LATTICE SEMICONDUCTOR CORP
For the period ended Oct 3, 2026. Filed Nov 3, 2026.
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.
Oct 3, 2026 · Filed Nov 3, 2026
LSCC$105.02+7.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-07-04; filed 2026-08-04.
0001437749-26-025657
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-10-03; filed 2026-11-03.
0001193125-26-445613
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 82 previous paragraphs and 12 current paragraphs.
3 unchanged; 4 reworded; 5 added; 75 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 19 previous and 0 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 (5)
Current report
Revenue from Contracts with Customers
Current report
We recognize revenue upon satisfaction of performance obligations when control of promised goods or services has been transferred to our customers. We measure revenue based on the amount of consideration we expect to be entitled to in exchange for products or services. See “Note 1 - Basis of Presentation and Significant Accounting Policies” to our Consolidated Financial Statements in Part I, Item 1 of this report for further information on our recognition of revenue.
Current report
Distributor and royalty estimates. For revenue recognized on sales to distributors and on royalties, the amount of consideration we expect to be entitled to receive is based on estimates that require assumptions and judgments relating to trends in recent and historical activity and, for usage-based royalties where licensee reports are not yet available, estimates of licensee sales or usage. Sales to most distributors are made under terms allowing certain price adjustments upon sale to their end customers and limited rights of return of our products held in their inventory. The revenue recognized based on estimated price adjustments and stock rotation reserves may be materially different from the actual consideration received if actual distributor price adjustments and stock rotation returns differ significantly from the historical trends used in the estimates.
Current report
Acquisition Accounting
Current report
The fair value of the consideration the Company pays in an acquisition is allocated to tangible assets and identifiable intangible assets, liabilities assumed, and goodwill. The accounting for acquisitions involves a considerable amount of judgment and estimation, including the fair value of acquired intangible assets involving projections of future revenues and cash flows that are then either discounted at an estimated discount rate or measured at an estimated royalty rate; fair value of other acquired assets and assumed liabilities, including potential contingencies; and the useful lives of the acquired assets. The assumptions used are determined at the time of the acquisition in accordance with accepted valuation models. Projections are developed using internal forecasts, available industry and market data, and estimates of long-term rates of growth for the business. The judgments and estimates used in accounting for an acquisition have a significant impact on the values assigned to identified intangible assets and goodwill.
Removed paragraphs (75)
Previous report
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Previous report
Results of Operations
Previous report
Key elements of our Consolidated Statements of Operations, including as a percentage of revenue, are presented in the following table:
Previous report
Revenue by End Market
Previous report
During the first quarter of 2026, we aligned our end market structure to our larger strategic market focus areas. We sell our products globally to a broad base of customers in two primary end market groups: Compute and Communications, and Industrial and Embedded. Across our end markets, our products are increasingly used for AI-related applications, including device usage in AI-optimized servers in data centers, AI-enabled PCs, and AI-enabled robotics and ADAS systems, among others. We also provide IP licensing and services to these end markets.
Previous report
Within these end markets, there are multiple drivers, including:
Previous report
The end market data we use is derived from data provided to us by our distributors and end customers. With a diverse base of customers who may manufacture end products spanning multiple end markets, the assignment of revenue to a specific end market requires the use of judgment. We also recognize certain revenue for which end customers and end markets are not yet known. We assign this revenue first to a specific end market using historical and anticipated usage of the specific products, if possible, and allocate the remainder to the end markets based on either historical usage for each product family or industry application data for certain product types.
Previous report
The following are examples of end market applications for the periods presented:
Previous report
The composition of our revenue by end market is presented in the following table:
Previous report
Note: During the first quarter of 2026, we began disaggregating our revenue by Compute and Communications, and Industrial and Embedded. Prior periods have been reclassified to match current period presentation.
Previous report
Revenue from the Compute and Communications end market increased by 83% for the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and increased by 84% for the first six months of fiscal 2026 compared to the first six months of fiscal 2025 primarily due to stronger demand in data center applications, including general-purpose and AI-specific servers, as well as wireline networking components.
Previous report
Revenue from the Industrial and Embedded end market increased by 36% for the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and increased by 18% for the first six months of fiscal 2026 compared to the first six months of fiscal 2025 primarily due to recovering end market demand particularly from industrial and aerospace customers.
Previous report
AI applications are pervasive across our end markets, so we do not consider AI applications as a distinct end market. We expect AI-related revenue to grow over the next few years based on the growing pipeline of AI-related design wins in a diverse set of applications across both of our end market groups.
Previous report
Revenue by Geography
Previous report
We have a diverse base of customers where distributors represent a significant portion of our total revenue. Our revenue by geographical market is based on the ship-to location of our customers, which can vary from time to time. For the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and for the first six months of fiscal 2026 compared to the first six months of fiscal 2025, revenue from Asia increased by 92% and 82%, respectively, primarily due to hyperscaler demand, while revenue from the Americas decreased by 14% and 26%, respectively, primarily due to the non-recurrence of certain one-time sales in the prior year period, and revenue from Europe increased by 32% and 44%, respectively, primarily due to broad market recovery in this region.
Previous report
The composition of our revenue by geography is presented in the following table:
Previous report
Revenue from Customers
Previous report
We sell our products to independent distributors and directly to customers. Distributors have historically accounted for a significant portion of our total revenue. Revenue attributable to distributors as a percentage of total revenue was 95% and 84% for the second quarter of fiscal 2026 and 2025, respectively, and 95% and 81% for the first six months of fiscal 2026 and 2025, respectively.
Previous report
Gross Margin
Previous report
The composition of our Gross margin, including as a percentage of revenue, is presented in the following table:
Previous report
Gross margin, as a percentage of revenue, increased 190 basis points in the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 and increased by 140 basis points for the first six months of fiscal 2026 compared to the first six months of fiscal 2025. Higher margins resulted primarily from changes in product mix and volume between the periods, partially offset by higher stock-based compensation expense associated with market and performance-based awards in the current year.
Previous report
Operating Expenses
Previous report
Research and Development Expense
Previous report
The composition of our Research and development expense, including as a percentage of revenue, is presented in the following table:
Previous report
Research and development expense includes headcount-related costs, including cash- and stock-based compensation and benefits, R&D equipment expenses, engineering wafers, licenses, and outside engineering services. These expenditures are for the design of new products, IP cores, processes, packaging, and software solutions. The increase in Research and development expense for the second quarter and first six months of fiscal 2026 compared to the second quarter and first six months of fiscal 2025 was primarily due to higher stock-based and cash-based compensation expense, along with higher depreciation and amortization on semiconductor equipment and licensed software tools, and higher expenses for mask sets and prototypes. We believe that investing in research and development is important to delivering innovative products to our customers. We expect research and development expense to increase in the future, but to decline as a percentage of revenue.
Previous report
Selling, General, and Administrative Expense
Previous report
The composition of our Selling, general, and administrative expense, including as a percentage of revenue, is presented in the following table:
Previous report
Selling, general, and administrative expense includes headcount-related costs, including cash- and stock-based compensation and benefits, related to selling, general, and administrative employees, commissions, depreciation, professional and outside services, trade show, and travel expenses. The increase in Selling, general, and administrative expense for the second quarter and first six months of fiscal 2026 compared to the second quarter and first six months of fiscal 2025 was primarily due to higher stock-based and cash-based compensation expense. We expect selling, general, and administrative expense to increase in the future, but to decline as a percentage of revenue.
Previous report
Amortization of Acquired Intangible Assets
Previous report
The composition of our Amortization of acquired intangible assets, including as a percentage of revenue, is presented in the following table:
Previous report
The increase in Amortization of acquired intangible assets for the second quarter and first six months of fiscal 2026 compared to the second quarter and first six months of fiscal 2025 was due to the purchase of intellectual property assets in the second quarter of fiscal 2025.
Previous report
Restructuring and Other
Previous report
The composition of our Restructuring and other activity, including as a percentage of revenue, is presented in the following table:
Previous report
Restructuring and other is generally comprised of expenses resulting from workforce reductions, cancellation of contracts, and consolidation of our facilities. Details of our restructuring plans and expenses accrued under them are discussed in "Note 6 – Restructuring" to our Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q. Restructuring and other costs decreased in the second quarter and first six months of fiscal 2026 compared to the second quarter and first six months of fiscal 2025 as we completed the actions planned under the Q3 2024 Plan.
Previous report
Acquisition Related
Previous report
The composition of our Acquisition related activity, including as a percentage of revenue, is presented in the following table:
Previous report
Acquisition related activity includes professional fees and other expenses directly related to acquisitions. For fiscal 2026, Acquisition related expenses were entirely attributable to our acquisition of AMI which we completed in July 2026 and were comprised of professional fees for legal, accounting, and outside services, and for acquisition related travel costs.
Previous report
Interest Income (Expense), net
Previous report
The composition of our Interest income (expense), net, including as a percentage of revenue, is presented in the following table:
Previous report
Changes in Interest income (expense) for the second quarter and first six months of fiscal 2026 compared to the second quarter and first six months of fiscal 2025 were primarily due to amortization of debt costs related to the bridge facility in the current year periods as discussed in "Note 5 – Long-Term Debt" to our Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Showing the first 40 of 75 passages. Open the source sections for the rest.
Reworded paragraphs (4)
Previous wording
The following discussion should be read along with the unaudited consolidated financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as the audited consolidated financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2025 10-K.
Current wording
The following discussion should be read along with the unaudited consolidated financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, as well as the audited consolidated financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 202510-K.
Previous wording
Lattice develops technologies that we monetize through differentiated programmable logic semiconductor products, silicon-enabling products, system solutions, design services, and technology licenses. Lattice is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the Compute, Communications, Industrial, and Embedded markets. Our technology, long-standing relationships, and commitment to world-class support helps our customers quickly and easily unleash their innovation to create a smart, secure, and connected world.
Current wording
Lattice develops technologies that we monetize through differentiated programmable logic semiconductor products, silicon-enabling products, platform firmware and infrastructure manageability technology, system solutions, design services, and technology licenses. Lattice is the low power programmable and platform firmware leader. We solve customer problems across the network, from the Edge to the Cloud, in the Compute, Communications, Industrial, and Embedded markets. Our technology, long-standing relationships, and commitment to world-class support help our customers quickly and easily unleash their innovation to create a smart, secure, and connected world.
Previous wording
Lattice has focused its strategy on delivering programmable logic products and related solutions based on low power, small size, and ease of use. We also serve our customers with intellectual property ("IP") licensing and various other services. Our product development activities include new proprietary products, advanced packaging, existing product enhancements, software development tools, soft IP, and system solutions for high-growth applications such as Edge Artificial Intelligence, wireless and wireline infrastructure, platform security, and factory automation.
Current wording
Lattice has focused its strategy on delivering programmable logic products and related solutions based on low power, small size, and ease of use. With the addition of AMI’s industry-leading, silicon-neutral platform firmware and manageability solutions, Lattice can now deliver the industry’s most complete secure management and control platform for cloud and AI data center infrastructure. We also serve our customers with intellectual property (“IP”) licensing and various other services. Our product development activities include new proprietary products and solutions, advanced packaging, existing product enhancements, BIOS and manageability, software development tools, soft IP, and system solutions for high-growth applications such as data center and physical artificial intelligence, wireless and wireline infrastructure, platform security, and factory automation.
Previous wording
Critical accounting policies are those that are both most important to the portrayal of a company's financial condition and results of operations, and that require management's most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. There have been no material changes to the items that we disclosed as our critical accounting policies and estimates in Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2025 10-K.
Current wording
Critical accounting policies are those that are both most important to the portrayal of a company’s financial condition and results of operations, and that require management’s most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Other than as described below, there have been no material changes to the items that we disclosed as our critical accounting policies and estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 202510-K.