Company: AOSL
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001387467-25-000044
Chunk: 131

Company: ALPHA & OMEGA SEMICONDUCTOR Ltd
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 2
Chunk 131
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, the income tax expense for the nine months ended March 31, 2025 and 2024 was $2.7 million and $2.5 million, respectively, and the effective tax rate for the nine months ended March 31, 2025 and 2024 was (16.1%) and (43.4%), respectively. The changes in the tax expense and effective tax rate between the periods resulted primarily from changes in the mix of earnings in various geographic jurisdictions between the current year and the same period of last year as well as from reporting pretax book loss of $17.0 million for the nine months ended March 31, 2025 as compared to $5.7 million of pretax book loss for the nine months ended March 31, 2024.

The Company files its income tax returns in the United States and in various foreign jurisdictions.  The tax years 2004 to 2024 remain open to examination by U.S. federal and state tax authorities.  The tax years 2018 to 2024 remain open to examination by foreign tax authorities.

The Company’s income tax returns are subject to examinations by the Internal Revenue Service and other tax authorities in various jurisdictions.  In accordance with the guidance on the accounting for uncertainty in income taxes, the Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for income taxes.  These assessments can require considerable estimates and judgments.  As of March 31, 2025, the gross amount of unrecognized tax benefits was approximately $10.3 million, of which $7.0 million, if recognized, would reduce the effective income tax rate in future periods.  If the Company’s estimate of income tax liabilities proves to be less than the ultimate assessment, then a further charge to expense would be required.  If events occur and the payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when the Company determines the liabilities are no longer necessary.  The Company does not anticipate any material changes to its uncertain tax positions during the next twelve months.

Liquidity and Capital Resources 

Our principal need for liquidity and capital resources is to maintain sufficient working capital to support our operations and to invest adequate capital expenditures to grow our business. To date, we finance our operations and capital expenditures primarily through funds generated from operations and borrowings under our term loans, financing lease and other debt agreements.

In March 2024, Bank of