following assumptions: stock price of $656.29, simulation term of three years, expected volatility of 54.42%, risk-free interest rate of 4.20%, and expected dividend yield of 0.95%. The Monte Carlo simulation model for the 2025 Executive PSUs further utilized correlation coefficients of peer companies of 0.46 to 0.76. The correlation coefficients were based on peer companies in the PHLX Index as an aggregate benchmark for determining the market-based total stockholder return component. There is no illiquidity discount because the awards do not contain any post-vesting sales restrictions.

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4. BALANCE SHEET COMPONENTS

Inventories

Inventories consist of the following (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Raw materials	$	7786,~~254~~218	$	91107,~~851~~801
Work in process		~~210~~263,~~471~~067		~~169~~220,~~982~~410
Finished goods		~~217~~269,~~955~~874		~~157~~236,~~778~~438
Total	$	~~505~~619,~~680~~159	$	~~419~~564,~~611~~649

Other Current Assets

Other current assets consist of the following (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Prepaid wafer expenses (1)	$	60,000	$	-
Prepaids and other	$	42,689	$	46,982
Other receivables (1)		-		60,000
Other		36,021		49,978
Total	$	42,689	$	106,982
Total	$	96,021	$	109,978

(1) ~~Prepaid~~Other ~~wafer expenses and other~~ receivables relate to aan annually refundable deposit made to a supplier under a long-term wafer supply agreement. ~~See~~The ~~Note~~deposit 8was toreceived ~~our~~in ~~unaudited~~the ~~condensed~~quarter ~~consolidated~~ended ~~financial~~March ~~statements~~31, ~~for details about the supply agreement~~2026.

Other Long-Term Assets

Other long-term assets consist of the following (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Deferred compensation plan assets	$	~~101~~106,~~905~~031	$	92107,~~586~~096
Prepaid wafer purchases (1)		-		60,000
Refundable deposit (1)		40,000		-
Other		5960,~~150~~584		4157,~~791~~995
Total	$	~~161~~206,~~055~~615	$	~~194~~165,~~377~~091

(1) ~~Prepaid~~The ~~wafer~~refundable ~~purchases~~deposit ~~relate~~as toof aMarch ~~deposit~~31, ~~made~~2026 tois afor ~~supplier under~~ a long-term ~~wafer~~assembly ~~supply~~service agreement. ~~See Note 8 to our unaudited condensed consolidated financial statements for details about the supply agreement.~~

Other Accrued Liabilities

Other accrued liabilities consist of the following (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Dividends and dividend equivalents	$	79103,~~935~~485	$	6081,~~622~~510
Income tax payable (1)		51,350		10,534
Stock rotation and sales returns		21,635		17,150
Stock rotation and sales returns		31,854		20,799
Income tax payable		28,912		2,920
Other		3859,~~374~~659		3643,~~168~~550
Total	$	~~201~~213,~~513~~691	$	~~128~~145,~~123~~130

(1) The increase in income tax payable during the nine months ended September 30, 2025 was a result of the timing of payments of estimated taxes both domestically and internationally.

Other Long-Term Liabilities

Other long-term liabilities consist of the following (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Deferred compensation plan liabilities	$	9896,~~926~~374	$	93103,~~653~~954
Operating lease liabilities		1519,~~076~~968		1219,~~974~~972
Dividend equivalents		32,~~378~~818		43,~~943~~909
Total	$	~~117~~119,~~380~~160	$	~~111~~127,~~570~~835

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5. NET ~~LEASES~~INCOME PER SHARE

~~The~~Basic ~~Company~~net ~~has~~income ~~operating~~per ~~leases~~share ~~primarily~~is computed by dividing net income by the weighted-average number of shares of common stock outstanding for ~~administrative,~~the ~~sales~~period. Diluted net income per share reflects the potential dilution from contingently issuable shares and ~~marketing~~is ~~offices~~calculated using the treasury stock method. Contingently issuable shares, ~~manufacturing~~including ~~operations~~all ~~and~~types ~~R&D~~of ~~facilities~~equity awards, are considered outstanding shares of common stock and ~~employee~~included ~~housing~~in ~~units.~~basic ~~These~~net ~~leases~~income ~~have~~per ~~remaining~~share ~~lease~~as ~~terms~~of ~~from~~the ~~less~~date ~~than~~that ~~one~~all ~~year~~necessary conditions to ~~19 years.~~earn ~~Some~~the ofawards ~~these~~have ~~leases~~been ~~include~~satisfied. ~~options~~Prior to ~~renew~~the end of the ~~lease~~contingency ~~term~~period, ~~for~~the upnumber toof ~~five~~contingently ~~years~~issuable orshares included in diluted net income per share is based on athe ~~month-to-month~~number ~~basis.~~of ~~The~~shares, ~~Company~~if ~~does~~any, ~~not~~that ~~have~~would ~~finance~~be ~~lease~~issuable ~~arrangements~~under the terms of the arrangement at the end of the reporting period as if the end of the reporting period were the end of the contingency period.

The following table ~~summarizes~~sets forth the ~~balances~~computation of ~~operating~~basic ~~lease right-of-use~~and ~~(“ROU”) assets~~diluted ~~and~~net ~~liabilities~~income per share for the periods presented (in thousands, except per-share amounts):

			September 30,			December 31,
		Three Months Ended March 31,
	Financial Statement Line Item		2025			2024
		2026			2025
Operating lease ROU assets	Other long-term assets		$	19,737		$	16,915
Numerator:
Operating lease liabilities	Other accrued liabilities		$	3,778		$	2,819
Net income		$	193,226		$	135,052
	Other long-term liabilities		$	15,076		$	12,974
Denominator:
Weighted-average outstanding shares—basic			49,097			47,851
Effect of dilutive securities			145			155
Weighted-average outstanding shares—diluted			49,242			48,006
Net income per share:
Basic		$	3.94		$	2.82
Diluted		$	3.92		$	2.81

The following tables summarize certain information related to the leases (in thousands, except percentages and years):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Lease costs:
Operating lease costs	$	1,350	$	948	$	3,742	$	2,859
Other		864		822		2,458		2,020
Total lease costs	$	2,214	$	1,770	$	6,200	$	4,879

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	1,273	$	1,704	$	3,434	$	3,404
ROU assets obtained in exchange for new operating lease liabilities	$	-	$	2,339	$	5,206	$	11,610

	September 30,			December 31,
	2025			2024
Weighted-average remaining lease term (in years)		9.7			11.5
Weighted-average discount rate		5.5	%		5.5	%

As of September 30, 2025, the maturities of the lease liabilities were as follows (in thousands):

2025 (remaining three months)	$	1,300
2026		4,441
2027		3,937
2028		2,743
2029		1,954
Thereafter		11,471
Total remaining lease payments		25,846
Less: imputed interest		(6,992	)
Total lease liabilities	$	18,854

As of September 30, 2025, the Company’s operating leases that had not yet commenced were not material.

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6. NET INCOME PER SHARE

Basic net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding for the period. Diluted net income per share reflects the potential dilution from contingently issuable shares and calculated using the treasury stock method. Contingently issuable shares, including all types of equity awards, are considered outstanding shares of common stock and included in basic net income per share as of the date that all necessary conditions to earn the awards have been satisfied. Prior to the end of the contingency period, the number of contingently issuable shares included in diluted net income per share is based on the number of shares, if any, that would be issuable under the terms of the arrangement at the end of the reporting period.

The following table sets forth the computation of basic and diluted net income per share (in thousands, except per-share amounts):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Numerator:
Net income	$	178,274	$	144,430	$	445,791	$	337,337
Denominator:
Weighted-average outstanding shares—basic		47,898		48,757		47,879		48,692
Effect of dilutive securities		144		207		143		253
Weighted-average outstanding shares—diluted		48,042		48,964		48,022		48,945
Net income per share:
Basic	$	3.72	$	2.96	$	9.31	$	6.93
Diluted	$	3.71	$	2.95	$	9.28	$	6.89

Anti-dilutive common stock equivalents were not material for the periods presented.

6. SEGMENT 16AND GEOGRAPHIC INFORMATION

The ~~Table~~Company operates in one reportable segment that includes the design, development, marketing and sale of ~~Contents~~high-performance, semiconductor-based power electronics solutions for the storage and computing, enterprise data, automotive, industrial, communications, and consumer end markets. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for the purposes of allocating resources and evaluating financial performance. Specifically, the CODM uses net income that is reported on the Condensed Consolidated Statements of Operations, and cash provided by operating activities reported in the Condensed Consolidated Statements of Cash Flows, to decide whether and how much to reinvest profits into core business operations or to return to stockholders in the form of stock repurchases and dividends.

7. SEGMENT, SIGNIFICANT CUSTOMERS AND GEOGRAPHIC INFORMATION

The Company operates in one reportable segment that includes the design, development, marketing and sale of high-performance, semiconductor-based power electronics solutions for the storage and computing, automotive, enterprise data, communications, consumer, and industrial end markets. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for the purposes of allocating resources and evaluating financial performance. Specifically, the CODM uses net income that is reported on the Condensed Consolidated Statements of Operations and cash provided by operating activities reported in the Condensed Consolidated Statements of Cash Flows to decide whether and how much to reinvest profits into core business operations or to return to stockholders in the form of stock repurchases and dividends.

All significant segment expenses have been captured on the face of the Condensed Consolidated Statements of Operations.

The Company sells its products to end customers primarily through third-party distributors and value-added resellers. The following table summarizes those customers with sales equal to 10% or more of the Company’s total revenue for the periods presented:

	Three Months Ended September 30,						Nine Months Ended September 30,
Customer	2025			2024			2025			2024
Distributor A		26	%		24	%		25	%		33	%
Distributor B		18	%		25	%		18	%		19	%
Distributor C		*			*			10	%		*

*Represents less than 10%.

The Company’s agreements with these third-party distributors were made in the ordinary course of business and may be terminated with or without cause by either party with advance notice. Although the Company may experience a short-term disruption in the distribution of its products and a short-term decline in revenue if its agreement with any of the distributors were terminated, the Company believes that such termination would not have a material adverse effect on its financial statements because it would be able to engage alternative distributors, resellers and other distribution channels to deliver its products to end customers within a short period following any termination of the agreement with a distributor.

The following table summarizes those customers with accounts receivable equal to 10% or more of the Company’s total net accounts receivable:

	September 30,			December 31,
Customer	2025			2024
Distributor A		31	%		28	%
Distributor B		17	%		29	%

The Company derives a majority of its revenue from sales to customers located outside North America, with geographic revenue based on the customers’ ship-to locations. The following is a summary of revenue by geographic region (in thousands) for the periods presented:

	Three Months Ended September 30,				Nine Months Ended September 30,
Country or Region	2025		2024		2025		2024
China	$	393,837	$	310,472	$	1,155,508	$	856,026
Taiwan		155,978		179,747		377,289		407,593
South Korea		62,882		51,815		190,747		126,865
Southeast Asia		39,023		22,772		106,596		47,363
Europe		33,577		25,145		85,066		61,992
U.S.		29,937		13,797		63,313		42,544
Japan		21,779		16,286		60,416		42,786
Other		163		85		369		266
Total	$	737,176	$	620,119	$	2,039,304	$	1,585,435

The following is a summary of long-lived assets by geographic region (in thousands):

	September 30,		December 31,
	March 31,		December 31,
Country	~~2025~~2026		~~2024~~2025
China	$	~~308~~356,~~174~~585	$	~~237~~332,~~649~~506
U.S.		~~170~~205,~~934~~534		~~171~~165,~~514~~107
Taiwan		5864,~~764~~981		4265,~~388~~081
Other		5966,~~439~~764		4364,~~394~~995
Total	$	~~597~~693,~~311~~864	$	~~494~~627,~~945~~689

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87. 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,~~The ~~the~~ Company’s accrues for warranty ~~obligations~~and ~~have~~rework ~~not~~costs ~~been~~upon ~~material~~evaluation of customer specific claims. ~~The~~Historically, the Company’s ~~may~~warranty ~~also~~obligations ~~incur~~and rework costs associated with product-related claims have not been material. The ~~Company~~estimated ~~accrues~~amount ~~for~~of product warranty and rework ~~costs~~liabilities ~~upon~~was ~~evaluation~~$12.2 million ofand ~~customer~~$10.1 million ~~specific~~for ~~claims~~the periods ended March 31, 2026 and December 31, 2025.

The changes in warranty reserves were as follows (in thousands) for the periods presented:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2025			2024			2025			2024
Balance at beginning of period	$	3,045		$	14,702		$	5,401		$	16,906
Warranties issued		2,665			570			3,230			2,895
Repairs, replacement and refund		(145	)		(849	)		(1,633	)		(4,979	)
Changes in liability for pre-existing warranties		760			(79	)		(673	)		(478	)
Balance at end of period	$	6,325		$	14,344		$	6,325		$	14,344

Purchase Commitments

The Company has outstanding purchase obligations with its suppliers and other parties ~~for~~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.

InTotal ~~May~~estimated ~~2022,~~future ~~the~~unconditional ~~Company~~purchase ~~entered~~commitments ~~into a long-term supply agreement in order~~ to ~~secure~~all ~~manufacturing~~suppliers ~~production~~and ~~capacity~~other ~~for~~parties ~~silicon~~as ~~wafers over a four-year period. As~~ of ~~September~~March 3031, ~~2025,~~2026 ~~the~~were ~~Company~~as ~~had~~follows ~~remaining prepayments under this agreement of $60.0 million reported~~ (in ~~other current assets on the Condensed Consolidated Balance Sheets.~~thousands):

Total estimated future unconditional purchase commitments to all suppliers and other parties, net of the $60.0 million prepayment, as of September 30, 2025 were as follows (in thousands):

2026 (remaining nine months)	$	397,721
2027		190,022
2028		486
2029		486
Total	$	588,715

2025 (remaining three months)	$	117,079
2026		349,330
2027		31,936
2028		486
2029		486
Total	$	499,317

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 is also 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. Based on current information, the Company does not believe that a material loss from known matters is probable as of ~~September~~March 3031, ~~2025~~2026.

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98. CASH, CASH EQUIVALENTS, ~~INVESTMENTS~~ AND ~~RESTRICTED CASH~~INVESTMENTS

The following is a summary of the Company’s cash, cash equivalents and debt investments (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Cash	$	~~580~~932,~~992~~144	$	~~679~~969,~~949~~628
Money market funds		~~500~~130,~~259~~786		11129,~~867~~674
Certificates of deposit		~~154~~304,~~489~~179		~~164~~157,~~418~~243
U.S. treasuries and government agency bonds		33,249		-
Auction-rate securities backed by student-loan notes		49		49
Auction-rate securities backed by student-loan notes		74		148
Total	$	1,367,158	$	1,256,594
Corporate debt securities		-		6,712
Total	$	1,269,063	$	863,094

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Reported as:
Cash and cash equivalents	$	1,~~081~~062,~~251~~930	$	~~691~~1,~~816~~099,302
Investment within short-term investments		187,738		171,130
Short-term investments		304,179		157,243
Investment within other long-term assets		7449		~~148~~49
Total	$	1,~~269~~367,~~063~~158	$	~~863~~1,~~094~~256,594

The following table summarizes the contractual maturities of the short-term and long-term available-for-sale investments as of ~~September~~March 3031, ~~2025~~2026 (in thousands):

	Amortized Cost		Fair Value
Due in less than 1 year	$	89202,~~419~~786	$	89202,~~427~~786
Due in 1 - 5 years		98101,~~311~~393		98101,~~311~~393
Due in greater than 5 years		7550		7449
Total	$	~~187~~304,~~805~~229	$	~~187~~304,~~812~~228

Gross realized gains and losses recognized on the sales of available-for-sale investments were not material for the periods presented.

~~The~~ ~~following~~ 17 ~~tables summarize the unrealized gain and loss positions related to the available-for-sale investments (in thousands):~~

	September 30, 2025
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	$	500,259	$	-	$	-		$	500,259
Certificates of deposit		154,489		-		-			154,489
U.S. treasuries and government agency bonds		33,241		8		-			33,249
Auction-rate securities backed by student-loan notes		75		-		(1	)		74
Total	$	688,064	$	8	$	(1	)	$	688,071

	December 31, 2024
	Amortized Cost		Unrealized Losses			Fair Value
Money market funds	$	11,867	$	-		$	11,867
Certificates of deposit		164,418		-			164,418
Corporate debt securities		6,779		(67	)		6,712
Auction-rate securities backed by student-loan notes		150		(2	)		148
Total	$	183,214	$	(69	)	$	183,145

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~~The~~9. FAIR ~~following~~VALUE ~~tables present information about the available-for-sale investments that had been in a continuous unrealized loss position for greater than 12 months (in thousands):~~MEASUREMENTS

	September 30, 2025
	Greater than 12 Months
	Fair Value		Unrealized Losses
Auction-rate securities backed by student-loan notes	$	74	$	(1	)
Total	$	74	$	(1	)

	December 31, 2024
	Greater than 12 Months
	Fair Value		Unrealized Losses
Corporate debt securities	$	6,712	$	(67	)
Auction-rate securities backed by student-loan notes		148		(2	)
Total	$	6,860	$	(69	)

An impairment exists when the fair value of an investment is less than its amortized cost basis. As of September 30, 2025 and December 31, 2024, the Company did not consider the impairment of its investments to be a result of credit losses. The Company typically invests in highly rated securities, with the primary objective of minimizing the potential risk of principal loss. The Company’s investment policy generally requires securities to be investment grade and limits the amount of credit exposure to any one issuer. When evaluating a debt security for impairment, management reviews factors such as the Company’s intent to sell, or whether it will more likely than not be required to sell, the security before recovery of its amortized cost basis, the extent to which the fair value of the security is less than its cost, the financial condition of the issuer and the credit quality of the investment.

Restricted Cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported on the Condensed Consolidated Balance Sheets to the amounts reported on the Condensed Consolidated Statements of Cash Flows (in thousands):

	September 30,		December 31,
	2025		2024
Cash and cash equivalents	$	1,081,251	$	691,816
Restricted cash included in other long-term assets		142		125
Total cash, cash equivalents and restricted cash reported on the Condensed Consolidated Statements of Cash Flows	$	1,081,393	$	691,941

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10. FAIR VALUE MEASUREMENTS

Fair Value Hierarchy

The Company has estimated the fair value of its financial assets by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

●	Level 1—includes instruments with quoted prices in active markets for identical assets.
●	Level 2—includes instruments for which the valuations are based upon quoted market prices in active markets involving similar assets or inputs other than quoted prices that are observable for the assets. The market inputs used to value these instruments generally consist of market yields, recently executed transactions, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Pricing sources may include industry standard data providers, security master files from large financial institutions, and other third-party sources used to determine a daily market value.
●	Level 3—includes instruments for which the valuations are based on inputs that are unobservable and significant to the overall fair value measurement.

Financial Assets Measured at Fair Value on a Recurring Basis

The following tables detail the fair value of the Company’s financial assets measured on a recurring basis (in thousands):

	September 30, 2025
	March 31, 2026
	Total		Level 1		Level 2		Level 3
Money market funds	$	~~500~~130,~~259~~786	$	~~500~~130,~~259~~786	$	-	$	-
Certificates of deposit		~~154~~304,~~489~~179		-		~~154~~304,~~489~~179		-
U.S. treasuries and government agency bonds		33,249		-		33,249		-
Auction-rate securities backed by student-loan notes		49		-		-		49
Auction-rate securities backed by student-loan notes		74		-		-		74
Mutual funds and money market funds under deferred compensation plan		75,231		75,231		-		-
Mutual funds and money market funds under deferred compensation plan		70,994		70,994		-		-
Total	$	510,245	$	206,017	$	304,179	$	49
Total	$	759,065	$	571,253	$	187,738	$	74

	December 31, 2024
	December 31, 2025
	Total		Level 1		Level 2		Level 3
Money market funds	$	11129,~~867~~674	$	11129,~~867~~674	$	-	$	-
Certificates of deposit		~~164~~157,~~418~~243		-		~~164~~157,~~418~~243		-
Corporate debt securities		6,712		-		6,712		-
Auction-rate securities backed by student-loan notes		49		-		-		49
Auction-rate securities backed by student-loan notes		148		-		-		148
Mutual funds and money market funds under deferred compensation plan		75,484		75,484		-		-
Mutual funds and money market funds under deferred compensation plan		65,337		65,337		-		-
Total	$	362,450	$	205,158	$	157,243	$	49
Total	$	248,482	$	77,204	$	171,130	$	148

~~Redemptions~~ ~~and~~ 18 ~~changes in the fair value of the auction-rate securities classified as Level 3 assets were not material for the periods presented.~~

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1110. DEFERRED COMPENSATION PLAN

The following table summarizes the deferred compensation plan balances on the Condensed Consolidated Balance Sheets (in thousands):

	September 30,		December 31,
	March 31,		December 31,
	2025		2024
	2026		2025
Deferred compensation plan asset components:
Cash surrender value of corporate-owned life insurance policies	$	30,~~911~~800	$	2731,~~249~~612
Fair value of mutual funds and money market funds		7075,~~994~~231		6575,~~337~~484
Total	$	~~101~~106,~~905~~031	$	92107,~~586~~096
Deferred compensation plan assets reported in:
Other long-term assets	$	~~101~~106,~~905~~031	$	92107,~~586~~096
Deferred compensation plan liabilities reported in:
Accrued compensation and related benefits	$	36,~~656~~136	$	23,~~323~~707
Other long-term liabilities		9896,~~926~~374		93103,~~653~~954
Total	$	102,~~582~~510	$	95107,~~976~~661

1211. OTHER INCOME, NET

The components of other income, net, were as follows ~~(in thousands)~~ for the periods presented (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024			2025			2024
	2026			2025
Interest income	$	87,~~338~~941		$	65,~~805~~697		$	~~20,078~~		$	~~20,349~~
Amortization of discount on available-for-sale securities		~~1,009~~-			~~6,644~~768			~~3,894~~			~~16,684~~
Gain on deferred compensation plan investments		3,793			3,894			8,023			9,180
Charitable commitments		(900	)		-
Charitable commitments		(3,194	)		(6,400	)		(4,094	)		(18,550	)
Loss on deferred compensation plan investments		(1,588	)		(1,350	)
Other		~~446~~577			~~(665~~16	)		~~(158~~	)		~~(333~~	)
Total	$	106,~~392~~030		$	105,~~278~~131		$	~~27,743~~		$	~~27,330~~

12. INCOME 22TAXES

The income tax expense for the three months ended March 31, 2026 and 2025, was $54.0 million and $38.8 million respectively, or an effective tax rate of 21.8% and 22.3% respectively. The reduction in rate was primarily due to a reduction in non-deductible stock-based compensation.

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13. ~~INCOME TAXES~~ STOCKHOLDERS’ EQUITY

The income tax provision or benefit for interim periods is generally determined using an estimate of the Company’s annual effective tax rate and adjusted for discrete items, if any, in the relevant period. Each quarter the estimate of the annual effective tax rate is updated, and if the Company’s estimated tax rate changes, a cumulative adjustment is made.

The budget reconciliation bill H.R.1 (“H.R.1 Act”) signed into law on July 4, 2025 makes permanent certain expiring provisions of the 2017 Tax Cuts and Jobs Act and makes modifications to the existing tax framework. The modifications that primarily impact the Company for the current year are the immediate expensing of domestic R&D and 100% bonus depreciation. The Company’s tax provision for the three and nine months ended September 30, 2025 includes the estimated impact of the H.R.1 Act.

The income tax expense for the three months ended September 30, 2025 was $27.3 million, or 13.3% of pre-tax income. The income tax expense for the nine months ended September 30, 2025 was $110.7 million, or 19.9% of pre-tax income. The effective tax rates were lower than the federal statutory rate of 21% primarily due to the effect of U.S. federal tax law changes enacted during the quarter, income generated by the Company’s subsidiaries in lower tax jurisdictions, foreign tax credits, and U.S. R&D credits. The lower effective tax rates relative to the federal statutory rate were partially offset by the U.S. impact of foreign earnings and non-deductible stock-based compensation.

The income tax expense for the three months ended September 30, 2024 was $29.9 million, or 17.1% of pre-tax income. The income tax expense for the nine months ended September 30, 2024 was $66.0 million, or 16.4% of pre-tax income. The effective tax rates were lower than the federal statutory rate of 21% primarily due to lower statutory tax rates at certain foreign subsidiaries of the Company, and excess tax benefits from stock-based compensation. The lower effective tax rates relative to the federal statutory rate were partially offset by the U.S. impact of foreign earnings.

In January 2025, the Organization for Economic Co-operation and Development (“OECD”) released new Administrative Guidance on the application of the Global Anti-Base Erosion (“GLoBE”) Model Rules. The Company will continue to evaluate the impact of this release and of other future guidance on the Company’s future global tax provision.

In December 2023, the Bermuda Corporate Income Tax Act of 2023 (the “Bermuda CIT Act”) was enacted and signed into law. The Bermuda CIT Act includes a 15% corporate income tax applicable to Bermuda businesses that are multinational enterprises with annual revenue of €750M or more beginning in 2025. As the Company did not realize material taxable income in Bermuda in the three and nine months ended September 30, 2025, no material changes to income tax expense related to the Bermuda CIT Act have been recorded as of September 30, 2025.

14. ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table summarizes the changes in accumulated other comprehensive loss (in thousands):

	Unrealized
	Losses on			Foreign Currency
	Available-for-Sale			Translation
	Securities			Adjustments			Total
Balance as of January 1, 2025	$	(790	)	$	(47,721	)	$	(48,511	)
Other comprehensive income before reclassifications		43			5,139			5,182
Amounts reclassified from accumulated other comprehensive income		5			-			5
Net current period other comprehensive income		48			5,139			5,187
Balance as of March 31, 2025		(742	)		(42,582	)		(43,324	)
Other comprehensive income (loss) before reclassifications		(1	)		19,634			19,633
Net current period other comprehensive income (loss)		(1	)		19,634			19,633
Balance as of June 30, 2025		(743	)		(22,948	)		(23,691	)
Other comprehensive income before reclassifications		86			919			1,005
Tax effect		(17	)		-			(17	)
Net current period other comprehensive income		69			919			988
Balance as of September 30, 2025	$	(674	)	$	(22,029	)	$	(22,703	)

The amount reclassified from accumulated other comprehensive income for the period presented was recorded in other income, net, on the Condensed Consolidated Statements of Operations.

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15. STOCKHOLDERS’ EQUITY

Cash Dividend Program

The Company has a dividend program approved by its Board of Directors, pursuant to which the Company intends to pay quarterly cash dividends on its common stock. The Board of Directors declared the following cash dividends for the periods presented (in thousands, except per-share amounts) ~~for the periods presented~~:

	Three Months Ended September 30,				Nine Months Ended September 30,
	Three Months Ended March 31,
	2025		2024		2025		2024
	2026		2025
Dividend declared per share	$	12.5600	$	1.2556	$	~~4.68~~	$	~~3.75~~
Total amount	$	7498,~~731~~258	$	6074,~~974~~688	$	~~224,130~~	$	~~182,680~~

As of ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025, accrued ~~cash~~ dividends totaled $7498.73 million and $5976.80 million, respectively.

The declaration of any future cash dividends is at the discretion of the Board of Directors and will depend on, among other things, the Company’s financial condition, results of operations, capital requirements, business conditions, and other factors that the Board of Directors may deem relevant, as well as a determination that cash dividends are in the best interests of the Company’s stockholders.

The Company anticipates that cash used for future dividend payments will come from its domestic cash, cash generated from ongoing U.S. operations, and cash repatriated from certain foreign subsidiaries. The Company also anticipates that earnings from other foreign subsidiaries will continue to be indefinitely reinvested.

Cash Dividend Equivalent Rights

The Company’s RSUs contain rights to receive cash dividend equivalents, which entitle employees who hold RSUs to the same dividend value per share as holders of common stock. The dividend equivalents are accumulated and paid to the employees after the underlying RSUs vest. Dividend equivalents accumulated on the underlying RSUs are forfeited if the underlying RSUs do not vest. As of ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025, accrued dividend equivalents totaled $8.60 million and $59.84 million, respectively.

Stock Repurchase ~~Programs~~Program

In October 2023, the Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $640.0 million of its common stock, which was fully utilized as of December 31, 2024. In February 2025, the Board of Directors approved ~~another~~a stock repurchase program authorizing the Company to repurchase up to $500.0 million of its common stock through February 2028. Shares are retired upon repurchase. The Company ~~repurchased 2,000 and 6,000~~did ~~shares~~not make ofany ~~its~~repurchases ~~common~~under ~~stock~~this ~~for an aggregate purchase price of $2.1 million and $5.5~~program ~~million~~ during the three months ended ~~September~~March 3031, ~~2025 and~~2026 ~~2024, respectively. The Company repurchased 6,000~~ and ~~19,000 shares of its common stock for an aggregate purchase price of $4.7 million and $14.2 million during the nine months ended September 30,~~ 2025 ~~and 2024~~, respectively. ~~As of September 30, 2025, $495.3 million remained available for future repurchases under the program.~~

Stock repurchased under the program may be made through open market repurchases, privately negotiated transactions, or other structures, in accordance with applicable state and federal securities laws, at times and in amounts as management deems appropriate. The timing and the number of shares of any repurchased common stock will be determined by the Company’s management based on its evaluation of market conditions, legal requirements, share price, and other factors. The repurchase program does not obligate the Company to purchase any particular number of shares, and may be suspended, modified, or discontinued at any time without prior notice.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that have been made pursuant to and in reliance on the provisions of the Private Securities Litigation Reform Act of 1995. These statements include, among others, statements concerning:

•

the above-average industry growth of product and market areas that we have targeted;

• our plans to ~~grow~~increase revenue in a diversified way across regions and ~~increase revenue~~ through the introduction of new products within our existing product families as well as in new product categories and families;

•

our mission statement to reduce energy and material consumption to improve all aspects of quality of life and create a sustainable future;

• the effects of macroeconomic factors, global economic uncertainties, ~~geopolitical~~current ~~tensions~~and potential global conflicts and global tariffs, export controls and retaliatory measures on the semiconductor industry and our business;

•

the effect of changes in laws or economic policies in China or the U.S.;

•

the effect that liquidity of our investments has on our capital resources;

• the continuing application of our products in the storage and computing, ~~automotive,~~ enterprise data, ~~communications~~automotive, ~~consumer~~industrial, communications and ~~industrial~~consumer end markets;

•

estimates of our future liquidity requirements and the sufficiency of our cash, cash equivalents and short-term investments to operate our business;

•

the cyclical nature of the semiconductor industry;

•

our belief that we may incur significant legal expenses that vary with the level of activity in each of our current or future legal proceedings;

•

expectations regarding protection of our proprietary technology;

• ~~the~~our business outlook for the remainder of ~~2025~~2026 and beyond;

•

the factors that we believe will impact our business, operations and financial condition, as well as our ability to achieve revenue growth;

•

the expected percentage of our total revenue from various end markets;

•

our ability to identify, acquire and integrate companies, businesses and products, and achieve the anticipated benefits from such acquisitions and integrations;

• the expected impact of various U.S. and international tax laws and regulations, ~~including the H.R.1 Act signed into law~~ on ~~July 4, 2025, on~~ our income tax provision, financial position and cash flows;

•

our plan to repatriate cash from our foreign subsidiaries;

• our ~~intention and~~ ability to ~~execute~~fulfill our ~~stock~~customers’ ~~repurchase~~evolving ~~program~~needs, ~~and~~enter ~~pay~~new ~~cash~~market ~~dividends~~segments and ~~dividend~~obtain ~~equivalents;~~design ~~and~~wins;

• ~~the~~our ~~factors~~ability ~~that~~to ~~differentiate~~forecast usdemand ~~from~~accurately ~~our~~and ~~competitors.~~align inventory levels accordingly;

~~These~~• forward-looking statements generally are identified by the words “would,” “could,” “may,” “should,” “predict,” “potential,” “targets,” “continue,” “anticipate,” “expect,” “intend,” “plan,” “believe,” “seek,” “estimate,” “project,” “forecast,” “will,” and similar expressions. All forward-looking statements are based on our ~~current~~ability outlook, expectations, estimates, projections, beliefs and plans or objectives about our business, our industry and the global economy, including our expectations regarding the potential impacts of macroeconomic factors, global economic uncertainties, including tariffs, export controls and retaliatory measures, and geopolitical tensions on the semiconductor industry and our business. These statements are not guarantees of future performance and are subject to ~~significant~~develop ~~risks~~ and ~~uncertainties.~~leverage ~~Actual~~process ~~events~~technologies or results could differ materially and adversely from those expressed in any such forward-looking statements. Risks and uncertainties that could cause actual results to differ materially include those set forth throughout this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K including, in particular, in the sections entitled “Risk Factors.” Except as ~~required~~key bystrategic ~~law,~~components ~~we disclaim any duty, and undertake no obligation, to update any forward-looking statements, whether as a result~~ of ~~new~~our ~~information relating to existing conditions,~~ future events or otherwise or to release publicly the results of any future revisions we may make to forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this Quarterly Report on Form 10-Q and entail significant risks. Readers should carefully review future reports and documents that we file from time to time with the SEC, such as our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K.growth;

~~Unless~~• ~~stated~~our ~~otherwise~~expectation orto ~~the~~capitalize ~~context~~on ~~otherwise~~the ~~requires,~~length ~~references~~of ~~to “we,”~~product ~~“our,”~~life ~~and~~cycles ~~“us”~~to ~~mean~~reduce ~~Monolithic~~manufacturing ~~Power~~intensity ~~Systems, Inc.~~ and ~~its~~related ~~consolidated subsidiaries.~~emissions;

25• our ability to recruit and retain application and design engineering personnel;

•

our expectation to continue devoting significant resources to research and development including related increased expenses;

•

our ability to engage additional supply chain partners to support future growth and to leverage a diversified and resilient supply chain to reduce exposure to trade- and tariff-related risks;

•

our intention and ability to execute our stock repurchase program and pay cash dividends and dividend equivalents;

•

the factors that differentiate us from our competitors; and

•

our ability to timely and adequately remediate our material weakness.

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These forward-looking statements generally are identified by the words “would,” “could,” “may,” “should,” “predict,” “potential,” “targets,” “continue,” “anticipate,” “expect,” “intend,” “plan,” “believe,” “seek,” “estimate,” “project,” “forecast,” “will,” and similar expressions. All forward-looking statements are based on our current outlook, expectations, estimates, projections, beliefs and plans or objectives about our business, our industry and the global economy, including our expectations regarding the potential impacts of macroeconomic factors, global economic uncertainties, including tariffs, export controls and retaliatory measures, and geopolitical tensions on the semiconductor industry and our business. These statements are not guarantees of future performance and are subject to significant risks and uncertainties. Actual events or results could differ materially and adversely from those expressed in any such forward-looking statements. Risks and uncertainties that could cause actual results to differ materially include those set forth throughout this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K including, in particular, in the sections entitled “Risk Factors.” Except as required by law, we disclaim any duty, and undertake no obligation, to update any forward-looking statements, whether as a result of new information relating to existing conditions, future events or otherwise or to release publicly the results of any future revisions we may make to forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this Quarterly Report on Form 10-Q and entail significant risks. Readers should carefully review future reports and documents that we file from time to time with the SEC, such as our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K.

Unless stated otherwise or the context otherwise requires, references to the terms “Monolithic Power Systems,” “MPS,” “Registrant,” the “Company,” “we,” “our,” and “us” as used herein are references to Monolithic Power Systems, Inc. and its consolidated subsidiaries.

Overview

We are a fabless global company that provides high-performance, semiconductor-based power electronics solutions. Our mission is to reduce energy and material consumption to improve all aspects of quality of life and create a sustainable future. Founded in 1997 by our CEO Michael Hsing, we have three core strengths: deep system-level knowledge, strong semiconductor design expertise, and innovative proprietary technologies in the areas of semiconductor processes, system integration, and packaging. These combined advantages ~~are designed to~~ enable us to deliver reliable, compact, and monolithic solutions that are highly energy-efficient, cost-effective, and environmentally responsible while providing a consistent return on investment to our stockholders.

We operate in the cyclical semiconductor industry. We are subject to industry downturns, but we have targeted product and market areas that we believe allow us to operate at above average industry performance levels over the long term. We work with third parties to manufacture, assemble and ~~assemble~~test our ICs. This has enabled us to limit our capital expenditures and fixed costs, while focusing our engineering and design resources on our core strengths. Following the introduction of a product, our sales cycle generally takes a number of quarters after we receive an initial customer order for a new product to ramp up. Typical supply chain lead times for orders are generally 16 to 26 weeks. These factors, combined with the fact that our customers can cancel or reschedule orders without incurring a significant penalty, make the forecasting of our orders, revenue and expenses difficult.

We derive most of our revenue from sales through distribution arrangements and direct sales to customers in Asia, where our products are incorporated into end-user products. Our revenue from sales to customers in Asia was 9192% and 94% of our total revenue for the three months ended ~~September~~March 3031, ~~2025~~2026 and ~~2024~~2025, respectively,. ~~and 93% of~~We believe our ~~total~~ability to achieve revenue ~~for~~growth ~~each~~will ofdepend, ~~the~~in ~~nine months~~part, ~~ended~~on ~~September~~our 30ability to develop new products, ~~2025~~enter new markets, gain market share, manage litigation risk, diversify our customer base and ~~2024~~continue to secure manufacturing capacity.

We believe our ability to achieve revenue growth will depend, in part, on our ability to develop new products, enter new markets, gain market share, manage litigation risk, diversify our customer base and continue to secure manufacturing capacity.

Macroeconomic Conditions and Regulations

The semiconductor industry is impacted by various macroeconomic challenges including fluctuations in consumer spending, fluctuations in demand for semiconductors, rising inflation, global tariffs and retaliatory measures and announcements regarding the same, increased interest rates, and fluctuations in currency rates. We remain cautious in light of continued challenging global macroeconomic conditions and will continue to monitor the potential impact on our operations. The extent and duration of the direct and indirect impact of macroeconomic events on our business, results of operations and overall financial position remain uncertain and depend on future developments.

We closely monitor changes to export control laws, tariffs, trade regulations and other trade requirements. ToFor the three months ended March 31, 2026 and through the date we filed this Quarterly Report on Form 10-Q, no restrictions or requirements have had a material impact on our revenue and operations. We believe that our diverse, agile and resilient supply chain is structured in a way to minimize the impact of tariffs; however, such restrictions or requirements can be enacted quickly and unexpectedly and could impact our business in the future. To the extent tariffs, trade regulations or retaliatory measures or announcements regarding the same that affect us are implemented, we will seek to take mitigating actions in the near- and medium-term, as necessary, ~~and~~ but there can be no assurance we will be successful. We are committed to complying with all applicable trade laws, regulations and other requirements.

Critical Accounting Estimates

In preparing our condensed consolidated financial statements in accordance with U.S. GAAP, we are required to make estimates, assumptions and judgments that affect the amounts reported in our financial statements and the accompanying disclosures. Estimates and judgments used in the preparation of our financial statements are, by their nature, uncertain and unpredictable, and depend upon, among other things, many factors outside of our control, including demand for our products, economic conditions and other current and future events, such as macroeconomic factors, global economic uncertainties, geopolitical tensions and global tariffs, export controls and retaliatory measures and announcements regarding same. Actual results could differ from these estimates and assumptions, and any such differences may be material to our condensed consolidated financial statements.

~~There~~Estimates ~~have~~and ~~been~~judgments noused ~~material~~in ~~changes~~the ~~during~~preparation ~~the~~of ~~nine~~our ~~months~~financial ~~ended~~statements ~~September~~are, 30by their nature, ~~2025~~uncertain toand ~~our~~unpredictable, ~~critical~~and ~~accounting~~depend ~~estimates~~upon, ~~from~~among ~~the~~other ~~information~~things, ~~provided~~many infactors ~~the~~outside ~~“Critical~~of ~~Accounting~~our ~~Estimates”~~control. ~~section~~These offactors include ~~Part~~demand ~~II,~~for ~~Item~~our 7products, ~~“Management’s~~economic ~~Discussion~~conditions and ~~Analysis~~other ofcurrent ~~Financial~~and ~~Condition~~future events, such as macroeconomic factors, global economic uncertainties, current and ~~Results~~potential ofglobal ~~Operations”~~conflicts ~~included~~and inglobal ~~our~~tariffs, ~~Annual~~export ~~Report~~controls onand ~~Form~~retaliatory measures ~~10-K~~and ~~for~~announcements regarding the ~~year~~same. ~~ended~~Actual ~~December~~results 31could differ from these estimates and assumptions, ~~2024~~and any such differences may be material to our condensed consolidated financial statements.

26There have been no material changes during the three months ended March 31, 2026 to our critical accounting estimates from the information provided in the “Critical Accounting Estimates” section of Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2025.

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Results of Operations

The table below sets forth the data on the Condensed Consolidated Statements of Operations as a percentage of revenue for the periods presented:

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

2025

2024

2025

2024

2026

2025

(In thousands, except percentages)

Revenue

~~737~~804,~~176~~185

100.0

~~620~~637,~~119~~554

100.0

~~2,039,304~~

~~100.0~~

~~1,585,435~~

~~100.0~~

Cost of revenue

~~330~~359,~~948~~120

44.97

~~276~~284,~~676~~324

44.6

~~913,830~~

~~44.8~~

~~708,973~~

~~44.7~~

Gross profit

~~406~~445,~~228~~065

55.13

~~343~~353,~~443~~230

55.4

~~1,125,474~~

~~55.2~~

~~876,462~~

~~55.3~~

Operating expenses:

Research and development

98100,~~173~~566

1312.34

8592,~~051~~227

1314.74

~~286,666~~

~~14.1~~

~~238,986~~

~~15.1~~

Selling, general and administrative

~~112~~103,~~872~~347

1512.39

9492,~~364~~244

1514.25

~~310,108~~

~~15.2~~

~~261,425~~

~~16.5~~

Total operating expenses

~~211~~203,~~045~~913

2825.63

~~179~~184,~~415~~471

28.9

~~596,774~~

~~29.3~~

~~500,411~~

~~31.6~~

Operating income

~~195~~241,~~183~~152

2630.50

~~164~~168,~~028~~759

26.5

~~528,700~~

~~25.9~~

~~376,051~~

~~23.7~~

Other income, net

106,~~392~~030

10.47

105,~~278~~131

10.68

~~27,743~~

~~1.4~~

~~27,330~~

~~1.7~~

Income before income taxes

~~205~~247,~~575~~182

2730.97

~~174~~173,~~306~~890

2827.13

~~556,443~~

~~27.3~~

~~403,381~~

~~25.4~~

Income tax expense

2753,~~301~~956

36.7

2938,~~876~~838

46.81

~~110,652~~

~~5.4~~

~~66,044~~

~~4.1~~

Net income

~~178~~193,~~274~~226

24.20

~~144~~135,~~430~~052

2321.32

~~445,791~~

~~21.9~~

~~337,337~~

~~21.3~~

Revenue

The following table summarizes our revenue by end market for the periods presented:

	Three Months Ended September 30,										Nine Months Ended September 30,
	Three Months Ended March 31,
End Market	~~2025~~2026		% of Revenue			~~2024~~2025		% of Revenue			~~2025~~		~~% of Revenue~~			~~2024~~		~~% of Revenue~~
	(In thousands, except percentages)
Storage and Computing	$	186,572		25.3	%	$	143,993		23.2	%	$	570,403		28.0	%	$	365,069		23.0	%
Enterprise Data	$	262,823		32.7	%	$	132,924		20.8	%
Enterprise Data		191,482		26.0			184,459		29.7			468,370		23.0			521,397		32.9
Storage and Computing		174,394		21.7			188,511		29.6
Automotive		~~151~~152,~~540~~346		2018.69			~~111~~144,~~344~~904		1822.07			~~441,576~~		~~21.7~~			~~285,629~~		~~18.0~~
Communications		79111,~~868~~457		1013.89			71,~~884~~671		11.63			~~225,322~~		~~11.1~~			~~162,095~~		~~10.2~~
Consumer		7254,~~399~~540		96.8			6456,~~401~~947		108.49			~~189,009~~		~~9.2~~			~~144,704~~		~~9.1~~
Industrial		5548,~~315~~625		76.50			4442,~~038~~597		76.17			~~144,624~~		~~7.0~~			~~106,541~~		~~6.8~~
Total	$	~~737~~804,~~176~~185		100.0	%	$	~~620~~637,~~119~~554		100.0	%	$	~~2,039,304~~		~~100.0~~	%	$	~~1,585,435~~		~~100.0~~	%

Revenue for the three months ended ~~September~~March 3031, ~~2025~~2026 was $~~737~~804.2 million, an increase of $~~117~~166.16 million, or 1826.91%, from $~~620~~637.16 million for the three months ended ~~September~~March 3031, ~~2024~~2025. The increase in revenue was primarily due to higher shipment volume and higher average selling prices resulting primarily from product mix.

~~For~~By ~~the~~end ~~three~~market, ~~months~~first ~~ended~~quarter ~~September~~2026 ~~30, 2025,~~ revenue ~~from~~for ~~the~~enterprise ~~storage and computing market~~ data increased $42129.69 million, or 2997.67%, from the same period in ~~2024~~2025. This increase was primarily due to higher sales of power solutions for ~~storage~~artificial intelligence (“AI”) and server applications. Revenue from the ~~enterprise~~storage ~~data~~and computing market ~~increased~~of $174.4 million decreased $714.01 million, or 37.85%, from the same period in ~~2024.~~2025 primarily ~~Revenue~~due ~~from~~to ~~the~~decreased ~~automotive~~sales ~~market~~of ~~increased~~power ~~$40.2~~solutions ~~million,~~for ornotebooks ~~36.1%,~~and ~~from~~graphics ~~the~~cards, ~~same~~partially ~~period~~offset inby ~~2024.~~increased ~~This~~sales ~~increase~~of ~~was primarily~~memory ~~due~~and tostorage ~~higher sales of~~ applications. First ~~supporting~~quarter ~~advanced~~2026 ~~driver~~automotive ~~assistance~~revenue ~~systems,~~of ~~infotainment,~~$152.3 million increased ~~and~~$7.4 ~~motion~~million, ~~control~~or 5.1%, ~~Revenue~~ from the ~~communications~~same ~~market~~period in 2025. Communications revenue of $111.5 million increased $839.08 million, or 1155.15%, from the same period in ~~2024~~2025 due to higher sales of power solutions for optical modules and switches. ~~Revenue~~First ~~from~~quarter ~~the~~2026 consumer ~~market~~revenue decreased ~~increased~~ $82.04 million, or ~~12.~~4.2%, from the same period in ~~2024~~2025. Revenue of $48.6 million from the industrial market increased $116.3 0 million, or 2514.62%, from the same period in ~~2024~~2025.

~~Revenue~~ 23 for the nine months ended September 30, 2025 was $2,039.3 million, an increase of $453.9 million, or 28.6%, from $1,585.4 million for the nine months ended September 30, 2024. The increase in revenue was primarily due to higher shipment volume.

For the nine months ended September 30, 2025, revenue from the storage and computing market increased $205.3 million, or 56.2%, from the same period in 2024. This increase was primarily due to higher sales of power solutions for storage applications, notebooks and graphics cards. Revenue from the automotive market increased $155.9 million, or 54.6%, from the same period in 2024. This increase was primarily due to higher sales of applications supporting advanced driver assistance systems and infotainment. Revenue from the enterprise data market decreased $53.0 million, or 10.2%, from the same period in 2024. Revenue from the communications market increased $63.2 million, or 39.0%, from the same period in 2024. This increase was primarily driven by higher sales of power solutions for optical modules and routers. Revenue from the consumer market increased $44.3 million, or 30.6%, from the same period in 2024. This increase was primarily driven by higher sales of products for home appliances and gaming solutions. Revenue from the industrial market increased $38.1 million, or 35.7%, from the same period in 2024.

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Cost of Revenue and Gross Margin

Cost of revenue primarily consists of costs incurred to manufacture, assemble and test our products, as well as warranty costs, inventory-related and other overhead costs, and stock-based compensation ~~expense~~expenses.

	Three Months Ended September 30,						Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024			2025			2024
	2026			2025
	(In thousands, except percentages)
Cost of revenue	$	~~330~~359,~~948~~120		$	~~276~~284,~~676~~324		$	~~913,830~~		$	~~708,973~~
As a percentage of revenue		44.97	%		44.6	%		~~44.8~~	%		~~44.7~~	%
Gross profit	$	~~406~~445,~~228~~065		$	~~343~~353,~~443~~230		$	~~1,125,474~~		$	~~876,462~~
Gross margin		55.13	%		55.4	%		~~55.2~~	%		~~55.3~~	%

Cost of revenue was $~~330~~359.91 million, or 44.97% of revenue, for the three months ended ~~September~~March 3031, ~~2025~~2026, and $~~276~~284.73 million, or 44.6% of revenue, for the three months ended ~~September~~March 3031, ~~2024~~2025. The $5474.38 million increase in cost of revenue was primarily driven by product mix and higher shipment volume.

Gross margin was 55.13% for the three months ended ~~September~~March 3031, ~~2025~~2026, compared with 55.4% for the three months ended ~~September~~March 3031, ~~2024~~2025. The decrease in gross margin was mainly driven by ~~product~~higher ~~mix~~warranty expenses as a percentage of revenue, partially offset by lower manufacturing overhead costs as a percentage of revenue.

Cost of revenue was $913.8 million, or 44.8% of revenue, for the nine months ended September 30, 2025, and $709.0 million, or 44.7% of revenue, for the nine months ended September 30, 2024. The $204.9 million increase in cost of revenue was primarily driven by higher shipment volume.

Gross margin was 55.2% for the nine months ended September 30, 2025, compared with 55.3% for the nine months ended September 30, 2024. The decrease in gross margin was mainly driven by product mix, partially offset by a decrease in inventory write-downs as a percentage of revenue.

Research and Development

R&D expenses primarily consist of cash-based compensation and benefits, stock-based compensation and deferred compensation for design and product engineers, expenses related to new product development and supplies, and ~~facility~~ facilities costs.

	Three Months Ended September 30,						Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024			2025			2024
	2026			2025
	(In thousands, except percentages)
R&D expenses	$	98100,~~173~~566		$	8592,~~051~~227		$	~~286,666~~		$	~~238,986~~
As a percentage of revenue		1312.34	%		1314.74	%		~~14.1~~	%		~~15.1~~	%

R&D expenses were $98100.26 million, or 1312.34% of revenue, for the three months ended ~~September~~March 3031, ~~2025~~2026, and $8592.12 million, or 1314.74% of revenue, for the three months ended ~~September~~March 3031, ~~2024~~2025. The $138.14 million increase in R&D expenses was primarily due to ana $84.9 3 million increase in cash-based compensation and benefits, a $1.23 million increase in ~~stock-based~~laboratory ~~compensation~~ and ~~related~~other ~~expenses~~supplies, and a $1.13 million increase in ~~laboratory~~facilities ~~and other supplies~~costs.

~~R&D~~ 24 expenses were $286.7 million, or 14.1% of revenue, for the nine months ended September 30, 2025, and $239.0 million, or 15.1% of revenue, for the nine months ended September 30, 2024. The $47.7 million increase in R&D expenses was primarily due to a $29.0 million increase in cash compensation and benefits, a $6.3 million increase in new product development expenses, and a $4.1 million increase in laboratory and other supplies.

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Selling, General and Administrative

SG&A expenses primarily include cash-based compensation and benefits, stock-based compensation and deferred compensation for sales, marketing and administrative personnel, travel expenses, facilities costs, third -party service fees and legal expenses.

	Three Months Ended September 30,						Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024			2025			2024
	2026			2025
	(In thousands, except percentages)
SG&A expenses	$	~~112~~103,~~872~~347		$	9492,~~364~~244		$	~~310,108~~		$	~~261,425~~
As a percentage of revenue		1512.39	%		1514.25	%		~~15.2~~	%		~~16.5~~	%

SG&A expenses were $~~112~~103.93 million, or 1512.39% of revenue, for the three months ended ~~September~~March 3031, ~~2025~~2026, and $9492.42 million, or 1514.25% of revenue, for the three months ended ~~September~~March 3031, ~~2024~~2025. The $1811.51 million increase in SG&A expenses was primarily driven by ana $810.30 million increase in cash-based compensation and benefits, ~~and~~ a $75.0 1 million increase in stock-based compensation related payroll taxes, and ~~related~~a $4.4 million increase in legal expenses, partially offset by an $11.1 million decrease in stock-based compensation.

SG&A expenses were $310.1 million, or 15.2% of revenue, for the nine months ended September 30, 2025, and $261.4 million, or 16.5% of revenue, for the nine months ended September 30, 2024. The $48.7 million increase in SG&A expenses was primarily driven by a $24.1 million increase in cash compensation and benefits, and a $15.8 million increase in stock-based compensation and related expenses.

Other Income, Net

Other income, net, was $106.40 million for the three months ended ~~September~~March 3031, ~~2025~~2026, compared with $105.31 million for the three months ended ~~September~~March 3031, ~~2024. Other income, net, was $27.7 million for the nine months ended September 30,~~ 2025~~, compared with $27~~.3 ~~million for the nine months ended September 30, 2024.~~

Income Tax Expense

The income tax ~~provision~~expense for ~~interim~~the ~~periods~~three months isended ~~generally~~March ~~determined~~31, ~~using~~2026 ~~an estimate of our annual effective tax rate~~ and ~~adjusted for discrete items~~2025, was if$54.0 ~~any,~~million inand ~~the relevant period~~$38.8 ~~Each~~million ~~quarter~~respectively, ~~the~~or ~~estimate~~an ~~of the annual~~ effective tax rate isof 21.8% ~~updated,~~ and 22.3% ifrespectively. ~~our~~The ~~estimated~~reduction ~~tax~~in rate ~~changes,~~was primarily due to a ~~cumulative~~reduction ~~adjustment~~in isnon-deductible ~~made~~stock-based compensation.

~~The~~ 25 budget reconciliation bill H.R.1 (“H.R.1 Act”) signed into law on July 4, 2025 makes permanent certain expiring provisions of the 2017 Tax Cuts and Jobs Act and makes modifications to the existing tax framework. The modifications that primarily impact us for the current year are the immediate expensing of domestic R&D and 100% bonus depreciation. Our tax provision for the three and nine months ended September 30, 2025 includes the estimated impact of the H.R.1 Act.

The income tax expense for the three months ended September 30, 2025 was $27.3 million, or 13.3% of pre-tax income. The income tax expense for the nine months ended September 30, 2025 was $110.7 million, or 19.9% of pre-tax income. The effective tax rates were lower than the federal statutory rate of 21% primarily due to the effect of U.S. federal tax law changes enacted during the quarter, income generated by our subsidiaries in lower tax jurisdictions, foreign tax credits, and U.S. R&D credits. The lower effective tax rates relative to the federal statutory rate were partially offset by the U.S. impact of foreign earnings and non-deductible stock-based compensation.

The income tax expense for the three months ended September 30, 2024 was $29.9 million, or 17.1% of pre-tax income. The income tax expense for the nine months ended September 30, 2024 was $66.0 million, or 16.4% of pre-tax income. The effective tax rates were lower than the federal statutory rate of 21% primarily due to lower statutory tax rates at certain of our foreign subsidiaries, and excess tax benefits from stock-based compensation. The lower effective tax rates relative to the federal statutory rate were partially offset by the U.S. impact of foreign earnings.

In January 2025, the OECD released new Administrative Guidance on the application of the GLoBE Model Rules. We will continue to evaluate the impact of this release and of other future guidance on our future global tax provision.

In December 2023, the Bermuda CIT Act was enacted and signed into law. See Note 13 to our unaudited condensed consolidated financial statements for further details.

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Liquidity and Capital Resources

	September 30,			December 31,
	March 31,			December 31,
	2025			2024
	2026			2025
	(In thousands, except percentages)
Cash and cash equivalents	$	1,~~081~~062,~~251~~930		$	~~691~~1,~~816~~099,302
Short-term investments		~~188~~304,~~233~~179			~~171~~157,~~130~~243
Total cash, cash equivalents and short-term investments	$	1,~~269~~367,~~484~~109		$	~~862~~1,~~946~~256,545
Percentage of total assets		30.27	%		2330.90	%
Total current assets	$	2,~~112~~331,~~745~~095		$	12,~~565~~183,~~053~~802
Total current liabilities		(~~442~~486,~~804~~958	)		(~~294~~369,~~567~~365	)
Working capital	$	1,~~669~~844,~~941~~137		$	1,~~270~~814,~~486~~437

As of ~~September~~March 3031, ~~2025~~2026, we had cash and cash equivalents of $1,~~081~~062.39 million and short-term investments of $~~188~~304.2 million, compared with cash and cash equivalents of $~~691~~1,099.83 million and short-term investments of $~~171~~157.12 million as of December 31, ~~2024~~2025. As of ~~September~~March 3031, ~~2025~~2026, $~~871~~683.0 million of cash and cash equivalents and $~~154~~304.52 million of short-term investments were held by our foreign subsidiaries. ~~For~~We ~~the~~may ~~nine~~continue ~~months~~to ~~ended September 30, 2025, we repatriated $275 million of~~ repatriate cash from certain of our foreign subsidiaries to the U.S. ~~with~~to ~~minimal~~fund ~~tax impact. We may repatriate additional cash from certain of~~ our ~~foreign~~expenditures ~~subsidiaries~~ in future periods. We anticipate that earnings from other foreign subsidiaries will continue to be indefinitely reinvested.

Summary of Cash Flows

The following table summarizes our cash flow activities for the periods presented:

	Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024
	2026			2025
	(In thousands)
Net cash provided by operating activities	$	~~733~~250,~~292~~253		$	~~620~~256,~~729~~387
Net cash used in investing activities		(~~145~~212,~~718~~322	)		(~~296~~257,~~128~~485	)
Net cash used in financing activities		(~~208~~75,~~567~~266	)		(~~186~~55,~~853~~916	)
Effect of change in exchange rates		~~10,445~~961			12,~~552~~555
Net increase in cash, cash equivalents and restricted cash	$	389,452		$	139,300
Net decrease in cash, cash equivalents and restricted cash	$	(36,374	)	$	(54,459	)

For the ~~nine~~three months ended ~~September~~March 3031, ~~2025~~2026, the $~~112.~~6 .1 million ~~increase~~decrease in net cash provided by operating activities compared to the same period in ~~2024~~2025 was primarily due to increased ~~accounts~~inventory ~~receivable~~purchases ~~collections~~and other changes in working capital, partially offset by increased ~~inventory~~accounts ~~purchases~~receivable collections.

For the ~~nine~~three months ended ~~September~~March 3031, ~~2025~~2026, the $~~150~~45.4 2 million decrease in net cash used in investing activities compared to the same period in ~~2024~~2025 was primarily due to ~~a decrease~~ of $~~545~~69.9 2 million inhigher net purchases of investments, partially offset by ~~a decrease~~ of $~~395~~24.2 1 million inhigher ~~sales~~purchases of ~~investments~~property and equipment.

For the ~~nine~~three months ended ~~September~~March 3031, ~~2025~~2026, the $2119.7 4 million increase in net cash used in financing activities compared to the same period in ~~2024~~2025 was primarily due to an increase of $3118.2 4 million in dividend and dividend equivalent payments~~, partially offset by a decrease in repurchases of common stock~~.

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Cash Requirements

Although consequences of economic uncertainties and macroeconomic conditions, including tariffs and retaliatory measures and announcements regarding the same, and many other factors could adversely affect our liquidity and capital resources in the future, and cash requirements may fluctuate based on the timing and extent of many factors such as those discussed above, we believe that our balances of cash, cash equivalents and short-term investments of $1,~~269~~367.51 million as of ~~September~~March 3031, ~~2025~~2026, along with cash generated by ongoing operations, will be sufficient to satisfy our liquidity requirements for ~~at least~~ the next 12 months.

Our material cash requirements include the following contractual and other obligations:

Purchase Obligations

Purchase obligations represent commitments to our suppliers and other parties requiring the purchases of goods or services. Our 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.

InAs ~~May~~of ~~2022~~March 31, we2026, ~~entered~~total ~~into~~estimated afuture ~~long-term~~unconditional ~~supply~~purchase ~~agreement~~commitments ~~in order~~ to ~~secure~~all ~~manufacturing~~suppliers ~~production~~and ~~capacity~~other ~~for~~parties were ~~silicon wafers over a four-year period~~$588. ~~As of September 30~~7 million, ~~2025, we had remaining prepayments under this agreement~~ of which $60557.~~0 million~~5 ~~reported~~million inwas ~~other~~due ~~current assets~~within ona ~~the Condensed Consolidated Balance Sheets~~year.

As of September 30, 2025, total estimated future unconditional purchase commitments to all suppliers and other parties, net of the $60.0 million prepayment, were $499.3 million, of which $443.2 million was due within a year.

Operating Leases

Operating lease obligations represent the undiscounted remaining lease payments primarily for our leased facilities. As of September 30, 2025, these obligations totaled $18.9 million, of which $3.8 million was short-term.

Capital Return to Stockholders

In February 2025, our Board of Directors approved a new stock repurchase program authorizing us to repurchase up to $500.0 million of our common stock through February 2028. Shares are retired upon repurchase. WeThe ~~repurchased~~Company ~~6,000~~did not make ~~shares~~any ofrepurchases ~~our~~under ~~common~~this ~~stock for an aggregate purchase price of $4.7 million~~ program during the ~~nine~~three months ended ~~September~~March 3031, ~~2025~~2026. As of ~~September~~March 3031, ~~2025~~2026, $~~495~~493.34 million remained available for future repurchases under the program.

We currently have a dividend program approved by our Board of Directors, pursuant to which we intend to pay quarterly cash dividends on our common stock. Based on our historical practice, stockholders of record as of the last business day of the quarter are entitled to receive the quarterly cash dividends when and if declared by the Board of Directors, which are payable to the stockholders in the following month. As of ~~September~~March 3031, ~~2025~~2026, accrued ~~cash~~ dividends totaled $7498.73 million. The declaration of any future cash dividends is at the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, capital requirements, business conditions and other factors that our Board of Directors may deem relevant, as well as a determination that cash dividends are in the best interests of our stockholders.

Other Long-Term Obligations

Other long-term obligations primarily include ~~payments for~~ deferred compensation plan liabilities and accrued dividend equivalents. As of ~~September~~March 3031, ~~2025~~2026, these obligations totaled $~~102~~99.32 million.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

For a discussion of market risks, refer to Item 7A, “Quantitative and Qualitative Disclosures about Market Risk” in our Annual Report on Form 10-K for the year ended December 31, ~~2024~~2025. During the three ~~and nine~~ months ended ~~September~~March 3031, ~~2025~~2026, there were no material changes or developments that would have materially altered, or were reasonably likely to materially alter, the market risk assessment performed as of December 31, ~~2024~~2025.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Interim Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934 as of the end of the period covered by this Quarterly Report on Form 10-Q.

Based on this evaluation, and due to the finding of the material weakness described below, our Chief Executive Officer and Interim Chief Financial Officer concluded that, as of ~~September~~March 3031, ~~2025~~2026, our disclosure controls and procedures were ~~designed~~not ~~at a reasonable assurance level and were~~ effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. ~~Changes in Internal Control over Financial Reporting~~

~~During~~As previously reported in our Annual Report on Form 10-K for the ~~quarter~~year ended ~~September~~December 3031, 2025, ~~there~~during ~~were~~the year-end nofinancial ~~changes~~reporting inprocess ~~our~~for fiscal year 2025, the material weakness was identified in internal control over financial reporting ~~that~~related ~~would~~to ~~have~~the ~~materially~~accounting ~~affected~~for deferred income taxes. We engaged third-party tax service providers in connection with the original determination of the accounting for deferred income taxes associated with a one-time tax incentive granted by a certain foreign jurisdiction. Nevertheless, the orinternal ~~were~~controls ~~reasonably~~in ~~likely~~place with respect to ~~materially~~the ~~affect,~~review ~~our~~of ~~internal~~the ~~control~~calculation ~~over~~of deferred ~~financial~~income ~~reporting~~taxes and the related income tax expense (benefit) were not designed appropriately or operating effectively as of March 31, 2026.

Notwithstanding the material weakness in internal control over financial reporting, management believes and has concluded that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP.

Ongoing Remediation of Previously Identified Material Weakness

With respect to the material weakness described above, management, under the oversight of the Audit Committee, has implemented measures designed to ensure that control deficiencies contributing to the material weakness are remediated, such that these controls are designed, implemented, and operating effectively. However, the material weakness will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively. Management expects to remediate the material weakness by the end of fiscal year 2026 and is monitoring the effectiveness of its remediation plan and will refine the plan as appropriate. However, there is no assurance as to when such remediation will be completed.

Changes in Internal Control over Financial Reporting

Except for the remediation measures related to the material weakness described above, there were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2026, that would have materially affected, or were reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Controls and Procedures

In designing and evaluating the disclosure controls and procedures, management recognizes that any ~~set of~~ controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are a party to actions and proceedings in the ordinary course of business, including challenges to the enforceability or validity of our intellectual property, claims that our products infringe on the intellectual property rights of others, and employment matters. We are also subject to litigation initiated by our 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. We defend ourselves vigorously against any such claims. Based on current information and management assessment, we do not believe that a material loss from known matters is probable as of ~~September~~March 3031, ~~2025~~2026.

On February 4, 2025, a ~~purported~~ class action lawsuit was filed against us and certain of our executives. The lawsuit is captioned Waterford Twp. Gen. Emps. Ret. Sys. v. Monolithic Power Systems, Inc., et al., No. 25-cv-220 (W.D. Wash.) (the “Securities Action”) and alleges that we violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder, by making material misstatements or omissions relating to our business. We believe the lawsuit is meritless and currently intend to defend against it vigorously. Related to the Securities Action, two shareholder derivative suits were also filed, against current – and one former – director, and certain executives, alleging breaches of their fiduciary duties. The shareholder derivative suits have been consolidated under the caption Miller v. Hsing, et al., No. 25-cv-527 (W.D. Wash.), filed on March 26, 2025 (the “Derivative Litigation”). The Securities Action and Derivative Litigation seek unspecified amounts of damages and/or attorneys’ fees and other relief. The Derivative Litigation is stayed pending developments in the Securities Action.

Item 1A. Risk Factors

Our business, reputation, results of operations, financial condition and stock price can be affected by a number of factors, whether currently known or unknown, including those described in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, ~~2024~~2025 under the heading “Risk Factors.” When any one or more of these risks materialize from time to time, our business, reputation, results of operations, financial condition and stock price can be materially and adversely affected. There have been no material changes to our risk factors since the filing of our Annual Report on Form 10-K for the year ended December 31, ~~2024~~2025.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

In February 2025, our Board of Directors approved a stock repurchase program authorizing us to repurchase up to $500.0 million of our common stock through February 2028. Shares are retired upon repurchase. We ~~repurchased 2,000 and 6,000~~ ~~shares~~did not make ofany ~~our~~repurchases ~~common~~under ~~stock~~this ~~for an aggregate purchase price of $2.1~~program ~~million and $4.7 million~~ during the three ~~and nine~~ months ended ~~September~~March 3031, ~~2025~~2026.

The following table represents details of our stock repurchase transactions during the three months ended September 30, 2025:

Period	Total Number of Shares Purchased			Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program			Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
	(In thousands, except per share amounts)
July 1, 2025 – July 31, 2025		1		$	732.97		1		$	496,669
August 1, 2025 – August 31, 2025		1		$	827.71		1		$	496,008
September 1, 2025 – September 30, 2025		-	(a)	$	871.40		-	(a)	$	495,349
Total		2		$	804.98		2

(a) Represents less than one thousand shares.

Stock repurchases under the program may be made through open market repurchases, privately negotiated transactions, or other structures, in accordance with applicable state and federal securities laws, at times and in amounts as management deems appropriate. The timing and the number of shares of any repurchased common stock will be determined by our management based on the evaluation of market conditions, legal requirements, stock price, and other factors. The repurchase program does not obligate us to purchase any particular number of shares and may be suspended, modified, or discontinued at any time without prior notice.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Certain of our executive officers and directors have entered into trading plans pursuant to Rule 10b5-1(c) of the Securities Exchange Act of 1934, as amended. A trading plan is a written document that pre-establishes the amounts, prices and dates (or formula for determining the amounts, prices and dates) of future purchases or sales of our common stock, including the sale of shares acquired pursuant to the Monolithic Power Systems, Inc. 2004 Employee Stock Purchase Plan, amended and restated, and upon vesting of RSUs.

The following table summarizes the adoption of trading plans intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) during the three months ended ~~September~~March 3031, ~~2025~~2026:

Name and Title	Adoption Date	Plan Duration	Intended Sale Amount (in shares)
Victor K. Lee, Director	August 25, 2025	Through August 31, 2026	Up to 2,000
Deming Xiao, Executive Vice President, Global Operations	February 20, 2026	Through February 19, 2027	Up to 120,000
Michael Hsing, President, Chief Executive Officer and Director	August 28, 2025	Through August 31, 2026	Up to 100,000

The following table summarizes the termination of trading plans intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) during the three months ended ~~September~~March 3031, ~~2025~~2026:

Name and Title		Termination Date		Original Plan Duration		Intended Sale Amount (in shares)		Sold Amount (in shares)
Deming Xiao, Executive Vice President, Global Operations		~~August~~February 59, ~~2025~~2026		Through ~~February~~November 2713, 2026		Up to ~~160~~80,~~000~~976		~~39,999~~-

During the three months ended ~~September~~March 3031, ~~2025~~2026, no trading plans intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) were modified, and no other written trading arrangements that are not intended to qualify for the Rule 10b5-1(c) affirmative defense were adopted, modified, or terminated.

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Item 6. Exhibits

Exhibit No.	Description
10.1+	Transition Agreement with former Chief Financial Officer.
31.1	Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Interim Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer and Interim Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

Management contract or compensatory plan or arrangement.

This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

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MONOLITHIC POWER SYSTEMS, INC

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MONOLITHIC POWER SYSTEMS, INC.
Dated: November 5, 2025
Dated: May 4, 2026
	By:	/s/ T.Robert ~~Bernie Blegen~~Dean
		T. Bernie Blegen
		Robert Dean
		Executive Vice President and Chief Financial Officer
		Interim Chief Financial Officer
		(Duly Authorized Officer and Principal
		Financial and Accounting Officer)

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