GCT Semiconductor Holding, Inc.
For the period ended Sep 30, 2025. Filed Nov 12, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 12, 2025
GCTS$1.16+11.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-12.
0001851961-25-000010
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-12.
0001193125-25-277777
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 137 previous paragraphs and 141 current paragraphs.
86 unchanged; 46 reworded; 6 added; 3 removed; 2 previous and 3 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
General and administrative expenses increased by $1.5 million, or 64%, from $2.4 million for the three months ended September 30, 2024 to $3.9 million for the three months ended September 30, 2025. This increase was primarily driven by a $1.2 million increase in the stock-based compensation expense due to the issuance of the equity-classified common stock warrants to certain investors. This increase was also driven by a $0.2 million increase in personnel-related costs.
Current report
The change in fair value of common stock warrant liabilities resulted in a loss of $3.8 million for the three months ended September 30, 2025 and a gain of $0.8 million for the three months ended September 30, 2024. The loss in the third quarter of fiscal 2025 was driven by changes in the volatility implied by the traded price of our warrants as of the valuation date, which was used to determine the fair value of our common stock warrant liability. The gain in the third quarter of fiscal 2024 was primarily driven by changes in the fair value of our common stock during the three months ended September 30, 2024.
Current report
For the Nine Months Ended September 30, 2025 and 2024
Current report
Cost of net revenues decreased by $0.2 million, or 5%, from $2.8 million for the nine months ended September 30, 2024 to $2.7 million for the nine months ended September 30, 2025.
Current report
Product costs increased by $0.7 million, or 45%, from $1.5 million for the nine months ended September 30, 2024 to $2.2 million for the nine months ended September 30, 2025. This increase was primarily driven by additional production overhead costs of $0.4 million and an additional $0.3 million write down for slow moving and obsolete LTE inventory.
Current report
Interest expense increased by $0.9 million or 25%, from $3.5 million for the nine months ended September 30, 2024 to $4.4 million for the nine months ended September 30, 2025. This increase was primarily due to the increase in outstanding debt.
Removed paragraphs (3)
Previous report
For the Six Months Ended June 30, 2025 and 2024
Previous report
Interest expense decreased by $0.2 million or 8%, from $2.8 million for the six months ended June 30, 2024 to $2.6 million for the six months ended June 30, 2025. This decrease was primarily due to the conversion of significant amounts of outstanding convertible notes and repayment of outstanding borrowings during 2024.
Previous report
Gains from changes in fair value of common stock warrant liabilities were $0.6 million and $2.0 million for the six months ended June 30, 2025 and 2024, respectively, in each case driven by changes in the fair value of our common stock during the respective periods.
Reworded paragraphs (46)
Previous wording
This discussion and analysis of our financial condition and results of operations should be read together with our unaudited condensed consolidated financial statements as of and for the three and six months ended June 30, 2025 and related notes appearing elsewhere in this Quarterly Report and our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023 and related notes included in our Form 10‑K filing with the Securities and Exchange Commission (“SEC”) on March 25, 2025.
Current wording
This discussion and analysis of our financial condition and results of operations should be read together with our unaudited condensed consolidated financial statements as of and for the three and nine months ended September 30, 2025 and related notes appearing elsewhere in this quarterly report on Form 10-Q (“Quarterly Report”) and our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023 and related notes included in our Form 10‑K filing with the Securities and Exchange Commission (“SEC”) on March 25, 2025.
Previous wording
Even as more and more applications are deployed on 5G networks, we nonetheless anticipate continued demand for our existing 4G LTE product lineup (4.75G/4.5G/4G, etc.) for the foreseeable future, because 4G products are expected to coexist in the market with 5G products at lower price points for some time in the same way that 3rd generation (“3G”) products coexisted with 4G products when 4G networks were first deployed. Having delivered initial samples to our lead 5G customers in the second quarter of 2025, we anticipate the commercial launch of our 5G products in the second half of 2025. Also, we expect the average sales prices for our 5G chipset to be approximately four times that of our 4G chipset, resulting in a significant increase in revenue and gross margins. We plan to continuously expand our product lineup to support 5G chipsets for future applications such as vehicle-to-everything standard (e.g., C-V2X), 5G-based satellite communication (e.g., Non-Terrestrial Network) and 5G-based IoT standard (e.g., RedCap). Our current chipset products are used in a wide variety of applications, including fixed wireless subscriber terminals (e.g., CPE), mobile wireless routers (e.g., Mobile Router/MiFi), various communication modules and devices, and industrial products.
Current wording
Even as more and more applications are deployed on 5G networks, we nonetheless anticipate continued demand for our existing 4G LTE product lineup (4.75G/4.5G/4G, etc.) for the foreseeable future, because 4G products are expected to coexist in the market with 5G products at lower price points for some time in the same way that 3rd generation (“3G”) products coexisted with 4G products when 4G networks were first deployed. Having delivered initial samples to our lead 5G customers in the second quarter of 2025, we are focusing on production readiness now and anticipate first production shipments of our 5G products starting late in the fourth quarter of 2025 or early in the first quarter of 2026. Also, we expect the average sales prices for our 5G chipset to be approximately four times that of our 4G chipset, resulting in a significant increase in revenue and gross margins. We plan to continuously expand our product lineup to support 5G chipsets for future applications such as vehicle-to-everything standard (e.g., C-V2X), 5G-based satellite communication (e.g., Non-Terrestrial Network), and 5G-based IoT standard (e.g., RedCap). Our current chipset products are used in a wide variety of applications, including fixed wireless subscriber terminals (e.g., CPE), mobile wireless routers (e.g., Mobile Router/MiFi), various communication modules and devices, and industrial products.
Previous wording
Our business depends upon the continued commercial deployment of 4G and 5G wireless communications equipment, products, and services based on GCT’s technology. Deployment of new networks by wireless carriers requires significant capital expenditures well in advance of any revenue from such networks. If the rate of deployment of new networks by wireless carriers is slower than our expectation, this will reduce the sales of its products and could cause OEMs and ODMs to hold excess inventory. This would harm our revenues and our financial results. The worldwide commercial deployment and adoption of the narrow band LTE variants, Cat M and Cat NB, are expected to expand further the markets for IoT devices. If deployments of the Cat M or Cat NB standards are delayed or if competing standards for IoT devices become favored by wireless carriers, we may not be able to successfully increase sales of our Cat M and Cat NB products, which would harm our revenues and financial results.
Current wording
Our business depends upon the continued commercial deployment of 4G and 5G wireless communications equipment, products, and services based on GCT’s technology. Deployment of new networks by wireless carriers requires significant capital expenditures well in advance of any revenue from such networks. If the rate of deployment of new networks by wireless carriers is slower than our expectation, this will reduce the sales of its products and could cause OEMs and ODMs to hold excess inventory. This would harm our revenues and our financial results. The worldwide commercial deployment and adoption of the narrow band LTE variants, Cat M and Cat NB, are expected to further expand the markets for IoT devices. If deployments of the Cat M or Cat NB standards are delayed or if competing standards for IoT devices become favored by wireless carriers, we may not be able to successfully increase sales of our Cat M and Cat NB products, which would harm our revenues and financial results.
Previous wording
Because a significant portion of our expenses are fixed in the near term or are incurred in advance of anticipated sales, we may not be able to reduce our expenses rapidly enough to offset any unanticipated shortfall in revenue. If this situation were to occur, it could adversely affect our operating results, cash flow, and financial condition. In addition, the semiconductor industry has periodically experienced increased demand and production constraints. As a fabless semiconductor company, we rely exclusively on third-party foundries, including certain major semiconductor foundries such as United Microelectronics Corporation, Samsung and Taiwan Semiconductor Manufacturing Corporation, for the manufacturing and supplies of its wafers and products. We do not have any formal foundry agreements that guarantee a minimum level of manufacturing capacity. In times of significant increasing demand for capacity, these foundries may experience production shortages and may not allocate sufficient manufacturing capacity to us. If this happens, we may not be able to produce sufficient quantities of our products to meet the increased demand. Any disruption in our supply chain can make it more difficult for us to obtain sufficient wafer, assembly, and test resources from our subcontract manufacturers. Any factor adversely affecting the semiconductor industry in general, or the particular segments of the industry that our products target, may adversely affect our ability to generate revenue and impact our operating results.
Current wording
Semiconductor Manufacturing Corporation, for the manufacturing and supplies of its wafers and products. We do not have any formal foundry agreements that guarantee a minimum level of manufacturing capacity. In times of significant increasing demand for capacity, these foundries may experience production shortages and may not allocate sufficient manufacturing capacity to us. If this happens, we may not be able to produce sufficient quantities of our products to meet the increased demand. Any disruption in our supply chain can make it more difficult for us to obtain sufficient wafer, assembly, and test resources from our subcontract manufacturers. Any factor adversely affecting the semiconductor industry in general, or the particular segments of the industry that our products target, may adversely affect our ability to generate revenue and impact our operating results.
Previous wording
Our cost of net revenues consists of product and service costs. The cost of product net revenues consists of direct and indirect costs related to the manufacturing of our products. Direct costs include wafer costs and costs of assembly and testing performed by third-party contract manufacturers. Indirect costs consist of provisions for excess and obsolete inventory, royalties, allocated overhead for employee costs and facility costs, warranty, and the amortization of our production mask sets and certain intangible assets. Shipping and handling costs incurred for inventory purchases related to the units sold and costs of product shipments are also recorded in the cost of net product revenues. Service costs consist of non-recurring engineering costs for service projects.
Current wording
Our cost of net revenues consists of product and service costs. The cost of product net revenues consists of direct and indirect costs related to the manufacturing of our products. Direct costs include wafer costs and costs of assembly and testing performed by third-party contract manufacturers. Indirect costs consist of provisions for excess, slow moving and obsolete inventory, royalties, allocated overhead for employee costs and facility costs, warranty, and the amortization of our production mask sets and certain intangible assets. Shipping and handling costs incurred for inventory purchases related to the units sold and costs of product shipments are also recorded in the cost of net product revenues. Service costs consist of non-recurring engineering costs for service projects.
Previous wording
Gain on extinguishment of liability relates to the release by a vendor due to a contract termination during the period of amounts payable by us for research and development services received in prior years.
Current wording
Gain on extinguishment of liability relates to the release by a vendor due to a contract termination during the period of amounts payable by us for R&D services received in prior years.
Previous wording
Common stock forward liability represents a freestanding common stock forward contract under the purchase agreement (“Purchase Agreement”) with B. Riley B. Riley Principal Capital II, LLC (“B. Riley”) executed in April 2024, which contains a variable share forward on our common stock. This freestanding instrument is precluded from equity classification since the Purchase Agreement with B. Riley requires shareholder approval for the issuance of shares in excess of the applicable ownership limitation caps, which is not an input in a fixed-for-fixed option or forward on equity shares. The fair value of this liability reflects the probability-adjusted present value of the discount to be provided to B. Riley for sales of our common stock under the Purchase Agreement, relative to the volume-weighted average price of our common stock during the applicable pricing period. Change in fair value of common stock forward liability includes measurement gains and losses driven by the change in the probability of scenarios to sell certain number of shares under the Purchase Agreement.
Current wording
Common stock forward liability represents a freestanding common stock forward contract under the purchase agreement (“Purchase Agreement”) with B. Riley Principal Capital II, LLC (“B. Riley”) executed in April 2024, which contains a variable share forward on our common stock. This freestanding instrument is precluded from equity classification since the Purchase Agreement with B. Riley requires shareholder approval for the issuance of shares in excess of the applicable ownership limitation caps, which is not an input in a fixed-for-fixed option or forward on equity shares. The fair value of this liability reflects the probability-adjusted present value of the discount to be provided to B. Riley for sales of our common stock under the Purchase Agreement, relative to the volume-weighted average price of our common stock during the applicable pricing period. Change in fair value of common stock forward liability includes measurement gains and losses driven by the change in the probability of scenarios to sell certain number of shares under the Purchase Agreement.
Previous wording
Net revenues decreased by $0.3 million, or 19%, from $1.5 million for the three months ended June 30, 2024 to $1.2 million for the three months ended June 30, 2025. The reduction was attributable to a decrease of $0.7 million in service revenue, partially offset by an increase of $0.4 million in product sales.
Current wording
Net revenues decreased by $2.2 million, or 84%, from $2.6 million for the three months ended September 30, 2024 to $0.4 million for the three months ended September 30, 2025. The reduction was attributable to a decrease of $1.6 million in product sales and $0.6 million in service revenue.
Previous wording
Our product sales were nominal during the three months ended June 30, 2024 due to our largest customers changing their priorities on product development from 4G to 5G products. Our product sales during the three months ended June 30, 2025 of $0.4 million were attributed primarily to sales of single-chip 4G products.
Current wording
Product sales decreased by $1.6 million, or 91%, from $1.7 million for the three months ended September 30, 2024 to $0.1 million for the three months ended September 30, 2025. The sales of our LTE platforms contributed $1.5 million to our product sales in the three months ended September 30, 2024, and there were no LTE platform sales during the three months ended September 30, 2025. In addition, the sales of our LTE products decreased by $0.1 million due to our largest customers changing their priorities on product development from 4G to 5G products.
Previous wording
Service revenues decreased by $0.7 million, or 47%, from $1.5 million for the three months ended June 30, 2024 to $0.8 million for the three months ended June 30, 2025. The decrease was attributed to the substantial completion of a significant service project in the second quarter of 2024, which then did not contribute materially in subsequent quarters. Our service project portfolio during the second quarter of 2025 was less extensive, contributing to the decrease in activity levels.
Current wording
Service revenues decreased by $0.6 million, or 68%, from $0.9 million for the three months ended September 30, 2024 to $0.3 million for the three months ended September 30, 2025. The decrease was attributed to the substantial completion of a significant service project in the second quarter of 2024, which then did not contribute materially in subsequent quarters. Our service project portfolio and related revenue during the third quarter of 2025 was less extensive.
Previous wording
Cost of net revenues increased by $0.3 million, or 47%, from $0.5 million for the three months ended June 30, 2024 to $0.8 million for the three months ended June 30, 2025. This increase in the cost of net revenues was driven by product sales activity, partially offset by the reduced costs associated with service projects.
Current wording
Cost of net revenues increased by $0.5 million, or 50%, from $1.0 million for the three months ended September 30, 2024 to $1.5 million for the three months ended September 30, 2025.
Previous wording
Product costs increased by $0.4 million, or 268%, from $0.2 million for the three months ended June 30, 2024 to $0.6 million for the three months ended June 30, 2025. This increase in product costs was primarily driven by direct costs associated with unit sales.
Current wording
Product costs increased by $0.7 million, or 100%, from $0.7 million for the three months ended September 30, 2024 to $1.4 million for the three months ended September 30, 2025. This increase in product costs was primarily driven by additional production overhead costs of $0.4 million and an additional $0.5 million write down related to slow moving and obsolete LTE inventory.
Previous wording
Service costs decreased by $0.2 million, or 43%, from $0.4 million for the three months ended June 30, 2024 to $0.2 million for the three months ended June 30, 2025. This decrease in service costs was commensurate with the level of our service project activity.
Current wording
Service costs decreased by $0.2 million, or 78%, from $0.3 million for the three months ended September 30, 2024 to $0.1 million for the three months ended September 30, 2025. This decrease in service costs was commensurate with the level of our service project activity.
Previous wording
Our gross margin decreased to 32% for the three months ended June 30, 2025 from 63% for the three months ended June 30, 2024. Our current gross margins are still distorted by the reduction in product revenue, which is currently not sufficient to absorb overhead costs. This makes our current gross margins less indicative of the underlying profitability of our products and services. We expect operational efficiencies to improve as revenues increase, which will begin when 5G product sales start contributing to our overall revenue in the second half of 2025.
Current wording
Our gross margin for the three months ended September 30, 2024 was 62%. Our current gross margin for the three months ended September 30, 2025 is negative and not meaningful, as we continue experiencing lower product revenue, which is currently not sufficient to fully absorb production overhead costs. This makes our current gross margins less indicative of the underlying profitability of our products and services. We expect operational efficiencies to improve as revenues increase, after 5G product sales start contributing more significantly to our overall revenue beginning in the first quarter of 2026.
Previous wording
Research and development expenses decreased by $0.7 million, or 16%, from $4.2 million for the three months ended June 30, 2024 to $3.5 million for the three months ended June 30, 2025. This decrease was primarily due to a $0.9 million reduction in professional services provided by Alpha related to the design of 5G chip products, partially offset by a $0.3 million increase in the personnel-related costs.
Current wording
Research and development expenses decreased by $1.0 million, or 23%, from $4.2 million for the three months ended September 30, 2024 to $3.3 million for the three months ended September 30, 2025. This decrease was primarily due to a $1.2 million reduction in professional services provided by Alpha related to the design of 5G chip products as this development project was completed in the second quarter of 2025, partially offset by a $0.2 million increase in personnel-related costs.
Previous wording
Sales and marketing expenses remained consistent at $1.0 million for each of the three months ended June 30, 2025 and 2024, respectively.
Current wording
Sales and marketing expenses remained consistent at $1.0 million and $0.9 million during the three months ended September 30, 2025 and 2024, respectively.
Previous wording
Interest expense increased by $0.8 million or 102%, from $0.8 million for the three months ended June 30, 2024 to $1.5 million for the three months ended June 30, 2025. This increase was primarily due to interest and penalties we incurred on outstanding term loan balances.
Current wording
Interest expense increased by $1.1 million, or 167%, from $0.7 million for the three months ended September 30, 2024 to $1.8 million for the three months ended September 30, 2025. This increase was primarily due to interest and penalties we incurred on outstanding term loan balances.
Previous wording
Foreign currency transactions resulted in a loss of $3.2 million for the three months ended June 30, 2025 and a gain of $0.8 million for the three months ended June 30, 2024. The primary factor behind these fluctuations is our term loans portfolio, which is largely denominated in the South Korean won. The loss in the second quarter of fiscal 2025 was driven by the depreciation of the U.S. dollar against the South Korean won, while the gain in the second quarter of fiscal 2024 was attributable to the appreciation of the U.S. dollar against the South Korean won.
Current wording
Foreign currency transactions resulted in a gain of $1.3 million for the three months ended September 30, 2025 and a loss of $1.0 million for the three months ended September 30, 2024. The primary factor behind these fluctuations is our term loans portfolio, which is largely denominated in the South Korean won. The gain in the third quarter of fiscal 2025 was driven by the appreciation of the U.S. dollar against the South Korean won, while the loss in the third quarter of fiscal 2024 was attributable to the depreciation of the U.S. dollar against the South Korean won.
Previous wording
Net revenues decreased by $3.1 million, or 65%, from $4.7 million for the six months ended June 30, 2024 to $1.7 million for the six months ended June 30, 2025. The reduction was primarily attributable to a decrease of $1.9 million in product sales and a decrease of $1.2 million in service revenue.
Current wording
Net revenues decreased by $5.2 million, or 71%, from $7.3 million for the nine months ended September 30, 2024 to $2.1 million for the nine months ended September 30, 2025. The reduction was primarily attributable to a decrease of $3.5 million in product sales and a decrease of $1.8 million in service revenues.
Previous wording
Product sales decreased by $1.9 million, or 79%, from $2.4 million for the six months ended June 30, 2024 to $0.5 million for the six months ended June 30, 2025. The sales of our LTE platforms contributed $2.3 million to our product sales in the first half of 2024, and there were no LTE platform sales during the first half of 2025. This trend was partially offset by our sales of 4G products, which increased by $0.4 million during the first half of 2025.
Current wording
Product sales decreased by $3.5 million, or 84%, from $4.1 million for the nine months ended September 30, 2024 to $0.6 million for the nine months ended September 30, 2025. The sales of our LTE platforms contributed $3.8 million to our product sales in the first three quarters of 2024, and there were no LTE platform sales during the first three quarters of 2025.
Previous wording
Service revenues decreased by $1.2 million, or 50%, from $2.3 million for the six months ended June 30, 2024 to $1.2 million for the six months ended June 30, 2025. The decrease was attributed to the substantial completion of a significant service project during the six months ended June 30, 2024, which then did not contribute materially in subsequent quarters. Our service project portfolio during the six months ended June 30, 2025 was less extensive, contributing to the decrease in activity levels.
Current wording
Service revenues decreased by $1.8 million, or 55%, from $3.2 million for the nine months ended September 30, 2024 to $1.5 million for the nine months ended September 30, 2025. The decrease was attributed to the substantial completion of a significant service project during the nine months ended September 30, 2024, which then did not contribute materially in subsequent quarters. Our service project portfolio during the nine months ended September 30, 2025 was less extensive resulting in lower service revenues.
Previous wording
Cost of net revenues decreased by $0.6 million, or 35%, from $1.9 million for the six months ended June 30, 2024 to $1.2 million for the six months ended June 30, 2025. This decrease in the cost of net revenues was driven primarily by the reduction in our service costs that was commensurate with the level of our service project activity.
Current wording
Service costs decreased by $0.8 million, or 63%, from $1.3 million for the nine months ended September 30, 2024 to $0.5 million for the nine months ended September 30, 2025. This decrease in service costs was commensurate with the level of our service project activity.
Previous wording
Our gross margin decreased to 28% for the six months ended June 30, 2025 from 61% for the six months ended June 30, 2024. Our current gross margins are distorted by the reduction in product revenue, which is currently not sufficient to fully absorb overhead costs. This makes our current gross margins less indicative of the underlying profitability of our products and services. We expect operational efficiencies to improve as revenues increase, which will begin when 5G product sales start contributing to our overall revenue in the second half of 2025.
Current wording
Our gross margin for the nine months ended September 30, 2024 was 61%. Our gross margin for the nine months ended September 30, 2025 is negative and not meaningful, as we continue experiencing lower product revenue, which is currently not sufficient to fully absorb production overhead costs. This makes our current gross margins less indicative of the underlying profitability of our products and services. We expect operational efficiencies to improve as revenues increase, which will begin after 5G product sales start contributing more significantly to our overall revenue beginning in the first quarter of 2026.
Previous wording
Research and development expenses decreased by $2.1 million, or 21%, from $9.7 million for the six months ended June 30, 2024 to $7.6 million for the six months ended June 30, 2025. This decrease was primarily due to a $1.4 million reduction in professional services provided by Alpha related to the design of 5G chip products and a $1.4 million reduction in the project-specific intellectual property expenses, partially offset by a $0.5 million increase in the personnel-related costs.
Current wording
Research and development expenses decreased by $3.0 million, or 22%, from $13.9 million for the nine months ended September 30, 2024 to $10.9 million for the nine months ended September 30, 2025. This decrease was primarily due to a $2.7 million reduction in professional services provided by Alpha related to the design of 5G chip products after completion of this development project in the second quarter of 2025, and a $1.5 million reduction in the project-specific intellectual property expenses incurred in 2024. This reduction was partially offset by a $0.7 million increase in personnel-related costs due to changes in our headcount and a $0.2 million increase in pre-production supplies for 5G chips related to our key business initiatives.
Previous wording
Sales and marketing expenses remained consistent at $2.1 million and $2.0 million for the six months ended June 30, 2025 and 2024, respectively.
Current wording
Sales and marketing expenses remained relatively consistent at $3.2 million and $2.9 million for the nine months ended September 30, 2025 and 2024, respectively.
Previous wording
General and administrative expenses increased by $0.4 million, or 6%, from $5.7 million for the six months ended June 30, 2024 to $6.0 million for the six months ended June 30, 2025. Changes in our expected credit loss estimates for receivables resulted in a $0.5 million gain in the six months ended June 30, 2024, compared to a $1.4 million loss in the six months ended June 30, 2025, representing a $1.9 million net increase. This variance was partially offset by a $1.2 million decrease in professional services and other costs in the six months ended June 30, 2025 compared to the six months ended June 30, 2024, driven by lower transactional activity during this period, and $0.6 million decrease in stock-based compensation, recognized during the six months ended June 30, 2024 from the vesting of equity awards with performance conditions.
Current wording
General and administrative expenses increased by $1.9 million, or 23%, from $8.1 million for the nine months ended September 30, 2024 to $9.9 million for the nine months ended September 30, 2025. Changes in our expected credit loss estimates for receivables resulted in a $0.5 million gain in the nine months ended September 30, 2024, compared to a $1.4 million loss in the nine months ended September 30, 2025, resulting in a $1.9 million net increase to general and administrative expenses. Stock-based compensation expense increased by $0.6 million from $1.6 million in the nine months ended September 30, 2024 compared to $2.1 million for the nine months ended September 30, 2025. This increase was primarily due to the issuance of the equity-classified common stock warrants to certain investors with the fair value of $1.3 million in the third quarter of 2025, compared to $0.9 million of the stock-based compensation related to vesting of performance-based founder shares in the first quarter of 2024. Personnel-related costs increased by $0.3 million in the first three quarters of 2025 due to the increased headcount and merit-based salary adjustments. These increases were partially offset by a $1.0 million decrease in professional services and other costs in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, driven by lower transactional activity during this period.
Previous wording
Gain on extinguishment of liability was $14.6 million for the six months ended June 30, 2024 due to the release by a vendor of amounts payable by us for research and development services received in prior years. No similar transactions took place during the year ended six months ended June 30, 2025.
Current wording
Gain on extinguishment of liability was $14.6 million for the nine months ended September 30, 2024 due to the release by a vendor of amounts payable by us for research and development services received in prior years. No similar transactions took place during the nine months ended September 30, 2025.
Previous wording
Foreign currency transactions resulted in a loss of $3.2 million for the six months ended June 30, 2025 and a gain of $2.3 million for the six months ended June 30, 2024. The primary factor behind these fluctuations is our term loans portfolio, which is largely denominated in the South Korean won. The loss in the six months ended June 30, 2025 was primarily driven by the depreciation of the U.S. dollar against the South Korean won, while the gain in the six months ended June 30, 2024 was attributable to the appreciation of the U.S. dollar against the South Korean won.
Current wording
Foreign currency transactions resulted in a loss of $1.9 million for the nine months ended September 30, 2025 and a gain of $1.2 million for the nine months ended September 30, 2024. The primary factor behind these fluctuations is our term loans portfolio, which is largely denominated in the South Korean won. The loss in the nine months ended September 30, 2025 was primarily driven by the depreciation of the U.S. dollar against the South Korean won, while the gain in the nine months ended September 30, 2024 was attributable to the appreciation of the U.S. dollar against the South Korean won.
Previous wording
The change in fair value of common stock forward liability resulted in a gain of $0.3 million for the six months ended June 30, 2025 and a loss of $0.6 million for the six months ended June 30, 2024. The decrease in the fair value of $0.3 million for the six months ended June 30, 2025 was based on our expectations related to the utilization of the available commitment under the common stock purchase agreement with B. Riley. The increase in fair value of common stock forward liability of $0.6 million for the six months ended June 30, 2024 was due the initial recognition of this financial instrument.
Current wording
The change in fair value of common stock forward liability resulted in a gain of $0.3 million for the nine months ended September 30, 2025 and a loss of $0.6 million for the nine months ended September 30, 2024. The decrease in the fair value of the underlying liability of $0.3 million for the nine months ended September 30, 2025 was based on our expectations related to the utilization of the available commitment under the common stock purchase agreement with B. Riley. The increase in fair value of common stock forward liability of $0.6 million for the nine months ended September 30, 2024 was due to the initial recognition of this financial instrument based on our assumptions at the inception of this arrangement.
Previous wording
The change in fair value of common stock warrant liabilities resulted in a loss of $1.0 million for the three months ended June 30, 2025 and a gain of $6.6 million for the three months ended June 30, 2024. The respective loss and gain were both driven by changes in the fair value of our common stock during the respective periods.
Current wording
The change in fair value of common stock warrant liabilities resulted in a loss of $3.2 million for the nine months ended September 30, 2025 and a gain of $2.8 million for the nine months ended September 30, 2024. The loss in the first three quarters of 2025 was driven by changes in the volatility implied by the traded price of our warrants as of the valuation date, which was used to determine the fair value of our common stock warrant liability. The gain in the first three quarters of 2024 was driven by changes in the fair value of our common stock during the three months ended September 30, 2024.
Previous wording
Losses from changes in fair value of convertible promissory notes were less than $0.2 million and $1.2 million for the six months ended June 30, 2025 and 2024, respectively. These losses in each year were derived from the fair value measurement and related assumptions, specifically remeasurement of the convertible notes prior to their settlement in our common stock, which significantly increased the underlying liability during the six months ended June 30, 2024.
Current wording
Losses from changes in fair value of convertible promissory notes were less than $0.3 million and $1.4 million for the nine months ended September 30, 2025 and 2024, respectively. These losses in each year were derived from the fair value measurement and related assumptions, specifically remeasurement of the convertible notes prior to their settlement in our common stock, which significantly increased the underlying liability during the nine months ended September 30, 2024.
Previous wording
Since inception, we have financed our operations primarily through cash receipts from customers, the issuance of convertible promissory notes, borrowings, issuance of capital stock and the exercise of stock options.
Current wording
Since inception, we have financed our operations primarily through cash receipts from customers, the issuance of convertible promissory notes, borrowings, the issuance of capital stock, and the exercise of stock options.
Previous wording
With limited exceptions, we have incurred and expect that we will continue to incur significant operating losses. For the six months ended June 30, 2025, we had a net loss of $20.5 million. For the six months ended June 30, 2025 and 2024, we had cash used in operating activities of $16.6 million and $24.1 million, respectively. As of June 30, 2025, we had an accumulated deficit of $582.5 million. Our unaudited condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary if we are unable to obtain adequate financing in the future.
Current wording
With limited exceptions, we have incurred and expect to continue incurring significant operating losses. For the nine months ended September 30, 2025, we had a net loss of $34.4 million. For the years ended December 31, 2024 and 2023, we had a net loss of $12.4 million and $22.5 million, respectively. For the nine months ended September 30, 2025 and 2024, we had cash used in operating activities of $23.5 million and $28.7 million, respectively. As of September 30, 2025, we had an accumulated deficit of $596.4 million. Our unaudited condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary if we are unable to obtain adequate financing in the future.
Previous wording
In April 2025, we executed an at-market issuance sales agreement (“ATM Agreement”) with B. Riley and H.C. Wainwright & Co., LLC, acting as sales agents. The ATM Agreement allows us to sell our common stock for gross proceeds of up to $75.0 million from time to time, through at-the-market offerings or to the sales agents as principal purchasers (“ATM Offering”). As there is no commitment for future sales of additional shares under the ATM Agreement or the ATM Offering, we cannot predict how much, if any, additional proceeds may be realized. During the three months ended June 30, 2025, we received net proceeds of approximately $0.5 million in cash related to the ATM Offering.
Current wording
In April 2025, we executed an at-market issuance sales agreement (“ATM Agreement”) with B. Riley and H.C. Wainwright & Co., LLC, acting as sales agents. The ATM Agreement allows us to sell our common stock for gross proceeds of up to $75.0 million from time to time, through at-the-market offerings or to the sales agents as principal purchasers (“ATM Offering”). As there is no commitment for future sales of additional shares under the ATM Agreement or the ATM Offering, we cannot predict how much, if any, additional proceeds may be realized. During the nine months ended September 30, 2025, we received net proceeds of approximately $1.4 million in cash related to the ATM Offering.
Previous wording
In December 2024, we entered into a term loan agreement with Anapass, Inc., our major stockholder, pursuant to which we borrowed $3.4 million maturing in December 2025. In January 2025, we entered into a term loan agreement with Dr. Lee, pursuant to which we borrowed $4.4 million maturing in February 2025, which remained outstanding as of June 30, 2025. In March 2025, we entered into a term loan agreement with Anapass, Inc., pursuant to which we borrowed $3.1 million maturing in March 2026. In July 2025, we entered into a term loan agreement with Anapass, Inc. and borrowed $2.2 million that will mature in July 2026. In August 2025, we entered into a term loan agreement with Anapass, Inc. and borrowed $1.5 million that will mature in August 2026.
Current wording
In December 2024, we entered into a term loan agreement with Anapass, Inc., our major stockholder, pursuant to which we borrowed $3.4 million maturing in December 2025. In January 2025, we entered into a term loan agreement with Dr. Lee, pursuant to which we borrowed $4.4 million maturing in February 2025, which remained outstanding as of September 30, 2025. In March 2025, we entered into a term loan agreement with Anapass, Inc., pursuant to which we borrowed $3.1 million maturing in March 2026. In July 2025, we entered into a term loan agreement with Anapass, Inc. and borrowed $2.1 million that will mature in July 2026. In August 2025, we entered into a term loan agreement with Anapass, Inc. and borrowed $1.4 million that will mature in August 2026. In September 2025, we entered into a term loan agreement with Anapass, Inc. and borrowed $10.7 million that will mature in September 2026. In November 2025, the Company executed an amendment with Anapass, Inc. to extend the maturity date of a term loan, originally entered into in May 2022 with a principal of $2.1 million, from November 2025 to November 2026.
Previous wording
During six months ended June 30, 2025, we were able to renegotiate the timing of payments for some of the obligations, including loan agreements with i Best Investment Co., Ltd and Dr. Lee, that initially were due in the first and second fiscal quarter of 2025, respectively.
Current wording
During nine months ended September 30, 2025, we were able to renegotiate the timing of payments for some of the obligations, including loan agreements with i Best Investment Co., Ltd, Dr. Lee, and Anapass, Inc., that initially were due in the first, second, and third fiscal quarter of 2025, respectively. We currently remain dependent on related party debt financing to fund our operations, including the loans received from Anapass Inc. and Dr. Lee.
Previous wording
We expect significant ongoing operating expenditures will be necessary to successfully implement our business plan and market our products. Having delivered initial samples to our lead 5G customers in the second quarter of 2025, we anticipate the commercial launch of our 5G products in the second half of 2025. We anticipate continued significant related expenditures in the form of production-related costs, including mask sets, wafers, and assembly and test costs, and most such costs will be incurred prior to the commencement of manufacturing and production.
Current wording
We expect significant ongoing operating expenditures will be necessary to successfully implement our business plan and market our products. Having delivered initial samples to our lead 5G customers in the second quarter of 2025, we are focusing on production readiness now and anticipate the first production shipments of our 5G products starting late in the fourth quarter of 2025 or early in the first quarter of 2026. We anticipate continued significant related expenditures in the form of production-related costs, including mask sets, wafers, and assembly and test costs, and most such costs will be incurred prior to the commencement of manufacturing and production.
Previous wording
As of June 30, 2025, our existing sources of liquidity include cash and cash equivalents of $1.3 million. As of June 30, 2025, we have outstanding convertible promissory notes and borrowings with a total principal amount of $51.7 million, which are contractually due within 12 months from this reporting date. We will need to start generating positive cash flows, renegotiate our existing debt obligations and raise additional capital through debt or equity financing. There can be no assurance that such additional debt or equity financing will be available on terms acceptable to us or at all.
Current wording
As of September 30, 2025, our existing sources of liquidity include cash and cash equivalents of $8.3 million. As of September 30, 2025, we have outstanding convertible promissory notes and borrowings with a total principal amount of $64.4 million, which are contractually due within 12 months from this Quarterly Report. We will need to start generating positive cash flows, renegotiate our existing debt obligations and raise additional capital through debt or equity financing. There can be no assurance that such additional debt or equity financing will be available on terms acceptable to us or at all.
Previous wording
We intend to mitigate the risk of any working capital deficit by continuing to seek and execute appropriate actions to secure funding as a publicly traded company, including extension and refinancing of existing loans, executing public or private equity offerings, debt financings, and other means. In addition, we recently filed a universal shelf registration statement on Form S-3 that will allow us to raise up to $200.0 million from the issuance of our securities, which includes the $75.0 million for the ATM Offering. Following the completion of the RDO, the Company has $114.0 million of remaining equity funding capacity available under its shelf registration statement. We have historically been able to raise capital through the issuance and sale of equity and equity-linked instruments, such as redeemable convertible preferred stock, convertible promissory notes, and borrowings, although no assurance can be provided that we would continue to be successful in doing so in the future.
Current wording
We intend to mitigate the risk of any working capital deficit by continuing to seek and execute appropriate actions to secure funding as a publicly traded company, including extension and refinancing of existing loans, executing public or private equity offerings, debt financings, and other means. In addition, we recently filed a universal shelf registration statement on Form S-3 that will allow us to raise up to $200.0 million from the issuance of our securities, which includes the $75.0 million for the ATM Offering. Following the completion of the RDO and through the date of this Quarterly Report, the Company has $114.0 million of remaining equity funding capacity available under its shelf registration statement. We have historically been able to raise capital through the issuance and sale of equity and equity-linked instruments, such as redeemable convertible preferred stock, convertible promissory notes, and borrowings, although no assurance can be provided that we would continue to be successful in doing so in the future.
Previous wording
Cash Flow Comparison for the Six Months Ended June 30, 2025 and 2024
Current wording
Cash Flow Comparison for the Nine Months Ended September 30, 2025 and 2024
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Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Because a significant portion of our expenses are fixed in the near term or are incurred in advance of anticipated sales, we may not be able to reduce our expenses rapidly enough to offset any unanticipated shortfall in revenue. If this situation were to occur, it could adversely affect our operating results, cash flow, and financial condition. In addition, the semiconductor industry has periodically experienced increased demand and production constraints. As a fabless semiconductor company, we rely exclusively on third-party foundries, including certain major semiconductor foundries such as United Microelectronics Corporation, Samsung and Taiwan
Current report — wording carried from elsewhere
Change in fair value of common stock forward liability
Current report — wording carried from elsewhere
Change in fair value of common stock forward liability
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
General and administrative expenses increased by $0.6 million, or 20%, from $2.9 million for the three months ended June 30, 2024 to $3.4 million for the three months ended June 30, 2025. Changes in our expected credit loss estimates for receivables resulted in a $0.8 million gain in the second quarter of 2024, compared to a $1.1 million loss in the second quarter of 2025, representing a $1.9 million net increase. This increase was partially offset by a $1.2 million decrease in professional services and other costs in the second quarter of 2025 compared to the second quarter of 2024, driven by lower transactional activity during this period.
Previous report — wording carried elsewhere
There was no change in fair value of common stock forward liability for the three months ended June 30, 2025 since the balance was nominal based on our expectations related to the utilization of the available commitment under the common stock purchase agreement with B. Riley. The increase in fair value of common stock forward liability of $0.6 million for the three months ended June 30, 2024 was due the initial recognition of this financial instrument.