Beneficial owners of shares held in street name must contact their broker, bank or other agent to revoke any prior voting instructions.

Voting Results

Preliminary voting results will be announced at the Annual Meeting. In addition, final voting results will be published in a current report on Form8-K that the Company expects to file within four business days after the Annual Meeting. If final voting results are not available in time to file a Form8-K within four business days after the meeting, the Company intends to file a Form8-K to publish preliminary results and, within four business days after the final results are known, file an additional Form8-K to publish the final results.

Important Notice Regarding Availability of Proxy Materials

This Proxy Statement and our 20182020 Annual Report to Shareholders are available atwww.edocumentview.com/AMBA. Please promptly vote your shares as instructed in the Notice of Internet Availability. This will not limit your rights to attend or vote at the Annual Meeting.

PROPOSAL 1

ELECTION OF CLASS IIIII DIRECTORS

Ambarella’s Board of Directors, or the Board, currently has seven (7)eight (8) members. The authorized number of directors may be changed by resolution of the Board.Board and the Board intends to increase the authorized number of directors to nine (9) members prior to the Annual Meeting. Vacancies on the Board may be filled only by a majority of the remaining directors even if less than a quorum, unless the Board determines that the vacancies shall be filled by the shareholders. A director elected to fill a vacancy in a class, including vacancies created by an increase in the number of directors, shall serve for the remainder of the full term of that class and until the director’s successor is duly elected and qualified.

The Board is divided into three classes, Class I, Class II and Class III, which serve staggered three-year terms:

Dr. Hsiao-Wuen Hon was appointed to the Board by the remaining directors in August 2017 to fill the vacancy on the Board created whenLip-Bu Tan’s term expired at the 2017 annual meeting of shareholders. The Board, upon the recommendation of the nominating and corporate governance committee, has selected Dr. Hon, Christopher B. PaisleyMr. Kohn, Mr. Richardson and Andrew W. VerhalenMs. Schwarting as nominees for election as Class IIIII directors at the upcoming Annual Meeting. Ms. Schwarting is not currently a member of the Board and is standing for election for the first time. The proxies given to the proxy holders will be voted or not voted as directed and, if no direction is given, will be voted FOR each of the three (3) nominees. If any nominee is unable or declines to serve as director at the time of the Annual Meeting, an event not now anticipated, proxies will be voted for any nominee designated by the Board to fill the vacancy. The three (3) nominees for Class IIIII director receiving the highest number of affirmative votes will be elected as Class IIIII directors and will serve until the annual meeting of shareholders to be held in 20212023 or until their successors are elected and qualified.

The names of the nominees for election as Class IIIII directors, who have been nominated by the Board, and the names of the continuing directors not up for election at the Annual Meeting, along with certain biographical information about the nominees and continuing directors, including the director’s business experience, public company director positions held currently or at any time during the last five years, information regarding involvement in certain legal or administrative proceedings (if applicable), and the experiences, qualifications, attributes or skills that caused the nominating and corporate governance committee to recommend that the director should continue to serve on the Board, are set forth below.

Christopher B. Paisley has served as a member of our Board since August 2012. Since January 2001, Mr. Paisley has served as the Dean’s Executive Professor of Accounting at the Leavey School of Business at Santa Clara University. Mr. Paisley also serves on the board of directors of Equinix, Inc., a provider of network

Microsystems, Mr. Kohn served in engineering and management positions with Sun Microsystems, Intel Corporation and National Semiconductor. Mr. Kohn holds a B.S. degree in physics from California Institute of Technology. We believe that Mr. Kohn possesses specific attributes that qualify him to serve as a member of our Board, including his role in developing our technology, his leadership as ourco-founder and his years of experience in the digital video industry.

D. Jeffrey Richardson has been a member of our Board since March 2014. Mr. Richardson served as a senior executive of LSI Corporation (“LSI”), a semiconductor company, from 2005 until LSI’s acquisition by Avago Technologies Company in May 2014, including most recently serving as LSI’s Executive Vice President and Chief Operating Officer. He earlier served as General Manager of the Semiconductor Solutions Group, Executive Vice President of the Networking and Storage Products Group, Executive Vice President and General Manager of the Custom Solutions Group and as Executive Vice President of Worldwide Strategic Planning. Prior to joining LSI, Mr. Richardson served in several capacities at Intel Corporation, including as its Vice President and General Manager of Server Platform Group and Vice President and General Manager of Enterprise Platforms and Services Division. Mr. Richardson currently serves on the board of directors of Lattice Semiconductor Corporation, a semiconductor company, and also served on the board of directors of Volterra Semiconductor Corporation, a provider of power management semiconductors, from April 2011 to October 2013, when Volterra was acquired by Maxim Integrated Products, Inc.2013. Mr. Richardson received a B.S. degree in electrical engineering from the University of Colorado Boulder. We believe that Mr. Richardson possesses specific attributes that qualify him to serve as a member of our Board, including his extensive managerial experience in the semiconductor industry as Chief Operating Officer of LSI and senior management positions with LSI and Intel, and as a board member of Lattice and Volterra.

Elizabeth M. Schwartinghas been nominated by the Board for election to the Board at the upcoming Annual Meeting. Since October 2015, Ms. Schwarting has been the Principal Member of DBS Ventures, LLC. where she serves as a consultant for various audiences relating to the automotive market, including automotive technology (with a special emphasis on ADAS/Automated Driving), regulatory trends and business development. From 2009 to 2015, Ms. Schwarting served as Vice President of the Electronic Controls business unit for Delphi Corporation (now Aptiv PLC), an automotive parts company. As a member of the Executive Committee, she led a global team responsible for the Automotive ADAS and Safety Electronics product lines, the Body Electronics and Security product lines as well Power Electronics (for Hybrid and Electric Vehicles). From 1999 to 2009, Ms. Schwarting held several leadership positions at Delphi, including Vice President, Safety Systems, Global Director, Sales and Marketing, and General Motors Global Customer Director. Prior to joining Delphi, Ms. Schwarting held the position of General Manager and Vice President, Strategic Accounts for Eastman Kodak Company within the Consumer Imaging Division. We believe that Ms. Schwarting possesses specific attributes that qualify her to serve as a member of our Board, including her extensive managerial experience in the automotive industry in senior management positions with Delphi, as well as her sales and customer management experience with Eastman Kodak.

Hsiao-Wuen Hon, PhD. has been a member of our Board since August 2017. Dr. Hon is currently the Corporate Vice President, Asia-Pacific R&D Group Chairman of Microsoft Corporation (“Microsoft”), a position he has held since October 2015. Previously, beginning in November 2007, he served as Managing Director of Microsoft Research Asia. Dr. Hon has been employed at Microsoft since 1995 in various capacities, including Deputy Managing Director of Microsoft Research Asia, Chief Architect of the Natural Interaction Service Division, and Principal Researcher. Prior to joining Microsoft, Dr. Hon served as Technology Director of theApple-ISS Research Center on behalf of Apple Corporation. Dr. Hon received a Bachelor of Science degree in Electrical Engineering from National Taiwan University, a Master of Science degree in Computer Science, Artificial Intelligence from Carnegie Mellon University, and a Ph.D. degree in Computer Science, Artificial Intelligence, Speech Recognition from Carnegie Mellon University. We believe that Dr. Hon possesses specific attributes that qualify him to serve as a member of our Board, including his extensive experience in artificial intelligence and managerial experience in the technology industry as Corporate Vice President, Asia-Pacific R&D Group Chairman of Microsoft.

Chenming C. Hu, Ph.D. has been a member of our Board since November 2011. Since 1976, Dr. Hu has been a professor in electrical engineering and computer sciences at the University of California, Berkeley, where he has been the TSMC Distinguished Chair Professor Emeritus and Professor in the Graduate School since 2010. He was the Chief Technology Officer of TSMC from 2001 to 2004. Dr. Hu was the founding chairman of Celestry Design Technologies, which was acquired by Cadence Design Systems in 2002. Dr. Hu also serves on the board of directors of Inphi Corporation, a fabless semiconductor company, and ACM Research, Inc., a semiconductor equipment producer. Dr. Hu previously served as a director of Fortinet, Inc. from 2012 to 2015, and SanDisk Corporation from 2009 to 2016, when it merged with Western Digital Corporation. Dr. Hu is a member of the U.S. National Academy of Engineering and the Chinese Academy of Sciences, and Taiwan’s Academia Sinica. Dr. Hu received his B.S. degree from National Taiwan University and his M.S. degree and Ph.D. from the University of California, Berkeley, all in Electrical Engineering. We believe that Dr. Hu possesses specific attributes that qualify him to serve as a member of our Board, including his extensive experience in the microelectronics and semiconductor industries as Chief Technology Officer of TSMC and as a current and former board member of a number of technology companies, as well as his experience in academia as a professor of microelectronics, which gives himin-depth knowledge of current technology trends and developments.

Teresa H. Meng, Ph.D. has been a member of our Board since October 2018. Dr. Meng is a Professor Emerita and was the Reid Weaver Dennis Professor of Electrical Engineering at Stanford University until 2013, focusing onlow-power circuit and system design, video signal processing, and wireless communications. Dr. Meng took leave from Stanford in 1998 and founded Atheros Communications Inc., a provider of semiconductor system solutions for wireless network communications products, after which she returned to Stanford in 2000 to continue her teaching and research. Atheros Communications was acquired by Qualcomm Incorporated in 2011. Dr. Meng currently serves as a consultant and member of the advisory board of Atmosic Technologies. Dr. Meng is a Fellow of the IEEE and a member of the National Academy of Engineering. She holds a B.S degree in Electrical Engineering from National Taiwan University and M.S. and Ph.D. degrees in Electrical Engineering and Computer Sciences from the University of California, Berkeley. We believe that Dr. Meng possesses specific attributes that qualify her to serve as a member of our board of directors, including her extensive experience inlow-power circuit and system design and video signal processing, as well as her experience in the technology industry as a founder of Atheros Communications.

Christopher B. Paisley has served as a member of our Board since August 2012. Since January 2001, Mr. Paisley has served as the Dean’s Executive Professor of Accounting at the Leavey School of Business at Santa Clara University. Mr. Paisley also serves on the board of directors of Equinix, Inc., a provider of network colocation, interconnection and managed services, Fastly, Inc., a cloud computing services provider, and Fortinet, Inc., a provider of unified threat management solutions. Mr. Paisley has decided to not stand forre-election to the board of Fitbit, Inc., a connected health and fitness company, at the end of the current term in May 2020, and so his service on that Board will end at that time. Mr. Paisley also served on the board of directors

of Volterra Semiconductor Corporation, a provider of power management semiconductors, from April 2002 to October 2013, and YuMe, Inc., a digital media advertising company, from November 2012 to February 2018. Mr. Paisley holds a B.A. degree in business economics from the University of California at Santa Barbara and an M.B.A. from the Anderson School at the University of California at Los Angeles. We believe that Mr. Paisley possesses specific attributes that qualify him to serve as a member of our Board, including expertise in finance, including accounting and financial reporting, as a chief financial officer and in other finance roles and currently as a professor in the field of accounting and finance. Mr. Paisley also has over 15 years of outside board experience, which includes serving as audit committee chairman, at numerous public and private companies.

Andrew W. Verhalen has been a member of our Board since January 2004. Mr. Verhalen has served as a General Partner of Matrix Partners, a venture capital firm, since 1992. He currently serves on the board of directors of several private technology companies in which Matrix Partners has invested and has served in the past on six public technology company boards of directors. Prior to joining Matrix Partners, Mr. Verhalen was an executive at 3Com Corporation from July 1986 through November 1991. He served as Vice President and General Manager of the Network Adapter Division for three years and as a Director or Vice President of Marketing for two years. From July 1981 to July 1986, Mr. Verhalen served in various marketing and strategic planning roles at Intel Corporation. Mr. Verhalen holds a B.S.E.E. degree, a M.Eng. degree and a M.B.A. from Cornell University. We believe that Mr. Verhalen possesses specific attributes that qualify him to serve as a member of our Board, including his experience as a technology-focused investor, which gives himin-depth knowledge of, and exposure to, current technology and industry trends and developments, providing us with insight into our industry and target markets, as well as his past experience serving on the boards of directors of six public technology companies.

Feng-Ming (Fermi) Wang, Ph.D. has served as our Chairman of the Board of Directors, President and Chief Executive Officer since heco-founded Ambarella in January 2004. Prior toco-founding Ambarella, Dr. Wang was Chief Executive Officer andco-founder of Afara Websystems, a developer of throughput-oriented microprocessor technology, from November 2000 to July 2002, when Afara was acquired by Sun Microsystems, Inc. Before founding Afara, Dr. Wang served in various positions atC-Cube Microsystems, Inc., a digital video company, from August 1991 to August 2000, and last served as Vice President and General Manager from 1997 to 2000. Dr. Wang holds a B.S. degree in electrical engineering from National Taiwan University and an M.S. degree and Ph.D. in electrical engineering from Columbia University. We believe that Dr. Wang possesses specific attributes that qualify him to serve as a member of our Board, including his service as our Chairman of the Board of Directors, President and Chief Executive Officer, his leadership as aco-founder of Ambarella and his years of experience in the digital video industry.

INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

Board Composition

The Board is currently composed of seveneight members. The Board and its committees met throughout the year on a set schedule and held special meetings from time to time as appropriate. The Board held five meetings during the 20182020 fiscal year. Each director attended at least 75% of the total aggregate of the regularly scheduled and special meetings held by the Board and the committees on which such director served during his or her tenure in fiscal year 2018.2020. Ournon-management directors meet in regularly scheduled sessions without the presence of management in executive sessions. The lead independent director of the Board presides over each such executive session. We do not have a policy regarding directors’ attendance at the Annual Meeting of Shareholders.

Director Independence

Our Corporate Governance Guidelines provide that a majority of our directors will be independent. Based on the review and recommendation by the nominating and corporate governance committee, the Board has determined that Hsaio-WuenHsiao-Wuen Hon, Chenming Hu, Teresa Meng, Christopher Paisley, Jeffrey Richardson, and Andrew Verhalen, representing a majority of our directors, are independent directors under the rules of NASDAQ. The Board has also determined that Elizabeth Schwarting, director nominee, would be an independent director under the rules of NASDAQ. In making this determination,these determinations, the Board found that none of these directors or nominees for director had a material or other disqualifying relationship with Ambarella that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Feng-Ming (Fermi) Wang, Ambarella’s Chairman of the Board, President and Chief Executive Officer, and Leslie Kohn, Ambarella’s Chief TechnicalTechnology Officer, are not independent directors by virtue of their employment with Ambarella.

Board Leadership Structure

The Board is currently chaired by Dr. Wang, the President and Chief Executive Officer of Ambarella. We believe that combining the positions of Chief Executive Officer and Chairman helps to ensure that the Board and management act with a common purpose. In our view, separating the positions of Chief Executive Officer and Chairman has the potential to give rise to divided leadership, which could interfere with good decision-making or weaken our ability to develop and implement strategy. Instead, we believe that combining the positions of Chief Executive Officer and Chairman provides a single, clear chain of command to execute our strategic initiatives and business plans. In addition, we believe that a combined Chief Executive Officer and Chairman is better positioned to act as a bridge between management and the Board, facilitating the regular flow of information.

The Board determined as part of our corporate governance principles that one of our independent directors should serve as a lead director at any time when the title of chairman is held by an employee director or there is no current chairman. The lead independent director presides over periodic meetings of our independent directors, has the responsibility of raising issues with management on behalf of the outside directors when appropriate and oversees the function of the Board and committees, among other responsibilities. Mr. Verhalen has served as our lead independent director since June 2017, when he replacedLip-Bu Tan at the conclusion of Mr. Tan’s term as a director.2017. The Board has determined that Mr. Verhalen qualifies as an independent director under the rules of NASDAQ.

We believe that the current leadership structure of the Board is appropriate at the present time and allows the Board to fulfill its duties effectively and efficiently based on our current needs.

Board Committees

We have established an audit committee, a compensation committee, and a nominating and corporate governance committee. Each of the committees has authority to engage legal counsel or other experts or consultants, as it deems appropriate to carry out its responsibilities. The Board has determined that each member

of each committee meets the applicable NASDAQ rules and regulations regarding “independence” and that each member is free of any relationship that would impair his or her individual exercise of independent judgment with regard to Ambarella. We intend to comply with future requirements as they become applicable to us. Each of the committees operates under a written charter adopted by the Board, each of which can be found on our website athttp://investor.ambarella.com. Each committee has the composition and responsibilities described below.

Audit Committee

The audit committee is currently composed of three directors: Dr. Hu, Mr. Paisley Dr. Hu and Mr. Richardson. Mr. Paisley serves as the chairman of the committee. The audit committee met five times during fiscal year 2018.2020.

The responsibilities of our audit committee include:

The Board has determined that Mr. Paisley qualifies as an “audit committee financial expert,” as defined in applicable SEC rules. The Board made a qualitative assessment of Mr. Paisley’s level of knowledge and experience based on a number of factors, including his formal education and experiences as a chief financial officer for public reporting companies, as well as his service on the audit committees of other publicly traded companies.companies, as well as his role as a professor in the field of accounting and finance. The Board has determined that Mr. Paisley’s simultaneous service on multiple audit committees would not impair his ability to effectively serve on our audit committee.

Compensation Committee

The compensation committee is currently composed of four directors: Dr. Hon, Dr. Hu, Mr. Richardson,Dr. Meng, and Mr. Verhalen.Richardson. Mr. Richardson currently serves as the chairman of the committee. Dr. Hon joined the committee when he was appointed to the Board in August 2017. The compensation committee formally met sixfive times during fiscal year 2018,2020, and committee members also met informally on several occasions to review matters relevant to the compensation of our executive officers.

The responsibilities of our compensation committee include:

Each member of the compensation committee is anon-employee director, as defined pursuant to Rule16b-3 promulgated under the Securities Exchange Act of 1934, as amended, and an outside director, as defined pursuant to Section 162(m) of the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code.

Nominating and Corporate Governance Committee

The nominating and corporate governance committee is currently composed of twothree directors: Mr. Paisley, Mr. Richardson and Mr. Verhalen, who currently serves as the chairman of the committee. The nominating and corporate governance committee met one timethree times during fiscal year 2018.2020.

The responsibilities of our nominating and corporate governance committee include:

Role of the Board in Risk Oversight

One of the key functions of the Board is informed oversight of our risk management process. The Board does not have a standing risk management committee, but rather administers this oversight function directly through the Board as a whole, as well as through its standing committees that address risks inherent in their respective areas of oversight. In particular, the Board is responsible for monitoring and assessing strategic risk exposure. Our audit committee has the responsibility to consider and discuss our major financial risk exposures and the steps our management has taken to monitor and control these exposures, including guidelines and policies to govern the process by which risk assessment and management is undertaken. The audit committee also monitors compliance with legal and regulatory requirements, in addition to oversight of the performance of our external audit function. Our nominating and corporate governance committee monitors the effectiveness of our corporate governance guidelines. Our compensation committee assesses and monitors whether any of our compensation policies and programs has the potential to encourage excessive risk-taking.

Compensation Committee Interlocks and Insider Participation

During fiscal year 2018,2020, Dr. Hon, Dr. Hu, Mr. Richardson, Mr. TanDr. Meng, and Mr. VerhalenRichardson served as members of the compensation committee. Mr. Tan ceased to be a member of the compensation committee when his term on the Board ended in June 2017. None of the members of our compensation committee is or has in the past served as an officer or employee of the Company. None of our executive officers currently serves, or in the past year has served, as a member of the Board or compensation committee of any entity that has one or more executive officers serving on the Board or compensation committee.

Evaluation of Board and Director Performance

The Board believes that a regular evaluation process is an essential component of strong corporate governance practices. The nominating and corporate governance committee oversees an evaluation process to evaluate Board effectiveness and aid in succession planning. This process consists of a full Board evaluation as well as evaluations of each of the Board’s standing committees. The evaluations, which are distributed and obtained through outside counsel to promote candidness, seek feedback on Board and committee performance, chairman performance, processes, effectiveness, and opportunities for improvement. The questionnaires are designed to solicit feedback on a range of topics, including overall Board and committee dynamics, leadership, meeting agenda topics, information flow and access to management, director preparation and participation, and succession planning. The results of the evaluations are reviewed and discussed with the Board and its committees.

In addition to the Board and committee evaluation process, in fiscal year 2020 the nominating and corporate governance committee conducted a skill set survey of the current Board members. This survey solicited feedback on areas such as public board experience, relevant industry experience, market sector experience, and technical skills, including technology, accounting/finance, marketing/sales, public relations, strategy development, mergers and acquisitions, human resource management, and risk management and governance. The Board used the survey responses to evaluate the experience and expertise of the existing Board members and to identify the skills and characteristics of future director candidates, including Ms. Schwarting.

Director Nominations

The Board nominates directors for election at each annual meeting of shareholders and elects new directors to fill vacancies when they arise. The nominating and corporate governance committee has the responsibility to identify, evaluate, recruit and recommend qualified candidates to the Board for nomination or election.

Director Criteria. The nominating and corporate governance committee has a policy regarding consideration of director candidates recommended by shareholders. The nominating and corporate governance committee reviews suggestions for director candidates recommended by shareholders and considers such candidates for recommendation based upon an appropriate balance of knowledge, experience and capability. In addition to considering an appropriate balance of knowledge, experience and capability, the Board has as an objective that its membership be composed of experienced and dedicated individuals with diversity of backgrounds, perspectives and skills. Except as may be required by rules promulgated by Nasdaq or the SEC, there are currently no specific, minimum qualifications that must be met by each candidate for the Board, nor are there any specific qualities or skills that are necessary for one or more of the members of the Board to possess. The nominating and corporate governance committee selects candidates for director based on their character, judgment, diversity of experience, independence, corporate experience, length of service, potential conflicts of interest, and their willingness and ability to devote sufficient time to effectively carry out their duties as a director.

Prior to each annual meeting of shareholders, the nominating and corporate governance committee will identify nominees first by reviewing the current directors whose term expires at the annual meeting of shareholders and who are willing to continue in service. These candidates are evaluated based on the criteria described above, including as demonstrated by the candidate’s prior service as a director, and the needs of the Board with respect to the particular talents and experience of its directors. In the event that a director does not wish to continue in service, the nominating and corporate governance committee determines not to nominate the director, or a vacancy is created on the Board as a result of a resignation, an increase in the size of the Board or other event, the nominating and corporate governance committee will consider various candidates for Board membership, including those suggested by members of the nominating and corporate governance committee, by other members of the Board, by any executive search firm engaged by the nominating and corporate governance committee and by shareholders. The nominating and corporate governance committee retained an executive

search firm to assist in sourcing potential candidates for our Board, including Ms. Schwarting. Upon review of Ms. Schwarting’s skills and characteristics, including an evaluation of the criteria described above, the nominating and corporate governance committee recommended Ms. Schwarting to the Board for selection as a nominee.

Shareholder Nominees. In addition, our articles of association contain provisions that address the process by which a shareholder may nominate an individual to stand for election to the Board at our annual meeting of shareholders. In order to nominate a candidate for director, a shareholder must give timely notice in writing to Ambarella, Inc.’s Secretary and otherwise comply with the provisions of our articles of association. To be timely, we must have received the shareholder’s notice not more than 120 days nor less than 90 days prior to the anniversary of the date our proxy statement was provided to shareholders in connection with previous year’s annual meeting of shareholders. However, if we did not hold an annual meeting of shareholders in the prior year or if the date of the annual meeting of shareholders is more than 30 days before or after the anniversary date of the prior year’s annual meeting of shareholders, we must receive the shareholder’s notice not earlier than the close of business on the 120th120^th day prior to the Annual Meeting and not later than the close of business on the later of 90 days prior to the annual meeting of shareholders and the 10th10^th day after the day we provided such public disclosure of the meeting date. Information required by the articles of association to be in the notice include the name and contact information for the candidate and the person making the nomination, the principal occupation or employment of the candidate, the class and number of Ambarella securities held by the candidate, and other information about the nominee that must be disclosed in proxy solicitations under Section 14 of the Securities Exchange Act of 1934 and the related rules and regulations under that Section. We received no director nominees from our shareholders for the upcoming Annual Meeting. Shareholder nominations must be made in accordance with the procedures outlined in, and include the information required by, our articles of association and must be addressed to 3101 Jay Street, Santa Clara, CA 95054, Attn: Secretary. You can obtain a copy of our articles of association by writing to the Secretary at this address.

The Board also has adopted a Code of Ethics for our Chief Executive Officer and Senior Financial Officers, including our Chief Financial Officer and principal accounting officer, relating to ethical conduct, conflicts of interest and compliance with law. The Code of Conduct and the Code of Ethics for our Chief Executive Officer and Senior Financial Officers is available to shareholders on the investor relations portion of Ambarella’s website atwww.ambarella.com. Any waiver to the Code of Business Conduct for an executive officer or director or any waiver of the Code of Ethics may only be granted by the Board or a committee of the Board and must be timely disclosed as required by applicable law. We also have implemented whistleblower procedures that establish formal protocols for receiving and handling complaints from employees. Any concerns regarding accounting or auditing matters reported under these procedures will be communicated promptly to our audit committee.

DIRECTOR COMPENSATION

Ournon-employee directors receive compensation consisting of annual cash retainers for service on our Board and its standing committees, as well as equity grants awarded on an annual recurring basis as they remain a member of the Board.Non-employee directors joining the Board may also receive an equity grant in connection with their appointment to the Board. If elected to the Board, Ms. Schwarting is expected to receive compensation on the same terms as our other non-employee directors, including an equity grant.

Our compensation committee periodically reviews compensation for ournon-employee directors, including review of competitive practices provided by our compensation consultant. Our compensation committee last modified ournon-employee director compensation program for fiscal year 2017 compensation. We believe ournon-employee director compensation program provides reasonable compensation to ournon-employee directors that is appropriately aligned with our peers and is commensurate with the services and contributions of ournon-employee directors.

Cash Retainers. During fiscal year 2018,2020, ournon-employee directors received an annual retainer of $35,000, prorated for partial service in any year and paid in cash. The chairpersons of our audit committee, compensation committee and nominating and corporate governance committee each receive an additional annual retainer of $15,000, $10,000 and $7,500, respectively. Members of our audit committee, compensation committee and nominating and corporate governance committee, other than the chairpersons of those committees, receive an additional annual retainer of $10,000, $6,000 and $4,000, respectively. The chairpersons of our audit committee, compensation committee and nominating and corporate governance committee each receive an additional annual retainer of $15,000, $10,000 and $7,500, respectively and the individual acting as lead independent director, if any, receives an additional $15,000 annually.annually for serving in that role. Cash retainers are paid in arrears at the end of each quarter for service during the previous quarter.

Stock Compensation. For fiscal year 2018,2020, the equity award compensation structure for ournon-employee directors generally remained the same as was adopted for fiscal year 2017.2017 and was continued for subsequent years. Each continuing director received a restricted stock unit award with an initial grant date fair value (determined in accordance with U.S. generally accepted accounting principles) of approximately $200,000 vesting quarterly over 12 months following grant, subject to his continued service through the applicable vesting dates. Accordingly, on September 5, 2017,3, 2019, each of thenon-employee directors who were then serving on the Board received a restricted stock unit award covering 4,9263,431 shares.

Equity awards granted to ournon-employee directors are subject to the terms and conditions of our 2012 Equity Incentive Plan (the “Plan”) which provides an annual limit of $500,000 on the total value of equity compensation that may be paid to each continuingnon-employee director under the Plan. The Plan also provides an annual limit of $1,000,000 on the total value of equity compensation that may be paid to a new director in connection with being named to the Board. For these purposes, the value of an equity compensation award is determined as grant date fair value, which is determined in accordance with U.S. generally accepted accounting principles. Under the terms of the Plan, if awards, including those of our non-employee directors, are not assumed or substituted for in the event of a merger of change in control of the Company, all awards accelerate in full, and for awards with performance-based vesting, all performance goals or other vesting criteria are deemed achieved at 100% of target levels and all other terms and conditions met. The Plan also provides that if equity awards granted to non-employee directors are assumed or substituted for in a change in control but, on or after such assumption or substitution, the individual’s status as a director (or director of the successor) is terminated other than by a voluntary termination not requested by the acquirer, the non-employee director’s equity awards immediately vest in full.

Stock Ownership Guidelines. The Board believes that all directors should maintain a meaningful personal financial stake in the Company to align their long-term interests with those of our shareholders. We maintain stock ownership guidelines that apply to our executive officers andnon-employee directors. This policy requiresnon-employee directors to attain and maintain a minimum share ownership level equal to at least five times the annual cash retainer, i.e., $175,000 within five years of becoming a director. As of January 31, 2018,2020, all of ournon-employee directors satisfy the equity ownership guidelines.

Director Compensation for Fiscal Year 20182020

The following table sets forth the compensation paid or accrued by us to ournon-employee directors during fiscal year 2018.2020. The table excludes Mr. Kohn and Dr. Wang, who did not receive any additional compensation from us in their roles as a director because they are employees of Ambarella.

PROPOSAL 2

RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The audit committee of the Board has appointed PricewaterhouseCoopers LLP as Ambarella’s independent registered public accounting firm, or independent auditors, for the fiscal year ending January 31, 2019,2021, and has further directed that management submit the appointment of independent auditors for ratification by the shareholders at the Annual Meeting. PricewaterhouseCoopers LLP has audited Ambarella’s financial statements since fiscal year 2007. Representatives of PricewaterhouseCoopers LLP are expected to be present at the Annual Meeting. They will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.

Neither Ambarella’s Articles of Association nor other governing documents or law require shareholder ratification of the appointment of PricewaterhouseCoopers LLP as Ambarella’s independent auditors. However, the audit committee is submitting the appointment of PricewaterhouseCoopers LLP to shareholders for ratification as a matter of good corporate practice. If the shareholders fail to ratify the appointment, the audit committee will reconsider whether or not to retain that firm. Even if the appointment is ratified, the audit committee in its discretion may direct the appointment of different independent auditors at any time during the year if they determine that such a change would be in the best interests of Ambarella and its shareholders.

The affirmative vote of the holders of a majority of the shares present in person or represented by proxy and entitled to vote at the Annual Meeting will be required to ratify the appointment of PricewaterhouseCoopers LLP. Abstentions will be counted toward the tabulation of votes cast on proposals presented to the shareholders and will have the same effect as negative votes.

Principal Accountant Fees and Services

The following table represents aggregate fees billed to Ambarella by PricewaterhouseCoopers LLP for the fiscal years ended January 31, 20172019 and 2018,2020, respectively, all of which were approved by the audit committee:

Pre-Approval Policies and Procedures

The audit committee has adopted a policy and procedures for thepre-approval of audit andnon-audit services rendered by our independent auditors, PricewaterhouseCoopers LLP. The policy generallypre-approves specified services in the defined categories of audit services, audit-related services and tax services up to specified amounts.Pre-approval may also be given as part of the audit committee’s approval of the scope of the engagement of the independent auditors or on an individual, explicit,case-by-case basis before the independent auditor is engaged to provide each service. Thepre-approval of services may be delegated to one or more of the audit committee’s members, but the decision must be reported to the full audit committee at its next scheduled meeting.

The audit committee has determined that the rendering of the services described above by PricewaterhouseCoopers LLP is compatible with maintaining the principal accountant’s independence.

Vote Required

Ratification of the appointment of PricewaterhouseCoopers LLP requires the affirmative vote of a majority of the shares present and voting at the Annual Meeting in person or by proxy. Unless otherwise indicated, proxies received will be voted “FOR” ratification of the appointment. In the event ratification is not obtained, the audit committee will review its future appointment of our independent registered public accountants.

The Board recommends a vote FOR the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm.

REPORT OF THE AUDIT COMMITTEE¹

The audit committee provides assistance to the Board of Directors in fulfilling its legal and fiduciary obligations in matters involving Ambarella’s accounting, auditing, financial reporting, internal control and legal compliance functions by approving the services performed by Ambarella’s independent accountants and reviewing their reports regarding Ambarella’s accounting practices and systems of internal accounting controls as set forth in a written charter adopted by the Board. Ambarella’s management is responsible for preparing Ambarella’s financial statements and the independent registered public accountants are responsible for auditing those financial statements. The audit committee is responsible for overseeing the conduct of these activities by Ambarella’s management and the independent registered public accountants.

In this context, the audit committee has met and held discussions with management and the independent registered public accountants. Management represented to the audit committee that Ambarella’s consolidated financial statements were prepared in accordance with generally accepted accounting principles, and the audit committee has reviewed and discussed the consolidated financial statements with management and the independent registered public accountants. The audit committee has discussed with the independent registered public accountants matters required to be discussed by Statement on Auditing Standards No. 1301, as amended.the Public Company Accounting Oversight Board and the SEC. In addition, the independent registered public accountants provided to the audit committee the written disclosures required by Public Company Accounting Oversight Board Rule 3526 (Communication with Audit Committees Concerning Independence) and the audit committee and the independent registered public accountants have discussed such accountants’ independence from Ambarella and its management. The audit committee has discussed with Ambarella’s internal and independent registered public accountants, with and without management present, their evaluations of Ambarella’s internal accounting controls and the overall quality of Ambarella’s financial reporting.

In reliance on the reviews and discussions with management and the independent registered public accountants referred to above, the audit committee recommended to the Board, and the Board approved, the inclusion of the audited financial statements in Ambarella’s Annual Report on Form10-K for the fiscal year ended January 31, 2018,2020, for filing with the SEC.

Christopher B. Paisley (Chairman)

Chenming C. Hu

D. Jeffrey Richardson

PROPOSAL 3

ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), allows our shareholders to vote to approve, on an advisory basis, the compensation of our named executive officers. At our annual meeting of shareholders held in 2015, the Company’s shareholders approved, on an advisory basis, soliciting a shareholder advisory vote on the compensation of our named executive officers on an annual basis and the Company holds such advisory votes on the compensation of our named executive officers annually. Accordingly, this year we again are asking our shareholders to provide an advisory vote to approve the compensation of our named executive officers, including the Compensation Discussion and Analysis section, along with the accompanying compensation tables and narrative disclosures as described in this Proxy Statement. This proposal, commonly known as a“say-on-pay” proposal, gives our shareholders the opportunity to express their views on the compensation of our named executive officers.

The“say-on-pay” vote is advisory, and as such is not binding on the Company, but it does provide the compensation committee with valuable information about shareholder opinion of our executive compensation policies and programs for consideration when determining executive compensation in the future. After the “say on pay” vote at this year’s annual meeting of stockholders, the next“say-on-pay” vote will be scheduled to occur at the Company’s annual meeting of stockholders in 2019.2021.

Please see the Compensation Discussion and Analysis section of this Proxy Statement beginning on page 22,23, the accompanying compensation tables and the narrative disclosures for greater detail about our executive compensation programs, including information about the fiscal year 20182020 compensation of our named executive officers. We believe that our executive compensation programs have been effective in achieving long-term alignment of management and shareholder interests, consistent with the Company’s philosophy on pay and performance.

We ask that you vote “FOR” the followfollowing resolution:

RESOVLED:RESOLVED: That the shareholders of Ambarella, Inc. hereby approve, on an advisory basis, the compensation of the named executive officers, including the Compensation Discussion and Analysis, compensation tables and the narrative discussion, as disclosed in the Proxy Statement furnished for the 20182020 Annual Meeting of Shareholders pursuant to the compensation disclosure rules and regulations of the U.S. Securities and Exchange Commission.

Vote Required

Approval, on an advisory basis, of named executive officer compensation requires the affirmative vote of the holders of a majority of the shares present and voting at the Annual Meeting in person or by proxy. Unless otherwise indicated, proxies received will be voted “FOR” approval, on an advisory basis, of named executive officer compensation.

The Board unanimously recommends a vote “FOR” the approval, on an advisory basis, of the compensation of our named executive officers as disclosed in this Proxy Statement.

EXECUTIVE OFFICERS

The following table sets forth certain information about our current executive officers and their respective ages as of March 31, 2018.2020. There are no family relationships among any of our directors or executive officers.

Feng-Ming (Fermi) Wang Ph.D. and Leslie Kohn. For brief biographies of Dr. Wang and Mr. Kohn, please see “Proposal 1 – Election of Class IIIII Directors” above.

George W. LaplanteKevin C. (Casey) Eichler has served as our Chief Financial Officer since March 2011. As announced by the Company on April 18, 2018,August 2018. Prior to joining Ambarella, Mr. Laplante intends to retire in 2018, and the Company has initiated a search for his replacement. Mr. Laplante intends to remain in his current role until a successor is named and an orderly transition is completed. From May 2009 to March 2011, Mr. LaplanteEichler most recently served as a management consultantPresident and interim chief financial officer to several private technology companies. From March 2007 to May 2009, Mr. Laplante served as the Chief Financial Officer of Ultra Clean Holdings, Inc. from March 2015 to July 2016 and Secretary of Santur Corporation, a manufacturer of laser technology for the communications industry. From September 2000 to December 2006, Mr. Laplante served as theExecutive Vice President and Chief Financial Officer from July 2009 to February 2015, where he oversaw all the financial reporting for the company, as well as business development and Secretary of 2Wire, Inc., a provider of broadband services platforms.key customer relationships. Prior to joining 2Wire,Ultra Clean Holdings, Mr. LaplanteEichler was the Senior Vice President and Chief Financial Officer of Credence Systems Corporation from January 2008 to November 2008, Executive Vice President of Operations and Chief Financial Officer of MarketTools, Inc. from March 2006 to December 2007, and Vice President and Chief Financial Officer of MIPS Technologies Inc. from June 1998 to February 2006. Prior to that, he held finance and management positions at Action Computer Supplies Holdings Plc., ACS Distribution, Inc., Arneson Marine, Inc., Molecular Computer,with several technology companies, including Visigenic Software, NeXT Software and Televideo Systems, Inc.Microsoft. Mr. Laplante began his career as a CPA with Arthur Andersen & Company. Mr. LaplanteEichler holds a B.A.Bachelor of Science degree in Economicsaccounting from Southern Connecticut State College and a Masters in Accountancy from Bowling Green StateSt. John’s University.

Yun-Lung (Michael) Chen has served as our Vice President, Business Development since June 2011, and was Sr. Director of Sales from January 2005 to June 2011. Prior to joining Ambarella, Mr. Chen was Director of Sales for Marvell Technology, a semiconductor company, from December 2002 to October 2003. From October 1997 to October 2002, Mr. Chen served as Director of Sales for Wintech Microelectronics, a distributor of electronics. Mr. Chen holds a B.S. degree in industrial engineering from Tung Hai University in Taiwan.

Christopher Day has served as our Vice President, Marketing and Business Development since March 2010. Prior to joining Ambarella, Mr. Day was President and Chief Executive Officer of Mobilygen, Inc., a video compression company from March 2007 to October 2008, prior to acquisition by Maxim Integrated Products, Inc., and then served as Executive Director of Business Management of Maxim until March 2010. From February 2002 to February 2007, Mr. Day served as General Manager of Media Processing at NXP Semiconductors N.V., formerly Philips Semiconductor. From February 1998 to May 2001, Mr. Day served as Senior Director of Marketing forC-Cube Microsystems. Prior to joiningC-Cube Microsystems, Mr. Day held sales and marketing positions at AuraVision, Inc., Motorola, Inc., and Hitachi, Ltd. Mr. Day holds a B.S. degree in computer and microprocessor systems from Essex University in the United Kingdom, and an M.B.A. from Santa Clara University.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

This Compensation Discussion and Analysis discusses the compensation programs and policies for our named executive officers (“NEOs”) for fiscal year 2018,2020, ended January 31, 2018, who2020. Our NEOs for fiscal year 2020 were:

The information contained in this Compensation Discussion and Analysis should be read in connection with the compensation tables below, which provide a detailed view of the compensation paid to our NEOs in fiscal year 2018.2020.

Executive Summary

Shareholder Outreach

Prior to 2018, our shareholders showed strong support for our executive compensation program, and that support guided our compensation committee in making its decisions. The Say on Pay vote at our 2018 annual meeting of shareholders, however, received significantly lower support (56.4%) than prior votes. In response to the lower level of support, we actively engaged in a shareholder outreach program to solicit feedback relating to executive compensation and corporate governance practices. The feedback we received from shareholders informed the compensation committee’s deliberations and decisions, resulting in the adoption of significant changes for our fiscal year 2020 NEO compensation programs:

We believe these changes better align executive pay with Company performance, focus the management team on achieving objectives that support the Company’s business transformation and emphasize long-term value creation. These changes were anticipated in our proxy statement for the 2019 annual meeting, at which our Say on Pay vote received strong support of approximately 93%. In light of such support, we have maintained these structural changes for fiscal year 2021.

Fiscal Year 2020 Business Highlights.

We are a leading developer of semiconductor solutions that enable high-definition, or HD, and Ultra HD video capture, analysis, sharing and display. Historically, we primarily focused on providing video and image processors for specialized professional and consumer camera devices, such as internet protocol, or IP, security

cameras, wearable sports cameras, drone cameras and aftermarket automotive video recorders. Over the last several years, our development efforts have focused on creating advanced artificial intelligence, or AI, computer vision, or CV, algorithms and high-performance,low-power hardware platforms to enhance processing acceleration, which we refer to as our CVflow^™ architecture. The CVflow architecture supports a variety of CV algorithms, including stereovision, object identification and motion detection, obstacle detection and avoidance, terrain mapping technology and face recognition, and allows customers to differentiate their products by porting their own algorithms and neural networks to our CVflow-based chips. This CV technology, combined with our traditional video and image processing technology, is allowing us to address a broader range of markets and applications, including the OEM automotive market and industrial and robotics applications, which we believe will be critical to our long term growth.

Our business transformation toCV-centric products continued in fiscal year 2020. Between January 2018 and January 2019, we introduced our first four CV based SoCs to enable our customers to develop intelligent camera systems for a variety of markets at different feature levels. We focused our initial marketing efforts with these new SoCs on the professional IP security market, which tends to have a faster rate of adoption for new video processing technology. However, with our expanded portfolio of CV solutions, we are now targeting the professional IP security market, the home security and monitoring market, the OEM automotive market, as well as industrial and robotics applications. In the automotive market, our solutions address six different camera systems: video recorders,in-cabin and driver monitoring cameras, electronic mirrors, surround view monitoring, front camera advanced driving assistance systems (ADAS), and autonomous driving systems.

We have discussed that we anticipate three initial waves of revenue from our new CV solutions. A first wave from adoption of our CV solutions in the professional IP security camera market, followed by a wave from the adoption of our solutions in the home security and monitoring market, and finally a wave from adoption by the automotive market. Our success in achieving these three waves is dependent upon continued timely research and development of new CV technology and solutions, as well as securing design wins with customers across these primary markets and getting the customers into production with our solutions.

In fiscal year 2020, we made substantial progress against our objectives, including:

Transitioning to new markets and new customers presents significant challenges. For our transformation to be successful, we believe it is important to establish not only the robustness and competitiveness of our technology, but also that the Company is prepared to be a supplier to these markets. The automotive OEM market, in particular, tends to be more conservative than our traditional camera markets and places greater emphasis on quality and reliability. Exiting fiscal year 2020, we believed that we were well positioned to begin to capitalize on ourCV-related efforts, in light of the number of companies that have gone into production with our CV solutions as well as the number of customers that purchased engineering parts, evaluation kits and/or development boards in fiscal year 2020. TheCOVID-19 pandemic, however, has created a significant amount of uncertainty and will likely continue to create uncertainty well into the 2020 calendar year and may have a negative impact on our financial results if the pandemic progresses in ways that significantly disrupt the manufacture, shipment and buying patterns of our products or the products of our customers.

Our executive compensation programs support our long-term strategy, and furthermore, adapt and pivot based on business needs and changes in our strategy. Continuity of leadership is critical during this juncture of our transformation and the compensation committee of our Board (the “compensation committee”) has sought to adapt our compensation programs around strategic initiatives that are critical to our future success. As we strive to balance short-term retention needs against longer-term pay for performance objectives, we have taken in feedback from shareholders and proxy advisors and implemented changes in its executive compensation for fiscal year 2020 and beyond.

Fiscal Year 2020 Executive Compensation Highlights.

In fiscal year 2017, the compensation committee undertook a holistic review of our executive compensation programs, resulting in several changes implemented in fiscal year 2018. These programs were adjusted for fiscal year 2019 and then further adjusted in fiscal year 2020 to address feedback from shareholders and proxy advisors and to align with market pay levels. The largest portion of executive compensation continues to be variable and tied directly to the achievement of annual and longer-term strategic and financial goals. Key compensation highlights from fiscal year 2020 include:

Implementing Shareholder Feedback in Fiscal Year 2020 Compensation Structure.

Since our first annual Say on Pay vote in 2015, shareholders historically have shown strong support for our executive compensation program, with votes ranging between 93.3% to 95.8% of votes cast, which guided our compensation committee in making its decisions. Our Say on Pay proposal at our 2018 annual shareholder meeting, which took place during our 2019 fiscal year, received 56.4% shareholder support. In response to this lower level of support, we engaged in a shareholder outreach program to solicit feedback relating to executive compensation and corporate governance practices. The feedback we received from shareholders informed the compensation committee’s deliberations and decisions, resulting in the adoption of significant changes for our fiscal year 2020 NEO compensation programs, including:

These changes were initially disclosed in our 2019 proxy statement, which was prepared during our fiscal year 2020. In voting on the Say on Pay for our fiscal year 2019 executive compensation, our shareholders seemingly supported the changes, resulting in a Say on Pay vote at the 2019 Annual Meeting of approximately 93% in favor of the executive compensation program.

The compensation committee is committed to engaging with shareholders on executive compensation and corporate governance matters. We also conduct ongoing reviews of our corporate governance policies, practices and market trends.

Pay for Performance. The cornerstone of our executive compensation program is pay for performance. Accordingly, while we pay competitive base salaries and other benefits, a significant portion of each of our NEOs’ compensation opportunity is based on variable pay in the form of performance-based cash bonuses and equity awards. As discussed above, our business has been undergoing a transition from our legacy consumer camera markets, such as wearable cameras and camera enabled drones, toAI-based CV applications for professional, automotive, and industrial and robotic applications. This multi-year effort has presented retention challenges. It is imperative to galvanize our employees and executives around the strategic initiatives during this transformation, which is critical to the Company’s future success and business direction. For fiscal year 2018,2020, we implemented a new framework for our equity awardsannual bonus program by incorporating short-term strategic objectives in addition to annual financial metrics. We also recognize that sustainable long-term growth is significant for shareholders and, as a result, for fiscal year 2020 the PRSUs granted to ourall NEOs utilizing performance-based awards designed to focus our executive officers on key strategic objectives as well sustained long-term growth. are based upon a three-year total shareholder return metric.

The composition of the total annual compensation of our chief executive officer (“CEO”)CEO for fiscal year 2018,2020, as reported in the Summary Compensation Table further below, was as follows:

Fiscal Year 2018 Business Highlights.We are a leading developer of semiconductor processing solutions for video that enable high-definition, or HD, video capture, analysis, sharing and display. Oursystem-on-a-chip, or SoC, designs integrate HD video processing, image processing, computer vision, audio processing and system functions onto a single chip, delivering exceptional video and image quality at high compression rates, differentiated functionality and low power consumption. Our platform enables the creation of high-quality video content in wearable cameras, automotive recording cameras, professional and consumer IP security cameras, cameras incorporated into drones, and virtual reality cameras, also referred to as 360° cameras. While our revenue in the last three years has been driven primarily by sales into specialized video and image capture devices such as IP security cameras, wearable sports cameras, automotive aftermarket cameras, and drones, we

FY2018 CEO Compensation Mix Base Salary Performance-Based Cash Bonus Time-Based RSUs Performance-Based PRSUs

Framework for Determining Executive Compensation

Overview

Our executive compensation program has focused primarily on attracting executive talent to manage and operate our business, retaining individuals who are key to our growth and success, and rewarding individuals

Fiscal Year 2020 Peer Group

The Role of the Compensation Committee and Board of Directors

The compensation committee is responsible for the executive compensation program for our executive officers. The compensation committee formally met sixfive times during fiscal year 2018, and also met informally on several occasions,2020, to review and discuss matters related to compensation of our employeesexecutive officers and executive officers.senior management. Some of these meetings were held with members of management in attendance and some were held in closed session. ManyMost of the meetings also included members of our compensation consultant (as described below). Typically, theThe compensation committee reports to the Board on its discussions and actions and, in some cases, recommends to the Board the decisions to be made and other actions to be taken with regard to our executive officers’ compensation. Our compensation committee’s recommendationsdecisions regarding executive compensation are based on the compensation committee’s assessment of the performance of the Company and each individual executive officer, as well as other factors, such as prevailing industry trends and the competitive market for executive talent. The Board (or the independent members regarding CEO compensation) typically makes the final decisions regarding executive compensation.

The Role of Management

Our CEO and Chief Financial Officer (“CFO”) typically make recommendations to our compensation committee, attend certain compensation committee meetings and are involved in the process for setting our executive officers’ compensation, provided that neither our CEO nor our CFO makes recommendations as to his own compensation or participates in compensation committee discussion of their own compensation. Our compensation committee considers theirmanagement’s recommendations but is not required to follow any recommendations and may adjust compensation up or down as it determines in its discretion. Our compensation committee reviews the recommendations and other data and makes recommendations to the Board as to each executive officer’s total compensation, as well as each individual compensation component.

Elements of Executive Compensation

The compensation of our NEOs consists of the following principal components:

We strive to achieve an appropriate mix between cash compensation and equity incentive awards to meet our objectives. We do not apply any formal or informal policies or guidelines for allocating compensation between current and long-term compensation, or between cash and equity compensation. We believe the most important indicator of whether our compensation objectives are being met is our ability to motivate our executive officers to deliver superior performance and retain them to continue their careers with us on a cost-effective basis. Our Board, led by our compensation committee, generally conducts an annual review of our executive compensation, as well as the mix of components used to compensate our executive officers.NEOs. In reviewing and setting the executive compensation for fiscal year 2018,2020, our compensation committee and Board relied on its collective judgment, recommendations from Dr. Wang (for executives other than Dr. Wang), the relative pay among the management team members, and its assessment of each executive officer’s role, responsibilities and overall contribution to the business in determining the size and mix of compensation for each executive, and Semler Brossy’s analysis of executive pay practices of the Company’s compensation peers. Given our strong commitment to pay for performance, the large majority of each NEO’s target direct compensation (salary, target cashannual bonus opportunity, and target equity awards) was variable and subject to the achievement of key performance objectives that are important for the growth and success of the Company.

Key changes in executive compensation for fiscal year 2020 include (additional details regarding these changes are provided in the sections that follow):

Base Salary

Our base salaries are intended to provide financial stability, predictability and security of compensation for our executive officersNEOs for fulfilling their core job responsibilities. The base salaries of our NEOs are based primarily on role, the scope of their responsibilities, experience, performance and contributions, and our compensation committee’s understanding of compensation paid to similarly situated executives. None of our NEOs has an employment agreement that provides for automatic or scheduled increases in base salary.

Our executives did not receive salary increases from fiscal year 2012 to fiscal year 2018. Based upon market data that executive salaries were trailing behind market, the compensation committee approved increases to executive salaries, including a 3% increase for our NEOs have remained unchanged since our initial public offeringfiscal year 2020. The 3% increase in October 2012 (orNEO salaries was below the NEO’s later appointment as an officer, as applicable).increase for the Company’s general employee population, which averaged 3.5% for fiscal year 2020. The following table sets forth the annual base salary for each of our NEOs for fiscal year 2018:2020:

Annual Performance-Based Cash Bonuses

Our NEOs are eligible to receive cash bonuses under our annual bonus plan established at the beginning of the fiscal year. Annual cash bonuses are intended to motivate our executives to achieve, and reward our executives for achieving, important corporate financial and operational goals, as well as individual performance.

Target Pool Set Performance Goals Set Performance Achieved and Certified (Poo1 funding between 70%-135% of Target) Pool AIIocated to Executives based on Certified Performance

These performance objectives were chosen because the compensation committee and Board believe that these are important financial metrics that reflect our performance as a growing company. While revenue growth remained an important focus for the Company’s overall growth and business success, the operating profit goal also was important to ensure that such top-line growththe pursuit of revenue was balanced with efforts in achieving profitable growthmargins and the management of expenses. The operating profit goal is anon-GAAP measure and refers to our GAAP operating income less the impact of stock-based compensation and the associated tax impact. impact and excluding bonus accruals. The strategic goals are anon-GAAP measure consisting of five short-term strategic objectives significant to the Company’s transition from traditional image and video processors to CV solutions for a broader range of markets, including advanced automotive cameras and industrial and robotics applications.

For fiscal year 2018,2020, we set a revenue target of $313.5$205.5 million representing 1% growth over fiscal year 2017, but which required substantial revenue growth in our key IP security camera and automotive OEM markets. For fiscal year 2018, we set an operating incomeprofit target of $89.6$2.3 million. In setting these targets, the compensation committee and Board considered our then-current operating plan for fiscal year 2018,2020, then-current forecasts and projections, as well as prevailing industry conditions, andconditions. The compensation committee acknowledged these represented lower targets from the prior fiscal year, but intended that the difficulty of attaining the goals would be relatively consistent with prior years and would require strong operational performance. At the time of the compensation committee’s goal setting, the Company continued to be in the midst of its transition from its traditional specialized consumer camera markets, such as wearable sports cameras and drones, to new markets focused on CV applications, but was unlikely to generate significant revenue from its new CV solutions until late in fiscal year 2020. More significantly, there was substantial concern of disruption among our large China IP security camera customers due to geopolitical and trade factors. The John S. McCain National Defense Authorization Act for Fiscal Year 2019 was anticipated to negatively impact the ability of two large Chinese IP security camera customers to sell products into the U.S. market, which could decrease those customers’ demand for the Company’s solutions. There was also concern that the brewing trade dispute between the US and China could impact demand for the Company’s solutions in China.

In light of these factors, the primary challenges for fiscal year 20182020 also included growing revenue in markets other than sports cameras and drones, such as the IP security camera andmarkets outside of China, as well as in the automotive markets, andmarket, while continuing to invest substantially in research and development of the Company’s computer visionCV technology while maintainingwithout significantly sacrificing profitability. For the fiscal year 2020 annual bonus plan, the five strategic objectives related to the long-term success of the Company’s business transition and were as follows:

At target

Target achievement of the performance goals of $205.5 million in revenue, $2.3 million in operating profit before bonus accruals and achievement of 3 “points” worth of strategic goals, would result in 100% of the approved bonus pool would becomebecoming funded and available for payment to executives. Maximum achievement of the performance goals at $341$246.7 million in revenue, and $104$17.3 million in operating profit before bonus accruals, and achievement of five points worth of strategic goals would result in 135%200% of the bonus pool becoming funded and payable. Threshold performance at $301$199.4 million in revenue, and $73-$0.7 million in operating profit before bonus, and achievement of 0.5 points of performance goals would result in 70% of approved bonus pool being funded. Failure to achieve neitherthreshold performance of any specific metric would result in no payout for that portion of the bonus pool, and failure to achieve threshold performance goalson all metrics would result in none of the bonus pool becoming payable. Payouts between performance targets is based on a linear interpolation. Under our Fiscal Year 2018 Annual Bonus Plan,fiscal

year 2020 annual bonus plan, our compensation committee and board of directors had the discretion to reduce, eliminate or increase the size of the bonus pool and the individual bonuses. No upward discretionary adjustments were made to the bonus pool for fiscal year 2018.2020.

Fiscal Year 2020 Annual Bonus Metric Weighting

Fiscal Year 2020 Performance.

For fiscal year 2020, we exceeded targets of each of the three metrics, resulting in funding of the bonus pool at a level of 161% of target. The higher than target revenue was primarily attributable to higher revenue from the home security and monitoring portion of the IP security camera market, primarily in the North America region, and the sports camera market. In the professional IP security camera market, despite increased adoption of our CV solutions, lower demand from one of our largest China customers and customers in other regions resulted in a net revenue decrease in fiscal year 2020. The higher than target operating profit was primarily due to the increased revenue, along with control over operating costs. For fiscal year 2020, we generated cash flows from operating activities of $39.4 million, as compared to $24.5 million in fiscal year 2019. We achieved or partially achieved 4 of the 5 strategic objectives, including: development of our CV22FS SoC, reaching production status with CV solutions with customers in the professional IP security camera market, securing design wins for next generation home security and monitoring cameras using our new CV solutions; and research and development milestones in autonomous driving applications.

Individual Bonus OpportunityOpportunity..Actual

Typically, actual allocation of the bonus pool to eachindividual executive officer for fiscal year 2018,officers, including our NEOs, wasis made by the Board (with the recommendation of the compensation committee) at the conclusion of the fiscal yearyear. This allocation is generally based on historical allocation, the executive’s individual contribution to the Company’s financial and operational results and with a focus on executive retention in light of prevailing market conditions in our industry, and taking into consideration Dr. Wang’s recommendations for NEOs other than himself. The compensation committee believes strongly in the alignment of CEO pay with overall company performance. As a result, Dr. Wang’s allocation of the bonus pool in 2018 was decreased substantially from prior years.

For fiscal year 2018,2020, the Board, upon recommendation of the compensation committee, established a target equity award pool, which included both time-based and performance-based restricted stock units, for our NEOs and other executives. The compensation committee retained the discretion to adjust this pool up or down from target based on the compensation committee’s assessment of annual financial performance, and the Company’s historical relative performance to the compensation peers on revenue growth, operating margin, and relative TSR. After the adjustment to the size of the pool was made, equityEquity award grants were then allocated to individual executives based upon a number of factors, including individual performance, retention needs, historical allocations and competitive market data,data. The target total equity award for our CEO did not increase from the reduced level implemented in fiscal year 2019. The individual RSU and PRSU grants for our NEOs for fiscal year 2020 were as follows:

Typically, stock awards areThe number of PRSUs granted effective two trading days afterwas determined in the same method as the time-based RSUs, by dividing the target dollar amount by the fair market value of an ordinary share on the date of grant. The grant date fair value of the RSUs for accounting purposes was determined by multiplying the number of shares subject to the RSU by the closing price of our quarterly earnings call that discusses our most recently ended fiscal quarter financial results.ordinary shares on the date of grant and is reflected above and in the Summary Compensation and Grants of Plan-Based Awards tables below. The compensation committeegrant date fair value of the PRSUs for accounting purposes was determined using a Monte Carlo analysis, and boardis the value reflected above and in the Summary Compensation and Grants of directors believe that the granting of awards after the trading window opens several days following the earnings call helps to reduce the risk that awards coincide with the possession of material, non-public information.