Table of Contents generated at or adjacent to those properties, except for residential account holders in a multi-family residential property. Both of these policy changes in California reduced demand for solar PV systems in the year ended December 31, 2023 and may continue to do so for future inverter sales. However, the reduction in export compensation under NEM 3.0, coupled with rising utility rates, may encourage deployment of battery energy storage with solar PV systems and mitigate some of the demand reductions. Seasonality Historically, the majority of our revenue are from the North American and European regions which experience higher sales of our products in the second, third and fourth quarters and have been affected by seasonal customer demand trends, including weather patterns and construction cycles. The first quarter historically has had softer customer demand in our industry, due to these same factors. Although these seasonal factors are common in the solar sector, historical patterns should not be considered a reliable indicator of our future sales activity or performance. Environment and Climate Change We have understood the climate change threat from the beginning and have been creating clean energy technologies needed to directly combat it, protect our environment and enable sustainable development. We recognize our ability to do so rests on our capacity to understand, anticipate and successfully navigate various types of climate risk. Our strategy is advancing solutions to meet any number of climate risk mitigation opportunities – solar energy equipment, battery storage, EV charging, smart load management and integration with grid modernization efforts. We align our risk assessment and climate strategy with the recommendations of the Taskforce for Climate- Related Financial Disclosures (“TCFD”), as all existing and emerging climate risk disclosure regulations are modeled on this framework. We issued our third TCFD aligned Environmental, Social and Governance Report in 2023 and plan to follow up with another aligned report in 2024. We believe that sound corporate governance is critical to helping us achieve our goals, including with respect to designing products that address both energy generation and consumption. We continue to evolve a governance framework that exercises appropriate oversight of responsibilities at all levels throughout the company and manages its affairs consistent with high principles of business ethics and advancing a sustainable future for all. Human Capital Resources As of December 31, 2023, we had 3,157 full-time employees. Of the full-time employees, 1,218 were engaged in research and development, 1,220 in sales and marketing, 283 in general and administration, 268 in solar system configuration design and permitting services and 168 in manufacturing and operations. Of these employees, 1,002 were in the United States, 1,696 in India, 223 in Europe, 118 in New Zealand, 29 in Australia, 25 in Mexico, 24 in Canada, 24 in China, and 16 in Brazil. None of our employees are represented by a labor union; however, our employees in France are represented by a collective bargaining agreement. We have not experienced any employment-related work stoppages, and we consider our relations with our employees to be good. Culture Supporting our purpose of “Advancing a sustainable future for all,” all employees are expected to uphold the following core values that drive our culture: • Customer First • Integrity • Innovation • Teamwork • Quality These core values are represented by how we work together, how we perform and how we all get rewarded. Values are reinforced in new hire training, culture workshops and everyday interactions. Enphase Energy, Inc. | 2023 Form 10-K | 15