# LATTICE SEMICONDUCTOR CORP (LSCC)

Informational only - not investment advice.

CIK: 0000855658
SIC: 3674 Semiconductors & Related Devices
SIC breadcrumb: [Manufacturing](/division/D/) > [Electronic And Other Electrical Equipment And Components, Except Computer Equipment](/major-group/36/) > [SIC 3674 Semiconductors & Related Devices](/industry/3674/)
Latest 10-K filed: 2026-02-13
SEC page: https://www.sec.gov/edgar/browse/?CIK=855658
Filing source: https://www.sec.gov/Archives/edgar/data/855658/000143774926004100/lscc20260103_10k.htm

## At a glance

FY2025 · period end 2026-01-03 · filed 2026-02-13 · accession 0001437749-26-004100 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000855658.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 523,262,000 USD | 2025 | verified |
| Net income | 3,084,000 USD | 2025 | verified |
| Assets | 883,120,000 USD | 2025 | verified |
| Free cash flow | 132,580,000 USD | 2025 | computed |
| Net margin | 0.59% | 2025 | computed |
| Operating margin | 2.15% | 2025 | computed |
| Revenue YoY | +2.72% | 2025 | computed |
| ROE | 0.43% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | LSCC | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 0.6% | 4.9% | 41 | 59 |
| Operating margin | 2.1% | 3.7% | 44 | 58 |
| Revenue growth | 2.7% | 15.5% | 23 | 61 |
| FCF margin | 25.3% | 8.9% | 85 | 60 |
| ROE | 0.4% | 3.8% | 40 | 58 |
| ROA | 0.3% | 1.6% | 43 | 61 |
| Liabilities / equity | 0.24 | 0.51 | 29 | 59 |
| Current ratio | 3.09 | 2.70 | 53 | 61 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 3674 Semiconductors & Related Devices, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 523262000 | USD | 2025 | 2026-02-13 |
| Net income | 3084000 | USD | 2025 | 2026-02-13 |
| Assets | 883120000 | USD | 2025 | 2026-02-13 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-13. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000855658.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue | 427,054,000 | 385,961,000 | 398,799,000 | 404,093,000 | 408,120,000 | 515,327,000 | 660,356,000 | 737,154,000 | 509,401,000 | 523,262,000 |
| Net income | -54,099,000 | -70,562,000 | -26,322,000 | 43,493,000 | 47,392,000 | 95,922,000 | 178,882,000 | 259,061,000 | 61,131,000 | 3,084,000 |
| Operating income | -26,699,000 | -47,620,000 | -3,120,000 | 59,041,000 | 52,366,000 | 100,816,000 | 187,367,000 | 212,270,000 | 34,457,000 | 11,232,000 |
| Gross profit |  | 216,579,000 | 219,439,000 | 238,422,000 | 245,306,000 | 321,675,000 | 452,050,000 | 514,670,000 | 340,400,000 | 356,943,000 |
| Diluted EPS | -0.45 | -0.58 | -0.21 | 0.32 | 0.34 | 0.67 | 1.27 | 1.85 | 0.44 | 0.02 |
| Operating cash flow | 41,734,000 | 38,514,000 | 51,458,000 | 124,137,000 | 91,687,000 | 167,722,000 | 238,806,000 | 269,588,000 | 140,876,000 | 175,107,000 |
| Capital expenditures | 16,717,000 | 12,855,000 | 8,384,000 | 15,590,000 | 12,121,000 | 9,835,000 | 23,338,000 | 20,098,000 | 20,985,000 | 42,527,000 |
| Share buybacks | 0.00 | 0.00 | 0.00 | 0.00 | 14,989,000 | 70,124,000 | 110,132,000 | 80,004,000 | 66,998,000 | 100,000,000 |
| Assets | 766,883,000 | 635,961,000 | 623,687,000 | 612,016,000 | 680,067,000 | 726,494,000 | 798,713,000 | 840,894,000 | 843,903,000 | 883,120,000 |
| Liabilities | 496,453,000 | 418,268,000 | 365,230,000 | 284,357,000 | 295,640,000 | 314,861,000 | 311,550,000 | 148,874,000 | 132,971,000 | 169,066,000 |
| Stockholders' equity | 270,430,000 | 245,094,000 | 258,457,000 | 327,659,000 | 384,427,000 | 411,633,000 | 487,163,000 | 692,020,000 | 710,932,000 | 714,054,000 |
| Cash and cash equivalents | 106,552,000 | 106,815,000 | 119,051,000 | 118,081,000 | 182,332,000 | 131,570,000 | 145,722,000 | 128,317,000 | 136,291,000 | 133,886,000 |
| Free cash flow | 25,017,000 | 25,659,000 | 43,074,000 | 108,547,000 | 79,566,000 | 157,887,000 | 215,468,000 | 249,490,000 | 119,891,000 | 132,580,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin | -12.67% | -18.28% | -6.60% | 10.76% | 11.61% | 18.61% | 27.09% | 35.14% | 12.00% | 0.59% |
| Operating margin | -6.25% | -12.34% | -0.78% | 14.61% | 12.83% | 19.56% | 28.37% | 28.80% | 6.76% | 2.15% |
| Return on equity | -20.00% | -28.79% | -10.18% | 13.27% | 12.33% | 23.30% | 36.72% | 37.44% | 8.60% | 0.43% |
| Return on assets | -7.05% | -11.10% | -4.22% | 7.11% | 6.97% | 13.20% | 22.40% | 30.81% | 7.24% | 0.35% |
| Liabilities / equity | 1.84 | 1.71 | 1.41 | 0.87 | 0.77 | 0.76 | 0.64 | 0.22 | 0.19 | 0.24 |
| Current ratio | 2.00 | 3.15 | 4.10 | 2.63 | 4.19 | 2.84 | 2.98 | 3.78 | 3.66 | 3.09 |

## As-reported value updates

1 tracked difference above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period.

Ledger: /company/LSCC/revisions/


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-04. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000855658.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q3 | 2022-07-02 |  |  | 0.33 | reported discrete quarter |
| 2023-Q1 | 2023-04-01 |  |  | 0.40 | reported discrete quarter |
| 2023-Q2 | 2023-07-01 |  |  | 0.36 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 192,169,000 | 53,788,000 | 0.38 | reported discrete quarter |
| 2023-Q4 | 2023-12-30 | 170,596,000 | 98,706,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-30 | 140,815,000 | 14,796,000 | 0.11 | reported discrete quarter |
| 2024-Q2 | 2024-06-29 | 124,076,000 | 22,631,000 | 0.16 | reported discrete quarter |
| 2024-Q3 | 2024-09-28 | 127,091,000 | 7,190,000 | 0.05 | reported discrete quarter |
| 2024-Q4 | 2024-12-28 | 117,419,000 | 16,514,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-29 | 120,150,000 | 5,022,000 | 0.04 | reported discrete quarter |
| 2025-Q2 | 2025-06-28 | 123,971,000 | 2,913,000 | 0.02 | reported discrete quarter |
| 2025-Q3 | 2025-09-27 | 133,349,000 | 2,794,000 | 0.02 | reported discrete quarter |
| 2025-Q4 | 2026-01-03 | 145,792,000 | -7,645,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-04-04 | 170,897,000 | 21,817,000 | 0.16 | reported discrete quarter |
| 2026-Q2 | 2026-07-04 | 201,079,000 | 19,359,000 | 0.14 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from LSCC's latest 10-K: [/company/LSCC/business/](/company/LSCC/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from LSCC's latest 10-K: [/company/LSCC/risk-factors/](/company/LSCC/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/855658/000143774926025657/lscc20260704_10q.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-08-04
Report date: 2026-07-04

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read along with the unaudited consolidated financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as the audited consolidated financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2025 10-K.

Overview

Lattice develops technologies that we monetize through differentiated programmable logic semiconductor products, silicon-enabling products, system solutions, design services, and technology licenses. Lattice is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the Compute, Communications, Industrial, and Embedded markets. Our technology, long-standing relationships, and commitment to world-class support helps our customers quickly and easily unleash their innovation to create a smart, secure, and connected world.

Lattice has focused its strategy on delivering programmable logic products and related solutions based on low power, small size, and ease of use. We also serve our customers with intellectual property ("IP") licensing and various other services. Our product development activities include new proprietary products, advanced packaging, existing product enhancements, software development tools, soft IP, and system solutions for high-growth applications such as Edge Artificial Intelligence, wireless and wireline infrastructure, platform security, and factory automation.

Critical Accounting Policies and Use of Estimates

Critical accounting policies are those that are both most important to the portrayal of a company's financial condition and results of operations, and that require management's most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. There have been no material changes to the items that we disclosed as our critical accounting policies and estimates in Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2025 10-K.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments affecting the amounts reported in our consolidated condensed financial statements and the accompanying notes. We base our estimates and judgments on historical experience, knowledge of current conditions, and our beliefs of what could occur in the future considering available information. While we believe that our estimates, assumptions, and judgments are reasonable, they are based on information available when made, and because of the uncertainty inherent in these matters, actual results may differ materially from these estimates under different assumptions or conditions. We evaluate our estimates and judgments on an ongoing basis.

Results of Operations

Key elements of our Consolidated Statements of Operations, including as a percentage of revenue, are presented in the following table:

[[GREPCENT_TABLE]]
[["","","Three Months Ended","","","Six Months Ended"],["","","July 4,","","","June 28,","","","July 4,","","","June 28,"],["(In thousands)","","2026","","","2025","","","2026","","","2025"],["Revenue","","$","201,079","","","","100.0","%","","$","123,971","","","","100.0","%","","$","371,976","","","","100.0","%","","$","244,121","","","","100.0","%"],["Gross margin","","","141,332","","","","70.3","","","","84,751","","","","68.4","","","","258,964","","","","69.6","","","","166,479","","","","68.2"],["Research and development","","","64,231","","","","31.9","","","","43,530","","","","35.1","","","","115,067","","","","30.9","","","","84,917","","","","34.8"],["Selling, general and, administrative","","","50,278","","","","25.0","","","","34,811","","","","28.1","","","","90,383","","","","24.3","","","","67,937","","","","27.8"],["Amortization of acquired intangible assets","","","19","","","","0.0","","","","13","","","","0.0","","","","39","","","","0.0","","","","13","","","","0.0"],["Restructuring and other","","","22","","","","0.0","","","","1,691","","","","1.4","","","","625","","","","0.2","","","","1,932","","","","0.8"],["Acquisition related","","","4,429","","","","2.2","","","","\u2014","","","","\u2014","","","","4,429","","","","1.2","","","","\u2014","","","","\u2014"],["Income from operations","","$","22,353","","","","11.1","%","","$","4,706","","","","3.8","%","","$","48,421","","","","13.0","%","","$","11,680","","","","4.8","%"]]
[[/GREPCENT_TABLE]]

- 19 -

Table of Contents

Revenue by End Market

During the first quarter of 2026, we aligned our end market structure to our larger strategic market focus areas. We sell our products globally to a broad base of customers in two primary end market groups: Compute and Communications, and Industrial and Embedded. Across our end markets, our products are increasingly used for AI-related applications, including device usage in AI-optimized servers in data centers, AI-enabled PCs, and AI-enabled robotics and ADAS systems, among others. We also provide IP licensing and services to these end markets.

Within these end markets, there are multiple drivers, including:

[[GREPCENT_TABLE]]
[["\u2022","Compute and Communications: data center servers, storage, and networking equipment, client computing platforms, and wireless and wireline communications infrastructure deployments,"],["\u2022","Industrial and Embedded: factory automation, robotics, automotive electronics, and industrial Internet of Things (\"IoT\"), smart home, prosumer, and other applications."]]
[[/GREPCENT_TABLE]]

The end market data we use is derived from data provided to us by our distributors and end customers. With a diverse base of customers who may manufacture end products spanning multiple end markets, the assignment of revenue to a specific end market requires the use of judgment. We also recognize certain revenue for which end customers and end markets are not yet known. We assign this revenue first to a specific end market using historical and anticipated usage of the specific products, if possible, and allocate the remainder to the end markets based on either historical usage for each product family or industry application data for certain product types.

The following are examples of end market applications for the periods presented:

[[GREPCENT_TABLE]]
[["Compute and Communications","Industrial and Embedded"],["Data Networking","Security and Surveillance"],["Server Computing","Machine Vision"],["Client Computing","Industrial Automation"],["Data Storage","Robotics"],["Cloud","Automotive"],["Hyperscalers","Drones"],["Wireless","Factory Automation"],["Wireline","Cameras"],["","Displays / Televisions"],["","Home Theater / Sound Systems"],["","Wearables"]]
[[/GREPCENT_TABLE]]

The composition of our revenue by end market is presented in the following table:

[[GREPCENT_TABLE]]
[["","","Three Months Ended","","","Six Months Ended"],["","","July 4,","","","June 28,","","","July 4,","","","June 28,"],["(In thousands)","","2026","","","2025","","","2026","","","2025"],["Compute and Communications","","$","125,944","","","","62.6","%","","$","68,664","","","","55.4","%","","$","232,576","","","","62.5","%","","$","126,098","","","","51.6","%"],["Industrial and Embedded","","","75,135","","","","37.4","","","","55,307","","","","44.6","","","","139,400","","","","37.5","","","","118,023","","","","48.4"],["Total revenue","","$","201,079","","","","100.0","%","","$","123,971","","","","100.0","%","","$","371,976","","","","100.0","%","","$","244,121","","","","100.0","%"]]
[[/GREPCENT_TABLE]]

Note: During the first quarter of 2026, we began disaggregating our revenue by Compute and Communications, and Industrial and Embedded. Prior periods have been reclassified to match current period presentation.

Revenue from the Compute and Communications end market increased by 83% for the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and increased by 84% for the first six months of fiscal 2026 compared to the first six months of fiscal 2025 primarily due to stronger demand in data center applications, including general-purpose and AI-specific servers, as well as wireline networking components.

Revenue from the Industrial and Embedded end market increased by 36% for the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and increased by 18% for the first six months of fiscal 2026 compared to the first six months of fiscal 2025 primarily due to recovering end market demand particularly from industrial and aerospace customers.

AI applications are pervasive across our end markets, so we do not consider AI applications as a distinct end market. We expect AI-related revenue to grow over the next few years based on the growing pipeline of AI-related design wins in a diverse set of applications across both of our end market groups.

- 20 -

Table of Contents

Revenue by Geography

We have a diverse base of customers where distributors represent a significant portion of our total revenue. Our revenue by geographical market is based on the ship-to location of our customers, which can vary from time to time. For the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and for the first six months of fiscal 2026 compared to the first six months of fiscal 2025, revenue from Asia increased by 92% and 82%, respectively, primarily due to hyperscaler demand, while revenue from the Americas decreased by 14% and 26%, respectively, primarily due to the non-recurrence of certain one-time sales in the prior year period, and revenue from Europe increased by 32% and 44%, respectively, primarily due to broad market recovery in this region.

The composition of our revenue by geography is presented in the following table:

[[GREPCENT_TABLE]]
[["","","Three Months Ended","","","Six Months Ended"],["","","July 4,","","","June 28,","","","July 4,","","","June 28,"],["(In thousands)","","2026","","","2025","","","2026","","","2025"],["Asia","","$","159,359","","","","79.2","%","","$","82,974","","","","66.9","%","","$","291,936","","","","78.4","%","","$","160,715","","","","65.8","%"],["Americas","","","23,106","","","","11.5","","","","26,883","","","","21.7","","","","41,898","","","","11.3","","","","56,880","","","","23.3"],["Europe","","","18,614","","","","9.3","","","","14,114","","","","11.4","","","","38,142","","","","10.3","","","","26,526","","","","10.9"],["Total revenue","","$","201,079","","","","100.0","%","","$","123,971","","","","100.0","%","","$","371,976","","","","100.0","%","","$","244,121","","","","100.0","%"]]
[[/GREPCENT_TABLE]]

Revenue from Customers

We sell our products to independent distributors and directly to customers. Distributors have historically accounted for a significant portion of our total revenue. Revenue attributable to distributors as a percentage of total revenue was 95% and 84% for the second quarter of fiscal 2026 and 2025, respectively, and 95% and 81% for the first six months of fiscal 2026 and 2025, respectively.

Gross Margin

The composition of our Gross margin, including as a percentage of revenue, is presented in the following table:

[[GREPCENT_TABLE]]
[["","","Three Months Ended","","","Six Months Ended"],["","","July 4,","","","June 28,","","","July 4,","","","June 28,"],["(In thousands)","","2026","","","2025","","","2026","","","2025"],["Gross margin","","$","141,332","","","$","84,751","","","$","258,964","","","$","166,479"],["Gross margin percentage","","","70.3","%","","","68.4","%","","","69.6","%","","","68.2","%"]]
[[/GREPCENT_TABLE]]

Gross margin, as a percentage of revenue, increased 190 basis points in the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and increased by 140 basis poin

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/855658/000143774926004100/lscc20260103_10k.htm
Complete FY 2026 MD&A: /company/LSCC/mda/fy2026/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-02-13
Report date: 2026-01-03

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview

Lattice develops technologies that we monetize through differentiated programmable logic semiconductor products, silicon-enabling products, system solutions, design services, and technology licenses. Lattice is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the Communications, Computing, Industrial, Automotive, and Consumer markets. Our technology, long-standing relationships, and commitment to world-class support lets our customers quickly and easily unleash their innovation to create a smart, secure, and connected world.

Lattice has focused its strategy on delivering programmable logic products and related solutions based on low power, small size, and ease of use. We also serve our customers with IP licensing and various other services. Our product development activities include new proprietary products, advanced packaging, existing product enhancements, software development tools, soft IP, and system solutions for high-growth applications such as Edge AI, wireless and wireline infrastructure, platform security, and factory automation.

This discussion and analysis of financial condition and results of operations should be read in conjunction with our consolidated financial statements and accompanying notes included in Part II, Item 8. "Financial Statements and Supplementary Data" of this report. Discussions of results for prior periods (fiscal 2024 compared to fiscal 2023) are incorporated by reference from our Annual Report on Form 10-K for the year ended December 28, 2024.

Critical Accounting Policies and Use of Estimates

Critical accounting policies are those that are both most important to the portrayal of a company's financial condition and results of operations, and that require management's most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments affecting the amounts reported in our consolidated financial statements and the accompanying notes. We base our estimates and judgments on historical experience, knowledge of current conditions, and our beliefs of what could occur in the future considering available information. While we believe that our estimates, assumptions, and judgments are reasonable, they are based on information available when made, and because of the uncertainty inherent in these matters, actual results may differ materially from these estimates under different assumptions or conditions. We evaluate our estimates and judgments on an ongoing basis.

We believe the following accounting policies and the related estimates are critical in the portrayal of our financial condition and results of operations, and require management's most difficult, subjective, or complex judgments. See Note 1 - Basis of Presentation and Significant Accounting Policies to our Consolidated Financial Statements in Part II, Item 8 of this report for further information on the significant accounting policies and methods used in the preparation of the consolidated financial statements.

Revenue from Contracts with Customers

We recognize revenue upon satisfaction of performance obligations when control of promised goods or services has been transferred to our customers. We measure revenue based on the amount of consideration we expect to be entitled to in exchange for products or services. For revenue recognized on both sales to distributors and related to royalties, the amount of consideration we expect to be entitled to receive is based on estimates that require assumptions and judgments relating to trends in recent and historical activity. See Note 1 - Basis of Presentation and Significant Accounting Policies to our Consolidated Financial Statements in Part II, Item 8 of this report for further information on our recognition of revenue. Sales to most distributors are made under terms allowing certain price adjustments upon sale to their end customers and limited rights of return of our products held in their inventory. The revenue recognized based on estimated price adjustments and stock rotation reserves may be materially different from the actual consideration received if the actual distributor price adjustments and stock rotation returns differ significantly from the historical trends used in the estimates.

31

Table of Contents

Inventories and Cost of Revenue

Inventories are stated at the lower of actual cost (determined using the first-in, first-out method) or net realizable value. We review and set standard costs quarterly to approximate current actual manufacturing costs. Our manufacturing overhead standards for product costs are calculated assuming full absorption of actual costs. The valuation of inventory requires us to estimate excess or obsolete inventory. Material assumptions we use to estimate necessary inventory carrying value adjustments can be unique to each product and are based on specific facts and circumstances. In determining provisions for excess or obsolete products, we consider assumptions such as changes in business and economic conditions, projected customer demand for our products, and changes in technology or customer requirements. The creation of such provisions results in a write-down of inventory to net realizable value and a charge to Cost of revenue. If in any period we anticipate a change in assumptions such as future market or economic conditions to be less favorable than our previous estimates, additional inventory write-downs may be required and would be reflected in Cost of revenue, resulting in a negative impact to our gross margin in that period. If in any period we are able to sell inventories that had been written down to a level below the ultimate realized selling price in a previous period, related revenue would be recorded with a lower or no offsetting charge to Cost of revenue resulting in a net benefit to our gross margin in that period.

Accounting for Income Taxes

We are required to estimate our provision for income taxes and amounts ultimately payable or recoverable in numerous tax jurisdictions around the world. These estimates involve significant judgment and interpretations of regulations and are inherently complex. Resolution of income tax treatments in individual jurisdictions may not be known for many years after completion of the applicable year. Deferred tax assets and liabilities are recognized for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts in the financial statements using enacted tax rates and laws that will be in effect when the difference is expected to reverse.

Valuation allowances are provided to reduce deferred tax assets to an amount that in management’s judgment is more-likely-than-not to be recoverable against future taxable income. The determination of a valuation allowance and when it should be released requires complex judgment. In assessing the ability to realize deferred tax assets, we regularly evaluate both positive and negative evidence that may exist and consider whether it is more-likely-than-not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. In determining the need to establish or maintain a valuation allowance, we consider the four sources of jurisdictional taxable income: (i) future reversals of existing taxable temporary differences; (ii) future taxable income exclusive of reversing temporary differences and carryforwards; (iii) taxable income in prior carryback year(s) if carryback is permitted under the tax law; and (iv) viable and prudent tax planning strategies.

We continue to maintain a full valuation allowance against our state deferred tax assets due to insufficient income sources. We will continue to evaluate both positive and negative evidence in future periods to determine if we will realize the deferred tax assets. The amount of the deferred tax asset considered realizable could be adjusted if sufficient positive evidence exists. We do not maintain a valuation allowance on a significant portion of our U.S. Federal deferred tax assets or in any foreign jurisdictions as we have concluded that it is more likely than not that we will realize those net deferred tax assets in the future periods.

As part of our regular financial review process, we also assess the likelihood that our tax reporting positions will ultimately be sustained on examination by the taxing authorities, based on the technical merits of the position. To the extent it is determined it is more likely than not (a likelihood of more than 50 percent) that some portion or all of a tax reporting position will ultimately not be recognized and sustained, a provision for unrecognized tax benefit is provided by either reducing the applicable deferred tax asset or accruing an income tax liability. Our judgment regarding the sustainability of our tax reporting positions may change in the future due to changes in U.S. or international tax laws and other factors. These changes, if any, may require material adjustments to the related deferred tax assets or accrued income tax liabilities and an accompanying reduction or increase in income tax expense which may result in a corresponding increase or decrease in net income in the period when such determinations are made. The expiration of statutes of limitations may decrease our uncertain tax positions.

We recognize the tax impact of including certain foreign earnings in U.S. taxable income as a period cost. We recognize deferred income taxes for local country income and withholding taxes that could be incurred on distributions of certain non-U.S. earnings or for outside basis differences in our subsidiaries, where we do not plan to indefinitely reinvest such earnings and basis differences.

32

Table of Contents

Results of Operations

Key elements of our Consolidated Statements of Operations, including as a percentage of revenue, are presented in the following table:

[[GREPCENT_TABLE]]
[["","","Year Ended"],["","","January 3,","","","December 28,","","","December 30,"],["(In thousands)","","2026","","","2024","","","2023"],["Revenue","","$","523,262","","","","100.0","%","","$","509,401","","","","100.0","%","","$","737,154","","","","100.0","%"],["Gross margin","","","356,943","","","","68.2","","","","340,400","","","","66.8","","","","514,670","","","","69.8"],["Research and development","","","187,983","","","","35.9","","","","159,302","","","","31.3","","","","159,770","","","","21.7"],["Selling, general and, administrative","","","153,632","","","","29.4","","","","116,942","","","","23.0","","","","137,244","","","","18.6"],["Amortization of acquired intangible assets","","","52","","","","0.0","","","","3,479","","","","0.7","","","","3,478","","","","0.5"],["Restructuring and other","","","4,044","","","","0.8","","","","12,291","","","","2.4","","","","1,908","","","","0.3"],["Impairment of acquired intangible assets","","","\u2014","","","","\u2014","","","","13,929","","","","2.7","","","","\u2014","","","","\u2014"],["Income from operations","","$","11,232","","","","2.1","%","","$","34,457","","","","6.8","%","","$","212,270","","","","28.8","%"]]
[[/GREPCENT_TABLE]]

Revenue

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2026 MD&A: /company/LSCC/mda/fy2026/
All MD&A years: /company/LSCC/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/LSCC/mda/fy2024/): filed 2025-02-14; accession 0001437749-25-003987 (https://www.sec.gov/Archives/edgar/data/855658/000143774925003987/lscc20241228_10k.htm)
- [FY 2023 MD&A](/company/LSCC/mda/fy2023/): filed 2024-02-16; accession 0001437749-24-004522 (https://www.sec.gov/Archives/edgar/data/855658/000143774924004522/lscc20231206_10k.htm)
- [FY 2022 MD&A](/company/LSCC/mda/fy2022/): filed 2023-02-17; accession 0001437749-23-003778 (https://www.sec.gov/Archives/edgar/data/855658/000143774923003778/lscc20221231_10k.htm)
- [FY 2022 MD&A](/company/LSCC/mda/a-0001437749-22-004190/): filed 2022-02-23; accession 0001437749-22-004190 (https://www.sec.gov/Archives/edgar/data/855658/000143774922004190/lscc20220101_10k.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 3674 Semiconductors & Related Devices) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm

Macro-to-micro threads including this sector: [Inflation (CPI / PCE / PPI)](/thread/inflation-cpi-pce-ppi/), [US labor market](/thread/us-labor-market/), [Growth & output](/thread/growth-output/), [Money & trade](/thread/money-trade/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/), [Industrial orders & inventories](/thread/industrial-orders/), [Trade & external](/thread/trade-external/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/LSCC.md · JSON record: /company/LSCC.json · verified financials: /company/LSCC/financials.json / /company/LSCC/financials.csv · machine TOC for the whole site: /llms.txt