What Arteris, Inc. told the SEC could break it.

Arteris derived 60.3% of 2025 revenue from outside the United States, including 24.5% from customers in China (down from 29.2% in 2024 and expected to decrease further due to U.S. trade restrictions), and conducts sales and R&D across the SF Bay Area, Texas, France, Poland, China and South Korea; this international/China concentration exposes it to Chinese economic, political and regulatory conditions and to FX and geopolitical risk.

“We derived 60.3% and 62.3% of our revenue for the years ended December 31, 2025, and 2024, from sales to customers outside of the United States. In particular, we derived 24.5% and 29.2% of our revenue for the years ended December 31, 2025 and 2024 from customers located in China.”

Arteris's business tracks the highly cyclical semiconductor industry, where downturns — driven by factors including the COVID-19 pandemic and ongoing U.S.-China trade disputes — bring diminished product demand, production overcapacity, high inventory levels and accelerated average-selling-price erosion; prolonged or significant industry downturns directly reduce demand for its interconnect IP and SoC-integration software.

“These downturns have been characterized by diminished product demand, production overcapacity, high inventory levels and accelerated erosion of average selling prices.”

Arteris's revenue has been concentrated among a small number of licensees and customers, so the loss of any of these customers — or failure to attract new ones or expand existing relationships — would materially affect revenue; recognized revenue from licensing arrangements also varies quarter to quarter depending on the number and size of deals closed, making results lumpy and hard to predict. (Customers not individually named.)

“Our revenue has been concentrated among a small number of licensees and customers, and if we lose any of these customers and fail”

As a semiconductor-IP licensor with significant China revenue, Arteris is directly exposed to U.S. Commerce/BIS export controls — modified in October 2022, October 2023, April 2024 and expanded in December 2024 to cover advanced semiconductors used in weapons/AI — which it expects to reduce its China revenue, plus 2025 U.S. tariffs on China and the EU and potential retaliatory countermeasures and China-Taiwan tensions, all of which could impair demand and competitive position.

“In December 2024, BIS further expanded export controls on certain advanced semiconductors that can be used in advanced weapon systems and in AI and advanced computing products. We must continue to comply with such regula”