What the changes say
- Pixelworks narrowed its strategic focus to cinematic visualization and the TrueCut Motion platform following asset sales.
What changed since the prior 10-K
New
- New
Our product strategy, which is targeted at markets demanding superior image quality, may not address the demands of our target customers and may not lead to increased revenue in a timely manner or at all, which could materially adversely affect our results of operations and limit our ability to grow
Our product strategy for the TrueCut Motion platform may fail to meet customer demands or distribution chain requirements.
- New
The source of our revenue is concentrated in our TrueCut Motion platform, which depends on relationships with multiple levels of the distribution chain for theatrical and home entertainment
Substantially all future revenue will concentrate in the TrueCut Motion platform across theatrical and home entertainment.
Dropped
- DroppedRisks Related to the Global Economy
The continued uncertain global economic environment and volatility in global credit, banking and financial markets could materially and adversely affect our business and results of operations
Uncertain global economic environment and credit market volatility.
- DroppedRisks Related to the Global Economy
We may not fully realize the estimated savings from our restructurings in a timely manner or at all, and our restructuring programs may result in business disruptions and decrease productivity. Any of the foregoing would negatively affect our financial condition and results of operations
- DroppedRisks Related to the Global Economy
We generally do not have long-term purchase commitments from our customers and if our customers cancel or change their purchase commitments, our revenue and operating results could suffer
- DroppedRisks Related to the Global Economy
We face a number of risks as a result of the concentration of our operations and customers in Asia
- DroppedRisks Related to the Global Economy
Our operations in Asia expose us to heightened risks due to natural disasters
Realization of estimated savings from restructurings.
- DroppedRisks Related to the Global Economy
Our international operations expose us to risks resulting from the fluctuations of foreign currencies
- DroppedRisks Related to the Global Economy
Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws could subject us to penalties and other adverse consequences
- DroppedRisks Related to the Global Economy
Our reported financial results may be materially and adversely affected by changes in accounting principles generally accepted in the United States
Absence of long-term purchase commitments from customers.
- DroppedRisks Related to the Global Economy
As we have limited insurance coverage, any incurred liability resulting from uncovered claims could adversely affect our financial condition and results of operations
- DroppedRisks Related to the Global Economy
Our dependence on selling to distributors and integrators increases the complexity of managing our supply chain and may result in excess inventory or inventory shortages
- DroppedRisks Related to the Global Economy
Regulations related to conflict minerals may adversely impact our business
- DroppedRisks Related to the Global Economy
Our effective income tax rate is subject to unanticipated changes in, or different interpretations of, tax rules and regulations, and forecasting our effective income tax rate is complex and subject to uncertainty
Concentration of operations and customers in Asia.
- DroppedRisks Related to the Global Economy
Environmental laws and regulations may cause us to incur significant expenditures to comply with applicable laws and regulations, and we may be assessed considerable penalties for noncompliance
Risks of natural disasters in the Pacific Rim region.
- DroppedRisks Related to the Global Economy
Increasing attention on environmental, social and governance ("ESG") matters may have a negative impact on our business, impose additional costs on us, and expose us to additional risks
Fluctuations of foreign currencies in Asia and Canada.
- DroppedRisks Related to the Global Economy
Company Risks Related to the Semiconductor Industry and Our Markets
Compliance with anti-bribery, anti-corruption, and anti-money laundering laws.
- DroppedRisks Related to the Global Economy
Shortages of materials used in the manufacturing of our products and other key components of our customers’ products may increase our costs, impair our ability to ship our products on time and delay our ability to sell our products
Changes in U.S. generally accepted accounting principles.
- DroppedRisks Related to the Global Economy
Our highly integrated products and high-speed mixed signal products are difficult to manufacture without defects and the existence of defects could result in increased costs, delays in the availability of our products, reduced sales of products or claims against us
- DroppedRisks Related to the Global Economy
The development of new products is extremely complex and we may be unable to develop our new products in a timely manner, which could result in a failure to obtain new design wins and/or maintain our current revenue levels
Limited insurance coverage for Asian operations.
- DroppedRisks Related to the Global Economy
We use a customer-owned tooling process for manufacturing most of our products, which exposes us to the possibility of poor yields and unacceptably high product costs
Dependence on selling to distributors and integrators.
- DroppedRisks Related to the Global Economy
We depend on the manufacturers of our semiconductor products not only to respond to changes in technology and industry standards but also to continue the manufacturing processes on which we rely
- DroppedRisks Related to the Global Economy
Because of our long product development process and sales cycles, we may incur substantial costs before we earn associated revenue and ultimately may not sell as many units of our products as we originally anticipated
- DroppedRisks Related to the Global Economy
Our developed software may be incompatible with industry standards and challenging and costly to implement, which could slow product development or cause us to lose customers and design wins
Regulations related to conflict minerals.
- DroppedRisks Related to the Global Economy
The competitiveness and viability of our products could be harmed if necessary licenses of third-party technology are not available to us on terms that are acceptable to us or at all
Unanticipated changes in effective income tax rates.
- DroppedRisks Related to the Global Economy
Our products are characterized by average selling prices that can decline over relatively short periods of time, which will negatively affect our financial results unless we are able to reduce our product costs or introduce new products with higher average selling prices
- DroppedRisks Related to the Global Economy
The cyclical nature of the semiconductor industry may lead to significant variances in the demand for our products and could harm our operations
- DroppedRisks Related to the Global Economy
Our business is subject to the risks of earthquakes, fire, power outages, floods, and other catastrophic events, and to interruption by man-made problems such as acts of war and terrorism
- DroppedRisks Related to Our Operations in China
Even if we complete the Listing, we may not achieve the results contemplated by our business strategy and our strategy for growth in the PRC may not result in increases in the price of our common stock
- DroppedRisks Related to Our Operations in China
If the Listing is completed, PWSH’s status as a publicly traded company in China that is controlled, but less than wholly owned, by Pixelworks could have an adverse effect on us
- DroppedRisks Related to Our Operations in China
The STAR Market is relatively new, and as a result, it is difficult to predict the effect of the proposed Listing, which may in turn negatively affect the price of our common stock on the Nasdaq Capital Market
- DroppedGeneral Risks
minimum of $2.5 million in shareholders' equity, at least 500,000 publicly held shares, at least $1.0 million in market value of publicly held shares and at least two registered and active market makers
Reworded
- 84% rewritten
If we are not profitable in the future, we may be unable to continue our operations
Updated accumulated deficit to $528 million as of December 31, 2025, and added a near-term cash sufficiency statement.
- 78% rewritten
If we fail to meet the evolving needs of our markets, identify new products, services or technologies, or successfully compete in our target markets, our revenue and financial results will be adversely impacted
Shifted focus from mobile and home markets to cinematic visualization solutions and the TrueCut Motion platform.
- 65% rewritten
Our net operating loss carryforwards may be limited or they may expire before utilization
Updated net operating loss carryforwards to $157.9 million federal and $18.3 million state expiring in 2026, with $44.6 million federal having indefinite life.
- 63% rewritten
If we are not able to respond to the rapid technological changes and evolving industry standards in the markets in which we compete, or seek to compete, our products may become less desirable or obsolete
Removed specific artificial intelligence and broadband video examples from the rapid technological change description.
- 58% rewritten
Continued compliance with regulatory and accounting requirements will be challenging and will require significant resources
Streamlined regulatory compliance references to remove specific mentions of Dodd-Frank and Sarbanes-Oxley acts.
- 56% rewritten
Intense competition in our markets may reduce sales of our products, reduce our market share, decrease our gross profit and result in large losses
Replaced list of semiconductor competitors with specific post-processing and visual effects competitors like Dolby, Epic Games, and Pixar.
- 53% rewrittenGeneral Risks
Future sales of our equity could result in significant dilution to our existing shareholders and depress the market price of our common stock
Removed specific reference to the 2024 ATM Program and shares sold under it.
- 43% rewritten
If we are unable to maintain effective disclosure controls and internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our common stock may be materially and adversely affected
Minor phrasing adjustments regarding internal control over financial reporting.
Was: If we are unable to maintain effective disclosure controls and internal controls over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our common stock may be materially and adversely affected
- 38% rewritten
We have significantly fewer financial resources than most of our competitors, which limits our ability to implement new products or enhancements to our current products, which in turn could adversely affect our future sales and financial condition
Was: We have significantly fewer financial resources than most of our competitors, which limits our ability to implement new products or enhancements to our current products and may require us to implement additional future restructuring plans, which in turn could adversely affect our future sales and financial condition
- 32% rewritten
Our revenue and operating results can fluctuate from period to period, which could cause our share price to decline
- 32% rewritten
We license our intellectual property, which exposes us to risks of infringement or misappropriation, and may cause fluctuations in our operating results
- 30% rewritten
Our limited ability to protect our IP and proprietary rights could harm our competitive position by allowing our competitors to access our proprietary technology and to introduce similar products
- 29% rewritten
If we fail to retain or attract the specialized technical and management personnel required to successfully operate our business, it could harm our operations and may result in lost sales and diversion of management resources
Was: If we fail to retain or attract the specialized technical and management personnel required to successfully operate our business, it could harm our business and may result in lost sales and diversion of management resources
- 28% rewrittenGeneral Risks
Our stock price and the stock prices of technology companies similar to Pixelworks have been highly volatile. The price of our common stock may decline and the value of our shareholders' investment may be reduced regardless of our performance
All 23 risk factors
Headings as the filing states them, in filing order.
Other
- 01If we fail to meet the evolving needs of our markets, identify new products, services or technologies, or successfully compete in our target markets, our revenue and financial results will be adversely impacted78% rewritten
- 02Our product strategy, which is targeted at markets demanding superior image quality, may not address the demands of our target customers and may not lead to increased revenue in a timely manner or at all, which could materially adversely affect our results of operations and limit our ability to growNew
- 03If we fail to retain or attract the specialized technical and management personnel required to successfully operate our business, it could harm our operations and may result in lost sales and diversion of management resources29% rewritten
- 04We have significantly fewer financial resources than most of our competitors, which limits our ability to implement new products or enhancements to our current products, which in turn could adversely affect our future sales and financial condition38% rewritten
- 05If we are not profitable in the future, we may be unable to continue our operations84% rewritten
- 06The source of our revenue is concentrated in our TrueCut Motion platform, which depends on relationships with multiple levels of the distribution chain for theatrical and home entertainmentNew
- 07Our revenue and operating results can fluctuate from period to period, which could cause our share price to decline32% rewritten
- 08We license our intellectual property, which exposes us to risks of infringement or misappropriation, and may cause fluctuations in our operating results32% rewritten
- 09Our net operating loss carryforwards may be limited or they may expire before utilization65% rewritten
- 10If we are unable to maintain effective disclosure controls and internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our common stock may be materially and adversely affected43% rewritten
- 11We may be unable to successfully manage any future growth, including the integration of any acquisition or equity investment, which could disrupt our business and severely harm our financial condition
- 12Continued compliance with regulatory and accounting requirements will be challenging and will require significant resources58% rewritten
- 13System security and data protection breaches, as well as cyber-attacks, could disrupt our operations, reduce our expected revenue and increase our expenses, which could adversely affect our stock price and damage our reputation
- 14We rely on certain critical information systems for the operation of our business, and the failure of any critical information system may result in serious harm to our business
- 15Intense competition in our markets may reduce sales of our products, reduce our market share, decrease our gross profit and result in large losses56% rewritten
- 16If we are not able to respond to the rapid technological changes and evolving industry standards in the markets in which we compete, or seek to compete, our products may become less desirable or obsolete63% rewritten
- 17Our limited ability to protect our IP and proprietary rights could harm our competitive position by allowing our competitors to access our proprietary technology and to introduce similar products30% rewritten
- 18Others may bring infringement or indemnification actions against us that could be time-consuming and expensive to defend
General Risks
- 19The price of our common stock has and may continue to fluctuate substantially
- 20Our stock price and the stock prices of technology companies similar to Pixelworks have been highly volatile. The price of our common stock may decline and the value of our shareholders' investment may be reduced regardless of our performance28% rewritten
- 21The interests of our current or potential significant shareholders may conflict with other shareholders and they may attempt to effect changes or acquire control, which could adversely affect our results of operations and financial condition
- 22Future sales of our equity could result in significant dilution to our existing shareholders and depress the market price of our common stock53% rewritten
- 23The anti-takeover provisions of Oregon law and in our articles of incorporation could adversely affect the rights of the holders of our common stock, including by preventing a sale or takeover of us at a price or prices favorable to the holders of our common stock
Other Pixelworks 10-Ks
- FY2024 10-K risk factors51 risks
Pixelworks is heavily dependent on Asian contract manufacturers and end markets, primarily generating sales outside the U.S.
Filed Mar 13, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.