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

Because Calix's sole-source and limited-source component suppliers are concentrated in China and other Asian countries, U.S. trade policy directly raises its input costs. An April 2025 executive order increased tariffs on imports from numerous countries including China and other Asian nations; while the majority of Calix's finished goods are currently exempt, the tariffs on imported components used in domestic manufacturing and certain finished goods increased its cost of revenue. Further tariff escalation or retaliatory measures could raise costs and dampen customer demand.

“in April 2025, the U.S. President signed an executive order increasing tariffs on imports from numerous countries, including China and other Asian countries where our sole-source or limited-source suppliers are located. Currently, the majority of our finished goods are exempt from tariffs. For imported components for domestic manufacturing and certain finished goods, these actions increased our cost of revenue.”

Calix's broadband appliances depend on sole-source or limited-source suppliers for key components — chipsets, certain application-specific integrated circuit (ASIC) processors, and memory and resistor components — with certain components sourced solely through suppliers in China and other Asian countries. Any of these suppliers could halt production, raise prices, be hit by higher tariffs or disruptions, cease operations, or sign exclusive deals with competitors. The exposure is heightened by industry-wide memory supply constraints and the DDR4-to-DDR5 transition, which can constrain availability and raise component costs for its hardware.

“We are dependent upon sole-source or limited-source suppliers for some key product components such as chipsets, certain of our application-specific integrated circuit processors and memory and resistor components, including certain components sourced solely through suppliers located in China and other Asian countries.”