LATTICE SEMICONDUCTOR CORP
For the period ended Apr 4, 2026. Filed May 4, 2026.
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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.
Apr 4, 2026 · Filed May 4, 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 2025-09-27; filed 2025-11-03.
0001437749-25-032777
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-04-04; filed 2026-05-04.
0001437749-26-014686
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 80 current paragraphs.
52 unchanged; 25 reworded; 3 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 18 previous and 18 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 (3)
Current 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.
Current report
Income Tax Expense
Current report
Adjusted EBITDA increased for the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 primarily as a result of higher revenue, partially offset by higher headcount-related expenses.
Removed paragraphs (5)
Previous report
Impact of Global Economic Conditions on our Business
Previous report
We depend in part on stable trade, political, geopolitical, economic, and regulatory environments in the countries where we do business. Increased financial market volatility, inflationary pressure, uncertainty regarding potential increases in tariffs or taxes and impacts from already implemented or announced tariffs, interest rate changes, recessionary concerns, uncertainty in the financial and banking industry, and geopolitical tension and conflicts continue to impact business globally and may impact our operations by causing disruption to our customers, our supply chains, and labor markets. The extent to which increased financial market volatility (including currency market volatility), inflationary pressures, tariffs and trade disruptions, and related uncertainty will impact our business activities will depend on future developments that are highly uncertain and cannot be predicted at this time. Additionally, our business has been impacted by the cyclic correction affecting the broader semiconductor industry, which has seen softened demand across our end markets.
Previous report
We are monitoring the rapidly evolving tariff and global trade policies, including tariffs, retaliatory tariffs, and related trade actions announced by the U.S., China, and other countries, and we are working to mitigate potential impacts on our business. The extent and duration of the tariffs and the resulting impact of general economic conditions on our business are uncertain and depend on various factors, such as negotiations between the U.S. and affected countries, the responses of other countries or regions, exemptions that may be granted, availability and cost of alternative sources of supply, the ability to pass additional costs to customers, and demand for our products in affected markets. Changes to U.S. and other countries’ tariff policies, such as the imposition or expansion of tariffs or export bans to specific customers or countries, may reduce or limit demand for, or increase the cost of production of, our products in certain markets, and may adversely impact our supply chain as well as our supply chain strategies, both domestically and internationally, any of which may then have an adverse impact on our results of operations and business. Significant devaluation of the U.S. dollar relative to the currencies of the countries we operate in could increase our Operating Expenses. In addition to existing trade restrictions and tariffs, we are monitoring the U.S. government’s ongoing Section 232 investigation into the national security implications of semiconductor imports. While no new measures have been finalized, the investigation may result in additional tariffs or restrictions that could materially impact our supply chain costs, customer demand, or access to key inputs. We continue to assess potential outcomes and their implications for our operations. See Part I, Item 1A. “Risk Factors” in our 2024 Annual Report on Form 10-K for further discussion on risks related to tariffs.
Previous report
Income Tax Expense (Benefit)
Previous report
Adjusted EBITDA increased for the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 primarily due to higher adjusted gross margin and lower adjusted operating expenses. The decrease in Adjusted EBITDA for the first nine months of fiscal 2025 compared to the first nine months of fiscal 2024 was primarily due to lower adjusted gross margin, partially offset by lower adjusted operating expenses.
Reworded paragraphs (25)
Previous wording
Lattice Semiconductor Corporation and its subsidiaries (“Lattice,” the “Company,” “we,” “us,” or “our”) develop technologies that we monetize through differentiated programmable logic semiconductor products, silicon-enabling products, system solutions, design services, and technology licenses. Lattice is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the Communications, Computing, Industrial, Automotive, and Consumer markets. Our technology, long-standing relationships, and commitment to world-class support 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, system solutions, design services, and technology licenses. Lattice is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the Communications, Computing, Industrial, Automotive, and 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.
Previous wording
We sell our products globally to a broad base of customers in three primary end market groups: Communications and Computing, Industrial and Automotive, and Consumer. 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.
Current wording
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 wording
Revenue from the Communications and Computing end market increased by 21% for the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 and increased by 18% for the first nine months of fiscal 2025 compared to the first nine months of fiscal 2024 primarily due to stronger demand in data center applications, including general-purpose and AI-specific servers, as well as wireline networking components.
Current wording
Revenue from the Compute and Communications end market increased by 86% for the first quarter of fiscal 2026 compared to the first quarter 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 wording
Revenue from the Industrial and Automotive end market decreased by 7% for the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 and decreased by 20% for the first nine months of fiscal 2025 compared to the first nine months of fiscal 2024 primarily due to softer end market demand and from continued inventory normalization by customers.
Current wording
Revenue from the Industrial and Embedded end market increased by 2% for the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 primarily due to recovering end market demand particularly from industrial and aerospace customers.
Previous wording
While 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 all three of our end market segments.
Current wording
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 wording
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. Revenue in all regions for the third quarter and first nine months of fiscal 2025 compared to the third quarter and first nine months of fiscal 2024 has been impacted by the global macroeconomic environment.
Current wording
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 first quarter of fiscal 2026 compared to the first quarter of fiscal 2025, revenue from Asia increased by 71% primarily due to hyperscaler demand, while revenue from the Americas decreased by 37% primarily due to the non-recurrence of certain one-time sales in the prior year period, and revenue from Europe increased by 57% primarily due to broad market recovery in this region.
Previous wording
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 83% and 95% for the third quarter of fiscal 2025 and 2024, respectively, and 82% and 91% for the first nine months of fiscal 2025 and 2024, respectively.
Current wording
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 94% and 79% for the first quarter of fiscal 2026 and 2025, respectively.
Previous wording
Gross margin, as a percentage of revenue, decreased 110 basis points in the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 and decreased by 40 basis points for the first nine months of fiscal 2025 compared to the first nine months of fiscal 2024. Changes in margins were primarily due to higher stock-based compensation associated with market and performance based awards in the current year periods and changes in product mix between the periods presented.
Current wording
Gross margin, as a percentage of revenue, increased 80 basis points in the first quarter of fiscal 2026 compared to the first quarter 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 wording
Operating expenses increased year-over-year primarily due to higher stock-based compensation in the current year periods; excluding stock-based compensation, operating expenses decreased year-over-year. See"Note 9 – Stock-Based Compensation" for additional details.
Current wording
Operating expenses increased year-over-year primarily due to higher stock-based compensation expense in the current year periods. See "Note 9 – Stock-Based Compensation" for additional details.
Previous wording
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 third quarter and first nine months of fiscal 2025 compared to the third quarter and first nine months of fiscal 2024 was primarily due to higher stock-based compensation associated with market-based and performance-based awards in the current year periods coupled with the prior year reduction in stock compensation expense from the forfeiture of equity awards by departing executives. 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.
Current wording
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 first quarter of fiscal 2026 compared to the first quarter 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 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 wording
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 third quarter and first nine months of fiscal 2025 compared to the third quarter and first nine months of fiscal 2024 was primarily due to higher stock-based compensation associated with market-based and performance-based awards in the current year periods coupled with the prior year reduction in stock compensation expense from the forfeiture of equity awards by departing executives.
Current wording
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 first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 was primarily due to higher stock-based and cash-based compensation expense, partially offset by lower legal costs and audit fees. We expect selling, general, and administrative expense to increase in the future, but to decline as a percentage of revenue.
Previous wording
The decrease in Amortization of acquired intangible assets for the third quarter and first nine months of fiscal 2025 compared to the third quarter and first nine months of fiscal 2024 was primarily due to the full impairment of the Mirametrix intangible assets in the fourth quarter of fiscal 2024.
Current wording
The increase in Amortization of acquired intangible assets for the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 was due to the purchase of intellectual property assets in the second quarter of fiscal 2025.
Previous wording
Restructuring activity 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 third quarter and first nine months of fiscal 2025 compared to the third quarter and first nine months of fiscal 2024 primarily due to lower costs in the current year periods for severance under the Q3 2024 Plan as compared to higher costs in the prior year periods for severance under both the Q3 2024 and Q3 2023 Plans.
Current wording
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 increased in the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 primarily due to additional costs incurred in the current year period for settlement of certain severance liabilities under the Q3 2024 Plan.
Previous wording
Interest income (expense) for the third quarter and first nine months of fiscal 2025 compared to the third quarter and first nine months of fiscal 2024 decreased primarily due to lower interest rates on cash and cash equivalents between the periods.
Current wording
Interest income (expense) for the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 increased primarily due to lower interest expense on long-term contractual obligations and reduced carrying costs on our revolving loan facility.
Previous wording
Other income (expense) for the third quarter and first nine months of fiscal 2025 and 2024 was primarily due to foreign currency effects.
Current wording
Other income (expense) for the first quarter of fiscal 2026 and 2025 was primarily due to foreign currency effects.
Previous wording
Our Income tax expense (benefit) is partially offset by federal tax credits. The income tax (benefit) in the third quarter of fiscal 2025 and lower income tax expense for the first nine months of fiscal 2025 was primarily due to tax benefits related to increased federal tax credits.
Current wording
Our Income tax expense is partially offset by federal tax credits. The higher income tax expense for the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 was primarily due to increased worldwide income, combined with federal tax credits and the impact of stock‑based compensation.
Previous wording
Adjusted EBITDA is a non-GAAP financial measure that we define as net income before net interest income (expense), income tax (benefit) expense, depreciation and amortization, stock-based compensation, and other items that are considered unusual or not representative of underlying trends of our business, including but not limited to: legal expenses outside the ordinary course of business, restructuring, transformation, and other charges, impairments, and other non-recurring charges, if applicable for the periods presented.
Current wording
Adjusted EBITDA is a non-GAAP financial measure that we define as net income before net interest income (expense), income tax expense, depreciation and amortization, stock-based compensation, and other items that are considered unusual or not representative of underlying trends of our business, including but not limited to: legal expenses outside the ordinary course of business, transformation charges incurred in connection with our multi‑year strategic initiative to realign our organizational structure and modernize our technology platforms, restructuring, and other charges, if applicable for the periods presented.
Previous wording
As of September 27, 2025, we had Cash and cash equivalents of $117.9 million, of which approximately $48.0 million was held by our foreign subsidiaries. We manage our global cash requirements considering, among other things, (i) available funds among our subsidiaries through which we conduct business, (ii) the geographic location of our liquidity needs, and (iii) the cost to access international cash balances. The repatriation of non-US earnings may require us to withhold and pay foreign income tax on dividends. This should not result in our recording significant additional tax expense as we have accrued expense based on current withholding rates. As of September 27, 2025, we could access all cash held by our foreign subsidiaries without incurring significant additional expense.
Current wording
As of April 4, 2026, we had Cash and cash equivalents of $140.0 million, of which $56.4 million was held by our foreign subsidiaries. We manage our global cash requirements considering, among other things, (i) available funds among our subsidiaries through which we conduct business, (ii) the geographic location of our liquidity needs, and (iii) the cost to access international cash balances. The repatriation of non-US earnings may require us to withhold and pay foreign income tax on dividends. This should not result in our recording significant additional tax expense as we have accrued expense based on current withholding rates. As of April 4, 2026, we could access all cash held by our foreign subsidiaries without incurring significant additional expense.
Previous wording
The net decrease in Cash and cash equivalents of $18.4 million between December 28, 2024 and September 27, 2025 was primarily driven by cash flows from the following activities:
Current wording
The net increase in Cash and cash equivalents of $6.1 million between January 3, 2026 and April 4, 2026 was primarily driven by cash flows from the following activities:
Previous wording
Operating activities — Cash provided by operating activities results from net income adjusted for certain non-cash items and changes in assets and liabilities. Cash provided by operating activities for the first nine months of fiscal 2025 was $117.5 million compared to $95.5
Current wording
Operating activities — Cash provided by operating activities results from net income adjusted for certain non-cash items and changes in assets and liabilities. Cash provided by operating activities for the first three months of fiscal 2026 was $50.3 million compared to $31.9
Previous wording
million for the first nine months of fiscal 2024. This increase of $22.0 million was primarily driven by $17.9 million of net changes in working capital coupled with $4.1 million more cash provided by net income adjusted for non-cash items.
Current wording
million for the first three months of fiscal 2025. This increase of $18.4 million was primarily driven by $27.6 million more cash provided by net income adjusted for non-cash items, partially offset by $9.2 million of net changes in working capital.
Previous wording
Investing activities — Investing cash flows consist primarily of transactions related to capital expenditures and payments for software and intellectual property licenses. Net cash used by investing activities in the first nine months of fiscal 2025 was $41.1 million compared to $27.7 million in the first nine months of fiscal 2024.
Current wording
Investing activities — Investing cash flows consist primarily of transactions related to capital expenditures and payments for software and intellectual property licenses. Net cash used by investing activities in the first three months of fiscal 2026 was $15.4 million compared to $12.1 million in the first three months of fiscal 2025.
Previous wording
Financing activities — Financing cash flows consist primarily of repurchases of common stock, tax payments related to the net share settlement of restricted stock units, and proceeds from the exercise of options to acquire common stock. Net cash used by financing activities in the first nine months of fiscal 2025 was $95.3 million compared to $71.6 million in the first nine months of fiscal 2024. This $23.7 million increase was due to the following activities. During the first nine months of fiscal 2025, we repurchased approximately 1.5 million shares of common stock for $85.9 million compared to the first nine months of fiscal 2024, where we repurchased approximately 0.8 million shares of common stock for $47.0 million. Payments for tax withholdings on vesting of RSUs partially offset by purchases under the employee stock purchase plan used net cash flows of $9.4 million in the first nine months of fiscal 2025, a decrease of approximately $15.2 million from the net $24.6 million used in the first nine months of fiscal 2024.
Current wording
Financing activities — Financing cash flows consist primarily of repurchases of common stock, tax payments related to the net share settlement of restricted stock units, and proceeds from the acquisition of common stock under our employee stock purchase plan. Net cash used by financing activities was $28.8 million in the first three months of both fiscal 2026 and 2025. During the first three months of fiscal 2026, we repurchased 0.2 million shares of common stock for $15.0 million compared to the first three months of fiscal 2025, where we repurchased 0.4 million shares of common stock for $25.0 million. Payments for tax withholdings on vesting of RSUs partially offset by purchases under the employee stock purchase plan used net cash flows of $13.8 million in the first three months of fiscal 2026, an increase of $10.0 million from the net $3.8 million used in the first three months of fiscal 2025.
Previous wording
Accounts receivable, net as of September 27, 2025 increased by approximately$14.4 million, or 18%, compared to December 28, 2024. This increase was due to order scheduling through the quarter. We calculate Days sales outstanding on the basis of a 365-day year as Accounts receivable, net at the end of the quarter divided by sales during the quarter annualized and then multiplied by 365.
Current wording
Accounts receivable, net as of April 4, 2026 increased by$15.8 million, or 16%, compared to January 3, 2026. This increase was due to increased revenue and order scheduling through the quarter. We calculate Days sales outstanding on the basis of a 365-day year as Accounts receivable, net at the end of the quarter divided by sales during the quarter annualized and then multiplied by 365.
Previous wording
Inventories as of September 27, 2025 decreased by approximately $12.7 million, or 12%, compared to December 28, 2024 primarily as a result of our continued optimization of inventory to efficient levels for the business. Days of inventory on hand increased over the period due to lower cost of revenue.
Current wording
Inventories as of April 4, 2026 decreased by $1.0 million, or 1%, compared to January 3, 2026 primarily as a result of our continued optimization of inventory to efficient levels for the business, which also decreased Days of inventory on hand over the period. We expect to build inventory as we see continued demand growth.