Company: GCTS
Filing Date: 2025-03-26
Form Type: 424B3
Source: 0000929638-25-001279
Chunk: 118

Company: GCT Semiconductor Holding, Inc.
Filing Date: 2025-03-26
Form: 424B3
Chunk 118
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---------|:-------------|-----:|:--|:----|:----|-----:|:---|
| Customer B |          |              |    — | % |     |     |   19 | %  |
| Customer F |          |              |   16 | % |     |     |      | *% |
| Customer G |          |              |    — | % |     |     |   19 | %  |
| Customer K |          |              |   22 | % |     |     |    — | %  |
| Customer L |          |              |   10 | % |     |     |      | *% |
| Customer M |          |              |   25 | % |     |     |    — | %  |

* Less than 10%.

Management closely monitors the creditworthiness and performance of these key customers and has established credit limits and terms to mitigate potential credit risks. The Company also continues diversifying its customer base and exploring opportunities to reduce its reliance on a few major customers.

Cost of Net Revenues Cost of net revenues consists of direct and indirect costs related to the manufacture of the Company’s products. Direct costs include wafer costs and costs relating to assembly and testing performed by third-party contract manufacturers. Indirect costs consist of provisions for excess and obsolete inventory, royalties, allocated overhead for employee costs and facility costs, warranty and the amortization of the Company’s production mask sets and certain intangible assets. Shipping and handling costs incurred for inventory purchases and product shipments are recorded in cost of net revenues in the consolidated statements of operations.

56 GCT SEMICONDUCTOR HOLDING, INC. Notes to Consolidated Financial Statements Stock-Based Compensation Compensation costs related to stock option grants are based on the fair value of the options on the date of grant, net of estimated forfeitures. The Company determines the grant date fair value of the options using the Black-Scholes option-pricing model and the associated stock-based compensation expense is generally recognized on a straight-line basis over the period in which an employee is required to provide service in exchange for the options, which generally equals the vesting period. Compensation costs related to the restricted stock units (“RSUs”) grants are based on the common stock price on the date of grant, net of estimated forfeitures. The RSUs that are based on the fixed monetary amount are initially classified as a liability and reclassified to equity when the number of shares to be issued becomes determinable and other equity classification criteria are