Form 8-K

8-K — POWER INTEGRATIONS INC

Accession: 0000833640-26-000076

Filed: 2026-05-07

Period: 2026-05-04

CIK: 0000833640

SIC: 3674 (SEMICONDUCTORS & RELATED DEVICES)

Item: Results of Operations and Financial Condition

Item: Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers

Item: Financial Statements and Exhibits

Documents

8-K — powi-20260504x8k.htm (Primary)

EX-99.1 (powi-20260504xex99d1.htm)

XML — IDEA: XBRL DOCUMENT (R1.htm)

8-K

8-K (Primary)

Filename: powi-20260504x8k.htm · Sequence: 1

Power Integrations, Inc._May 4, 2026

0000833640false00008336402026-05-042026-05-04

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 4, 2026

______________

Power Integrations, Inc.

(Exact name of registrant as specified in its charter)

______________

Delaware

000-23441

94-3065014

(State or other jurisdiction

(Commission

(IRS Employer

of incorporation)

File Number)

Identification No.)

5245 Hellyer Avenue

San Jose, California 95138-1002

(Address of principal executive offices, including zip code)

Registrant's telephone number, including area code (408) 414-9200

______________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.001 Par Value

POWI

The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Item 2.02. Results of Operations and Financial Condition.

On May 7, 2026 the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

The Board of Directors of Power Integrations, Inc. (the “Company”) appointed Mike Balow as the Company’s Senior Vice President, Worldwide Sales, effective upon Mr. Balow’s commencement of employment with the Company on May 4, 2026.

Mike Balow brings more than three decades of semiconductor sales and business development experience. From 2021 to 2025 he served as executive vice president of sales for onsemi, a supplier of sensing and power-management semiconductors. Previously, he served as executive vice president of sales at Infineon Technologies after holding a similar position at Cypress Semiconductor from 2015 until its acquisition by Infineon in 2020. His prior industry experience includes roles at Freescale Semiconductor and Integrated Device Technology (IDT). Mr. Balow holds a Bachelor of Science degree in applied mathematics from the University of Wisconsin-Stout.

There are no arrangements or understandings between Mr. Balow and any other persons in connection with Mr. Balow’s appointment as the Senior Vice President, Worldwide Sales. Mr. Balow does not have any family relationships with any directors or officers of the Company. Mr. Balow is not a party to any transaction, or series of transactions, required to be disclosed pursuant to Item 404(a) of Regulation S-K.

Employment Agreement and Executive Officer Benefits Agreement with Mr. Balow

In connection with the appointment of Mr. Balow as the Company’s Senior Vice President, Worldwide Sales, on April 22, 2026, Mr. Balow entered into each of an employment agreement (the “Employment Agreement”) and an executive officer benefits agreement (the “EOBA,” and together with the Employment Agreement, the “Balow Employment Agreements”), in each case, effective upon Mr. Balow’s commencement of employment with the Company. The Balow Employment Agreements provide Mr. Balow with the following compensation and other benefits:

Employment Agreement

● Base Salary – Mr. Balow will have an annual base salary of $450,000, less applicable withholdings, which shall be payable in accordance with the Company’s normal payroll practices.

● Equity Awards – Mr. Balow will be eligible to receive the following equity awards, each of which will be subject to the Company’s Amended and Restated 2016 Incentive Award Plan or the Amended and Restated 2025 Inducement Award Plan and the applicable grant agreement:

o an annual performance incentive award for 2026 in the form of performance stock units (“PSUs”) in a value pro-rated from a full year target value of $360,000 for the portion of the 2026 calendar year in which he is employed by the Company (“Target PSUs”). The PSUs will be subject to the terms and conditions of the Company’s 2026 PSU program providing for PSU vesting based on achievement of performance conditions for the 2026 calendar year, and the actual number of PSUs that will vest can vary from 0 to 200% of the Target PSUs.

o a restricted stock units (“RSUs”) award in the value of $2,400,000. The RSUs will vest over four years from the date that Mr. Balow commences employment with the Company, with 25% of the RSUs vesting on the first anniversary of Mr. Balow’s start date, and with an additional 25% of the RSUs vesting on each subsequent anniversary of Mr. Balow’s start date, until the RSUs are fully vested after four years, subject in each case to Mr. Balow’s continued full-time service through the applicable vesting date.

o a long-term restricted performance stock units (“PRSUs”) award in the value of $1,600,000 (“Target PRSUs”). The PRSUs will be subject to the terms and conditions of the Company’s 2026 PRSU program providing for

PRSU vesting based on achievement of performance conditions over the applicable performance period, and the actual number of PRSUs that will vest can vary from 0 to 200% of the Target PRSUs.

o The number of shares that will be granted under each of the equity awards described above, at target performance level in the case of PSUs and PRSUs, will be calculated by dividing the dollar grant value by the closing stock price on the date of grant, which will be the 15th of the month following his start date.

Executive Officer Benefits Agreement

● Mr. Balow will be entitled to receive certain benefits under the terms of the EOBA, which will take effect upon his commencement of employment with the Company. Outside of the change of control period (as defined below), in the event Mr. Balow is terminated without “cause” or resigns for “good reason” his severance benefits include (1) a cash payment equal to one year of his annual base salary then in effect, (2) a cash payment equal to the prorated portion of his then outstanding annual performance award of PSUs measured as of the date of termination at the lesser of (a) the applicable target (i.e., 100%) performance level in effect as of the date of the termination and (b) the actual performance level in effect as of the date of the termination, and (3) a cash payment equal to 100% of the value of his then outstanding annual performance award of PSUs at the applicable target (i.e., 100%) performance level in effect as of the date of termination. Mr. Balow would also be entitled to the Company’s payment of COBRA premiums for up to 12 months following such cessation of employment subject to certain limitations. In the event Mr. Balow is terminated without “cause” or resigns for “good reason” within three months prior to or 12 months following a change of control (the “change of control period”), his severance benefits include (1) a cash payment equal to one year of his annual base salary then in effect, (2) a cash payment equal to the prorated portion of his then outstanding annual performance award of PSUs measured as of the date of termination at the applicable target (i.e., 100%) performance level in effect as of the date of termination, (3) a cash payment equal to 100% of the value of his then outstanding annual performance award of PSUs at the applicable target (i.e., 100%) performance level in effect as of the date of termination, (4) fully accelerated vesting for then outstanding time-based awards (including RSUs), and (5) accelerated vesting of a pro-rated portion of any then outstanding PRSUs at the applicable target (i.e., 100%) performance level (pro-rated based upon the number of days of his employment during the applicable performance period for such awards). Mr. Balow would also be entitled to the Company’s payment of COBRA premiums for up to 12 months following such cessation of employment subject to certain limitations. In addition, Mr. Balow will be entitled to retirement benefits once he has served the Company for 10 years subject to certain conditions on a termination that does not trigger the severance benefits described above. These retirement benefits include a cash payment equal to the prorated portion of his then outstanding annual performance award of PSUs measured as of the date of termination at the applicable target (i.e., 100%) performance level in effect as of the date of termination. In the event of Mr. Balow’s death or permanent disability during employment, Mr. Balow or his legal representative will receive (1) a cash payment equal to the prorated portion of his then outstanding annual performance award of PSUs measured as of the date of termination at the applicable target (i.e., 100%) performance level in effect as of the date of termination, (2) fully accelerated vesting for then outstanding time-based award (including RSUs), and (3) continued vesting of outstanding PRSUs, subject to satisfaction of the specified vesting criteria other than continued employment. The term “change of control” is defined as an acquisition by any person of beneficial ownership of 50% or more of the Company’s outstanding shares of common stock or the combined voting power of the Company’s then-outstanding securities, certain mergers or other business combinations involving the Company, the sale of more than 50% of the Company’s consolidated assets, the dissolution or liquidation of the Company, or a change in the majority of the incumbent members of the Board within a two-year period (except changes in the Board composition approved by a majority of incumbent directors). “Cause” generally includes, among other acts, a material act of theft, dishonesty, fraud, or falsification of records; improper disclosure of confidential information; a material violation of material written Company policy; an action intentionally causing or expected to cause harm to the reputation and standing of the Company; gross negligence or willful misconduct in the performance of assigned duties; or conviction of a crime involving moral turpitude or a felony. “Good reason” generally includes any of the following without Mr. Balow’s written consent: a material decrease in base salary or target opportunity for Mr. Balow’s annual performance award (other than a general decrease that affects a majority of the Company’s then senior executives in substantially the same proportions), a demotion or material reduction in position or responsibilities or duties, relocation of Mr. Balow’s work place to a location increasing his commute time by more than 30 minutes as compared to his

commute time to his current work place or a material adverse change in working conditions or established working hours which persist for a period of six months or any material breach of the EOBA by the Company. All payments and distributions described in this paragraph are subject to reduction for applicable withholding. In the event that any payments and benefits to be paid or provided to Mr. Balow would constitute “parachute payments” under Section 280G of the Internal Revenue Code of 1986, as amended, they will be subject to reduction to the extent that Mr. Balow would be better off on an after-tax basis after such reduction.

The above descriptions of the Balow Employment Agreements do not purport to be complete and are qualified in their entirety by reference to, and should be read in conjunction with, the full text of each of the Balow Employment Agreements to be filed as exhibits to the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2026.

Item 9.01. Financial Statements and Exhibits.

Exhibit 99.1

Press release dated May 7, 2026

Exhibit 104

Cover Page Interactive Data File (Formatted as Inline XBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Power Integrations, Inc.

Dated:

May 7, 2026

By:

/s/ NANCY ERBA

Nancy Erba

Chief Financial Officer

EX-99.1

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POWI - Q1'26 - 8-K - EX99.1

Exhibit 99.1

Power Integrations Reports First-Quarter Financial Results

Revenue increased three percent year-over-year to $108.3 million; cash flow from operations was $20.0 million

SAN JOSE, Calif. – May 7, 2026 – Power Integrations (NASDAQ: POWI) today announced financial results for the quarter ended March 31, 2026. Net revenue for the first quarter was $108.3 million, up five percent from the prior quarter and up three percent from the first quarter of 2025. GAAP net income for the first quarter was $3.3 million or $0.06 per diluted share compared to $0.24 per diluted share in the prior quarter and $0.15 per diluted share in the first quarter of 2025. Cash flow from operations for the first quarter was $20.0 million.

In addition to its GAAP results, the company provided non-GAAP measures that exclude stock-based compensation, amortization of acquisition-related intangible assets, a restructuring charge associated with previously announced workforce reductions and the tax effects of these items. Non-GAAP net income for the first quarter of 2026 was $13.9 million or $0.25 per diluted share compared to $0.23 per diluted share in the prior quarter and $0.31 per diluted share in the first quarter of 2025. A reconciliation of GAAP to non-GAAP financial results and outlook is included with the tables accompanying this press release.

Power Integrations CEO Jen Lloyd commented: “Q1 was a good quarter for Power Integrations as we saw improved market demand while remaining focused on delivering innovative solutions based on our customers’ needs. Our industrial revenue grew 23 percent year-over-year driven by a breadth of applications including renewable energy, battery storage, home automation and automotive.”

Dr. Lloyd continued: “The momentum in our industrial business reflects our strategic focus on markets where our high-voltage technologies help customers solve the most pressing challenges in power. We continue to see confirmation that EVs and AI data centers not only need innovative solutions like our PowiGaN™ technology but also—by increasing pressure on the power grid—drive growth in renewables, battery storage and DC transmission, where our gate driver products excel. We are orienting our strategy and our R&D pipeline around these highly attractive opportunities.”

Power Integrations paid a dividend of $0.215 per share on March 31, 2026. A dividend of $0.215 per share will be paid on June 30, 2026, to stockholders of record as of May 29, 2026.

Financial Outlook

The company issued the following forecast for the second quarter of 2026:

● Revenue is expected to be in a range of $115 million to $120 million.

● GAAP gross margin is expected to be between 53.5 percent and 54.5 percent, and non-GAAP gross margin is expected to be between 54 percent and 55 percent.

● GAAP operating expenses are expected to be between $55 million and $56 million, and non-GAAP operating expenses are expected to be between $46.5 million and $47.5 million.

● GAAP operating margin is expected to be between 5.5 percent and 7.5 percent. Non-GAAP operating margin is expected to be between 13.5 percent and 15.5 percent.

Conference Call Information and Supplemental Materials

Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. A live webcast of the call will be available on the company's investor web page, http://investors.power.com, along with supplemental materials related to today’s earnings release.

About Power Integrations

Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com.

Note Regarding Use of Non-GAAP Financial Measures

In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets, a restructuring charge associated with workforce reductions implemented in the first quarter, and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to non-GAAP operating income, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations’ industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release.

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally relate to future events or the company’s future financial or operating performance. In some cases, you can identify forward looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates,” “going to,” "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these words or other similar terms or expressions that concern the company’s expectations, strategy, priorities, plans or intentions. Forward-looking statements in this release include, but are not limited to, the company’s guidance and outlook for the second quarter of 2026, the trends and assumptions underlying such guidance and outlook, and the company’s expectations regarding its upcoming dividend, including the timing and amount of such dividend. The company’s expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected, including the company’s ability to forecast its performance; changes in trade policies, in particular the escalation and imposition of new and higher tariffs, which could reduce demand for end products that incorporate our integrated circuits and/or place pressure on our prices as our customers seek to offset the impact of increased tariffs on their own products; the company’s ability to supply products and its ability to conduct other aspects of its business, such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company’s products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company’s revenue to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates; and product development delays and defects and market acceptance of the new products. The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in the company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q filed with the SEC. The forward-looking statements in this release are based on information available to the company as of the date hereof and the company disclaims any obligation to update or alter its forward-looking statements, except as otherwise required by law.

Power Integrations, PowiGaN and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners.

POWER INTEGRATIONS, INC.

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(in thousands, except per-share amounts)

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

Net revenue

108,308

103,204

105,529

Cost of revenue

51,370

48,595

47,294

Gross profit

56,938

54,609

58,235

Operating expenses:

Research and development

26,255

24,334

24,095

Selling, general and administrative

24,444

25,245

27,422

Other operating expenses

(1,419)

(3,744)

—

Restructuring and related charges

6,204

—

Total operating expenses

55,484

45,835

51,517

Income from operations

1,454

8,774

6,718

Other income

2,466

2,373

3,167

Income before income taxes

3,920

11,147

9,885

Provision (benefit) for income taxes

620

(2,143)

1,095

NET INCOME

3,300

13,290

8,790

Earnings per share:

Basic

0.06

0.24

0.15

Diluted

0.06

0.24

0.15

Shares used in per share calculation:

Basic

55,506

55,329

56,871

Diluted

55,874

55,694

57,123

SUPPLEMENTAL INFORMATION:

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

Stock-based compensation expenses included in:

Cost of revenue

469

232

657

Research and development

1,904

1,945

2,250

Selling, general and administrative

3,526

2,668

5,776

Other operating expenses

(1,419)

(5,120)

—

Restructuring and related charges

1,827

—

Total stock-based compensation expense

6,307

(275)

8,683

Cost of revenue includes:

Amortization of acquisition-related intangible assets

147

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

Revenue mix by end market:

Communications

10%

15%

10%

Computer

11%

14%

12%

Consumer

38%

34%

44%

Industrial

41%

37%

34%

POWER INTEGRATIONS, INC.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS (Unaudited)

(in thousands, except per-share amounts)

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

RECONCILIATION OF GROSS PROFIT

GAAP gross profit

56,938

54,609

58,235

GAAP gross margin

52.6%

52.9%

55.2%

Stock-based compensation included in cost of revenue

469

232

657

Amortization of acquisition-related intangible assets

147

Restructuring and related charges in cost of revenue

365

—

Non-GAAP gross profit

57,919

54,988

59,039

Non-GAAP gross margin

53.5%

53.3%

55.9%

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

RECONCILIATION OF OPERATING EXPENSES

GAAP operating expenses

55,484

45,835

51,517

Less: Stock-based compensation expense included in operating expenses

Research and development

1,904

1,945

2,250

Selling, general and administrative

3,526

2,668

5,776

Other operating expenses

(1,419)

(5,120)

—

Other operating expenses

—

1,376

—

Total

4,011

869

8,026

Less: Restructuring and related charges

6,204

—

Non-GAAP operating expenses

45,269

44,966

43,491

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

RECONCILIATION OF INCOME FROM OPERATIONS

GAAP income from operations

1,454

8,774

6,718

GAAP operating margin

1.3%

8.5%

6.4%

Add: Total stock-based compensation unrelated to restructuring

4,480

(275)

8,683

Amortization of acquisition-related intangible assets

147

Other operating expenses

—

1,376

—

Restructuring and related charges

6,569

—

Non-GAAP income from operations

12,650

10,022

15,548

Non-GAAP operating margin

11.7%

9.7%

14.7%

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

RECONCILIATION OF PROVISION (BENEFIT) FOR INCOME TAXES

GAAP provision (benefit) for income taxes

620

(2,143)

1,095

GAAP effective tax rate

15.8%

19.2%

11.1%

Tax effect of adjustments to GAAP results

(611)

(1,806)

239

Non-GAAP provision (benefit) for income taxes

1,231

(337)

856

Non-GAAP effective tax rate

8.1%

–2.7%

4.6%

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

RECONCILIATION OF NET INCOME PER SHARE (DILUTED)

GAAP net income

3,300

13,290

8,790

Adjustments to GAAP net income

Total Stock-based compensation unrelated to restructuring

4,480

(275)

8,683

Amortization of acquisition-related intangible assets

147

Other operating expenses

—

1,376

—

Tax effect of items excluded from non-GAAP results

(611)

(1,806)

239

Restructuring and related charges

6,569

—

Non-GAAP net income

13,885

12,732

17,859

Average shares outstanding for calculation of non-GAAP net income per share (diluted)

55,874

55,694

57,123

GAAP net income per share (diluted)

0.06

0.24

0.15

Non-GAAP net income per share (diluted)

0.25

0.23

0.31

Three Months Ended

RECONCILIATION OF FREE CASH FLOW

March 31,

2026

Cash flow from operations

20,045

Purchases of property and equipment

(1,998)

Free cash flow

18,047

POWER INTEGRATIONS, INC.

CONSOLIDATED BALANCE SHEETS (Unaudited)

(in thousands)

March 31, 2026

December 31, 2025

ASSETS

Current assets:

Cash and cash equivalents

63,390

58,755

Short-term investments

193,814

190,755

Accounts receivable, net

14,407

18,254

Inventories

162,982

166,887

Prepaid expenses and other current assets

23,747

23,678

Total current assets

458,340

458,329

Property and equipment, net

143,630

146,536

Intangible assets, net

7,061

7,244

Goodwill

95,271

Other non-current assets

66,385

64,827

TOTAL ASSETS

770,687

772,207

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

31,407

33,963

Accrued payroll and related expenses

13,224

13,840

Other accrued liabilities

21,958

22,558

Total current liabilities

66,589

70,361

Long-term liabilities:

Other liabilities

32,292

29,001

TOTAL LIABILITIES

98,881

99,362

STOCKHOLDERS' EQUITY:

Common stock

Additional paid-in capital

8,997

—

Accumulated other comprehensive loss

(2,491)

(1,105)

Retained earnings

665,280

673,930

TOTAL STOCKHOLDERS' EQUITY

671,806

672,845

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

770,687

772,207

POWER INTEGRATIONS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)

Three Months Ended

March 31,

2026

December 31,

2025

March 31,

2025

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

3,300

13,290

8,790

Adjustments to reconcile net income to cash provided by operating activities

Depreciation

6,380

6,407

7,244

Amortization of intangible assets

183

208

207

Loss on disposal of property and equipment

—

Stock-based compensation expense

6,307

(275)

8,683

Accretion of discount on investments

(156)

(216)

(346)

Increase (decrease) in accounts receivable allowance for credit losses

—

(381)

Change in operating assets and liabilities:

Accounts receivable

3,847

13,222

4,747

Inventories

3,905

(2,269)

(3,456)

Prepaid expenses and other assets

3,414

(2,807)

832

Accounts payable

(4,072)

(2,762)

4,002

Other accrued liabilities

(3,112)

1,369

(3,936)

Net cash provided by operating activities

20,045

26,206

26,386

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment

(1,998)

(7,050)

(5,726)

Purchases of investments

(14,807)

(5,709)

(5,630)

Proceeds from sales and maturities of investments

10,655

8,279

15,882

Net cash provided by (used in) investing activities

(6,150)

(4,480)

4,526

CASH FLOWS FROM FINANCING ACTIVITIES:

Issuance of common stock under employee stock plans

2,690

—

2,787

Repurchase of common stock

—

(23,098)

Payments of dividends to stockholders

(11,950)

(11,617)

(11,959)

Net cash used in financing activities

(9,260)

(11,617)

(32,270)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

4,635

10,109

(1,358)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

58,755

48,646

50,972

CASH AND CASH EQUIVALENTS AT END OF PERIOD

63,390

58,755

49,614

POWER INTEGRATIONS, INC.

RECONCILIATION OF NON-GAAP MEASURES TO GAAP IN SECOND-QUARTER 2026 FORECAST

(dollar amounts in millions)

RECONCILIATION OF GROSS MARGIN FORECAST

LOW

HIGH

GAAP gross margin forecast

53.5

54.5

Adjustments to reconcile GAAP to non-GAAP

Stock-based compensation included in cost of revenue

0.4

Amortization of acquisition-related intangible assets

0.1

Non-GAAP gross margin forecast

54.0

55.0

RECONCILIATION OF OPERATING EXPENSE FORECAST

LOW

HIGH

GAAP operating-expense forecast

55.0

56.0

Adjustments to reconcile GAAP to non-GAAP

Stock-based compensation

(8.5)

Non-GAAP operating-expense forecast

46.5

47.5

RECONCILIATION OF OPERATING MARGIN FORECAST

LOW

HIGH

GAAP operating margin forecast

5.5

7.5

Adjustments to reconcile GAAP to non-GAAP

Stock-based compensation

7.9

Amortization of acquisition-related intangible assets

0.1

Non-GAAP operating margin forecast

13.5

15.5

Contact:

Joe Shiffler

Power Integrations, Inc.

(408) 414-8528

joe@power.com

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