SkyWater Technology, IncSKYT

SkyWater Technology, Inc Fair Value Disclosure

10-KFiled Mar 11, 20262 min read
Fair Value Measurements
Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To determine fair value, the Company uses a fair value hierarchy categorized into three levels based on the inputs used in the fair value measurement. Generally, the three levels are as follows:
•Level 1 – Quoted prices in active markets for identical assets or liabilities;
•Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and
•Level 3 – Unobservable inputs that are supported by little, or no, observable market activity and that are significant to the fair value of the assets or liabilities.
Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, and other financial working capital items approximate fair values at December 28, 2025 and December 29, 2024 due to the short maturity of these items. The carrying amount of the borrowing under the Revolver approximates its fair value due to the frequency at which the interest rate resets. The fair value of the Revolver was determined based on inputs that are classified as Level 2 in the fair value hierarchy.
The Company's non-financial assets, including property and equipment and intangible assets, are initially recorded at cost upon acquisition, or at fair value if acquired via a business combination. Non-financial assets are remeasured at fair value only if an impairment charge is recognized. No impairment charges were incurred in the fiscal years ended December 28, 2025, and December 29, 2024.
As of December 28, 2025 and December 29, 2024, the Company did not have any assets or liabilities measured at fair value on a non-recurring basis.

Historical Timeline

Fiscal YearFiled
2025Mar 11, 2026Showing above
2024Mar 14, 2025
2023Mar 15, 2024
2022Mar 10, 2022

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

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