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Except for the historical information contained herein, the matters addressed in
this Item 2 constitute "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. These forward looking statements
include, but are not limited to, statements regarding future financial
performance of the Company; the expected ramp up timeline of the 12-inch fab at
the JV Company; the impact of government investigation and coronavirus on our
financial performance; and other statements and information set forth under the
heading "Factors Affecting Our Performance". Such forward-looking statements are
subject to a variety of risks and uncertainties, including those discussed below
under the heading "Risk Factors" and elsewhere in this Quarterly Report on Form
10-Q, that could cause actual results to differ materially from those
anticipated by the Company's management. The Private Securities Litigation
Reform Act of 1995 (the "Act") provides certain "safe harbor" provisions for
forward-looking statements. All forward-looking statements made in this
Quarterly Report on Form 10-Q are made pursuant to the Act. The Company
undertakes no obligation to publicly release the results of any revisions to its
forward-looking statements that may be made to reflect events or circumstances
after the date hereof or to reflect the occurrence of unexpected events. Unless
the context otherwise requires, the words "AOS," the "Company," "we," "us" and
"our" refer to Alpha and Omega Semiconductor Limited and its subsidiaries.

This management's discussion should be read in conjunction with the management's
discussion included in the Company's Annual Report on Form 10-K for the fiscal
year ended June 30, 2021, filed with the Securities and Exchange Commission on
August 30, 2021.

Insight

We are a designer, developer and global supplier of a broad portfolio of power
semiconductors. Our portfolio of power semiconductors includes approximately
2,400 products, and has grown significantly with the introduction of over 160
new products in each of the fiscal years ended June 30, 2021 and 2020,
respectively, and 200 new products in the fiscal year ended June 30, 2019.
During the nine months ended March 31, 2022, we introduced an additional 116 new
products. Our teams of scientists and engineers have developed extensive
intellectual property and technical knowledge that encompass major aspects of
power semiconductors, which we believe enables us to introduce and develop
innovative products to address the increasingly complex power requirements of
advanced electronics. We have an extensive patent portfolio that consists of 883
patents and 55 patent applications in the United States as of March 31, 2022. We
also have a total of 927 foreign patents, which were based primarily on our
research and development efforts through March 31, 2022. We differentiate
ourselves by integrating our expertise in technology, design and advanced
manufacturing and packaging to optimize product performance and cost. Our
portfolio of products targets high-volume applications, including personal and
portable computers, graphic cards, flat panel TVs, home appliances, smart
phones, battery packs, game consoles, consumer and industrial motor controls and
power supplies for TVs, computers, servers and telecommunications equipment.

Our business model leverages global resources, including research and
development and manufacturing in the United States and Asia. Our sales and
technical support teams are localized in several growing markets. We operate an
8-inch wafer fabrication facility located in Hillsboro, Oregon, or the Oregon
fab, which is critical for us to accelerate proprietary technology development,
new product introduction and improve our financial performance. To meet the
market demand for the more mature high volume products, we also utilize the
wafer manufacturing capacity of selected third party foundries. For assembly and
test, we primarily rely upon our in-house facilities in China. In addition, we
utilize subcontracting partners for industry standard packages. We believe our
in-house packaging and testing capability provides us with a competitive
advantage in proprietary packaging technology, product quality, cost and sales
cycle time.

During the fiscal quarter ended March 31, 2022, we continued our product
diversification program by developing new silicon and packaging platforms to
expand our serviceable available market, or SAM and offer higher performance
products. Our metal-oxide-semiconductor field-effect transistors, or MOSFET, and
power IC product portfolio expanded significantly. Our high performance products
and deepened customer relationships with our OEM and ODM customers have
contributed to the achievement of our record high quarterly revenue of $203.2
million for the three months ended March 31, 2022, a 20.1% growth compared to
the same quarter last year.

On March 29, 2016, we formed a joint venture (the "JV Company") with two
investment funds owned by the Municipality of Chongqing (the "Chongqing Funds"),
for the purpose of constructing and operating a power semiconductor packaging,
testing and 12-inch wafer fabrication facility ("Fab") in the LiangJiang New
Area of Chongqing, China. The Fab is being built in phases.  As of December 1,
2021, we owned 50.9%, and the Chongqing Funds owned 49.1% of the equity interest
in the JV Company. The Joint Venture was accounted under the provisions of the
consolidation guidance since we had controlling financial interest until
December 1, 2021.

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Effective December 1, 2021, we entered into a share transfer agreement (the
"STA") with a third-party investor (the "Investor"), pursuant to which we sold
to the Investor approximately 2.1% of outstanding equity interest held by us in
the JV Company for an aggregate purchase price of RMB 108 million or
approximately $16.9 million (the "Transaction"). The STA contained customary
representations, warranties and covenants. The Transaction was closed on
December 2, 2021 (the "Closing Date"). As a result of the Transaction, as of the
Closing Date, our equity interest in the JV Company decreased from 50.9% to
48.8%. Also, our right to designate directors on the board of JV Company was
reduced to three (3) out of seven (7) directors, from four (4) directors prior
to the Transaction. As of December 2, 2021, we no longer have a controlling
financial interest in the JV Company under generally accepted accounting
principles. Loss of control is deemed to have occurred when, among other things,
a parent company owns less than a majority of the outstanding common stock in
the subsidiary, lacks a controlling financial interest in the subsidiary and, is
unable to unilaterally control the subsidiary through other means such as
having, or the ability to obtain or represent, a majority of the subsidiary's
Board of Directors. All of these loss of control factors were present for us as
of December 2, 2021. Accordingly, since December 2, 2021, we have deconsolidated
the JV Company in our Consolidated Financial Statements and accounted for our
investment in the JV Company using the equity method of accounting.

On December 24, 2021, we entered into a share transfer agreement with another
third-party investor, pursuant to which we sold to this investor 1.1% of
outstanding equity interest held by us in the JV Company for an aggregate
purchase price of RMB 60 million or approximately $9.4 million based on the
currency exchange rate as of December 24, 2021. In addition, the JV Company
adopted an employee equity incentive plan and issued an equity interest
equivalent to 3.99% of the JV Company to exchange in cash. As a result, we owned
45.8% of the equity interest in the JV Company as of December 31, 2021.

On January 26, 2022, the JV Company completed a financing transaction pursuant
to a corporate financing agreement (the "Financing Agreement") between the JV
Company and certain third-party investors (the "New Investors"). Under the
Financing Agreement, the New Investors purchased newly issued equity interest of
JV for a total purchase price of RMB 509 million (or approximately $80 million
based on the currency exchange rate as of January 26, 2022) (the "Investment").
Following the closing of the Investment, the percentage of outstanding JV equity
interest beneficially owned by the Company was reduced to 42.2%.

We reduced our ownership of the JV Company to below 50% to increase the
flexibility of the JV Company to raise capital to fund its future expansion.
Following the Transaction and the successful ramp up to its Phase I target run
rate in the September quarter of 2021, as planned, the JV Company intends to
raise up to $200 million, including the $80 million funding on January 26, 2022,
through private funding rounds for its Phase II expansion. In addition to
immediate private funding rounds, the JV Company is also contemplating an
eventual listing on the Science and Technology innovAtion boaRd, or STAR Market,
of the Shanghai Stock Exchange. The Transaction assists the JV Company in
meeting certain regulatory listing requirements. A potential STAR Market listing
may take several years to consummate and there is no guarantee that such listing
by the JV Company will be successful or will be completed in a timely manner, or
at all. In addition, the JV Company will continue to provide us with significant
level of foundry capacity to enable us to develop and manufacture our products.

Impact of the COVID-19 pandemic on our business


Our business operations have been impacted by the global COVID-19 pandemic and
the resulting economic downturn. Numerous governmental jurisdictions, including
the States of California, Oregon and Texas in the U.S. and countries throughout
the Asia Pacific region have imposed various restrictions on commercial
activities, resulting in business closures, work stoppages, labor shortage,
disruptions to ports, vaccine mandates and other shipping infrastructure, border
closures, thereby negatively impacting our customers, suppliers, distributors,
employees, offices, and the entire semiconductor ecosystem.

As a result of the COVID-19 pandemic and changing consumer behaviors due to
various government restrictions and the growing trend to provide remote-working
options by employers, , we have experienced shifting market trends, including an
increasing demand in markets for notebooks, PCs, gaming devices and other
products. While we have benefited from the increasing demand for PC related
products, there is no guarantee that this trend will continue, and such
increasing demand may discontinue or decline if government authorities relax or
terminate COVID-19 related restrictions and consumer behaviors change in
response to the reopening of certain economic activities. In an effort to
protect the health and safety of our employees and to comply with various
government and regulatory guidelines, we also took proactive actions to adopt
policies and protocols at our locations around the world, including social
distancing guidelines, vaccine and testing protocols,

Since the start of the second quarter of calendar year 2021, there have been
increasing availability and administration of vaccines against COVID-19, as well
as an easing of restrictions on social, business, travel, and government
activities and functions, and a gradual resumption of economic activities and
consumer spending in our industries. However, infection rates continued to
fluctuate in various regions and new strains of the virus remain a risk,
including a surge of COVID-19 cases and hospitalization due to the spread of
Omicron variants in late 2021 and early 2022. During the first calendar quarter
of 2022,
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COVID-19 cases and hospitalization rate continued to decline and governments in
various jurisdictions, including the U.S. and Europe, have lifted various
restrictions and limitations on economic activities. However, there are ongoing
global impacts resulting from the pandemic, including disruption of the product
supply chains, shortages of semiconductor components, and delays in shipments,
product development, and product launches and rising inflation rates.

In April 2022, the operations of our two packaging and testing facilities in
Shanghai, China were suspended due to a strict lockdown of the city imposed by
the local government in response to surging COVID cases. Our facilities in
Shanghai were required to shut down and production was halted beginning in
mid-April. Transportation suspension in and out of Shanghai also interrupted the
shipping of raw materials and finished parts to and from our facilities. We have
been working closely with factory management to separate non-infected employees
from infected employees, perform regular COVID-19 testing, and secure food,
water, and other necessary supplies to support employees who have been affected.
In addition, we have been working with local authorities to obtain permission to
reopen the facilities, and as of the date of this Form 10-Q, we have received
permission to reopen our facilities partially under a "closed-loop" arrangement.
Under this arrangement, some of our employees are allowed to live and work on
the premises. However, the pace at which we can resume full operations remains
challenging due to difficulties in bringing back our workforce to the
facilities, procuring certain raw materials and resolving logistical
bottlenecks, and we also expect to incur additional costs to implement and
maintain public health safety measures and protocols at our factories as
required by the Shanghai authorities. Currently we intend to gradually ramp up
production at these facilities in May and return to normal operation in June
2022, assuming no additional restriction and lockdown are imposed by the
government. Furthermore, while we seek to secure alternative sources of
packaging capacity from third-party providers to mitigate the loss of in-house
packaging capacity, there is no guarantee that such sources are available. Even
if alternative sources are available, it will be difficult to complete the
transition to a new supplier efficiently and timely, and we currently do not
expect to secure sufficient third-party sources to substitute or replace fully
our in-house packaging and testing capacity. The suspension of our Shanghai
facilities, and the subsequent partial resumption of production, reduces our
ability to complete orders from our customers in a timely manner, or at all,
which is expected to adversely affect our revenue and results of operation for
the three months ending June 30, 2022. It is uncertain how long the Shanghai
government intends to impose a shutdown, and even when lifted, the government
may reimpose strict zero-positive-case requirements and lockdown. It is not
possible to predict at this time the ultimate duration of these restrictions or
the impact on financial results in the near-term.

The full extent of the longer-term impact of the COVID-19 pandemic on our
operational and financial performance is uncertain and will depend on many
factors outside our control, including, without limitation, the timing, extent,
trajectory and duration of the pandemic; the availability, distribution and
effectiveness of vaccines; the spread of new variants of COVID-19; the continued
and renewed imposition of protective public safety measures, including local and
regional lockdown and quarantines; the disruption of global supply chain; and
the impact of the pandemic on the global economy and demand for consumer
products. Although we are unable to predict the full impact and duration of the
COVID-19 pandemic on our business, we are actively managing our business
operations and financial expenditures in response to continued uncertainty.

Other factors affecting our performance

In addition to the COVID-19 pandemic and related events described above, our performance is affected by several key factors, including the following:


The global, regional economic and PC market conditions: Because our products
primarily serve consumer electronic applications, any significant change in
global and regional economic conditions could materially affect our revenue and
results of operations. A significant amount of our revenue is derived from sales
of products in the personal computing ("PC") markets, such as notebooks,
motherboards and notebook battery packs, therefore a substantial decline or
downturn in the PC market could have a material adverse effect on our revenue
and results of operations. The PC markets have experienced a modest global
decline in recent years due to continued growth of demand in tablets and smart
phones, worldwide economic conditions and the industry inventory correction
which had and may continue to have a material impact on the demand for our
products. However, we recently have experienced a significant increase of demand
in PC market due to the impact of the COVID-19 pandemic and resulting shift in
market trend and consumer behaviors. We cannot predict whether and how long this
trend will continue due to the uncertainty and unpredictability of COVID-19
pandemic. A decline of the PC market may have a negative impact on our revenue,
factory utilization, gross margin, our ability to resell excess inventory, and
other performance measures. We have executed and continue to execute strategies
to diversify our product portfolio, penetrate other market segments, including
the consumer, communications and industrial markets, and improve gross margins
and profit by implementing cost control measures. While making efforts to reduce
our reliance on the computing market, we continue to support our computing
business and capitalize on the opportunities in this market with a more focused
and competitive PC product strategy to gain market share.

Manufacturing costs and capacity availability:  Our gross margin is affected by
a number of factors including our manufacturing costs, utilization of our
manufacturing facilities, the product mixes of our sales, pricing of wafers from
third party foundries and pricing of semiconductor raw materials. Capacity
utilization affects our gross margin because we have
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certain fixed costs at our Shanghai facilities and our Oregon fab. If we are
unable to utilize our manufacturing facilities at a desired level, our gross
margin may be adversely affected. In addition, from time to time, we may
experience wafer capacity constraints, particularly at third party foundries,
that may prevent us from meeting fully the demand of our customers. For example,
the recent global shortage of semiconductor manufacturing capacity has provided
us with both challenges and opportunities in the market, and highlighted the
importance of maintaining sufficient and independent in-house manufacturing
capabilities to meet increasing customer demands. While we can mitigate these
constraints by increasing and re-allocating capacity at our own fab, we may not
be able to do so quickly or at sufficient level, which could adversely affect
our financial conditions and results of operations. In addition, we recently
commenced a plan to enhance the manufacturing capability and capacity of our
Oregon fab by investing in new equipment and expanding our factory facilities,
which we expect will have a positive impact on our future new product
development and revenue, particularly during the period of global shortage of
capacity. We also rely substantially on the JV Company to provide foundry
capacity to manufacture our products, therefore it is critical that we maintain
continuous access to such capacity, which may not be available at sufficient
level or at a pricing terms favorable to us because of lack of control over the
JV Company's operation. As a result of sales of our JV equity interests and
issuance of additional equity interests by the JV Company to third-party
investors in financing transactions, our equity interest in the JV Company was
reduced to 42.2%, which reduced our control and influence over the JV Company.
While we continue to maintain a business relationship with the JV Company to
ensure uninterrupted supply of manufacturing capacity, and we are currently
negotiating a foundry agreement for the JV Company to provide guarantee level of
capacity, the JV Company may take actions or make decisions that adversely
impact our ability to access required capacity, and our lack of control and
influence may prevent us from eliminating or mitigating such risk.

Erosion and fluctuation of average selling price: Erosion of average selling
prices of established products is typical in our industry. Consistent with this
historical trend, we expect our average selling prices of existing products to
decline in the future. However, in the normal course of business, we seek to
offset the effect of declining average selling price by introducing new and
higher value products, expanding existing products for new applications and new
customers and reducing the manufacturing cost of existing products. These
strategies may cause the average selling price of our products to fluctuate
significantly from time to time, thereby affecting our financial performance and
profitability.

Product introductions and customers' product requirements: Our success depends
on our ability to introduce products on a timely basis that meet or are
compatible with our customers' specifications and performance requirements. Both
factors, timeliness of product introductions and conformance to customers'
requirements, are equally important in securing design wins with our customers.
As we accelerate the development of new technology platforms, we expect to
increase the pace at which we introduce new products and seek and acquire design
wins. If we were to fail to introduce new products on a timely basis that meet
customers' specifications and performance requirements, particularly those
products with major OEM customers, and continue to expand our serviceable
markets, then we would lose market share and our financial performance would be
adversely affected.

Distributor ordering patterns, customer demand and seasonality: Our distributors
place purchase orders with us based on their forecasts of end customer demand,
and this demand may vary significantly depending on the sales outlook and market
and economic conditions of end customers. Because these forecasts may not be
accurate, channel inventory held at our distributors may fluctuate
significantly, which in turn may prompt distributors to make significant
adjustments to their purchase orders placed with us. As a result, our revenue
and operating results may fluctuate significantly from quarter to quarter. In
addition, because our products are used in consumer electronics products, our
revenue is subject to seasonality. Our sales seasonality is affected by numerous
factors, including global and regional economic conditions as well as the PC
market conditions, revenue generated from new products, changes in distributor
ordering patterns in response to channel inventory adjustments and end customer
demand for our products and fluctuations in consumer purchase patterns prior to
major holiday seasons. In recent periods, broad fluctuations in the
semiconductor markets and the global and regional economic conditions, in
particular the decline of the PC market conditions, have had a more significant
impact on our results of operations than seasonality. Furthermore, our revenue
may be impacted by the level of demand from our major customers due to factors
outside of our control. If these major customers experience significant decline
in the demand of their products, encounter difficulties or defects in their
products, or otherwise fail to execute their sales and marketing strategies
successfully, it may adversely affect our revenue and results of operations.

Main income statement items

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The following section describes the main items presented in our condensed consolidated statements of income:

Revenue


We generate revenue primarily from the sale of power semiconductors, consisting
of power discretes and power ICs. Historically, a majority of our revenue has
been derived from power discrete products. Because our products typically have
three-year to five-year life cycles, the rate of new product introduction is an
important driver of revenue growth over time. We believe that expanding the
breadth of our product portfolio is important to our business prospects, because
it provides us with an opportunity to increase our total bill-of-materials
within an electronic system and to address the power requirements of additional
electronic systems. In addition, a small percentage of our total revenue is
generated by providing packaging and testing services to third parties through
one of our subsidiaries.

Our product revenue is reported net of the effect of the estimated stock
rotation returns and price adjustments that we expect to provide to our
distributors. Stock rotation returns are governed by contract and are limited to
a specified percentage of the monetary value of products purchased by the
distributor during a specified period. At our discretion or upon our direct
negotiations with the original design manufacturers ("ODMs") or original
equipment manufacturers ("OEMs"), we may elect to grant special pricing that is
below the prices at which we sold our products to the distributors. In these
situations, we will grant price adjustments to the distributors reflecting such
special pricing. We estimate the price adjustments for inventory at the
distributors based on factors such as distributor inventory levels, pre-approved
future distributor selling prices, distributor margins and demand for our
products.

Cost of Goods Sold


Our cost of goods sold primarily consists of costs associated with semiconductor
wafers, packaging and testing, personnel, including share-based compensation
expense, overhead attributable to manufacturing, operations and procurement, and
costs associated with yield improvements, capacity utilization, warranty and
valuation of inventories. As the volume of sales increases, we expect cost of
goods sold to increase. While our utilization rates cannot be immune to the
market conditions, our goal is to make them less vulnerable to market
fluctuations. We believe our market diversification strategy and product growth
will drive higher volume of manufacturing which will improve our factory
utilization rates and gross margin in the long run.

Operating Expenses


Our operating expenses consist of research and development, selling, general and
administrative expenses and impairment of long-lived assets. We expect our
operating expenses as a percentage of revenue to fluctuate from period to period
as we continue to exercise cost control measures in response to the declining PC
market as well as align our operating expenses to the revenue level.

Research and development costs. Our research and development expenses primarily include salaries, bonuses, benefits, stock-based compensation expenses, expenses associated with new product prototypes, travel expenses, fees for engineering services provided by external contractors and consultants, amortization of software and design tools, depreciation of equipment and overheads. We continue to invest in the development of new technologies and products using our own manufacturing and packaging facilities, as this is essential to our long-term success. We are also evaluating appropriate levels of investment and remain focused on introducing new products to improve our competitiveness. We expect our research and development expenses to fluctuate from time to time.


Selling, general and administrative expenses.  Our selling, general and
administrative expenses consist primarily of salaries, bonuses, benefits,
share-based compensation expense, product promotion costs, occupancy costs,
travel expenses, expenses related to sales and marketing activities,
amortization of software, depreciation of equipment, maintenance costs and other
expenses for general and administrative functions as well as costs for outside
professional services, including legal, audit and accounting services. We expect
our selling, general and administrative expenses to fluctuate in the near future
as we continue to exercise cost control measures.

income tax expense


We are subject to income taxes in various jurisdictions. Significant judgment
and estimates are required in determining our worldwide income tax expense. The
calculation of tax liabilities involves dealing with uncertainties in the
application of complex tax regulations of different jurisdictions globally. We
establish accruals for potential liabilities and contingencies based on a more
likely than not threshold to the recognition and de-recognition of uncertain tax
positions. If the recognition threshold is met, the applicable accounting
guidance permits us to recognize a tax benefit measured at the largest amount of
tax benefit that is more likely than not to be realized upon settlement with a
taxing authority. If the actual tax outcome of such
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exposures is different from the amounts that were initially recorded, the
differences will impact the income tax and deferred tax provisions in the period
in which such determination is made. Changes in the location of taxable income
(loss) could result in significant changes in our income tax expense.

We record a valuation allowance against deferred tax assets if it is more likely
than not that a portion of the deferred tax assets will not be realized, based
on historical profitability and our estimate of future taxable income in a
particular jurisdiction. Our judgments regarding future taxable income may
change due to changes in market conditions, changes in tax laws, tax planning
strategies or other factors. If our assumptions and consequently our estimates
change in the future, the deferred tax assets may increase or decrease,
resulting in corresponding changes in income tax expense. Our effective tax rate
is highly dependent upon the geographic distribution of our worldwide profits or
losses, the tax laws and regulations in each geographical region where we have
operations, the availability of tax credits and carry-forwards and the
effectiveness of our tax planning strategies.

WE Tax Cuts and Jobs Act, enacted December 22, 2017


On December 22, 2017, the United States enacted tax reform legislation through
the Tax Cuts and Jobs Act ("the Tax Act"), which significantly changes the
existing U.S. tax laws, including, but not limited to, (1) a reduction in the
corporate tax rate from 35% to 21%, (2) a shift from a worldwide tax system to a
territorial system, (3) eliminating the corporate alternative minimum tax (AMT)
and changing how existing AMT credits can be realized, (4) bonus depreciation
that will allow for full expensing of qualified property, (5) creating a new
limitation on deductible interest expense and (6) changing rules related to uses
and limitations of net operating loss carryforwards created in tax years
beginning after December 31, 2017.

The company is not currently subject to the Base Erosion and Anti-Abuse (BEAT)
tax , which is a tax imposed on certain entities who make payments to their non
US affiliates, where such payments reduce the US tax base . The BEAT tax is
imposed at a rate of 10% on Adjusted Taxable Income, excluding certain payments
to foreign related entities. It is an incremental tax over and above the
corporate income tax and is recorded as a period cost. It is
possible that this tax could be applicable in future periods, which would cause
an increase to the effective tax rate and cash taxes.

WE Consolidated Appropriations Act 2021 (“CAA 2021”), enacted December 27, 2020


On December 27, 2020, the United States enacted the Consolidated Appropriations
Act, 2021, which made changes to existing U.S. tax laws. There was no material
impact of the tax law changes included in the Consolidated Appropriations Act,
2021 to the Company.

‘US Bailout Act 2021’ signed into law March 11, 2021


On March 11, 2021, the United States enacted the American Rescue Plan Act of
2021, which made changes to existing U.S. tax laws. There was no material impact
of the tax law changes included in the American Rescue Plan Act of 2021 to the
Company.
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Investment gain/loss under the equity method from an investee


We use the equity method of accounting when we have the ability to exercise
significant influence, but not control, as determined in accordance with general
accepted accounting principles, over the operating and financial policies of the
company. Effective December 2, 2021, we reduced our equity interest in the JV
Company below 50% of outstanding equity ownership and experienced a loss of
control of the JV Company. As a result, we record our investment under equity
method of accounting. Since we are unable to obtain accurate financial
information from the JV Company in a timely manner, we record our share of
earnings or losses of such affiliate on a one quarter lag.

We record our interest in the net earnings of its equity method investees, along
with adjustments for unrealized profits or losses on intra-entity transactions
and amortization of basis differences, within earnings or loss from equity
interests in the Consolidated Statements of Income. Profits or losses related to
intra-entity sales with its equity method investees are eliminated until
realized by the investor or investee. Basis differences represent differences
between the cost of the investment and the underlying equity in net assets of
the investment and are generally amortized over the lives of the related assets
that gave rise to them. Equity method goodwill is not amortized or tested for
impairment; instead the equity method investment is tested for impairment. We
review for impairment whenever factors indicate that the carrying amount of the
investment might not be recoverable. In such a case, the decrease in value is
recognized in the period the impairment occurs in the Consolidated Statement of
Operations.

Results of Operations

The following tables set forth statements of income, also expressed as a
percentage of revenue, for the three and nine months ended March 31, 2022 and
2021. Our historical results of operations are not necessarily indicative of the
results for any future period.
                                                               Three Months Ended March 31,                                                          Nine Months Ended March 31,
                                            2022                  2021                2022                 2021                  2022                  2021                2022                 2021
                                                 (in thousands)                            (% of revenue)                             (in thousands)                            (% of revenue)
Revenue                               $      203,239          $ 169,212                 100.0  %            100.0  %       $      583,593          $ 479,593                 100.0  %            100.0  %
Cost of goods sold                           130,837            116,521                  64.4  %             68.9  %              378,259            335,630                  64.8  %             70.0  %
Gross profit                                  72,402             52,691                  35.6  %             31.1  %              205,334            143,963                  35.2  %             30.0  %
Operating expenses
Research and development                      16,545             15,557                   8.1  %              9.2  %               50,873             45,671                   8.7  %              9.5  %
Selling, general and administrative           24,625             19,338                  12.1  %             11.4  %               70,563             56,579                  12.1  %             11.8  %

Total operating expenses                      41,170             34,895                  20.2  %             20.6  %              121,436            102,250                  20.8  %             21.3  %
Operating income                              31,232             17,796                  15.4  %             10.5  %               83,898             41,713                  14.4  %              8.7  %

Other income (loss), net                         263               (253)                  0.2  %             (0.1) %                  720              2,087                   0.1  %              0.4  %
Interest income (expense), net                  (308)            (1,562)                 (0.2) %             (1.1) %               (3,025)            (4,832)                 (0.5) %             (1.0) %
Gain on deconsolidation of the JV
Company                                            -                  -                     -  %                -  %              399,093                  -                  68.4  %                -  %
Gain (loss) on changes of equity
interest in the JV Company, net                4,501                  -                   2.2  %                -  %               (3,140)                 -                  (0.5) %                -  %
Net income before income taxes                35,688             15,981                  17.6  %              9.3  %              477,546             38,968                  81.9  %              8.1  %
Income tax expense                             2,902              1,014                   1.4  %              0.6  %               38,318              2,694                   6.6  %              0.6  %
Net income before loss from equity
method investment                             32,786             14,967                  16.2  %              8.7  %              439,228             36,274                  75.3  %              7.5  %
Equity method investment loss from
equity investee                                1,136                  -                   0.6  %                -  %                1,136                  -                   0.2  %                -  %
Net income                                    31,650             14,967                  15.6  %              8.7  %              438,092             36,274                  75.1  %              7.5  %
Net gain (loss) attributable to
noncontrolling interest                            -             (1,133)                    -  %             (0.7) %                   20             (2,303)                    -  %             (0.5) %
Net income attributable to Alpha and
Omega Semiconductor Limited           $       31,650          $  16,100                  15.6  %              9.4  %       $      438,072          $  38,577                  75.1  %              8.0  %




                                       39
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Share-based compensation expense was recognized as follows:

                                                           Three Months Ended March 31,                                                      Nine Months Ended March 31,
                                           2022                2021               2022                2021                 2022                 2021               2022                2021
                                              (in thousands)                          (% of revenue)                           (in thousands)                          (% of revenue)
Cost of goods sold                   $       1,282          $   427                   0.6  %            0.3  %       $        3,560          $ 1,195                   0.6  %            0.2  %
Research and development                     1,814            1,316                   0.9  %            0.8  %                4,769            3,639                   0.8  %            0.8  %
Selling, general and administrative          5,177            2,082                   2.5  %            1.2  %               13,125            5,091                   2.2  %            1.1  %
Total                                $       8,273          $ 3,825                   4.0  %            2.3  %       $       21,454          $ 9,925                   3.6  %            2.1  %


Three and nine months ended March 31, 2022 and 2021

Revenue

Here is a summary of revenue by product type:


                                                          Three Months Ended March 31,                                                                 Nine Months Ended March 31,
                                 2022                2021                               Change                                2022               2021                               Change
                                      (in thousands)                  (in thousands)            (in percentage)                   (in thousands)                  (in thousands)            (in percentage)
Power discrete               $  140,572          $ 122,615          $        17,957                         14.6  %       $ 406,235          $ 355,487          $        50,748                         14.3  %
Power IC                         60,359             43,385                   16,974                         39.1  %         167,782            115,224                   52,558                         45.6  %
Packaging and testing
services                          2,308              3,212                     (904)                       (28.1) %           9,576              8,882                      694                          7.8  %
                             $  203,239          $ 169,212          $        34,027                         20.1  %       $ 583,593          $ 479,593          $       104,000                         21.7  %



Total revenue was $203.2 million for the three months ended March 31, 2022, an
increase of $34.0 million, or 20.1%, as compared to $169.2 million for the same
quarter last year. The increase was primarily due to an increase of $18.0
million and $17.0 million in sales of power discrete products and sales of power
IC products, respectively. The increase in power discrete and power IC product
sales was primarily due to an 24.1% increase in average selling price, offset by
an 2.4% decrease in unit shipments as compared to same quarter last year due to
a shift in product mix. The decrease in revenue of packaging and testing
services for the three months ended March 31, 2022, as compared to same quarter
last year, was primarily due to decreased demand.

Total revenue was $583.6 million for the nine months ended March 31, 2022 an
increase of $104.0 million, or 21.7%, as compared to $479.6 million for the same
period last year. The increase was primarily due to an increase of $50.7 million
and $52.6 million in sales of power discrete products and sales of power IC
products, respectively. The increase in power discrete and power IC product
sales was primarily due to an 25.3% increase in average selling price, partially
offset by a 2.9% decrease in unit shipments as compared to same period last year
due to a shift in product mix. The increase in revenue of packaging and testing
services for the nine months ended March 31, 2022, as compared to same period
last year, was primarily due to increased demand.

Cost of goods sold and gross profit


                                                                  Three Months Ended March 31,                                                                 Nine Months Ended March 31,
                                          2022               2021                               Change                                2022               2021                               Change
                                              (in thousands)                  (in thousands)            (in percentage)                   (in thousands)                  (in thousands)            (in percentage)
Cost of goods sold                    $ 130,837          $ 116,521          $        14,316                         12.3  %       $ 378,259          $ 335,630          $        42,629                         12.7  %
 Percentage of revenue                     64.4  %            68.9  %                                                                  64.8  %            70.0  %

Gross profit                          $  72,402          $  52,691          $        19,711                         37.4  %       $ 205,334          $ 143,963          $        61,371                         42.6  %
 Percentage of revenue                     35.6  %            31.1  %                                                                  35.2  %            30.0  %



                                       40
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Cost of goods sold was $130.8 million for the three months ended March 31, 2022,
an increase of $14.3 million, or 12.3%, as compared to $116.5 million for the
same quarter last year. The increase was primarily due to 20.1% increase in
revenue. Gross margin increased by 4.5 percentage points to 35.6% for the three
months ended March 31, 2022, as compared to 31.1% for the same quarter last
year. The increase in gross margin was primarily due to better product mix
during the three months ended March 31, 2022.

Cost of goods sold was $378.3 million for the nine months ended March 31, 2022,
an increase of $42.6 million, or 12.7%, as compared to $335.6 million for the
same period last year. The increase was primarily due to 21.7% increase in
revenue. Gross margin increased by 5.2 percentage points to 35.2% for the nine
months ended March 31, 2022, as compared to 30.0% for the same period last year.
The increase in gross margin was primarily due to better product mix during the
nine months ended March 31, 2022.

Research and development costs


                                                                 Three Months Ended March 31,                                                                      Nine Months Ended March 31,
                                         2022                  2021                               Change                                  2022                 2021                               Change
                                             (in thousands)                     (in thousands)            (in percentage)                     (in thousands)                   (in thousands)            (in percentage)
Research and development expenses $    16,545               $ 15,557          $           988                          6.4  %       $    50,873             $ 45,671          $        5,202                         11.4  %


Research and development expenses were $16.5 million for the three months ended
March 31, 2022, an increase of $1.0 million, or 6.4%, as compared to $15.6
million for the same quarter last year. The increase was primarily attributable
to a $1.6 million increase in employee compensation and benefits expense mainly
due to higher salary related expenses and higher bonuses accrual, a $0.5 million
increase in share-based compensation expense due to an increase in stock awards
granted and $0.3 million in allocation, partially offset by $1.3 million
decrease in product prototyping engineering expense as a result of decreased
engineering activities during the current quarter.

Research and development expenses were $50.9 million for the nine months ended
March 31, 2022, an increase of $5.2 million, or 11.4%, as compared to $45.7
million for the same period last year. The increase was primarily attributable
to a $4.8 million increase in employee compensation and benefits expense mainly
due to higher salary related expenses and higher bonuses, a $1.1 million
increase in share-based compensation expense due to an increase in stock awards
granted, a $0.2 million increase in depreciation expense and $0.6 million in
allocation, partially offset by a $1.7 million decrease in product prototyping
engineering expense as a result of decreased engineering activities during the
current period.

Selling, general and administrative expenses


                                                                     Three Months Ended March 31,                                                                   Nine Months Ended March 31,
                                             2022                 2021                               Change                                2022                2021                               Change
                                                 (in thousands)                   (in thousands)            (in percentage)                    (in thousands)                   (in thousands)            (in percentage)
Selling, general and administrative    $    24,625             $ 19,338          $        5,287                         27.3  %       $   70,563            $ 56,579          $        13,984                         24.7  %



Selling, general and administrative expenses were $24.6 million for the three
months ended March 31, 2022, an increase of $5.3 million, or 27.3%, as compared
to $19.3 million for the same quarter last year. The increase was primarily
attributable to a $0.9 million increase in employee compensation and benefits
expenses mainly due to higher salary related expenses, higher bonus expenses
accrual and increased business insurance expenses, a $3.1 million increase in
share-based compensation expense due to an increase in stock award granted, and
a $1.5 million in loss of a cybersecurity incident, partially offset by a $0.4
million decrease in legal expense related to the government investigation during
the current quarter.

Selling, general and administrative expenses were $70.6 million for the nine
months ended March 31, 2022, an increase of $14.0 million, or 24.7%, as compared
to $56.6 million for the same period last year. The increase was primarily
attributable to a $7.0 million increase in employee compensation and benefits
expenses mainly due to higher salary related expenses, higher bonus expenses and
business insurance expenses, a $8.0 million increase in share-based compensation
expense due to an increase in stock award granted as well as $1.5 million in
loss of a cybersecurity incident, partially offset by a $1.8 million decrease in
legal expenses related to the government investigation, a $0.3 million decrease
in marketing demo and trade shows costs as a result of the COVID-19 pandemic,
and a $0.4 million decrease in depreciation during the current period.

Other income (loss), net

                                       41
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                                                       Three Months Ended March 31,                                                               Nine Months Ended March 31,
                                 2022             2021                              Change                                 2022                2021                              Change
                                    (in thousands)                (in thousands)            (in percentage)                   (in thousands)                   (in thousands)            (in percentage)

Other income (loss), net $263 ($253) $516

                      (204.0) %       $    720               $ 2,087          $        (1,367)                      (65.5) %


Other income (loss), net increased by $0.5 million during the three months ended
March 31, 2022 as compared to the same quarter last year was primarily due to
decrease in foreign currency exchange loss as a result of the appreciation of
RMB against USD.

Other income (loss), net decreased by $1.4 million during the nine months ended
March 31, 2022 as compared to the same quarter last year was primarily due to
increase in foreign currency exchange loss as a result of the depreciation of
RMB against USD.

Interest income (expense), net


                                                              Three Months Ended March 31,                                                             

Nine month period ended March, 31st,

                                       2022                 2021                              Change                                2022                2021                              Change
                                           (in thousands)                   (in thousands)            (in percentage)                   (in thousands)                  (in thousands)            (in percentage)
Interest income (expense), net   $    (308)              $ (1,562)         $        1,254                       (80.3) %       $   (3,025)           $ (4,832)         $        1,807                       (37.4) %



Interest income (expense), net decreased by $1.3 million during the three months
ended March 31, 2022 as compared to the same quarter last year was primarily due
to a $1.2 million decrease in interest expenses as a result of the JV Company
being deconsolidated in December 2021.

Interest income (expense), net decreased by $1.8 million during the nine months
ended March 31, 2022 as compared to the same period last year was primarily due
to a $1.6 million decrease in interest expenses as a result of the JV Company
being deconsolidated in December 2021.


Gain on deconsolidation of JV Company and Gain/loss on changes in participation in the JV Company


Effective December 1, 2021, we entered into a share transfer agreement (the
"STA") with a third-party investor (the "Investor"), pursuant to which we sold
to the Investor approximately 2.1% of outstanding equity interest held by us in
the JV Company for an aggregate purchase price of RMB 108 million or
approximately $16.9 million (the "Transaction"). The STA contained customary
representations, warranties and covenants. The Transaction was closed on
December 2, 2021 (the "Closing Date"). As a result of the Transaction, as of the
Closing Date, our equity interest in the JV Company decreased from 50.9% to
48.8%, Also, our right to designate directors on the board of JV Company was
reduced to three (3) out of seven (7) directors, from four (4) directors prior
to the Transaction. We no longer have a controlling financial interest in the JV
Company under generally accepted accounting principles. Loss of control is
deemed to have occurred when, among other things, a parent company owns less
than a majority of the outstanding common stock in the subsidiary, lacks a
controlling financial interest in the subsidiary and, is unable to unilaterally
control the subsidiary through other means such as having, or the ability to
obtain, a majority of the subsidiary's Board of Directors. All of these loss of
control factors were present for us as of December 2, 2021. Accordingly, since
December 2, 2021, AOS has accounted for its investment in the JV Company using
the equity method of accounting. On December 24, 2021, we entered into a STA
with another third-party investor, pursuant to which we sold to this investor
1.1% of outstanding equity interest held by us in the JV Company for an
aggregate purchase price of RMB 60 million or approximately $9.4 million. In
addition, the JV Company adopted an employee equity incentive plan and issued an
equity interest equivalent to 3.99% of the JV Company to exchange in cash. As a
result, the Company owned 45.8% of the equity interest in the JV Company as of
December 31, 2021. On January 26, 2022, the JV Company completed a financing
transaction pursuant to a corporate financing agreement (the "Financing
Agreement") between the JV Company and certain third-party investors (the "New
Investors"). Under the Financing Agreement, the New Investors purchased newly
issued equity interest of JV for a total purchase price of RMB 509 million (or
approximately $80 million based on the currency exchange rate as of January 26,
2022) (the "Investment"). Following the closing of the Investment, the
percentage of outstanding JV equity interest beneficially owned by us was
reduced to 42.2%.

                                       42
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During the nine months ended March 31, 2022, we recorded a $399.1 million of
gain on deconsolidation of the JV Company. During the three and nine months
ended March 31, 2022, we recorded a $4.5 million of gain on changes of equity
interest in the JV Company and $3.1 million of loss on changes of equity
interest in the JV Company.

We account for our investment in the JV Company as an equity method investment
and reports its equity in earnings or loss of the JV Company on a three-month
lag due to an inability to timely obtain financial information of the JV
Company. During the three and nine months ended March 31, 2022, we recorded $1.1
million of its equity in loss of the JV Company, net of tax, using lag
reporting.

Income tax expense
                                                          Three Months Ended March 31,                                                            

Nine month period ended March, 31st,

                                    2022                 2021                             Change                                 2022                 2021                              Change
                                       (in thousands)                   (in thousands)            (in percentage)                    (in thousands)                   (in thousands)            (in percentage)
Income tax expense           $    2,902               $ 1,014          $        1,888                       186.2  %       $    38,318             $ 2,694          $        35,624                     1,322.3  %



The Company recognized income tax expense of approximately $2.9 million and $1.0
million for the three months ended March 31, 2022 and 2021, respectively. The
income tax expense of $2.9 million for the three months ended March 31, 2022
included a $0.7 million discrete tax expense related to the Company's $4.5
million of gain related to the revaluation of the Company's equity interest in a
joint venture. The income tax expense of $1.0 million for the three months ended
March 31, 2021 included immaterial discrete tax. Excluding the $4.5 million
revaluation gain and the $0.7 million of discrete income tax items, the
effective tax rate for the three months ended March 31, 2022 and 2021 was 7.4%
and 6.3%, respectively. The changes in the tax expense and effective tax rate
between the periods resulted primarily from the Company reporting pretax book
income of $34.5 million ($30.0 million of pretax book income excluding the $4.5
million of gain related to the revaluation of the Company's equity interest in a
joint venture) for the three months ended March 31, 2022 as compared to a pretax
book income of $16.0 million for the three months ended March 31, 2021 as well
as changes in the mix of earnings in various geographic jurisdictions between
the current year and the same period of last year.

The Company recognized income tax expense of approximately $38.3 million and
$2.7 million for the nine months ended March 31, 2022 and 2021, respectively.
The income tax expense of $38.3 million for the nine months ended March 31, 2022
iincluded a $33.5 million discrete tax expense related to the Company's $396.0
million of income from the sale of equity interest in a joint venture and the
related deconsolidation gain as the Company switches from the consolidation
method of accounting to the equity method of accounting related to this
investment and no longer asserts permanent reinvestment related to the Company's
investment in the joint venture as well as $0.1 million of other discrete income
tax items. The income tax expense of $2.7 million for the nine months ended
March 31, 2021 included a $0.04 million discrete tax benefit. Excluding the
discrete income tax items ($396.0 million of income from the sale of equity
interest in a joint venture and the related deconsolidation gain as well as
other discrete items), the effective tax rate for the nine months ended March
31, 2022 and 2021 was 6.0% and 7.0%, respectively. The changes in the tax
expense and effective tax rate between the periods resulted primarily from the
Company reporting pretax book income of $476.4 million ($80.4 million of pretax
book income excluding the $396.0 million of income from the sale of equity
interest in a joint venture and the related deconsolidation gain) for the nine
months ended March 31, 2022 as compared to a pretax book income of $39.0 million
for the nine months ended March 31, 2021 as well as changes in the mix of
earnings in various geographic jurisdictions between the current year and the
same period of last year.

The Company files its income tax returns in the United States and in various
foreign jurisdictions. The tax years 2001 to 2021 remain open to examination by
U.S. federal and state tax authorities. The tax years 2013 to 2021 remain open
to examination by foreign tax authorities.

The Company's income tax returns are subject to examinations by the Internal
Revenue Service and other tax authorities in various jurisdictions. In
accordance with the guidance on the accounting for uncertainty in income taxes,
the Company regularly assesses the likelihood of adverse outcomes resulting from
these examinations to determine the adequacy of its provision for income taxes.
These assessments can require considerable estimates and judgments. As of March
31, 2022, the gross amount of unrecognized tax benefits was approximately $7.8
million, of which $4.8 million, if recognized, would reduce the effective income
tax rate in future periods. If the Company's estimate of income tax liabilities
proves to be less than the ultimate assessment, then a further charge to expense
would be required. If events occur and the payment of these amounts ultimately
proves to be unnecessary, the reversal of the liabilities would result in tax
benefits being recognized in the period when the Company determines the
liabilities are no longer necessary. The Company does not anticipate any
material changes to its uncertain tax positions during the next twelve months.

Cash and capital resources

                                       43
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Our principal need for liquidity and capital resources is to maintain sufficient
working capital to support our operations and to invest adequate capital
expenditures to grow our business. To date, we finance our operations and
capital expenditures primarily through funds generated from operations and
borrowings under our term loans, financing lease and other debt agreements.
On August 18, 2021, Jireh entered into a term loan agreement with a financial
institution (the "Bank") in an amount up to $45.0 million for the purpose of
expanding and upgrading the Company's fabrication facility located in Oregon.
The obligation under the loan agreement is secured by substantially all assets
of Jireh and guaranteed by the Company. The agreement has a 5.5 year term and
matures on February 16, 2027. Jireh is required to make consecutive quarterly
payments of principal and interest. The loan accrues interest based on adjusted
LIBOR plus the applicable margin based on the outstanding balance of the loan.
This agreement contains customary restrictive covenants and includes certain
financial covenants that the Company is required to maintain. Jireh drew down
$45.0 million on February 16, 2022. As of March 31, 2022, there was $45.0
million outstanding balance under the loan.

On October 2019, the Company's subsidiary in China entered into a line of credit
facility with Bank of Communications Limited in China. This line of credit
matures on February 14, 2021 and is based on the China Base Rate multiplied by
1.05, or 4.99% on October 31, 2019. The purpose of the credit facility is to
provide short-term borrowings. The Company could borrow up to approximately RMB
60.0 million or $8.5 million based on the currency exchange rate between the RMB
and the U.S. Dollar on October 31, 2019. In September 2021, this line of credit
was renewed with maximum borrowings up to RMB 140.0 million with the same terms
and a maturity date of September 18, 2022. During the three months ended
December 31, 2021, the Company borrowed RMB 11.0 million, or $1.7 million, at an
interest rate of 3.85% per annum, with principal due on November 18, 2022. As of
March 31, 2022, the total outstanding balance of this loan was $1.7 million.

On November 16, 2018, the Company's subsidiary in China entered into a line of
credit facility with Industrial and Commercial Bank of China. The purpose of the
credit facility was to provide short-term borrowings. The Company could borrow
up to approximately RMB 72.0 million or $10.3 million based on currency exchange
rate between RMB and U.S. Dollar on November 16, 2018. The RMB 72.0 million
consists of RMB 27.0 million for trade borrowings with a maturity date of
December 31, 2021, and RMB 45.0 million for working capital borrowings or trade
borrowings with a maturity date of September 13, 2022. During the three months
ended December 31, 2021, the Company borrowed RMB 5.0 million, or $0.8 million,
at an interest rate of 3.7% per annum, with principal due on September 12, 2022.
As of March 31, 2022, the total outstanding balance of this loan was
$0.6 million.

On August 9, 2019, one of the Company's wholly-owned subsidiaries (the
"Borrower") entered into a factoring agreement with the Hongkong and Shanghai
Banking Corporation Limited ("HSBC"), whereby the Borrower assigns certain of
its accounts receivable with recourse. This factoring agreement allows the
Borrower to borrow up to 70% of the net amount of its eligible accounts
receivable of the Borrower with a maximum amount of $30.0 million. The interest
rate is based on one month London Interbank Offered Rate ("LIBOR") plus 1.75%
per annum. The Company is the guarantor for this agreement. The Company is
accounting for this transaction as a secured borrowing under the Transfers and
Servicing of Financial Assets guidance. In addition, any cash held in the
restricted bank account controlled by HSBC has a legal right of offset against
the borrowing. This agreement, with certain financial covenants required, has no
expiration date. On August 11, 2021, the Borrower signed an agreement with HSBC
to decrease the borrowing maximum amount to $8.0 million with certain financial
covenants required. Other terms remain the same. As of March 31, 2022, the
Borrower was in compliance with these covenants. As of March 31, 2022, there was
no outstanding balance and the Company had unused credit of approximately $8.0
million.

On May 1, 2018, Jireh entered into a loan agreement with the Bank that provided
a term loan in the amount of $17.8 million. The obligation under the loan
agreement is secured by certain real estate assets of Jireh and guaranteed by
the Company.  The loan has a five-year term and matures on June 1, 2023.
Beginning June 1, 2018, Jireh made consecutive monthly payments of principal and
interest to the Bank. The outstanding principal accrues interest at a fixed rate
of 5.04% per annum on the basis of a 360-day year. The loan agreement contains
customary restrictive covenants and includes certain financial covenants that
require the Company to maintain, on a consolidated basis, specified financial
ratios. In August 2021, Jireh signed an amendment of this loan with the Bank to
modify the financial covenants requirement to align with the new term loan
agreement entered into on August 18, 2021 discussed above. The amendment was
accounted for as a debt modification and no gain or loss was recognized. The
Company was in compliance with these covenants as of March 31, 2022. As of
March 31, 2022, the outstanding balance of the term loan was $14.4 million.

On August 15, 2017, Jireh entered into a credit agreement with the Bank that
provided a term loan in an amount up to $30.0 million for the purpose of
purchasing certain equipment for the Company's fabrication facility located in
Oregon.  The obligation under the credit agreement is secured by substantially
all assets of Jireh and guaranteed by the Company.  The credit agreement has a
five-year term and matures on August 15, 2022. In January 2018 and July 2018,
Jireh drew down the loan in the amount of $13.2 million and $16.7 million,
respectively. Beginning in October 2018, Jireh is required to pay to the Bank on
each payment date, the outstanding principal amount of the loan in monthly
installments.  The loan accrues interest based on an adjusted LIBOR as defined
in the credit agreement, plus a specified applicable margin in the range of
1.75% to 2.25%, based on
                                       44
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the outstanding balance of the loan.  The credit agreement contains customary
restrictive covenants and includes certain financial covenants that require the
Company to maintain, on a consolidated basis, specified financial ratios and
fixed charge coverage ratio. In August 2021, Jireh signed an amendment of this
loan with the Bank to modify the financial covenants requirement to align with
the new term loan agreement entered into on August 18, 2021 discussed above. The
amendment was accounted for as a debt modification and no gain or loss was
recognized. The Company was in compliance with these covenants as of March 31,
2022. As of March 31, 2022, the outstanding balance of the term loan was $3.7
million.

In September 2017, the Board of Directors approved a repurchase program (the
"Repurchase Program") that allowed us to repurchase our common shares from the
open market pursuant to a pre-established Rule 10b5-1 trading plan or through
privately negotiated transactions up to an aggregate of $30.0 million. The
amount and timing of any repurchases under the Repurchase Program depend on a
number of factors, including but not limited to, the trading price, volume and
availability of our common shares. Shares repurchased under this program are
accounted for as treasury shares and the total cost of shares repurchased is
recorded as a reduction of shareholders' equity. We did not repurchase any
shares pursuant to the Repurchase Plan during the nine months ended March 31,
2022. Since the inception of the program, we repurchased an aggregate of
6,784,648 shares for a total cost of $67.3 million, at an average price of $9.92
per share, excluding fees and related expenses.  As of March 31, 2022, of the
6,784,648 repurchased shares, 166,645 shares with a weighted average repurchase
price of $10.07 per share, were reissued at an average price of $5.02 per share
pursuant to option exercises and vested restricted share units. We had $13.4
million remained available under the Repurchase Program as of March 31, 2022.

We believe that our current cash and cash equivalents and cash flows from
operations will be sufficient to meet our anticipated cash needs, including
working capital and capital expenditures, for at least the next twelve months.
In the long-term, we may require additional capital due to changing business
conditions or other future developments, including any investments or
acquisitions we may decide to pursue. If our cash is insufficient to meet our
needs, we may seek to raise capital through equity or debt financing. The sale
of additional equity securities could result in dilution to our shareholders.
The incurrence of indebtedness would result in increased debt service
obligations and may include operating and financial covenants that would
restrict our operations. We cannot be certain that any financing will be
available in the amounts we need or on terms acceptable to us, if at all.

Cash, cash equivalents and restricted cash


As of March 31, 2022 and June 30, 2021, we had $323.4 million and $204.8 million
of cash, cash equivalents and restricted cash, respectively. Our cash, cash
equivalents and restricted cash primarily consist of cash on hand, restricted
cash, and short-term bank deposits with original maturities of three months or
less. Of the $323.4 million and $204.8 million cash, cash equivalents and
restricted cash, $277.0 million and $134.6 million, respectively, are deposited
with financial institutions outside the United States.

The following table presents our cash flows from operating, investing and financing activities for the periods indicated:

                                                                          Nine Months Ended March 31,
                                                                          2022                    2021
                                                                                (in thousands)
Net cash provided by operating activities                          $        193,196          $    84,524
Net cash used in investing activities                                       (91,142)             (40,412)
Net cash provided by (used in) financing activities                          16,351              (16,323)

Effect of changes in exchange rates on cash, cash equivalents and restricted cash

                                                                 152                3,982

Net increase in cash, cash equivalents and restricted cash $118,557 $31,771




                                       45
--------------------------------------------------------------------------------

Cash flow from operating activities


Net cash provided by operating activities of $193.2 million for the nine months
ended March 31, 2022 resulted primarily from net income of $438.1 million and
net changes in assets and liabilities using cash of $62.0 million, partially
offset by non-cash expenses of $306.9 million. The non-cash expenses of $306.9
million primarily included $399.1 million of gain on deconsolidation of the JV
Company, partially offset by $3.1 million of loss on changes of equity interest
in the JV Company, $30.0 million of deferred income tax on deconsolidation and
changes of equity interest in the JV Company, $34.3 million of depreciation and
amortization expenses, $1.1 million of loss on equity investment, $21.5 million
of share-based compensation expense, and $2.2 million of deferred income taxes.
The net changes in assets and liabilities of $62.0 million were primarily due to
a $65.1 million increase in accrued and other liabilities, a $3.5 million
increase in income taxes payable on deconsolidation and changes of equity
interest in the JV Company, a $15.6 million increase in accounts payable due to
timing of payments, and a $34.4 million increase in other payable from equity
investee, partially offset by a $3.6 million increase in accounts receivable as
a result of timing of the shipments and payments collected, a $42.9 million
increase in inventories as a result of our inventories built up for preparation
of uncertainty of supply chains, a $10.1 million increase in other current and
long-term assets due to increase in advance payments to vendors.

Net cash provided by operating activities of $84.5 million for the nine months
ended March 31, 2021 resulted primarily from net income of $36.3 million and
non-cash expenses of $50.1 million, partially offset by net changes in assets
and liabilities using cash of $1.9 million. The non-cash expenses of $50.1
million primarily included $39.4 million of depreciation and amortization
expenses, $9.9 million of share-based compensation expense and $0.7 million of
deferred income taxes. The net changes in assets and liabilities of $1.9 million
were primarily due to a $20.4 million increase in accounts receivable as a
result of higher revenue, a $9.6 million increase in inventories due to a
continued ramp of the JV Company, a $2.3 million increase in other current and
long-term assets due to increase in advance payments to vendors, and a $0.2
million decrease in accounts payable due to timing of payments, partially offset
by a $29.6 million increase in accrued and other liabilities and a $1.1 million
increase in income taxes payable.

Cash flow from investing activities


Net cash used in investing activities of $91.1 million for the nine months ended
March 31, 2022 was primarily attributable to cash disposed upon deconsolidation
of the JV Company of $20.7 million, purchases of property and equipment of $15.0
million for the JV Company, and purchases of property and equipment of $83.0
million for other than the JV Company, partially offset by proceeds from the
sale of equity interest in the JV Company of $26.3 million and government grants
related to fixed assets of $1.2 million.

Net cash used in investing activities of $40.4 million for the nine months ended
March 31, 2021 was primarily attributable to $40.5 million purchases of property
and equipment, including $15.6 million purchased by the JV Company.

Cash flow from financing activities


Net cash used in financing activities of $16.4 million for the nine months ended
March 31, 2022 was primarily attributable to $59.3 million proceeds from
borrowings, and $3.3 million of proceeds from exercise of stock options and
ESPP, partially offset by $33.7 million in repayments of borrowings, $4.2
million in payment of finance lease obligations, and $8.4 million in common
shares acquired to settle withholding tax related to vesting of restricted stock
units.

Net cash used in financing activities of $16.3 million for the nine months ended
March 31, 2021 was primarily attributable to $44.1 million in repayments of
borrowings, $12.3 million in payment of finance lease obligations, and $6.2
million in common shares acquired to settle withholding tax related to vesting
of restricted stock units, partially offset by $42.9 million proceeds from
borrowings and $3.3 million of proceeds from exercise of stock options and ESPP.

Commitments

See Note 12 of the Notes to the Summary Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q for a description of the covenants.

Off-balance sheet arrangements

From March 31, 2022we had no material off-balance sheet arrangements as defined in SK 303(a)(4)(ii).

Contractual obligations

                                       46
--------------------------------------------------------------------------------


There were no material changes outside of our ordinary course of business in our
contractual obligations from those disclosed in our Annual Report on Form 10-K
for the fiscal year ended June 30, 2021.

Recent accounting pronouncements


See   Note 1   of the Notes to the Condensed Consolidated Financial Statements
contained in this Quarterly Report on Form 10-Q for a description of recent
accounting pronouncements, including the expected dates of adoption and
estimated effects on results of operations and financial condition, which is
incorporated herein by reference.

                                       47

————————————————– ——————————

© Edgar Online, source Previews

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AI-powered contact centers can ease the workload https://atlantic-storm.org/ai-powered-contact-centers-can-ease-the-workload/ Tue, 10 May 2022 17:41:59 +0000 https://atlantic-storm.org/ai-powered-contact-centers-can-ease-the-workload/

What is the most basic business proverb? The direct answer is: “The customer is king”. Therefore, companies invest significant energies in designing their products or solutions that please the king. But unfortunately, the royal experience is often interrupted as soon as customers reach out to their favorite brand’s contact center with questions or troubleshooting. There are many reasons for this issue, including overloaded contact center agents, lack of contextual data on previous customer engagements, or simply waiting too long in the queue for the call to be answered. .

Using a pair of optimistic glasses, the challenge is also a significant opportunity to convert customers, aka kings, into true brand ambassadors. All a brand needs to do is fix the broken parts of the contact center experience. Fortunately, technology offers an easy way to do this. As a first step, it is essential to identify appropriate AI-based solutions that automate the iterative parts of the contact center experience. An experienced technology partner can help you with this process by analyzing previous customer voice, email, and chatbot interactions. Recordings or transcripts of these interactions are run through analytics engines capable of natural language processing to identify areas where engagement is falling flat. The exercise helps to understand which parts of customer engagements should be automated for a better result. The result is an optimally automated contact center that delivers a fast, accurate, and emphatic customer experience.

While automation eases the workload of contact center agents, it’s not the end of the game. After all, customer service is all about the warmth, rationality and empathy that only a human can. to offer. When customers arrive at the contact center, they seek reassurance that the issue can be resolved in “X” time and that someone is concerned about their situation as well. Therefore, the next important step is to restructure and retrain human agents to focus on critical incidents that require human intervention. These agents will be aided by more contextual data about a customer or issues through the automated system that remembers and analyzes every past interaction. Thus, if a client calls the contact center to follow up on her complaint, she does not need to repeat her entire file to a new agent. Based on in-depth data analysis, the system collects more insights into the customer’s engagement with the company. By leveraging this knowledge base, human agents continue to become more effective at solving problems. Ultimately, don’t treat a customer like a claim ticket number. She is a human first and she is treated as such. Humans need data, information and solutions, but they need empathy from their fellow human beings.

Based on the use case above, companies need to identify the right balance between technology and connectivity to provide customers with a unique contact center experience. Overuse of automation, for example, simply providing an automated chatbot or auto-response ID, can leave customers frustrated and unhappy in emergency situations. Consider your favorite taxi aggregator service that only offers an automated chat option when multiple drivers cancel your ride request after midnight. On the other hand, too much reliance on human agents makes the system inefficient and leaves room for errors or other undesirable violations of service level agreements. Both of these extreme situations are brand detrimental and should be avoided. A better way is to critically analyze every aspect of the contact center experience through deep data analysis and incremental investment in automating the parts where there is an engagement gap. Continuous analysis keeps the customer experience intact and also identifies areas where technology can help improve efficiency. Thereafter, it is important to continuously train agents to focus only on the critical parts of the conversation and expand the use of technology to peripheral parts of the business based on initial experience. Identifying an experienced and knowledgeable technology partner makes this journey very rewarding for companies.

Rashi Gupta is chief data scientist and co-founder of Rezo.ai.

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Biden will criticize Republicans as having no plan on inflation https://atlantic-storm.org/biden-will-criticize-republicans-as-having-no-plan-on-inflation/ Tue, 10 May 2022 09:02:00 +0000 https://atlantic-storm.org/biden-will-criticize-republicans-as-having-no-plan-on-inflation/

U.S. President Joe Biden arrives to deliver a speech on expanding high-speed internet access, during a Rose Garden event at the White House in Washington, U.S., May 9, 2022. REUTERS/Kevin Lamarque /File Photo

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WASHINGTON, May 10 (Reuters) – U.S. President Joe Biden will use a speech on inflation on Tuesday to turn his Democratic party’s main political responsibility ahead of the midterm elections into an argument against Republicans.

As Americans worry about a spike in inflation that has pushed consumer prices up more than 8%, the president will highlight a number of steps his administration has taken to bring prices down.

He is not expected to announce any new policy measures in the speech, which comes a day before new consumer price data shows inflation remained elevated through April.

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But he is expected to step up his attacks on Republicans six months before the Nov. 8 midterm elections, where Democrats want to retain narrow majorities in the Senate and House of Representatives.

“Republicans love to use inflation as a political talking point, but does anyone have any idea what their plan is to bring prices down?” said a White House official who asked not to be named.

Demand spurred by government spending and savings accumulated during the COVID-19 pandemic has failed to keep up with creaky supply chains and labor shortages, driving up the inflation on a global scale.

This has created a political problem as American consumers face higher grocery and gas bills, exacerbated by measures blocking Russian oil and gas after its invasion of Ukraine, actions Moscow calls ” a special operation.

According to a Reuters/Ipsos poll last week, less than half of American adults – 44% – approve of Biden’s handling of the presidency and see the economy as the country’s most important issue.

Republicans are trying to capitalize on the issue in the medium term, promoting measures such as easing regulations on oil and gas producers as well as cutting some taxes and government spending. But the party has not approved any policy documents outlining the measures it would take against inflation.

Biden has stepped up his attack on Republicans in recent days, including calling former President Donald Trump’s “Make America Great Again” movement extreme. Read more

“Voters know that Republican-led states are leading the way in economic recovery and job creation, and will vote for Republicans and our proven platform in November,” said National Committee spokeswoman Emma Vaughn. republican.

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Reporting by Trevor Hunnicutt; Editing by Kenneth Maxwell

Our standards: The Thomson Reuters Trust Principles.

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West Side Rag” “Nothing About Us Without Us”; AMNH Northwest Coast Lobby Reopens Friday with a New Perspective https://atlantic-storm.org/west-side-rag-nothing-about-us-without-us-amnh-northwest-coast-lobby-reopens-friday-with-a-new-perspective/ Mon, 09 May 2022 23:25:54 +0000 https://atlantic-storm.org/west-side-rag-nothing-about-us-without-us-amnh-northwest-coast-lobby-reopens-friday-with-a-new-perspective/

Posted on May 9, 2022 at 7:18 p.m. by West Side Rag

Renowned Tsimshian totem carver, David A. Boxley, and his grandson, Sage, listen to AMNH President Ellen Futter. Photograph by Peggy Taylor.

By Peggy Taylor

Ellen V. Futter, president of the American Museum of Natural History, in COVID quarantine, missed the preview of the Museum’s oldest gallery, the Northwest Coast Roomwhich will open its doors to the public on May 13. But she marked the momentous occasion via Zoom and saluted the Indigenous Nations co-curators, saying, “This completely redesigned and gloriously reinvigorated room would not have been possible without you.

D. Finnin/© AMNH.

Although the hall has existed since 1899, when it became the first permanent exhibition dedicated to the interpretation of cultures, it has always interpreted these cultures without the input of their members. That has now changed. After a five-year, $19 million renovation, the more than 1,000 artifacts on display are interpreted by the Indigenous communities themselves.

For five years, they collaborated with the curator of the Museum of North American Ethnology, Peter Whiteley, to present the gallery in a new and more meaningful way. Consultants from nine Indigenous communities also worked under the guidance of Nuu-chah-nulth scholar and cultural historian Haa’yuups, who unfortunately, like President Futter, was unable to attend the briefing. .

David R. Boxley, son of totem sculptor David A. Boxley, with his son, Sage Sanidad, Tsimshian. Photograph by Peggy Taylor.

Both chiefs were absent, but the co-curators were excellent back-ups as they brought the artifacts to life with stories, songs and dances to the sound of deer toes snapping from their elaborate ceremonial robes. They performed under the largest existing canoe on the Northwest Coast (65 feet long), which, once again suspended from the ceiling, allowed participants to fully admire the Haida and Haílzaqv designs that adorn it.

D. Finnin/© AMNH.

The presentations were so powerful that some attendees wanted the performers to be an integral part of the exhibit. But David A. Boxley noted, “We are not museum exhibits. We are a living and proud people, and we will continue. (This quote from one of the exhibits.) Garfield George of Clan Deisheetaan, Tlingit Nation, agreed, “People look at these artifacts and think wow, this is good. But they think we’re a dead culture, we’re not here anymore. But we say we are still here in our grandfather’s land.

The artifacts, not all new, are spread across eight alcoves and four corner galleries representing 10 nations. The alcoves have been reconfigured with walkways that facilitate the flow of visitors and, conceptually, reflect the porosity between these communities.

Unlike the original gallery, which opened directly to the artifact display cases, the reconfigured gallery begins, on the right, with a video featuring Indigenous experts explaining the history and persistence of the Northwest Coast peoples . On the left, the ‘Our Voices’ exhibit focuses on issues such as environmental conservation and racism.

“Nothing about us without us,” said James McGuire, curator of repatriations at the Haida Gwaii Museum in British Columbia, “We have gone from a people being studied to a people telling our own stories.”

THE ISSUE OF REPATRIATION

One of the great concerns of Native Americans, and one that museums around the world are facing, is that of repatriation. In the ongoing process of discovery, representatives of indigenous cultures have examined objects recovered from the Museum’s storerooms and found extraordinary treasures that have never been displayed to the public. Since 1998, the Museum has returned 1,850 significant objects to Native American peoples, guided by the Native American Graves Protection and Repatriation Act of 1990.

Beaver Canoe Bow Repatriation Photo courtesy of Garfield George, Householder, Deishú Hít, Deisheetaan Clan, Tlingit.

An example of an artifact that the Museum has returned to the Tlingit people is the beaver-shaped canoe prow of the only canoe to survive the bombardment of a Tlingit village by the United States Army in 1882 in Angoon, Alaska. In 1999, a Tlingit delegation discovered the beaver at the Museum and requested its repatriation. Today, he participates in all Tlingit ceremonies to remember hardship, resilience and healing.

For more information, click here. The American Museum of Natural History is located on Central Park West between 81st and 77th Streets and is open Wednesday through Sunday, 10 a.m. to 5:30 p.m.

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NY Jets EDGE Micheal Clemons has a surprisingly high pass-rush number https://atlantic-storm.org/ny-jets-edge-micheal-clemons-has-a-surprisingly-high-pass-rush-number/ Sun, 08 May 2022 23:30:15 +0000 https://atlantic-storm.org/ny-jets-edge-micheal-clemons-has-a-surprisingly-high-pass-rush-number/

Analysis of the strengths and weaknesses of New York Jets rusher Jermaine Johnson

Perhaps it’s the selection that finally teaches us to stop creating dummy drafts based on the needs of the position.

When the New York Jets entered Day 3 of the 2022 NFL Draft, the edge rusher position was far down the team’s list of important holes to fill. Still, they decided to close out their seven-man class by using a fourth-round high pick (117th overall) on Texas A&M rusher Micheal Clemons.

For the Jets to take Clemons — a nearly 25-year-old player in a strong position who has questions off the field — you know for a fact they had to be extremely optimistic about his skill level relative to the slot they’re in. chose. General manager Joe Douglas said the same thing when he called Clemons “the first [or] second-day talent.

Clearly Clemons was probably the best player available on the Jets’ roster by a significant margin, so they went ahead and took him despite his position, age and other red flags.

A quick look at Clemons’ statistical resume makes it clear why New York loved his talent enough to roll the dice on him.

Micheal Clemons was a dominant SEC passer in 2021

Clemons was a force in the passing game for Texas A&M last year. He put in big numbers and did it efficiently. In fact, he posted better stats in this phase than Jets first-round pick Jermaine Johnson (see more on Johnson’s pass-rush numbers here).

Over 10 games in 2021, Clemons has 46 total pressures, ranking fourth among SEC edge rushers and tied for 32nd among all FBS edge rushers. Those 46 pressures included 8 sacks (six full/two halves), 11 QB hits and 27 QB dispatches.

Collecting his 46 pressures from a total of 328 pass-rush snaps, Clemons recorded a pressure rate of 14.0%, which ranks in the 84th percentile among qualified FBS edge rushers.

Comparatively, Johnson had an equivalent total of 46 pressures last season, but he had two more games and another 87 quick passes. His pressure rate was 11.1% (62nd percentile).

Clemons’ win rate was 15.7%, good enough for the 71st percentile. That’s a respectable number, even if it’s well below his pressure rating. Johnson was also well behind Clemons in this category, with his 14.1% win rate ranking at the 60th percentile.

Of course, Clemons was 24 last season, which takes away from the impressiveness of his numbers. Good production should have been expected from him given that he faced players who could have been up to five years younger than him.

Clemons is actually a few months older than Quinnen Williams, who the Jets drafted in 2019.

It’s worrying that Clemons only started dominating last year. In his first three years with the Aggies (2017, 2019, 2020), Clemons had a 7.6% pressure ratio (39 pressures on 512 pass-rush snaps), which is well below the league average. post. It took him a while to stand out from his peers.

While Clemons’ age puts a glaring asterisk on his output, the bottom line is that he put up top numbers as a passing thrower last year. He enters the NFL having shown that he is capable of getting after the quarterback at a solid level of efficiency.

To allay concerns about his age, Clemons will have to rapidly prove he can translate his collegiate output to the NFL. The league is unlikely to have much patience for the development of a fourth-round pick who is the same age as NFL veterans who are already on their second contract.

Run defense is a concern for Clemons

Aside from his age and his off-court issues, Clemons’ run defense is the main weakness that brought him down in the fourth round despite his prowess in the passing game.

Clemons earned a 65.5 run defense rating at Pro Football Focus in 2021, which ranked only in the 46th percentile among qualified rushers. That’s a disappointing ranking for a 24-year-old player with exceptional physical tools (which we’ll talk about in the next section).

As a running defender, Clemons struggled with both finishing and play.

Clemons missed six tackles against the run. His 18.8 percent missed tackle rate against the run ranked in the 18th percentile among top rushers.

Clemons also showed no signs of making key saves in the running game. He made just 10 run saves on 218 snaps against the run, a 4.6% rate that ranks in the 28th percentile among top rushers.

Physical and athletic profile

Boasting remarkable length, Clemons has the perfect build for a 4-3 defensive end.

Here’s a look at some of Clemons’ measurables and their ranking among the top rushers in NFL combine history:

  • Height: 6′ 5¼” (86th percentile)
  • Weight: 263 pounds (39th percentile)
  • Wingspan: 83⅛” (88th percentile)
  • Arm length: 34⅞” (89th percentile)
  • Hand circumference: 10″ (58th percentile)

Clemons competed in the bench press and wide jump at the combine, then performed other drills on his pro day.

Here are Clemons’ sports test numbers and their respective Relative Athletic Score (RAS) ratings on a scale of 0-10 (0.0 being the worst ever for a peak prospect, 10.0 being the best, and 5 ,0 being the 50th percentile):

  • Bench press: 24 repetitions (7.12)
  • Vertical jump: 35″ (8.41)
  • Long jump: 116″ (6.74)
  • 40 yard run: 4.85s (5.93)
  • 10-yard split: 1.65s (7.88)
  • Shuttle 20 yards: 4.45s (5.81)
  • 3 cones: 7.20s (7.20)

Clemons’ 40-yard rush time of 4.85 seconds is only slightly above average for the position (5.93 RAS), but he showed his impressive burst with a much better split time 10-yard 1.65 seconds (7.88 RAS). His vertical leap of 35 inches (8.41 RAS) is further proof of his explosiveness.

Use/role

Clemons played both sides of the line for the Aggies but leaned slightly to the left side. He played 60.0% of his defensive snaps on the left side of the defensive line in 2021.

Clemons primarily played defensive end with his hand in the dirt, but was often asked to stand up and play outside linebacker on the edge. He got up in an outside linebacker lineup on 37.0% of his snaps.

Micheal Clemons can be a useful situational rusher for the Jets

As a rookie, I’d expect Clemons to compete for snaps as a situational passing thrower at the defensive end in the Jets’ 4-3 scheme, likely jockeying for third and fourth on the depth chart EDGE behind Carl Lawson and Jermaine Johnson. Bryce Huff, Jacob Martin and Vinny Curry will probably be his main competitors.

I’d be surprised if Clemons becomes a star or a much-above-average starter down the line. His run defense is questionable and his age suggests his cap is very limited.

However, Clemons’ long build, explosive flurry, high-level production a year ago, and vast experience/age combine to give him a strong chance of providing better rookie contributions than most fourth-round picks. round. He has a good chance of carving out a role right away even if his long-term potential isn’t supreme.

Clemons is a solid element in the Jets’ defense and should be able to turn that into a decent dose of passing shots this year. He will provide the ability to produce splashy moments as a passing thrower from time to time, allowing the Jets to rest their starters while maintaining off-the-edge explosiveness in passing situations.

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G7 to phase out Russian oil, US sanctions Gazprombank executives over Ukraine war https://atlantic-storm.org/g7-to-phase-out-russian-oil-us-sanctions-gazprombank-executives-over-ukraine-war/ Sun, 08 May 2022 18:20:00 +0000 https://atlantic-storm.org/g7-to-phase-out-russian-oil-us-sanctions-gazprombank-executives-over-ukraine-war/

U.S. President Joe Biden delivers remarks on economic growth, jobs and deficit reduction in the Roosevelt Room of the White House in Washington, U.S., May 4, 2022. REUTERS/Evelyn Hockstein

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WILMINGTON, Delaware, May 8 (Reuters) – The Group of Seven (G7) countries pledged on Sunday to ban or phase out imports of Russian oil and the United States unveiled sanctions against leaders of Gazprombank and other companies to punish Moscow for its war against Ukraine.

The move represents the West’s latest attempt to pressure Russian President Vladimir Putin for his country’s invasion of Ukraine and the resulting deadly consequences. Read more

President Joe Biden joined G7 leaders in a videoconference with Ukrainian President Volodymyr Zelenskiy to discuss war, support for Ukraine and further action against Moscow, including on energy. Read more

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“We are committed to phasing out our dependence on Russian energy, including by removing or prohibiting the import of Russian oil. We will ensure that we do so in a timely and orderly manner,” the leaders of the G7 in a joint statement. “We will work together and with our partners to ensure a stable and sustainable global energy supply and affordable prices for consumers.”

Meanwhile, the United States unveiled sanctions against three Russian TV stations, banned Americans from providing accounting and consulting services to Russians, and imposed some 2,600 visa restrictions on Russian and Belarusian officials.

The action taken against Gazprombank executives was the first involving the Russian gas exporting giant, as the United States and its allies avoided taking action that could lead to disruptions in gas supplies to Europe, main customer of Russia. Read more

Sanctioned Gazprombank executives include Alexy Miller and Andrey Akimov, according to a statement from the US Treasury Department.

“It’s not a complete block. We’re not freezing Gazprombank’s assets or prohibiting any transactions with Gazprombank,” a senior Biden administration official told reporters. “What we are signaling is that Gazprombank is not a safe haven, and so we are sanctioning some of their key corporate executives…to create a deterrent effect.”

Biden, who hailed Western leaders’ unity in standing up to Russian President Vladimir Putin, met via video conference from his home in Delaware, where he is spending the weekend.

The meeting comes ahead of Russia’s Victory Day celebrations on Monday. Putin calls the invasion a “special military operation” to disarm Ukraine and rid it of anti-Russian nationalism fomented by the West. Ukraine and its allies say Russia has launched an unprovoked war. Read more

The United States and Europe have imposed crushing sanctions on Russia since its invasion, targeting banks, businesses and individuals in an effort to squeeze the Russian economy and limit the resources used to advance the war.

Eight executives of Sberbank (SBER.MM), which owns a third of Russia’s banking assets, have been added to the latest US sanctions list. The Moscow Industrial Bank (MOIBI.MM) and its 10 subsidiaries have also been added.

“Taken together, today’s actions are a continuation of Russia’s systematic and methodical withdrawal from the global financial and economic system. And the message is that there will be no safe haven for the Russian economy if Putin’s invasion continues,” the official said.

The new export control restrictions were aimed at directly undermining Putin’s war effort, including controls on industrial engines, bulldozers, wood products, motors and fans. The European Union is going along with additional controls on chemicals that directly feed the Russian military effort, the official said.

The limited liability company Promtekhnologiya, an arms manufacturer, was sanctioned, along with seven shipping companies and a marine towage company. The White House also said the Nuclear Regulatory Commission would suspend special nuclear material export licenses to Russia.

The sanctioned television stations are directly or indirectly controlled by the state, the White House said, and included the joint-stock company Channel One Russia, the television station Russia-1 and the joint-stock company NTV Broadcasting Company.

Americans will be banned from providing accounting, trust and business formation and management consulting services to Russians, although the provision of legal services will still be permitted.

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Reporting by Jeff Mason and Steve Holland; Additional reporting by Maria Sheahan; Editing by Daniel Wallis and Lisa Shumaker

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Namibians held in Angolan jails to be repatriated https://atlantic-storm.org/namibians-held-in-angolan-jails-to-be-repatriated/ Sun, 08 May 2022 06:09:12 +0000 https://atlantic-storm.org/namibians-held-in-angolan-jails-to-be-repatriated/

NAMIBIANS serving their sentences in Angola will soon be able to do so in their home countries.

This was revealed to The Namibian by Commissioner General of the Namibian Corrections Service Raphael Hamunyela on Wednesday.

Hamunyela said an agreement was signed by ministers responsible for corrections in Angola and Namibia in April 2019.

“We are currently busy with internal arrangements before starting the transfer of detainees between the two countries,” Hamunyela said.

Ratification of Namibia’s agreement on the transfer of sentenced persons is the only step remaining before it becomes operational.

“We are also busy mobilizing inmates to understand the benefits of transfers before starting the process.”

Detainees will have the right to request transfers to serve their sentences in their respective countries, Hamunyela said.

“Under the law, the country of origin will be responsible for covering the cost of transporting detainees to their country.”

Hamunyela said the requirements to be met by detainees will depend on the type of crimes they have committed.

“If the crime the detainee has committed is also considered a crime in the other country, then automatically that person qualifies for transfer. If it’s not a crime in the other country, then that person will have to serve their sentence in that country,” he said.

In addition, the receiving country cannot change the prisoner’s sentence period.

“The length of the sentence will remain as it is. If the person is to be released on parole, it must be agreed to by both governments, and only if the law of that country allows people who commit a specific crime to be released on parole or on probation,” Hamunyela added. .

Currently, approximately 34 Namibians are serving their sentences in Angola and approximately 150 Angolans are in Namibian Correctional Service facilities.

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Explore Financials: Leading Compound with Natural Inflation Hedging (NYSE: DFS) https://atlantic-storm.org/explore-financials-leading-compound-with-natural-inflation-hedging-nyse-dfs/ Sat, 07 May 2022 10:20:00 +0000 https://atlantic-storm.org/explore-financials-leading-compound-with-natural-inflation-hedging-nyse-dfs/

Violeta Stoimenova/E+ via Getty Images

Discover financial services (NYSE: Homeless) has earned a reputation for consistent financial performance (the company has compounded EPS at a rate of 14.8% since 2006) and the past quarter has been no different. While the company’s EPS was down last year because of reserve releases the previous year, DFS still managed to beat street estimates by 16.4%. This pace was largely driven by solid loan growth, higher net interest margin (NIM) and excellent expense control. In a tough labor and cost market, the company actually improved its operational efficiency while many peers saw their efficiency ratios increase. (Efficiency ratio = non-interest expenses / total income, so a higher ratio is bad).

Since DFS is a consumer-focused finance company, it is perhaps one of the “most hated” sectors in the market today (excluding travel). Incomes are correlated to employment and inflation levels and it looks like people’s economy (and therefore employment) is slowing or shrinking in Q4 2022 or Q1 2023. In short, even though we see the economy slowing down, we still see a strong labor market and maintaining high levels of nominal consumer spending. This bodes well for DFS’ loan growth and earnings going forward and we believe that at current levels, stocks are simply too cheap to ignore.

We are long on stocks in the $105-$110 range and believe that below $100 the stock is a “book the table” buy.

Earnings

Discover’s first quarter results would indicate something other than a weakening economy. Total loans grew 8.3% year-over-year as NIM expanded, driving year-over-year (“y/y”) revenue growth (adjusted to account for market value losses on equity investments) of 10.6%. Management has almost impressively brought costs under control, with non-interest expenses rising only 4.5%. This translated into growth of 14% in adjusted profit before tax and before provisions of 14%.

Management also increased its dividend by 20% to $0.60 per share and the board approved a $4.2 billion buyout which, at current prices, is equivalent to 13% of the company’s market capitalization. society.

Credit performance trends remain strong with net charge-off (NCO) rates across the portfolio well below their long-term averages.

Credit yield

Discover the financial services first quarter 2022 results presentation

Credit performance and balance sheet

American Express (AXP) gets a halo multiple because the company generally attracts higher-income, more resilient consumers (people who tend not to lose their jobs during a recession), leading to better credit performance. However, we draw your attention to the fact that since 2006, DFS has had NCO rates that are on average only 70 basis points higher than those of DFS.

NCO to Loans

Author’s graph, Data obtained from the company’s financial statements

Discover also appears to be running its business more conservatively with NPL loan loss reserves averaging 5.7 times higher since 2008 and significantly higher in recent years.

LL Reserves

Author’s graph, Data obtained from the company’s financial statements

Discover’s management team decided a few years ago to actually reduce the company’s cost of funding by creating an online banking business that could attract customer deposits. Interest rates on checking accounts and savings accounts tend to rise more slowly than lending rates, resulting in a greater benefit to income when interest rates rise. In the chart below, you’ll see that when the Fed started raising rates, fed funds peaked at 2.5%, up 200 basis points in 24 months. At the same time, the cost of DFS deposits peaked at 2.35%, which rose only 100 basis points over the same period.

Cost of deposits

Author’s graph, Data obtained from the company’s financial statements

You can see how the growth of the company’s consumer banking business has led to improved NIMs over time. In their most recent quarter, NIM was up 64 basis points year-on-year and 4 basis points quarter-on-quarter. Management expects NIM to rise another 10 to 15 basis points this year as the Fed continues to hike rates to fight inflation.

NIm

Author’s graph, Data obtained from the company’s financial statements

Discover also has a fortress balance sheet, carrying $16.6 billion in cash, plus a revolver capacity of $39.6 billion. This represents total liquidity of $56.2 billion. You can sleep well at night, so even during an economic downturn like the one we experienced in 2020, there are no funding issues to worry about. DFS is also rated Investment Grade with a BBB- rating from S&P.

capital position

Discover the financial services first quarter 2022 results presentation

Discover is becoming more bank-like every day, and the brand is strong. Accounts receivable have consistently grown between high and double digits (up 11% last quarter).

Composition

There are really only 3 other publicly traded consumer credit card companies; American Express, Synchrony Financial (SYF) and Capital One (COF). We believe there is a strong case that DFS belongs on the same tier in terms of valuation as AXP given that DFS’s ROE, CET1 ratio are on par with the company and the historical EPS growth track record of DFS is almost double that of AXP. We also highlight management’s strong ability to control credit when prudent to do so, which led to the sell-off in credit portfolio performance, as discussed above.

The only downside we can point out with DFS is that their loan to deposit ratio is significantly higher than their peers, which means the company is required to finance itself with corporate borrowings which are more expensive.

comp

Provide

We believe loan growth can grow conservatively by 4% to 4.5% over the next two years and provisions as a % of total loans will normalize over time to historic levels over the next two years. coming years. Provisions drive earnings down after large reserve releases, but overall still very strong EPS growth considering. Using our 2024 EPS estimate, the 5-year EPS CAGR is 10.2% well above the S&P 500 long-term average of 7% to 8%.

model

Evaluation

Although we reiterate again that we believe DFS deserves a closer multiple to AXP rather than a 55% discount. The long-term average is a 34% discount, which would equate to a multiple of 10.7x. To be conservative, we apply the 10-year average P/E multiple of 10x and 2.5x for the P/E ratio for valuation purposes.

We believe the stock’s downside is limited to $100 or around 10% from recent prices and see 40-50% upside potential over the next two years.

p/e valuation
p/b valuation

Conclusion

We believe Discover Financial Services is significantly undervalued given the quality of the business and the natural inflation hedge built into their operations. Management has created significant shareholder value over a long-term horizon and we believe management will continue to be prudent with investor capital and continue to seek ways to generate greater shareholder value.

We believe the stock’s relative outperformance speaks to the strength of the company’s balance sheet and the quality of the business. However, they will still be somewhat perplexed by the low multiple achieved by the stock given the strong track record of financial performance, especially coming out of the pandemic.

We believe this stock is an excellent long-term core investment for any portfolio. The growing dividend and dividend yield above 2% provide a current cash income that many are desperately seeking today. We also believe that the massive buyback program provides good support for equities in the event of significant declines in volatile markets.

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Southwest Gas settles board battle with Icahn, replaces CEO https://atlantic-storm.org/southwest-gas-settles-board-battle-with-icahn-replaces-ceo/ Sat, 07 May 2022 01:49:00 +0000 https://atlantic-storm.org/southwest-gas-settles-board-battle-with-icahn-replaces-ceo/

Billionaire activist-investor Carl Icahn gives an interview on Fox Business Network’s Neil Cavuto show in New York, U.S., February 11, 2014. REUTERS/Brendan McDermid/File Photo

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NEW YORK, May 6 (Reuters) – Southwest Gas Holdings (SWX.N) reached an agreement on Friday with Carl Icahn who will replace the company’s chief executive and cede up to four board seats to the billionaire investor .

The settlement ends a months-long battle that Icahn started with the Las Vegas, Nevada-based company in October as it pursued its plan to buy Questar Pipelines for about $2 billion.

Southwest Gas said it promoted Karen Haller to CEO and president, replacing John Hester immediately. Icahn said in a statement that no deal would have been reached without Hester leaving the company.

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“We are confident that she is the right leader for the future of Southwest Gas,” Board Chairman Michael Melarkey said in a statement about Haller.

Icahn will be allowed to appoint at least three directors after next week’s annual meeting. The company said a fourth director would join the board if the board decides not to spin off infrastructure services company Centuri, a move the company announced in March.

Southwest Gas said it would make a decision on the Centuri spin-off within 90 days of the deal.

Icahn, saying buying Questar would hurt shareholders, had sought to gain control of the board by trying to replace 10 directors and pushing for the ousting of the CEO. He called Hester and her management team a “great responsibility” for the company.

The board will have 11 directors, including 10 independent directors after the company’s annual meeting on Thursday.

Icahn, 86, has spent a career tangling with corporations and traditionally asks for a few board seats when he thinks corporations should be run better. He often settles with the company, then retires when his selected administrators become involved in operations.

Icahn said in a statement Friday that he rarely felt the need to oust a CEO, but when such a move was necessary, it “almost always dramatically increases value for ALL shareholders.” Icahn even offered to buy the company for $82.50 per share.

Last month, Southwest said it would consider selling itself, among other alternatives, after an unnamed potential buyer expressed interest in buying the company at a “far higher” price than Icahn’s offer.

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Reporting by Svea Herbst-Bayliss; Editing by William Mallard

Our standards: The Thomson Reuters Trust Principles.

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PhD student kills himself after failing to register for academic year after study permit expires https://atlantic-storm.org/phd-student-kills-himself-after-failing-to-register-for-academic-year-after-study-permit-expires/ Fri, 06 May 2022 18:08:53 +0000 https://atlantic-storm.org/phd-student-kills-himself-after-failing-to-register-for-academic-year-after-study-permit-expires/

The campus of the University of the Witwatersrand.

  • A Zimbabwean PhD student at the University of the Witwatersrand killed himself over the weekend after failing to register for his academic year.
  • Philippe ChumaThe study permit expired at the end of January.
  • The university said it was assisting in the repatriation of his body to Zimbabwe.

A Zimbabwean doctoral candidate, who was unable to register for the academic year at the University of the Witwatersrand because his study permit had expired, committed suicide last weekend, the report said. university.

Wits said Philip Chuma – described as a dedicated doctoral student at the School of Education for the past five years – could not enroll for the 2022 academic year.

Chuma’s study permit expired at the end of January 2022 and he was in regular contact with the Home Office to process his documentation.

Wits spokeswoman Shirona Patel told News24 the university is saddened by her death.

READ | A pupil jumps on the back of his teacher during a chaotic class fight in Johannesburg

“By law, the university cannot enroll students from other countries without a valid study permit. There have been no policy changes regarding international students in recent years, and the university has registered successfully 2,020 international students in 2022.

“Through its International Office, the university provides dedicated support to international students, and while we do our best to facilitate interaction between students, staff and home affairs, we cannot influence the results of the ministries,” she said.

According to department spokesperson Siya Qoza, they would need the passport or ID number to accurately respond to Chuma’s situation.

Education

Patel said Chuma was doing her PhD on the transition of newly qualified teachers into their first teaching position in Zimbabwean schools.

“He had recently completed his data analysis chapters and was busy interpreting his findings. He recently presented parts of his work at two international conferences and was due to submit his doctoral work for consideration later this year,” said she added.

The university said it was assisting in the repatriation of Chuma’s body to Zimbabwe.

In November 2021, the Cabinet took the decision not to renew the Zimbabwean exemption permits. About 182,000 Zimbabweans hold permits. They had 12 months to apply to migrate to other permit regimes suited to their personal situation.

The decision to cancel the permit angered Zimbabweans and rights groups who took the government to court, but the result was unsuccessful.

Civil rights groups have argued that it would be impossible for current permit holders to successfully apply for other permits.

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