GCT Semiconductor Holding, Inc.

1. Organization and Liquidity

Description of Business

GCT Semiconductor Holding, Inc. and its wholly owned subsidiaries (collectively “GCT” or the “Company”) is headquartered in San Jose, California, with international offices in South Korea, China, Taiwan, and Japan. The Company is a fabless semiconductor company that specializes in the design, manufacturing, and sale of communication semiconductors, including high-speed wireless communication technologies such as 5G/4.75G/4.5G/4G transceivers and modems, which are essential for a wide variety of industrial, business-to-business (“B2B”) and consumer applications.

Liquidity

The accompanying unaudited condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets, liabilities, and commitments in the normal course of business. Through March 31, 2026, the Company has incurred operating losses and negative cash flows from operating activities and had an accumulated deficit of$615.3 million as of March 31, 2026. The Company’s existing sources of liquidity as of March 31, 2026 include cash and cash equivalents of$7.2 million. The Company has historically funded operations primarily through the issuance of capital stock and the incurrence of debt. The Company is dependent on additional fundraising in order to sustain its ongoing operations.

In April 2025, the Company executed an at-market issuance sales agreement (“ATM Agreement”) with B. Riley Securities, Inc. and H.C. Wainwright & Co., LLC, acting as sales agents. The ATM Agreement allows the Company to sell its 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”). During thethree months ended March 31, 2026, the Company received gross proceeds of approximately $12.7 million and incurred issuance costs of approximately $0.4 million related to the ATM Offering (see Note 8).

In December 2025, the Company entered into a convertible promissory note purchase agreement with Indigo Capital LP (“Indigo”), which provides for the issuance of convertible promissory notes of up to $20.0 million in aggregate (“Indigo Notes”). During thethree months ended March 31, 2026, the Company received gross proceeds of $2.8 million from the issuance of three Indigo Notes with a principal amount $1.0 million each (see Note 6).

In March 2026, the Company entered into a convertible promissory note purchase agreement with Obsidian Global GP, LLC (“Obsidian”), which provides for the issuance of convertible promissory notes of up to $20.0 million in aggregate (“Obsidian Notes”). Through March 31, 2026, no Obsidian Notes have been issued.

To fund its operations over the longer term, the Company will need to start generating positive cash flows, renegotiate its existing debt obligations, and raise additional capital through debt or equity financing. Management’s plans include seeking additional financing, such as issuances of equity, issuances of debt and convertible debt instruments. Sales of additional equity securities, convertible debt, or warrants by the Company could dilute the interests of existing stockholders. The Company will require significant additional financing to meet its planned capital needs and is pursuing opportunities to obtain additional financing through equity or debt alternatives. There can be no assurance that such additional debt or equity financing will be available on terms acceptable to the Company or at all. These factors raise substantial doubt about the Company’s ability to continue as a going concern beyond twelve months after the date that these unaudited condensed consolidated financial statements are issued. The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

2. Summary of Significant Accounting Policies and Basis of Presentation

Principles of Consolidation and Basis of Presentation

The unaudited condensed consolidated financial statements and accompanying notes include the accounts of the Company and its wholly owned subsidiaries, after elimination of intercompany balances and transactions. The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the requirements of the Securities and Exchange Commission (“SEC”) for interim financial information. Certain information and disclosures normally included in annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, these interim unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2025, which are included in the Company’s Form 10‑K filed with the SEC on March 25, 2026.

The information as of December 31, 2025 included in the unaudited condensed consolidated balance sheets was derived from the audited consolidated financial statements.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary for the fair presentation of the Company’s financial information. The unaudited condensed consolidated results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for the year ending December 31, 2026 or for any other future annual or interim period.

There have been no material changes in the Company’s significant accounting policies as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Use of Estimates

The preparation of the accompanying unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make judgments, estimates, and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. These judgments, estimates, and assumptions are used for but not limited to revenue recognition, provision for credit losses, deferred income taxes and related valuation allowances, inventory obsolescence, recoverability of long-lived assets, certain accrued expenses, stock-based compensation, determination of the fair value of the Company’s financial instruments, including convertible promissory notes, warrant liabilities, stock options, and common stock forward liability. The Company bases its estimates and judgments on historical experience and on various other assumptions that it believes are reasonable under the circumstances. Actual results could differ from these estimates, and these differences may be material.

Risk and Uncertainties

The Company is subject to certain risks and uncertainties and believes changes in any of the following areas could have a material adverse effect on the Company’s future financial position or results of operations or cash flows: 5G and other new product development, including market receptivity, the ability to satisfy obligations under development agreements with major partners, litigation or claims against the Company based on intellectual property, patent, product regulation or other factors, competition from other products, general economic conditions, the ability to attract and retain qualified employees and ultimately to sustain profitable operations.

The semiconductor industry is characterized by rapid technological change, competition, competitive pricing pressures, and cyclical market patterns. The Company’s financial results are affected by a wide variety of factors, such as general economic conditions specific to the semiconductor industry and the Company’s particular market, the timely implementation of new 5G and other new products, new manufacturing process technologies, and the ability to safeguard patents and intellectual property in a rapidly evolving market. In addition, the semiconductor market has historically been cyclical and subject to significant economic downturns. As a result, the Company may experience significant period-to-period fluctuations in the unaudited condensed consolidated operating results due to these factors.

The Company’s revenue may be impacted by its ability to obtain adequate wafer supplies from foundries and back-end production capacity from the Company’s test and assembly subcontractors. The foundries with which the Company currently has arrangements may not be willing or able to satisfy all of the Company’s manufacturing requirements on a timely basis or at favorable prices. The Company is also subject to the risks of service disruptions, raw material shortages, and price increases by its foundries. Such disruptions, shortages, and price increases could harm the Company’s consolidated operating results.

Provision for Credit Losses

The provision for credit losses is based on the Company’s assessment of the collectibility of its customer accounts. The Company reviews the provision for credit losses by considering certain factors such as historical experience, industry data, credit quality, age of balances, and current economic conditions that may affect a customer’s ability to pay. Uncollectible receivables are written off when all efforts to collect have been exhausted, and recoveries are recognized when they are recovered. The Company had a provision for credit losses of approximately$4.6 million and$4.0 million as of March 31, 2026 and December 31, 2025, respectively.

Revenue Recognition

The Company’s revenues are generated by the sale of 4G and 5G mobile semiconductor solutions consisting of product and platform solutions aimed at the 4G LTE and 5G NR (New Radio) wireless communications industry, and related development services and technical advice and maintenance services. To determine when revenues are recognized, the Company performs the following five steps: (1) identify the contract(s) with a customer, (2) identify the performance obligation in the contract, (3) determine the transaction price,

(4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when or as the Company satisfies a performance obligation.

The revenues from product sales are identified and determined pursuant to purchase orders. The Company considers a performance obligation satisfied once it has transferred control of a good or product to a customer, meaning the customer has the ability to direct the use and obtain the benefit of the product, which is generally at the time of shipment.

Service revenues are identified and determined based on each service agreement and recognized over time or at a point in time, depending on the evaluation of when the customer obtains control of the promised goods or services, which is generally as services are rendered. Service revenue may include licensing fees, which are recognized upon delivery of the license, generally at a point in time. For contracts that include multiple performance obligations, the Company allocates revenue to each performance obligation based on estimates of the relative stand-alone selling price that the Company would charge the customer for each promised product or service.

All product revenue presented in the unaudited condensed consolidated statements of operations is recognized at a point in time, and all service revenue is recognized over time.

Concentration of Credit Risk

The Company’s financial instruments subject to credit risk concentration consist of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents primarily with one financial institution located in the United States and another located in South Korea, where amounts deposited may exceed Federal Deposit Insurance Corporation or Korea Deposit Insurance Corporation limits. The Company’s accounts receivable balances are primarily derived from revenues recognized from customers located in the United States, China, South Korea, Japan, and Taiwan. The Company performs ongoing credit evaluations of the financial condition of its customers and distributors and generally does not require collateral.

The Company’s net revenues and accounts receivable are concentrated among a few significant customers, which could expose the Company to financial risk in the event of adverse developments. The following represents the concentration of the Company’s gross accounts receivable among key customers to the extent their share exceeds 10%:

The following table includes customers that individually accounted for more than 10% of the Company’s net revenues in the periods indicated:

*Less than 10%.

Management closely monitors the creditworthiness and performance of these key customers and has established credit limits and terms to mitigate potential credit risks. The Company also continues to diversify its customer base and explore opportunities to reduce its reliance on a few major customers.

Foreign Currency

Financial statements of foreign subsidiaries that use the local currency as their functional currency are translated into U.S. dollars at the end-of-period exchange rates or at historical exchange rates for purposes of consolidation. Revenues and expenses are translated using average exchange rates during the reporting period. Translation adjustments are included in accumulated other comprehensive income or loss within stockholders’ deficit.

Gains and losses resulting from transactions denominated in a currency other than the functional currency are presented separately in the unaudited condensed consolidated statements of operations. For the three months ended March 31, 2026, the Company recognized realized foreign currency exchange gains of$2.5 million and unrealized foreign currency exchange gains of$0.1 million. For the three months ended March 31, 2025, realized foreign currency exchange losses and unrealized foreign exchange gains were immaterial.

Convertible Promissory Notes

The Company has elected the fair value option to account for its outstanding convertible promissory notes, with changes in estimated fair value presented separately under the corresponding caption in the unaudited condensed consolidated statements of operations. The Company has made this election as the fair value option better reflects the underlying economics within convertible promissory notes. Through March 31, 2026, there were no changes in the instrument-specific credit risk that are required to be presented as a component of accumulated other comprehensive income.

Accumulated Other Comprehensive Income (Loss)

Accumulated other comprehensive income (loss) includes all changes within equity that are not the result of transactions with stockholders. Accumulated other comprehensive income (loss) includes foreign currency translation adjustments arising from the consolidation of the Company’s foreign subsidiaries.

Common Stock Warrants

Common stock warrants are classified as liabilities if they do not meet equity classification requirements based on their settlement mechanism upon a change of control and similar transactions. The corresponding liability is remeasured at fair value while the common stock warrants remain outstanding, with changes in fair value presented separately in the unaudited condensed consolidated statements ofoperations. Common stock warrants that meet equity classification requirements are credited to stockholders’ deficit on their issuance dates and are not subsequently remeasured.

Segment Information

The Company operates inone operating and reportable segment, providing fabless semiconductor products to customers. The Company’s chief operating decision-maker is its Chief Executive Officer. Since the Company operates in a single operating and reportable segment represented by the entire entity, significant segment expenses are provided to the chief operating decision-maker using the same basis as presented in the unaudited condensed consolidated statements of operations. When evaluating the Company’s financial performance and making strategic decisions on budgeting and resource allocation, the chief operating decision-maker utilizes consolidated revenue, operating expenses, other income and expenses, and net loss. The chief operating decision-maker regularly reviews assets, liabilities, revenue, expenses, and profitability measures at the same level and using the same categories as presented in the Company’s unaudited condensed consolidated financial statements.

Emerging Growth Company Status

The Company is an emerging growth company (“EGC”), as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS” Act). Under the JOBS Act, EGCs can delay adopting new or revised accounting standards using private company timelines. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these unaudited condensed consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. The Company anticipates that its EGC status will expire in November 2026 based on the five-year anniversary of the initial public offering of Concord Acquisition Corp III, its predecessor reporting entity.

Recent Accounting Pronouncements Adopted

In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets(“ASU 2025-05”), which introduces a practical expedient allowing entities to assume that current conditions as of the balance sheet date remain unchanged over the remaining life of the asset when estimating expected credit losses for current accounts receivable and current contract assets within the scope of “Revenue from Contracts with Customers (Topic 606)”. ASU 2025‑05 is effective for annual periods beginning after December 15, 2025, and interim periods within those annual reporting periods, with early adoption permitted. The Company adopted ASU 2025‑05 prospectively effective January 1, 2026 by electing the practical expedient. The adoption didnot have a material impact on the Company’s consolidated financial statements or related disclosures.

Recent Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures(“ASU 2023-09”), which requires companies to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. In addition, companies are required to disclose additional information about income taxes paid. ASU 2023-09 is effective for the Company as an emerging growth filer for annual periods beginning after December 15, 2025, with early adoption permitted. The standard is required to be adopted on a prospective basis; however, retrospective application is permitted. The Company is currently evaluating the impact of the adoption of ASU 2023-09 on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses(“ASU 2024-03”), which requires public entities to provide disaggregated disclosures of certain expense captions presented on the face of the income statement into specific categories within the notes to the consolidated financial statements. ASU 2024-03 is effective for the Company’s annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The ASU may be applied either on a prospective or retrospective basis. The Company is currently evaluating the impact of the adoption of ASU 2024-03 on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606) (“ASU 2025-07”). The guidance refines the scope of Topic 815 to clarify which contracts are subject to derivative accounting. The guidance also provides clarification under Topic 606 for share-based noncash consideration from a customer in a revenue contract. The amendments in ASU 2025-07 are effective for fiscal years beginning after December 15, 2026, and interim reporting periods, with early adoption permitted. The Company is currently evaluating the impact of the adoption of ASU 2025-07 on its consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) Narrow-Scope Improvements(“ASU 2025-11”). The amendments in this update clarify interim disclosure requirements and the applicability of Topic 270. The objective of the update is to provide clarity about current interim requirements. The amendments in this update also include a disclosure principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The amendments in ASU 2025-11 are effective for interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of the adoption of ASU 2025-11 on its future interim consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-12, Codification Improvements (“ASU 2025-12”). ASU 2025-12 addresses suggestions received from stakeholders regarding the Accounting Standards Codification (“ASC”) and makes other incremental improvements to U.S. GAAP. The update represents changes to the Codification that clarify, correct errors in or make other improvements to a variety of topics that are intended to make it easier to understand and apply. ASU 2025-12 is effective for fiscal years beginning after December 15, 2026 and interim periods within those fiscal years. The amendments to ASC 260, Earnings Per Share, must be applied retrospectively, while all other amendments may be applied prospectively or retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of ASU 2025-12 on its consolidated financial statements and related disclosures.

3. Disaggregation of Revenue

Net revenues are categorized by customer location as follows (in thousands):

4. Fair Value of Measurements

Recurring Fair Value Measurements

The following financial instruments are measured at fair value on a recurring basis (in thousands):

Valuation Techniques and Inputs

The table below presents valuation techniques and inputs used in the fair value measurement categorized within Level 3 of the fair value hierarchy (in thousands):

As of March 31, 2026, the key inputs for the convertible promissory notes using the BLM were as follows: stock price of$1.14, volatility of 105.90%, remaining term of 1.9 years, risk-free rate of 3.78%, and credit spread of 6.50%. The settlement date fair value of the Indigo Notes is determined based on the fair value of the Company's common stock issued.

The Company’s warrants listed on the New York Stock Exchange (“Public Warrants”) were initially classified within Level 3 of the fair value hierarchy due to the use of unobservable inputs. The Public Warrants were reclassified to Level 1 in the fourth quarter of 2025 due to the increased availability of quoted prices in an active market for identical instruments.

As of March 31, 2026, the key inputs used to measure the liability-classified warrants to purchase the Company's common stock initially issued by the predecessor reporting entity (“Private Warrants”) using the BSM were as follows: exercise price of$11.50 per share, term to expiration of 3.0 years, volatility of 128.30%, and a risk-free rate of 3.77%.

The following table sets forth a summary of the changes in the fair value of the convertible promissory notes (in thousands):

The following table sets forth a summary of the changes in the fair value of the warrant liabilities (in thousands):

The following table sets forth a summary of the changes in the fair value of the common stock forward liability (in thousands):

5. Balance Sheet Components

Inventory

Inventories consist of the following (in thousands):

There wereno inventory write-downs during the three months ended March 31, 2026 and 2025.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):

Accrued and Other Current Liabilities

Accrued and other current liabilities consist of the following (in thousands):

Contract Assets

The following represents the activity related to contract assets (in thousands):

6. Debt

The Company’s outstanding debt was as follows (in thousands):

Expected future minimum principal payments under the Company’s total debt are as follows as of March 31, 2026 (in thousands):

Convertible Promissory Notes

2024 Convertible Promissory Notes

In February 2024, the Company issued a convertible promissory note to a strategic investor for a principal amount of$5.0 million with an original maturity date in February 2026 and bears an annual interest rate of 5.0%. On or after the earlier of (i)six months from the issuance date of the convertible promissory note and (ii) the Closing of the Business Combination, the noteholder may demand that the Company convert all principal and interest due under the convertible promissory note into shares of the Company’s common stock, at a conversion price of$10.00 per share. This note includes customary representations, warranties, and events of default, as well as a covenant relating to the performance of obligations by the Company related to the Company’s 5G activity. In February 2026, the Company executed an amendment to extend the maturity date from February 2026 to February 2028. In connection with the execution of this amendment, the Company issued a warrant to purchase 500,000 shares of the Company's common stock to a holder of the 2024 convertible promissory notes (“February 2026 Warrant”). The February 2026 Warrant was immediately exercisable at $2.50 per share and will expire three years following the issuance date. The fair value of the February 2026 Warrant issued of $0.2 million was recorded within interest expense in the unaudited condensed consolidated statement of operations for thethree months ended March 31, 2026. As of March 31, 2026, the remaining principal and interest amount related to the 2024 convertible promissory notes of $5.5 million was outstanding.

Indigo Convertible Promissory Notes

In December 2025, the Company issued two Indigo Notes, each with a principal amount of $1.0 million, and received gross proceeds of $1.9 million reflecting the discount at issuance.

Each Indigo Note was issued at a purchase price equal to 93% of its principal amount. Each Indigo Note matures 24 months from its issuance date and is convertible into the Company’s common stock at any time on or before its maturity date unless redeemed by the Company. The conversion price is 90% of the reference price, which is calculated as the lowest volume-weighted average price (“VWAP”) of the Company’s common stock over the three trading days prior to the submission of a conversion notice by Indigo. The reference price is subject to a floor of 96% of the average VWAP during this three-day period. No interest is payable on the Indigo Notes, and the Company has an optional redemption right beginning 12 months following the issuance of the Indigo Notes. Redemption between 12 and 18 months from issuance carries a premium of 7% on the principal amount redeemed, increasing to 14% if redeemed between 18 months and prior to maturity. Although the Indigo Notes are convertible at the option of the holders, the Indigo Notes are presented as a non-current liability within the unaudited condensed consolidated balance sheets based on their maturity date.

In December 2025, the first Indigo Note was converted into 903,710 shares of our common stock. During thethree months ended March 31, 2026, the Company issued three Indigo Notes, each with a principal amount of $1.0 million, and received gross proceeds of $2.8 million based on the discount upon issuance. During thethree months ended March 31, 2026, the Indigo Notes with principal amount of $4.0 million converted into 4.4 million shares of the Company's common stock. No Indigo Notes remained outstanding as of March 31, 2026.

The Company has elected the fair value option to account for the Indigo Notes, and these instruments are initially and subsequently measured at fair value, with changes in fair value reported separately in the unaudited condensed consolidated statements of operations, except for adjustments attributable to instrument-specific credit risk, which are reported in other comprehensive income on the unaudited condensed consolidated statements of comprehensive loss. Transaction costs associated with the issuance of the convertible promissory notes are expensed as incurred.

Obsidian Convertible Promissory Notes Purchase Agreement

In March 2026, the Company entered into a convertible promissory note purchase agreement with Obsidian, which provides a facility for the issuance of Obsidian Notes up to $20.0 million in aggregate, which remained fully available as of March 31, 2026.

Each Obsidian Note will be issued at a purchase price equal to 96.5% of its principal amount. Each Obsidian Note matures 24 months from its issuance date and is convertible into the Company’s common stock at any time on or before its maturity date unless redeemed by the Company. The conversion price is 95% of the reference price, which is calculated as the lowest VWAP of the Company’s common stock over the three trading days prior to the submission of a conversion notice by Obsidian. No interest is payable on the Obsidian Notes, and the Company has an optional redemption right beginning 12 months following the issuance of the Obsidian Notes. Redemption between 12 and 18 months from issuance carries a premium of 7% on the principal amount redeemed, increasing to 14% if redeemed between 18 months and prior to maturity.

Borrowings Pursuant to Term Loan and Security Agreements

The amounts in South Korean won (“KRW”) presented below were converted into U.S. dollars based on the applicable historical exchange rates.

KEB Hana Bank

In July 2016, the Company entered into an unsecured term loan agreement with KEB Hana Bank, pursuant to which it borrowed 9.0 billion in KRW ($6.7 million), bearing a variable interest rate (initial annual interest rate of 2.6% and annual interest rates ranging between 3.1%-4.0% as of March 31, 2026), paid monthly, and maturing in July 2017. The terms of such unsecured term loan agreement have been extended annually for additionalone-year terms since 2017, and the maturity date was July 2024. In April 2024, the Company executed an amendment to extend the maturity date to April 2025 for the principal amount of KRW 1.0 billion ($0.7 million) with an annual interest rate of 3.5%. In July 2024, the Company executed an amendment to extend the maturity date to July 2025 for the principal amount of KRW 8.0 billion ($6.0 million) with an annual interest rate of 4.9%. Anapass, Inc., a related party, provided certificates of deposit as collateral to KEB Hana Bank to secure the Company’s obligations under this loan (see Note 7). In April 2025, the Company executed an amendment to extend the maturity date to April 2026 for the principal amount of KRW 1.0 billion ($0.7 million) with an annual interest rate of 3.1%. In July 2025, the Company executed an amendment to extend the maturity date to July 2026 for the principal amount of KRW 8.0 billion ($5.6 million) with an annual interest rate of 4.0%. In April 2026, the Company executed an amendment to extend the maturity date to April 2027 for the principal amount of KRW 1.0 billion ($0.7 million) with an annual interest rate of 2.9%.

IBK Industrial Bank

In January 2017, the Company entered into a term loan agreement with IBK Industrial Bank, pursuant to which the Company borrowed KRW 9.2 billion ($6.8 million). The term loan has a maturity date in November 2025 and bears an annual interest rate of 4.1%. In June 2025, the Company executed an amendment to change the annual interest rate from 4.1% to 4.0%, effective June 12, 2025. In November 2025, the Company executed an amendment to extend the maturity date to November 2026 and change the annual interest rate from 4.0% to 3.6%.

Mujin Electronics Co., Ltd.

In July 2024, the Company executed an agreement with M-Venture Investment, Inc. and Mujin Electronics Co., Ltd., in which Mujin Electronics Co., Ltd. fully assumed the remaining balance of the term loan originally entered into with M-Venture Investment, Inc. with the same principal amount of KRW 5.0 billion ($3.7 million). The maturity date of assumed loan at the time of the assignment was January 2025, with an annual interest rate of 6.8%. In October 2024, the Company executed an amendment to extend the maturity date to June 2025. In June 2025, the Company executed an amendment to further extend the maturity date to October 2025. In October 2025, the Company executed an amendment to further extend the maturity date to December 2025. In December 2025, the Company executed an amendment to further extend the maturity date to April 2026. In April 2026, the Company executed an amendment to further extend the maturity date to October 2026.

Anapass, Inc., Related Party

In July 2016, the Company entered into a loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 6.0 billion ($4.5 million) in a term loan. Interest-only payments are due monthly at 5.5% per annum and the principal amount of the term loan is due on the maturity date of July 2024. In July 2024, the Company and Anapass, Inc. amended the loan agreement to extend the maturity date from July 2024 to July 2025. The loan is collateralized by the Company’s assets as described under the Assets Pledged as Collateral (see Note 7). In July 2025, the Company entered into an amendment to extend the maturity date from July 2025 to July 2026.

In May 2022, the Company entered into a term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 3.0 billion ($2.2 million). The term loan had maturity date in May 2024 and bears an annual interest rate of 5.5%. In May 2024, the Company executed an amendment with Anapass, Inc., to extend the maturity date from May 2024 to May 2025. In May 2025, the Company executed an amendment with Anapass, Inc., to extend the maturity date from May 2025 to November 2025. In November 2025, the Company executed an amendment with Anapass, Inc., to extend the maturity date from November 2025 to November 2026 and change the annual interest rate from 5.5% to 7.0%.

In September 2022, the Company entered into a term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 4.0 billion ($3.0 million). The term loan had maturity date in September 2024 and bears an annual interest rate of 5.5%. In September 2024, the Company executed an amendment with Anapass, Inc., to extend the maturity date from September 2024 to September 2025. In September 2025, the Company executed an amendment with Anapass, Inc., to extend the maturity date from September 2025 to September 2026 and change the annual interest rate from 5.5% to 7.0%.

In December 2024, the Company entered into a new term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 5.0 billion ($3.4 million). The term loan has a maturity date in December 2025 and bears an annual interest rate of 6.5%. In December 2025, the Company executed an amendment to extend the maturity date from December 2025 to December 2026 and change the annual interest rate from 6.5% to 7.0%.

In March 2025, the Company entered into a term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 4.5 billion ($3.1 million). The term loan has a maturity date in March 2026 and bears an annual interest rate of 6.5%. In March 2026, the Company executed an amendment with Anapass, Inc., to extend the maturity date from March 2026 to March 2027 and change the annual interest rate from 6.5% to 7.0%.

In July 2025, the Company entered into a term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 3.0 billion ($2.1 million). The term loan has a maturity date in July 2026 and bears an annual interest rate of 6.5%.

In August 2025, the Company entered into a term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 2.0 billion ($1.4 million). The term loan has a maturity date in August 2026 and bears an annual interest rate of 6.5%.

In September 2025, the Company entered into a term loan agreement with Anapass, Inc. pursuant to which the Company borrowed KRW 15.0 billion ($10.7 million). The term loan has a maturity date in September 2026 and bears an annual interest rate of 7.0%.

i Best Investment Co., Ltd

Between 2022 and 2023, the Company entered into multiple term loans and security agreements with i Best Investment Co., Ltd. pursuant to which it borrowed principal amounts in six draws with an aggregate principal balance of KRW 14.0 billion ($10.3 million). All of the term loans had a maturity date in June 2024 and bear an annual interest rate of 6.5%. In June 2024, the Company executed an amendment with the i Best Investment Co., Ltd. to extend the maturity date from June 2024 to August 2024 for its first draw, fifth draw and sixth draw. In December 2023, the Company made a $0.8 million repayment of the outstanding principal and interest on its second draw. In March 2024, the Company repaid $2.3 million of the outstanding principal and interest amount of its fourth draw. In June 2024, the Company repaid in full the term loans with a principal amount of $1.4 million outstanding on its third draw. In July 2024, the Company executed an amendment with i Best Investment Co., Ltd. to extend the maturity date from August 2024 to February 2025 for its first draw, fifth draw and sixth draw. In October 2024, the Company executed an amendment with i Best Investment Co., Ltd. to extend the maturity date from February 2025 to May 2025 for its sixth draw.

In February 2025, the Company executed an amendment with i Best Investment Co., Ltd. to extend the maturity date from February 2025 to May 2025 for its first draw and fifth draw. In May 2025, the Company executed an amendment with i Best Investment Co., Ltd. to extend the maturity date from May 2025 to June 2025 for its first and fifth draw. In May 2025, the Company paid in full the term loans with a principal amount of $1.5 million outstanding on its fifth and sixth draw. In June 2025, the Company made a $0.7 million repayment of the principal amount of its first draw and extended the maturity date from June 2025 to December 2025 for the remaining principal amount of $2.2 million for its first draw. In December 2025, the Company executed an amendment with i Best Investment Co., Ltd. to extend the maturity date from December 2025 to June 2026.

Kyeongho Lee, Related Party

Between 2017 and 2021, the Company entered into multiple promissory note and term loan agreements with Kyeongho Lee pursuant to which the Company borrowed (a) KRW 500.0 million ($0.4 million) and KRW 500.0 million ($0.4 million) in promissory notes, and (b) KRW 1.0 billion ($0.7 million) and KRW 110.0 million ($0.1 million) in term loans. The promissory notes have a maturity date in November 2024 and bear an annual interest rate varying from 7.5% and 9.0%. In March 2024, the Company repaid to Kyeongho Lee the term loan of KRW 1.0 billion ($0.7 million). The outstanding term loan had a maturity date in May 2024 and bears no interest. In May 2024, the Company executed an amendment with Kyeongho Lee to extend the maturity date from May 2024 to November 2024 for its term loan. In November 2024, the Company executed two amendments with Kyeongho Lee to extend the maturity dates of two promissory notes from November 2024 to November 2025, and the maturity date of the term loan from November 2024 to May 2025. In May 2025, the Company executed an amendment with Kyeongho Lee to extend the maturity date of the term loan from May 2025 to August 2025. In August 2025, the Company executed an amendment with Kyeongho Lee to extend the maturity date of the term loan from August 2025 to December 2025. In October 2025, the Company repaid to Kyeongho Lee the term loan of KRW 110.0 million ($0.1 million) initially executed in May 2020. In November 2025, the Company executed an amendment to extend the maturity dates of the two promissory notes from November 2025 to November 2026.

In November 2024, the Company entered into a term loan agreement with Kyeongho Lee pursuant to which the Company borrowed KRW 4.0 billion ($2.9 million) at an annual interest rate of 12%. The term loan had a maturity date in December 2024. In January and April 2026, the Company partially repaid KRW 1.4 billion ($0.9 million) and KRW 1.7 billion ($1.2 million) of the principal amount of the term loan initially executed in November 2024, resulting in KRW 0.9 billion ($0.7 million) remaining outstanding as of the issuance date of these unaudited condensed consolidated financial statements.

In December 2024, the Company entered into two term loan agreements with Kyeongho Lee pursuant to which the Company borrowed KRW 1.0 billion ($0.7 million) and KRW 2.0 billion ($1.4 million). The term loans have maturity dates in January 2025 and bear an annual interest rate of 12%. In October 2025, the Company repaid to Kyeongho Lee the term loan of KRW 2.0 billion ($1.4 million) initially executed in December 2024. The term loan for KRW 1.0 billion ($0.7 million) remains outstanding as of the issuance date of these unaudited condensed consolidated financial statements.

In January 2025, the Company entered into a term loan agreement with Kyeongho Lee pursuant to which the Company borrowed KRW 6.5 billion ($4.4 million) with a maturity date in February 2025 and an annual interest rate of 12%, which remains outstanding as of the issuance date of these unaudited condensed consolidated financial statements.

For the three months ended March 31, 2026 and 2025, the Company incurred penalties of 3% of principal per month on loans in the amount of $0.6 million and $0.5 million that are past their maturity dates, respectively, calculated daily until the principal and accrued interest are paid, and are presented within interest expense in the unaudited condensed consolidated statements of operations. Outstanding penalties payable to Kyeongho Lee as of March 31, 2026 were $2.7 million.

7. Commitments and Contingencies

Litigation

The Company is subject to various claims arising in the ordinary course of business. Although no assurance can be given, the Company believes that it is not a party to any litigation of which the outcome, if determined adversely, would individually, or in the aggregate, be reasonably expected to have a material adverse effect on the business, consolidated operating results, cash flows or financial position of the Company as of March 31, 2026.

Third parties have from time to time claimed, and others may claim in the future, that the Company has infringed their past, current or future intellectual property rights. These claims, whether meritorious or not, could be time-consuming, result in costly litigation, require expensive changes in the Company’s methods of doing business or could require the Company to enter into costly royalty or licensing agreements, if available. As a result, these claims could harm the Company’s business, consolidated operating results, cash flows, and financial position.

Purchase Commitments

The Company has certain commitments for outstanding purchase orders related to the manufacture of certain wafers utilized by the Company and other services that, once the wafers are placed into production, are noncancellable. Otherwise, these production agreements are cancellable at any time, with the Company required to pay all costs incurred through the cancellation date. However, the Company does not have a history of cancelling these agreements once production has started. As of March 31, 2026, the Company had outstanding noncancellable purchase commitments for these production agreements of$0.2 million.

Assets Pledged as Collateral

The Company has provided collateral to Anapass, Inc., a related party (see Note 13), for borrowings from KEB Hana Bank, IBK Industrial Bank and Anapass, Inc. in the principal amount of$5.9 million,$6.1 million and$28.1 million, respectively, as of March 31, 2026, and$6.3 million,$6.4 million and$29.6 million, respectively, as of December 31, 2025 (see Note 6).

The following table includes a summary of the carrying amounts related to collateral provided to Anapass, Inc. (in thousands):

8. Common Stock

B. Riley Purchase Agreement

In April 2024, the Company executed a common stock purchase agreement (“Purchase Agreement”) with B. Riley Principal Capital II, LLC (“B. Riley”). Pursuant to the Purchase Agreement, the Company has the right, but not the obligation, to sell to B. Riley, from time to time, up to$50.0 million worth of shares of its common stock (“Commitment Amount”), subject to certain limitations and conditions at the Company’s sole discretion. The price per share payable by B. Riley on each trading day represents an amount equal to 98% of the volume-weighted average price (“VWAP”) of the Company’s common stock for the applicable pricing period. The Purchase Agreement requires settlement in registered shares. In May 2024, the Company filed a registration statement on Form S-1 with the SEC to register the resale of shares issued to B. Riley, which became effective on June 6, 2024. The Company may sell shares of its common stock to B. Riley through June 2026, up to the Commitment Amount, provided it remains in compliance with the terms of the Purchase Agreement.

The Purchase Agreement was determined to be an equity-linked contract that contains a purchased put option on the Company’s common stock and variable share forward. These freestanding instruments are precluded from equity classification since the Purchase Agreement 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.

As of April 2024, the Company determined that the fair value of the put option was nominal due to the short settlement period of one day or less, and the Company recognized a liability of$0.6 million related to the freestanding common stock forward contract. The fair value of the common stock forward liability represents the probability-adjusted present value of the discount to be granted to B. Riley with respect to the sales of its common stock under the Purchase Agreement compared to the VWAP of the company’s common stock for the applicable pricing period. As of March 31, 2026, the fair value of the liability was reduced to zero based on restrictions of the at-market issuance agreement that prevent the Company from making additional sales under the Purchase Agreement.

In connection with the Purchase Agreement, the Company issued 56,818 shares of its common stock (“Commitment Shares”), which included a make-whole provision requiring the Company to reimburse B. Riley in cash if the fair value of these shares is less than$0.25 million. The Company recognized $0.3 million as a liability within accrued payables (see Note 5), which remained outstanding through March 31, 2026.

During the three months ended March 31, 2026, the Company didnot sell any shares of common stock under the Purchase Agreement.

In April 2025, the Company executed an ATM Agreement with B. Riley Securities, Inc. and H.C. Wainwright & Co., LLC, acting as sales agents. The ATM Agreement allows the Company to sell its common stock through sales agents, from time to time, for gross proceeds of up to$75.0 million. The offering under the ATM Agreement is made pursuant to Rule 415 and a universal shelf registration statement on Form S-3, which became effective on April 9, 2025, for an aggregate amount of $200.0 million, including $75.0 million allocated to the ATM Agreement. There is no commitment for future sales of additional shares under the ATM Agreement or ATM Offering. During thethree months ended March 31, 2026, the Company sold approximately 10.0 million shares of its common stock under the ATM Agreement for gross proceeds of approximately$12.7 million in cash, partially offset by$0.4 million in issuance costs. As of March 31, 2026, approximately 38.6 million shares of common stock remain available for future issuance under the ATM Agreement.

Registered Direct Offering

In May 2025, the Company entered into securities purchase agreements through which the Company agreed to issue and sell to certain institutional investors in a registered direct offering (“RDO”) an aggregate of 7,006,370 shares of the Company’s common stock (“RDO Shares”) and equity-classified warrants (“RDO Warrants”) to purchase up to 10,509,555 shares of the Company’s common stock at a combined purchase price of $1.57 per RDO Share and the accompanying RDO Warrant. The RDO closed on May 16, 2025, and the Company received net proceeds of$9.9 million, after deducting issuance costs of$1.1 million. The Company allocated the proceeds based on the relative fair value of the securities issued, resulting in $5.8 million allocated to the RDO Shares and $4.1 million allocated to the RDO Warrants. The RDO Warrants have an exercise price of $1.71 per share and expire November 17, 2030.

Common Stock Reserved for Issuance

The Company has reserved shares of common stock for issuance as follows (in thousands):

9. Common Stock Warrants

The following table represents a summary of warrants to purchase shares of the Company’s common stock that are outstanding (in thousands, except for exercise price):

10. Stock-Based Compensation

2024 Employee Stock Purchase Plan

In December 2023, the Company’s board of directors adopted the 2024 Employee Stock Purchase Plan, which was subsequently approved by the Company’s stockholders in February 2024 (the “2024 ESPP”), under which eligible employees may be provided with the opportunity to periodically purchase shares of the Company’s common stock at a discount through their accumulated periodic payroll deductions. As of March 31, 2026, the Company had 600,000 shares authorized for issuance under the 2024 ESPP, and no offering periods had started.

2024 Omnibus Incentive Compensation Plan

In March 2024, the Company adopted the 2024 Omnibus Incentive Compensation Plan (the “2024 Plan”), under which 3,983,334 shares of common stock were initially reserved for issuance. The 2024 Plan permits the grant of stock options, stock appreciation rights, stock awards, restricted stock units (“RSUs”), dividend equivalent rights, cash awards, and other awards to employees and non-employees, including members of the board of directors, consultants, or advisors. As of March 31, 2026, the Company had 2,118,608 shares available for issuance under the 2024 Plan.

Common Stock Options

Common stock options outstanding under the 2024 Plan were as follows (in thousands, except per share amounts and years):

No options were granted or cancelled during thethree months ended March 31, 2026. As of March 31, 2026, unrecognized compensation cost related to common stock options was nominal.

Restricted Stock Units

In May 2025, the Company granted to the members of its board of directors certain share-based awards with a fixed monetary amount of $0.7 million equally allocated among the six grantees (“2025 RSUs”). The number of shares issuable to each grantee under the 2025 RSUs is calculated by dividing one-fourth of the allocated fixed monetary amount by the closing price of the Company’s common stock at the end of each fiscal quarter between April 1, 2025 and March 31, 2026. The 2025 RSUs were initially classified as a liability and were reclassified to equity up to the monetary amount for which the number of shares to be issued was determinable. During thethree months ended March 31, 2026, the Company determined that an additional 144,732 shares became required to be issued to settle the remaining liability related to the 2025 RSUs. Upon completion of the required service period,501,516 RSUs vested on March 31, 2026, of which 167,172 RSUs were settled in common stock in April 2026, and the remaining 334,344 RSUs will be released in future periods, based on the passage of time or upon the occurrence of certain qualifying distribution events.

In September 2025, the Company also granted to its officers 300,000 RSUs that vest annually, infour equal installments, commencing from September 2026 and subject to continuous service.

Activity for Restricted Stock Units

The RSU activity under the 2024 Plan was as follows (in thousands, except per share amounts):

As of March 31, 2026, there was $1.7 million of unrecognized compensation cost related to RSUs, which is expected to be recognized over a weighted-average period of 2.7 years. Any unvested RSUs are forfeited upon separation from the Company. Forfeitures are accounted for as they occur.

Components of Stock-Based Compensation

The following table summarizes stock-based compensation included in the Company’s unaudited condensed consolidated statements of operations (in thousands):

Stock-based compensation for the three months ended March 31, 2026 and 2025 primarily relates to the vesting of RSUs.

11. Income Taxes

For financial reporting purposes, the Company’s effective tax rate used for the interim periods is based on the estimated full-year income tax rate. For the three months ended March 31, 2026, the Company’s effective tax rate differs from the statutory rate primarily due to the valuation allowance recorded against the net deferred tax asset balance.

For each of the three months ended March 31, 2026 and 2025, the Company recorded income tax expense of$0.1 million. The effective tax rate is(1.3)% and(1.5)% for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, the Company was not under examination by any taxing authority.

As of March 31, 2026, the Company had unrecognized tax benefits of$3.5 million, of which$1.7 million would currently affect the Company’s effective tax rate if recognized due to the Company’s deferred tax assets being fully offset by a valuation allowance. The Company does not anticipate that the amount of unrecognized tax benefits relating to tax positions existing as of March 31, 2026 will significantly increase or decrease within the next twelve months. There wasno interest expense or penalties related to unrecognized tax benefits recorded as of March 31, 2026.

A number of years may elapse before an uncertain tax position is audited and finally resolved. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position, the Company believes that its reserves for income taxes reflect the most likely outcome. The Company adjusts these reserves, as well as the related interest, considering changing facts and circumstances.

12. Employee Benefit Plans

Under Korean law, the Company is required to make severance payments to Korean employees leaving their employment. The Company’s severance pay liability to its Korean employees, which is a function of the employee’s salary, years of employment, and severance factor, is reflected in the accompanying unaudited condensed consolidated balance sheets as the net defined benefit liabilities on an accrual basis. The net liability for severance payments was as follows (in thousands):

13. Related Party Transactions

A summary of balances and transactions with the related parties who are stockholders of the Company were as follows (in thousands):

For the three months ended March 31, 2026 and 2025, the Company recorded $0.5 million and $0.2 million of interest expense with Anapass, Inc., respectively, in the unaudited condensed consolidated statements of operations. Interest expense related to the Company's arrangements with Kyeongho Lee was $0.6 million and $0.5 million for thethree months ended March 31, 2026 and 2025, respectively. Penalties are incurred at 3.0% of principal per month on loans from Kyeongho Lee that are past their maturity dates, calculated daily until the principal and accrued interest are paid (see Note 6).

14. Segments and Information

The Company operates inone reportable segment. The Company’s chief operating decision maker is its Chief Executive Officer. When evaluating the Company’s financial performance and making strategic decisions, the chief operating decision maker utilizes consolidated revenue, operating expenses, and other income and expenses and does not regularly review this information except as presented in the consolidated financial statements. Long-lived assets by geographic region were as follows (in thousands):

15. Net Loss Per Share

The following outstanding potentially dilutive common stock equivalents were excluded from the computation of diluted net loss per share for the periods indicated because including them would have been antidilutive (in thousands):

Vested and unreleased RSUs are included in the calculation of basic and diluted net loss per share, even though they are not physically settled in shares of the Company'scommon stock.

16. Subsequent Events

Repayment of Borrowings

In April 2026, the Company partially repaid KRW 1.7 billion ($1.2 million) of the principal amount of the term loan agreement with Kyeongho Lee executed in November 2024.

KEB Hana Bank

In April 2026, the Company executed an amendment with KEB Hana Bank to extend the maturity date for the principal amount of KRW 1.0 billion ($0.7 million) with an annual interest rate of 2.9% to April 2027.

Mujin Electronics Co., Ltd.

In April 2026, the Company executed an amendment with Mujin Electronics Co., Ltd. to extend the maturity date for the principal amount of KRW 5.0 billion ($3.7 million) from April 2026 to October 2026.

From April 1, 2026 through May 11, 2026, the Company sold approximately 11.4 million shares of its common stock under the ATM Agreement for gross proceeds of approximately $17.8 million in cash, partially offset by $0.6 million of issuance costs. As of May 11, 2026, approximately 27.2 million shares of common stock remain available for future issuance under the ATM agreement.