Company: GCTS
Filing Date: 2025-03-26
Form Type: 424B3
Source: 0000929638-25-001281
Chunk: 119

Company: GCT Semiconductor Holding, Inc.
Filing Date: 2025-03-26
Form: 424B3
Chunk 119
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 more-likely-than-not that the tax position might be challenged despite the Company’s belief that the tax return positions are fully supportable, and additional taxes will be due as a result. To the extent that the assessment of such tax positions changes, for example, based on the outcome of a tax audit, the change in estimate is recorded in the period in which the determination is made. The provision for income taxes includes the impact of provisions for uncertain tax positions. Interest and penalties related to unrecognized tax benefits are included within the provision for income taxes. Foreign Currency Financial statements of foreign subsidiaries that use the local currency as their functional currency are translated into U.S. dollars at the end-of-period exchange rates or at historical exchange rates for purposes of consolidation. Revenues and expenses are translated using average exchange rates during the reporting period. Translation adjustments are included in accumulated other comprehensive income (loss) within stockholders’ deficit. For the year ended December 31, 2024, the Company recognized realized foreign currency exchange gains of $1.3 million and unrealized foreign currency exchange gains of $3.4 million. For the year ended December 31, 2023, the Company recognized realized foreign currency exchange gains of $0.3 million and an immaterial amount of unrealized foreign currency exchange gains. Convertible Promissory Notes The Company has elected the fair value option to account for its outstanding convertible promissory notes, with changes in estimated fair value presented separately under the corresponding caption in the consolidated statements of operations. Through December 31, 2024, there were no changes in the instrument-specific credit risk that are required to be presented as a component of other comprehensive loss. 57 GCT SEMICONDUCTOR HOLDING, INC. Notes to Consolidated Financial Statements Other Comprehensive Income (Loss) Other comprehensive income (loss) include all changes within equity that are not the result of transactions with stockholders. Accumulated other comprehensive income (loss) includes foreign currency translation adjustments arising from the consolidation of the Company’s foreign subsidiaries. Common Stock Warrants Common stock warrants are classified as liabilities if they do not meet equity classification requirements based on their settlement mechanism upon a change of control and similar transactions. The corresponding liability is remeasured at fair value while the common stock warrants remain outstanding, with changes in fair value presented separately in the consolidated statements of operations. Common stock warrants that meet equity classification requirements are credited to stockholders’ deficit on their issuance dates and are not subsequently remeasured. Certain Equity Contracts The Company’s promises to potentially issue additional