SITIME Corp

RISK FACTORS SUMMARY

Our business is subject to numerous risks, as more fully described in Part II, Item 1A "Risk Factors” below. You should read these risks before you invest in our common stock. We may be unable, for many reasons, including those that are beyond our control, to implement or execute our business strategy. In particular, risks associated with our business include, among others:

•Global macroeconomic conditions have harmed and may continue to harm our business;

•We are subject to the cyclical nature of the semiconductor industry, which can result in over- or under-supply of required electronic components from time to time;

•We have historically depended on a limited number of customers for a significant portion of our revenue; if we are unable to expand or further diversify our customer base, our business, financial condition, and results of operations could suffer, and the loss of, or a significant reduction in orders from our customers, including a large customer or end customer, could significantly reduce our revenue and adversely impact our operating results;

•Because we do not typically have long-term purchase commitments with our customers, orders may be cancelled, reduced, or rescheduled with little or no notice, which in turn exposes us to inventory risk, and may cause our business and results of operations to suffer;

•Our revenue and operating results may fluctuate from period to period due to, among other factors, macroeconomic conditions, cyclical fluctuations in the semiconductor market, customer demand, product life cycles, fluctuations in inventories held by our distributors or end customers, the gain or loss of significant customers, the availability of capacity in our supply chain, research and development costs, the impact of any pandemic, epidemic, or outbreak of disease, on our business as well as our suppliers and customers, and product warranty claims. This in turn could cause our stock price to decline;

•The third parties we rely upon for our raw materials, engineered materials, wafer fabrication and supply, assembly, packaging and testing may be unable to secure raw materials, reduce their resources available to us and our immediate suppliers, not meet satisfactory yields or quality, or increase pricing, which could harm our ability to ship our solutions to our customers on time and in the quantity required which could cause an unanticipated decline in our sales and loss of customers;

•International trade policies, including tariffs, sanctions and trade barriers, may adversely affect our business, financial condition, result of operations and prospects;

•A significant portion of our operations is located outside of the United States, which subjects us to additional risks, including increased complexity and costs of managing international operations and geopolitical instability;

•Our success and future revenue depend on our ability to achieve design wins and to convince our current and prospective customers to design our products into their product offerings, as well as our customers’ ability to develop products that achieve market acceptance;

•Our target customer and product markets may not grow or develop as we currently expect, and if we fail to penetrate new markets and scale successfully within those markets, our revenue and financial condition would be harmed;

•If we are not able to successfully introduce and ship in volume new products in a timely manner, our business and revenue will suffer;

•Pandemics, epidemics, or other outbreaks of disease have had and may in the future have an adverse impact upon our business, results of operations, and financial condition, as well as the businesses of our suppliers and customers;

•Our gross margins may fluctuate due to a variety of factors, which could negatively impact our results of operations and our financial condition;

•Our revenue in previous periods may not be indicative of future performance and our revenue may fluctuate over time;

•Our customers require our products and our third-party contractors to undergo a lengthy and expensive qualification process, which does not assure product sales. If we are unsuccessful or delayed in qualifying any of our products with a customer, our business and operating results would suffer;

•We provide a lifetime warranty on our products and may be subject to warranty or product liability claims, which could harm our reputation, result in unexpected expenses, and cause us to lose market share;

•Defects in our products could harm our relationships with our customers and damage our reputation;

•If we fail to compete effectively, we may lose or fail to gain market share, which could negatively impact our operating results and our business;

•We may make acquisitions in the future that could disrupt our business, cause dilution to our stockholders, reduce our financial resources, and harm our business;

•We may not be able to accurately predict our future capital needs, and we may not be able to obtain additional financing to fund our operations;

•We may seek, or be required to seek debt financing;

•Failure to comply with the laws associated with our activities outside of the United States could subject us to penalties and other adverse consequences;

•We are subject to government regulation, including import, export and economic sanctions laws and regulations that may expose us to liability and increase our costs;

•New or future changes to U.S. and non-U.S. tax laws, or tax regulatory authorities disagreeing with our positions and conclusions regarding certain tax positions, could materially adversely affect us;

•Breaches, cyberattacks, or other disruptions to our information technology systems owned or maintained by us or third parties could disrupt our operations, compromise confidentiality of private customer data or our intellectual property, and adversely affect our business, reputation, operations, and financial results;

•We may fail to adequately protect our intellectual property and have received, and may in the future receive, claims of intellectual property infringement, misappropriation, or other claims, which in turn could result in significant expense, result in the loss of significant rights, and harm our relationship with our end customers and distributors;

•We may be impacted by risks associated with the concentration of ownership of a significant portion of our stock, and our other shareholders’ ability to influence matters requiring stockholder approval will be limited, which could impact our business and operating results;

•Substantial future sales of our common stock could cause the market price of our common stock to decline; and

•Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock.