Company: AOSL
Filing Date: 2025-08-28
Form Type: 10-K
Source: 0001628280-25-041297
Chunk: 129

Company: ALPHA & OMEGA SEMICONDUCTOR Ltd
Filing Date: 2025-08-28
Form: 10-K
Item: Item 7
Chunk 129
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4) in the JV Company in exchange for a 7.09% interest.  This transaction closed on January 15, 2025, at which time, the percentage of outstanding JV Company’s equity interest owned by the Company was reduced to approximately 39.2%.  The funding of the investment was agreed to be made in three installments.  The JV Company received the first installment of RMB 40 million (or $5.5 million) on December 31, 2024.  However, the JV Company has not received the remaining two installments as of the filing date.  As of June 30, 2025, the percentage of outstanding JV equity interest beneficially owned by the Company was 39.2%.

On July 14, 2025, we entered into an equity transfer agreement with a strategic investor to sell approximately 20.3% of outstanding equity interest in the JV Company for an aggregate cash consideration of $150 million to be paid in four installments, subject to satisfaction of certain conditions.

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We expect to receive all four installment payments and close the transaction prior to the end of calendar year 2025.  We believe this sale will provide additional and significant capital for us to continue investment in technology, R&D projects and acquisition of assets complementary to our business operations, which will facilitate and accelerate our efforts to develop and distribute innovative and diverse power semiconductor products to customers worldwide. 

In addition, the JV Company will continue to provide us with significant level of foundry capacity to enable us to develop and manufacture our products.  Pursuant to an agreement with the JV Company and other shareholders of the JV Company, the JV Company is committed to provide us with a specified level of monthly wafer production capacity.

Other Factors Affecting Our Performance

The global, regional economic and PC market conditions: Because our products primarily serve consumer electronic applications, any significant changes in global and regional economic conditions could materially affect our revenue and results of operations.  A significant amount of our revenue is derived from sales of products in the PC markets, such as notebooks, motherboards and notebook battery packs.  Therefore, a substantial decline in the PC market could have a material adverse effect on our revenue and results of operations.  The PC markets have experienced a modest global decline in recent years due to continued growth of demand in tablets and smart phones, worldwide economic conditions and the industry inventory correction which had and may continue to have a material impact on the demand for our products.  In addition, the PC