Lattice Semiconductor Reports Record Communications & Computing Revenue For Full Year 2025

HILLSBORO, Ore.--( BUSINESS WIRE)--Lattice Semiconductor Corporation (Nasdaq: LSCC), the low power programmable leader, announced financial results today for the fiscal fourth quarter and full year ended January 3, 2026.

Revenue for the full year 2025 was $523.3 million, with GAAP gross margin of 68.2% and GAAP net income of $0.02 per diluted share. On a non-GAAP basis, gross margin was 69.3%, with net income per diluted share of $1.05. GAAP net income and GAAP net income margin for the full year 2025 were $3.1 million and 0.6%, respectively, with adjusted EBITDA of $183.0 million and a 35.0% adjusted EBITDA margin for the full year 2025.

Revenue for the fourth quarter of 2025 was $145.8 million, with GAAP gross margin of 68.5%, and GAAP net loss of $(0.06) per diluted share. On a non-GAAP basis, gross margin was 69.4%, with net income per diluted share of $0.32. GAAP net loss and GAAP net income margin for the fourth quarter of 2025 were $(7.6) million and (5.2)%, respectively, with adjusted EBITDA of $53.2 million, which is a 36.5% adjusted EBITDA margin for the fourth quarter of 2025. GAAP net cash flow from operating activities for the fourth quarter of 2025 was $57.6 million, which is a GAAP operating cash flow margin of 39.5%, and free cash flow and free cash flow margin of $44.0 million and 30.2%, respectively.

Ford Tamer, Chief Executive Officer, said, "2025 was a pivotal year where we delivered on what we said we would do: stabilized revenue, normalized channel inventories, and drove exceptional data center growth, with server revenues up approximately 85% year over year. We advanced our leadership product roadmap, strengthened our software and solutions, and secured design wins across all our segments to fuel production ramps. We finished the year with strong momentum led by accelerating growth in AI and datacenters, higher Lattice FPGA attach rates per system and increasing ASPs as diversified customers move to our newer product platforms and solutions. When taken together, we believe we are positioned for higher growth in 2026 and beyond."

Lorenzo Flores, Chief Financial Officer, said, "We delivered solid operating results, supported by disciplined execution, durable gross margin and improving free cash flow margins. We also delivered on our commitment to grow earnings faster than revenue. Given our normalized Industrial and Automotive channel inventory, we expect revenue to better track consumption in 2026. In Communications and Computing, demand remains strong, supported by sustained datacenter momentum. We remain focused on executing our strategy, including investing to strengthen our market leadership in Small and Mid-range FPGAs and drive our highly successful Companion Chip expansion."

Selected Fourth Quarter and Full Year 2025 Financial Results and Comparisons (in thousands, except per share data)

GAAP Financial Results (unaudited)

Q4 2025

Q3 2025

Q4 2024

Q/Q

Y/Y

FY 2025

FY 2024

FY/FY

Revenue

$145,792

$133,349

$117,419

9.3%

24.2%

$523,262

$509,401

2.7%

Gross Margin %

68.5%

67.9%

61.1%

60 bps

740 bps

68.2%

66.8%

140 bps

R&D Expense %

36.7%

37.2%

32.9%

(50) bps

380 bps

35.9%

31.3%

460 bps

SG&A Expense %

30.4%

31.0%

25.1%

(60) bps

530 bps

29.4%

23.0%

640 bps

Operating Expenses

$98,851

$92,061

$83,962

7.4%

17.7%

$345,711

$305,943

13.0%

Income (loss) from Operations

$1,086

$(1,534)

$(12,209)

(170.8)%

(108.9)%

$11,232

$34,457

(67.4)%

Net Income (loss)

$(7,645)

$2,794

$16,514

(373.6)%

(146.3)%

$3,084

$61,131

(95.0)%

Net Income (loss) per Share - Basic

$(0.06)

$0.02

$0.12

$(0.08)

$(0.18)

$0.02

$0.44

$(0.42)

Net Income (loss) per Share - Diluted

$(0.06)

$0.02

$0.12

$(0.08)

$(0.18)

$0.02

$0.44

$(0.42)

Net Income (loss) Margin

(5.2)%

2.1%

14.1%

(730) bps

(1930) bps

0.6%

12.0%

(1140) bps

Operating Cash Flow Margin

39.5%

35.3%

38.7%

420 bps

80 bps

33.5%

27.7%

580 bps

Non-GAAP* Financial Results (unaudited)

Q4 2025

Q3 2025

Q4 2024

Q/Q

Y/Y

FY 2025

FY 2024

FY/FY

Revenue (GAAP)

$145,792

$133,349

$117,419

9.3%

24.2%

$523,262

$509,401

2.7%

Gross Margin %

69.4%

69.5%

62.1%

(10) bps

730 bps

69.3%

67.4%

190 bps

R&D Expense %

24.8%

24.2%

25.9%

60 bps

(110) bps

24.8%

25.1%

(30) bps

SG&A Expense %

16.4%

16.2%

19.3%

20 bps

(290) bps

16.9%

17.6%

(70) bps

Operating Expenses

$56,394

$53,900

$52,799

4.6%

6.8%

$213,536

$215,562

(0.9)%

Income from Operations

$44,819

$38,733

$20,097

15.7%

123.0%

$149,175

$127,617

16.9%

Net Income

$43,725

$38,157

$20,181

14.6%

116.7%

$145,225

$124,415

16.7%

Net Income per Share - Basic

$0.32

$0.28

$0.15

$0.04

$0.17

$1.06

$0.90

$0.16

Net Income per Share - Diluted

$0.32

$0.28

$0.15

$0.04

$0.17

$1.05

$0.90

$0.15

Adjusted EBITDA Margin

36.5%

35.6%

24.8%

90 bps

1170 bps

35.0%

31.8%

320 bps

Free Cash Flow Margin

30.2%

25.5%

33.8%

470 bps

(360) bps

25.3%

23.5%

180 bps

GAAP represents U.S. Generally Accepted Accounting Principles. Non-GAAP represents GAAP excluding the impact of certain activities which the Company's management excludes in analyzing the Company's operating results and in understanding trends in the Company's earnings. Additional information relating to these measures is included below in “Non-GAAP Financial Measures.” For a reconciliation of GAAP to non-GAAP results, see accompanying tables "Reconciliation of U.S. GAAP to Non-GAAP Financial Measures."

Fourth Quarter and Full Year 2025 Highlights:

Business Outlook - First Quarter of 2026:

Non-GAAP Financial Measures: In addition to financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release makes reference to non-GAAP financial measures. With respect to the outlook for the first quarter of 2026, certain items that affect reconciliation of non-GAAP financial measures for non-GAAP gross margin percentage, non-GAAP total operating expenses, non-GAAP income tax rate, and non-GAAP net income are not available on a forward-looking basis because such items cannot be reasonably calculated without unreasonable efforts due to the unpredictability of the amounts and timing of events affecting the items we exclude from non-GAAP financial measures, including certain large and/or unpredictable charges such as stock-based compensation expense; performance-based equity expense; legal expense outside the ordinary course of business; restructuring; and impairment charges. Consequently, the Company is unable to calculate the most directly comparable GAAP measure to non-GAAP gross margin percentage, non-GAAP total operating expenses, non-GAAP income tax rate, and non-GAAP net income for the Company’s first quarter 2026 quarterly guidance.

Investor Conference Call / Webcast Details:

Lattice Semiconductor will review the Company's financial results for the fiscal fourth quarter and full year 2025, and business outlook on Tuesday, February 10 at 5:00 p.m. Eastern Time. The dial-in number for the live audio call is 1-877-407-3982 or 1-201-493-6780 with conference identification number 13757937. A live webcast of the conference call will also be available on the investor relations section of www.latticesemi.com. The Company's financial guidance will be limited to the comments on its public quarterly earnings call and the public business outlook statements contained in this press release.

Forward-Looking Statements Notice:

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements involve estimates, assumptions, risks and uncertainties. Any statements about our expectations, beliefs, plans, objectives, assumptions or future events or performance are neither historical facts nor assurances of future performance and may be forward-looking. Such forward-looking statements include, but are not limited to, statements relating to: our revenue and EPS growth, future financial performance and related drivers; our expectations related to market recovery and growth including AI and datacenter-related growth; statements about attach rates and ASP growth; our expectations regarding our share repurchase program; the statements under the heading “Business Outlook - First Quarter of 2026.” Other forward-looking statements may be indicated by words such as “will,” “could,” “should,” “would,” “may,” “expect,” “plan,” “project,” “anticipate,” “intend,” “forecast,” “future,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue” or the negative of these terms or other comparable terminology.

Estimates of future revenue and other financial and operational outcomes are inherently uncertain due to factors such as: global economic conditions which may affect customer demand; the cyclical nature of the semiconductor industry including fluctuating customer and distributor purchasing patterns, inventory levels, and order timing; pricing and inflationary pressures; competitive actions; international trade disputes and sanctions; the impact of tariffs, trade restrictions, export controls, license requirements or similar actions on us or our suppliers and customers, including the impact on the costs of our products, the products into which they are integrated, and the impact on demand due to costs and uncertainty; the potential impact of global pandemics; and other significant risks and uncertainties that are beyond our ability to predict or control. Actual gross margin percentage, operating expenses, tax rate, and net income could vary from the estimates on the basis of, among other things, changes in revenue levels, changes in product pricing and mix, changes in wafer, assembly, test and other costs, variations in manufacturing yields, the failure to sustain operational improvements, and the actual amount of compensation charges due to stock price changes.

Lattice believes these and other risks and uncertainties could cause actual results to differ materially from the forward-looking statements. New risk factors emerge from time to time and it is not possible for the Company to predict all risk factors. You should not rely on forward-looking statements because actual results could differ materially from those expressed in any forward-looking statements. In addition, any forward-looking statement applies only as of the date on which it is made. The Company does not intend to and undertakes no obligation to update or revise any forward-looking statements, whether as a result of events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Non-GAAP Financial Measures:

Included within this press release and the accompanying tables and notes are certain non-GAAP financial measures that supplement the Company's consolidated financial information prepared in accordance with U.S. GAAP, including non-GAAP gross margin, gross margin percentage, R&D expense, SG&A expense, operating expenses, income from operations, income tax expense, net income, net income per share – basic, and net income per share – diluted, adjusted EBITDA, adjusted EBITDA margin, free cash flow, and free cash flow margin. The non-GAAP measures presented exclude charges and adjustments primarily related to stock-based compensation and related payroll tax effects; accruals related to the portion of our annual incentive plan that we intend to settle in shares of our common stock; transformation activities; legal expense outside the ordinary course of business; amortization of acquired intangible assets; restructuring plans and other charges; impairment charges; and the estimated tax effect of these items, non-cash changes in net deferred income taxes, change in tax law and other tax adjustments; and depreciation and other amortization. These charges and adjustments are a result of periodic or non-core operating activities of the Company. The Company describes these non-GAAP financial measures and reconciles them to the most directly comparable GAAP measures in the tables and notes attached to this press release.

The Company's management believes that these non-GAAP financial measures provide an additional and useful way of viewing aspects of our performance that, when viewed in conjunction with our GAAP results, provide a more comprehensive understanding of the various factors and trends affecting our ongoing financial performance and operating results than GAAP measures alone. Management also uses these non-GAAP measures for strategic and business decision-making, internal budgeting, forecasting, and resource allocation processes and believes that investors should have access to similar data. The non-GAAP financial information used by the Company may differ from that used by other companies. These non-GAAP measures are included solely for informational and comparative purposes and are not meant as a substitute for GAAP and should be considered together with the consolidated financial information located in the tables attached to this press release.

About Lattice Semiconductor Corporation:

Lattice Semiconductor (Nasdaq: LSCC) is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the growing communications, computing, industrial, automotive and consumer markets. Our technology, long-standing relationships, and commitment to world-class support let our customers quickly and easily unleash their innovation to create a smart, secure, and connected world.

For more information about Lattice, please visit www.latticesemi.com. You can also follow us via LinkedIn, X, Facebook, YouTube, WeChat, or Weibo.

Lattice Semiconductor Corporation

Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Revenue

145,792

133,349

117,419

523,262

509,401

Cost of sales

45,855

42,822

45,666

166,319

169,001

Gross margin

99,937

90,527

71,753

356,943

340,400

Operating expenses:

Research and development

53,433

49,633

38,580

187,983

159,302

Selling, general, and administrative

44,293

41,402

29,474

153,632

116,942

Amortization of acquired intangible assets

870

3,479

Restructuring and other

1,106

1,006

1,109

4,044

12,291

Impairment of acquired intangible assets

—

13,929

—

13,929

Total operating expenses

98,851

92,061

83,962

345,711

305,943

Income (loss) from operations

1,086

(1,534

)

(12,209

)

11,232

34,457

Interest income (expense), net

628

602

772

2,896

3,948

Other income (expense), net

(446

)

(22

)

(2,135

)

(751

)

(2,176

)

Income (loss) before income taxes

1,268

(954

)

(13,572

)

13,377

36,229

Income tax expense (benefit)

8,913

(3,748

)

(30,086

)

10,293

(24,902

)

Net income (loss)

(7,645

)

2,794

16,514

3,084

61,131

Net income (loss) per share:

Basic

(0.06

)

0.02

0.12

0.02

0.44

Diluted

(0.06

)

0.02

0.12

0.02

0.44

Shares used in per share calculations:

Basic

136,718

136,877

137,861

137,091

137,623

Diluted

136,718

138,103

138,322

138,238

138,322

Lattice Semiconductor Corporation

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

January 3,

December 28,

2026

2024

Assets

Current assets:

Cash and cash equivalents

133,886

136,291

Accounts receivable, net

102,277

81,060

Inventories, net

89,202

103,410

Other current assets

38,509

44,073

Total current assets

363,874

364,834

Property and equipment, net

77,032

52,988

Operating lease right-of-use assets

39,459

13,870

Intangible assets, net

4,143

4,587

Goodwill

315,358

Deferred income taxes

62,675

66,980

Other long-term assets

20,579

25,286

883,120

843,903

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable

56,518

36,828

Accrued liabilities

30,594

45,638

Accrued payroll obligations

30,561

17,156

Total current liabilities

117,673

99,622

Long-term operating lease liabilities, net of current portion

36,127

9,433

Other long-term liabilities

15,266

23,916

Total liabilities

169,066

132,971

Stockholders' equity

714,054

710,932

883,120

843,903

Lattice Semiconductor Corporation

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

Year Ended

January 3,

December 28,

2026

2024

Cash flows from operating activities:

Net income

3,084

61,131

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Stock-based compensation expense

115,613

52,985

Depreciation and amortization

35,481

38,737

Change in deferred income tax provision

5,183

(12,069

)

Change in noncurrent taxes payable

(384

)

(19,370

)

Impairment charges

3,497

13,929

Charge for expiring production materials

—

7,019

Other non-cash adjustments

7,962

10,220

Net changes in assets and liabilities

4,671

(11,706

)

Net cash provided by (used in) operating activities

175,107

140,876

Cash flows from investing activities:

Capital expenditures

(42,527

)

(20,985

)

Other investing activities

(19,781

)

(16,708

)

Net cash provided by (used in) investing activities

(62,308

)

(37,693

)

Cash flows from financing activities:

Repurchase of common stock

(100,000

)

(66,998

)

Net cash flows related to stock compensation exercises

(15,697

)

(27,462

)

Net cash provided by (used in) financing activities

(115,697

)

(94,460

)

Effect of exchange rate change on cash

493

(749

)

Net increase (decrease) in cash and cash equivalents

(2,405

)

7,974

Beginning cash and cash equivalents

136,291

128,317

Ending cash and cash equivalents

133,886

136,291

Supplemental disclosure of cash flow information and non-cash investing and financing activities:

Income taxes paid, net of refunds

7,768

8,587

Operating lease payments

8,330

9,567

Lattice Semiconductor Corporation

Supplemental Historical Financial Information

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Balance Sheet Information

A/R Days Revenue Outstanding (DSO)

Inventory Days (DIO)

178

193

207

Revenue % (by Geography)

Asia

Americas

Europe (incl. Africa)

Revenue % (by End Market)

Communications and Computing

Industrial and Automotive

Consumer

Revenue $M (by End Market)

Communications and Computing

92.6

74.0

58.0

292.7

228.1

Industrial and Automotive

44.1

50.3

49.2

194.0

237.0

Consumer

9.1

9.0

10.2

36.6

44.3

Revenue % (by Channel)

Distribution

Direct

Lattice Semiconductor Corporation

Reconciliation of U.S. GAAP to Non-GAAP Financial Measures

(in thousands, except per share data)

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Gross Margin Reconciliation

GAAP Gross margin

99,937

90,527

71,753

356,943

340,400

Stock-based compensation - gross margin (1)

1,169

1,980

1,143

5,397

2,779

Incentive compensation to be settled in equity - gross margin (2)

107

126

—

371

—

Non-GAAP Gross margin

101,213

92,633

72,896

362,711

343,179

Gross Margin % Reconciliation

GAAP Gross margin %

68.5

67.9

61.1

68.2

66.8

Stock-based compensation - gross margin (1)

0.8

1.5

1.0

0.6

Incentive compensation to be settled in equity - gross margin (2)

0.1

—

0.1

—

Non-GAAP Gross margin %

69.4

69.5

62.1

69.3

67.4

Research and Development Expense % (R&D Expense %) Reconciliation

GAAP R&D Expense %

36.7

37.2

32.9

35.9

31.3

Stock-based compensation - R&D (1)

(10.3

(11.4

(6.1

(9.6

(5.7

Incentive compensation to be settled in equity - R&D (2)

(0.6

—

(0.5

—

Transformation charges

(1.0

(0.9

(1.0

(0.5

Non-GAAP R&D Expense %

24.8

24.2

25.9

24.8

25.1

Selling, General, and Administrative Expense % (SG&A Expense %) Reconciliation

GAAP SG&A Expense %

30.4

31.0

25.1

29.4

23.0

Stock-based compensation - SG&A (1)

(13.3

(14.1

(5.6

(11.6

(4.4

Incentive compensation to be settled in equity - SG&A (2)

(0.7

—

(0.7

—

Legal expenses (3)

0.0

(0.2

(1.0

Non-GAAP SG&A Expense %

16.4

16.2

19.3

16.9

17.6

(1)

Includes stock-based compensation and related payroll tax expenses.

(2)

Includes accruals for the portion of our annual incentive plan that we intend to settle in equity.

(3)

Includes legal expenses outside the ordinary course of business, including those incurred defending against claims brought against the Company by Steven A.W. De Jaray, Perienne De Jaray and Darrell R. Oswalde.

Lattice Semiconductor Corporation

Reconciliation of U.S. GAAP to Non-GAAP Financial Measures

(in thousands, except per share data)

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Operating Expenses Reconciliation

GAAP Operating expenses

98,851

92,061

83,962

345,711

305,943

Stock-based compensation - operations (1)

(34,450

)

(33,998

)

(13,712

)

(110,897

)

(50,939

)

Incentive compensation to be settled in equity - operations (2)

(1,800

)

(1,770

)

—

(6,234

)

—

Transformation charges

(1,488

)

(1,347

)

(1,032

)

(5,388

)

(2,770

)

Legal expenses (3)

—

)

(181

)

(1,107

)

(5,248

)

Amortization of acquired intangible assets

(19

)

(20

)

(870

)

(52

)

(3,479

)

Restructuring and other

(1,203

)

(1,020

)

(1,439

)

(5,000

)

(14,016

)

Impairment charges

(3,497

)

—

(13,929

)

(3,497

)

(13,929

)

Non-GAAP Operating expenses

56,394

53,900

52,799

213,536

215,562

Income from Operations Reconciliation

GAAP Income (loss) from operations

1,086

(1,534

)

(12,209

)

11,232

34,457

Stock-based compensation (1)

35,619

35,978

14,855

116,294

53,718

Incentive compensation to be settled in equity (2)

1,907

1,896

—

6,605

—

Transformation charges

1,488

1,347

1,032

5,388

2,770

Legal expenses (3)

—

181

1,107

5,248

Amortization of acquired intangible assets

870

3,479

Restructuring and other

1,203

1,020

1,439

5,000

14,016

Impairment charges

3,497

—

13,929

3,497

13,929

Non-GAAP Income from operations

44,819

38,733

20,097

149,175

127,617

Income from Operations % Reconciliation

GAAP Income (loss) from operations %

0.7

(1.2

(10.4

2.1

6.8

Cumulative effect of non-GAAP Gross Margin and Operating adjustments

30.0

30.2

27.5

26.4

18.3

Non-GAAP Income from operations %

30.7

29.0

17.1

28.5

25.1

Other Income (Expense) Reconciliation

GAAP Other income (expense), net

(446

)

(22

)

(2,135

)

(751

)

(2,176

)

Write-off of debt costs and non-recoverable investment

198

—

2,023

198

2,023

Non-GAAP Other income (expense), net

(248

)

(22

)

(112

)

(553

)

(153

)

(1)

Includes stock-based compensation and related payroll tax expenses.

(2)

Includes accruals for the portion of our annual incentive plan that we intend to settle in equity.

(3)

Lattice Semiconductor Corporation

Reconciliation of U.S. GAAP to Non-GAAP Financial Measures

(in thousands, except per share data)

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Income Tax Expense (Benefit) Reconciliation

GAAP Income tax expense (benefit)

8,913

(3,748

)

(30,086

)

10,293

(24,902

)

Estimated tax effect of non-GAAP adjustments

9,220

1,693

4,735

15,157

16,416

Non-cash changes in net deferred income taxes (4)

(16,659

)

1,532

25,757

(19,157

)

22,315

Change in tax law (5)

—

1,679

170

—

(6,832

)

Non-GAAP Income tax expense

1,474

1,156

576

6,293

6,997

Net Income Reconciliation

GAAP Net income (loss)

(7,645

)

2,794

16,514

3,084

61,131

Stock-based compensation (1)

35,619

35,978

14,855

116,294

53,718

Incentive compensation to be settled in equity (2)

1,907

1,896

—

6,605

—

Transformation charges

1,488

1,347

1,032

5,388

2,770

Legal expenses (3)

—

181

1,107

5,248

Amortization of acquired intangible assets

870

3,479

Restructuring and other

1,203

1,020

1,439

5,000

14,016

Impairment charges

3,497

—

13,929

3,497

13,929

Write-off of debt costs and non-recoverable investment

198

—

2,023

198

2,023

Estimated tax effect of non-GAAP adjustments

(9,220

)

(1,693

)

(4,735

)

(15,157

)

(16,416

)

Non-cash changes in net deferred income taxes (4)

16,659

(1,532

)

(25,757

)

19,157

(22,315

)

Change in tax law (5)

—

(1,679

)

(170

)

—

6,832

Non-GAAP Net income

43,725

38,157

20,181

145,225

124,415

(1)

Includes stock-based compensation and related payroll tax expenses.

(2)

Includes accruals for the portion of our annual incentive plan that we intend to settle in equity.

(3)

(4)

Includes non-cash changes in net deferred income taxes associated with $4.9 million of certain tax matters related to prior fiscal periods in the third quarter of fiscal 2025 and $27.7 million of certain tax matters related to prior fiscal periods in the fourth quarter of fiscal 2024.

(5)

Includes an increase in our provision for U.S. tax on foreign operations resulting from The 2017 Tax Cuts and Jobs Act and is related to the capitalization and subsequent amortization of R&D costs for tax purposes which was made permanent in the 2025 Tax Act in the third quarter of fiscal 2025.

Lattice Semiconductor Corporation

Reconciliation of U.S. GAAP to Non-GAAP Financial Measures

(in thousands, except per share data)

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Net Income Per Share Reconciliation

GAAP Net income (loss) per share - basic

(0.06

)

0.02

0.12

0.02

0.44

Cumulative effect of Non-GAAP adjustments

0.38

0.26

0.03

1.04

0.46

Non-GAAP Net income per share - basic

0.32

0.28

0.15

1.06

0.90

GAAP Net income (loss) per share - diluted

(0.06

)

0.02

0.12

0.02

0.44

Cumulative effect of Non-GAAP adjustments

0.38

0.26

0.03

1.03

0.46

Non-GAAP Net income per share - diluted

0.32

0.28

0.15

1.05

0.90

Shares used in per share calculations:

Basic

136,718

136,877

137,861

137,091

137,623

Diluted

138,727

138,103

138,322

138,238

138,322

Reconciliation of Net income to Adjusted EBITDA

GAAP Net income (loss)

(7,645

)

2,794

16,514

3,084

61,131

Interest (income) expense, net

(628

)

(602

)

(772

)

(2,896

)

(3,948

)

Income tax expense (benefit)

8,913

(3,748

)

(30,086

)

10,293

(24,902

)

Amortization of acquired intangible assets

870

3,479

Depreciation and other amortization

8,633

8,734

9,131

34,333

34,502

Stock-based compensation (1)

35,619

35,978

14,855

116,294

53,718

Incentive compensation to be settled in equity (2)

1,907

1,896

—

6,605

—

Transformation charges

1,488

1,347

1,032

5,388

2,770

Legal expenses (3)

—

181

1,107

5,248

Restructuring and other

1,203

1,020

1,439

5,000

14,016

Impairment charges

3,497

—

13,929

3,497

13,929

Write-off of debt costs and non-recoverable investment

198

—

2,023

198

2,023

Adjusted EBITDA

53,204

47,445

29,116

182,955

161,966

(1)

Includes stock-based compensation and related payroll tax expenses.

(2)

Includes accruals for the portion of our annual incentive plan that we intend to settle in equity.

(3)

Lattice Semiconductor Corporation

Reconciliation of U.S. GAAP to Non-GAAP Financial Measures

(in thousands, except per share data)

(unaudited)

Three Months Ended

Year Ended

January 3,

September 27,

December 28,

January 3,

December 28,

2026

2025

2024

2026

2024

Reconciliation of Net income margin to Adjusted EBITDA margin

GAAP Net income (loss) margin

(5.2

2.1

14.1

0.6

12.0

Cumulative effect of EBITDA adjustments

41.7

33.5

10.7

34.4

19.8

Adjusted EBITDA margin

36.5

35.6

24.8

35.0

31.8

Reconciliation of GAAP Net Cash Provided by Operating Activities to Free Cash Flow

GAAP Net cash provided by operating activities

57,584

47,100

45,421

175,107

140,876

Operating cash flow margin

39.5

35.3

38.7

33.5

27.7

Capital expenditures

(13,607

)

(13,074

)

(5,754

)

(42,527

)

(20,985

)

Free cash flow

43,977

34,026

39,667

132,580

119,891

Free cash flow margin

30.2

25.5

33.8

25.3

23.5