Company: DSWL
Filing Date: 2025-07-29
Form Type: 20-F
Source: 0001174947-25-001096
Chunk: 9

Company: DESWELL INDUSTRIES INC
Filing Date: 2025-07-29
Form: 20-F
Item: Item 3
Chunk 9
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 have jurisdiction, and meet other procedural requirements. However, it may be difficult for foreign shareholders to establish a sufficient connection to China for a PRC court to have jurisdiction as required under the PRC Civil Procedures Law.

The funds of Deswell, the Intermediate Holding Companies and Macao subsidiaries are deposited in banks located in Hong Kong and Macao. The funds of the PRC subsidiaries are deposited in banks located in China. Additionally, all of our officers and directors are located in, or are citizens of, Hong Kong. As a result, it may be difficult for investors to effect service of process within the United States upon or our officers and directors located in Hong Kong, or to enforce judgments obtained in U. S. courts against us or them, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. It will also be costlier and time-consumingfor investors to effect service of process outside the United States.

Risk Factors

We may from time to time make written or oral forward-lookingstatements. Written forward-lookingstatements may appear in this document and other documents filed with the Securities and Exchange Commission, in press releases, in reports to shareholders, on our website, and other documents. The Private Securities Litigation Reform Act of 1995 contains a safe harbor for forward-lookingstatements on which we rely in making such disclosures. In connection with this “safe harbor,” we are hereby identifying important factors that could cause actual results to differ materially from those contained in any forward-lookingstatements made by us or on our behalf. Any such statement is qualified by reference to the cautionary statements provided in this ITEM 3.

Table of Contents

Summary of Risk Factors

•We are, and have been, dependent on a few major customers, the loss of, or substantial reduction in orders from, which would substantially harm our business and operating results.

•Our gross margins fluctuate from year to year and may be adversely affected by a number of factors.

•If we were a passive foreign investment company in fiscal 2025, or are in later years, U. S. investors could suffer adverse U. S. federal income tax consequences in such years.

•Changes in currency exchange rates have and could continue to influence our financial results significantly.

•If OEMs stop or reduce their manufacturing outsourcing, our business could suffer.

•We could experience credit problems with our customers, which could adversely impact our operating results and financial condition and could adversely reduce our future revenues.

•The failure of any bank in which we