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What changed in Semilux International Ltd.'s 20-F — 2023 vs 2024

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Paragraph-level year-over-year comparison of Semilux International Ltd.'s 2023 and 2024 20-F annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+109 added−117 removedSource: 20-F (2025-11-10) vs 20-F (2024-05-15)

Top changes in Semilux International Ltd.'s 2024 20-F

109 paragraphs added · 117 removed · 65 edited across 4 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

9 edited+5 added−5 removed236 unchanged
Biggest changeThis led to delays in the research and development progress of certain ICs, LiDAR and ADB solutions by about 6 months. The Company expects to continue incur significant research and development costs going forward to conduct further research, development and tests on its products to further progress its efforts to commercialize these products.
Biggest changeThe Company expects to continue incur significant research and development costs going forward to conduct further research, development and tests on its products to further progress its efforts to commercialize these products. The Company’s future growth depends on introducing new products that achieve successful commercialization by OEM partners.
The decline in research and development expenses for the year ended December 31, 2023 as compared with the year ended December 31, 2022 was primarily due to some adjustments to research and development schedule during the down trend of revenue.
The increase in research and development expenses for the year ended December 31, 2024 as compared with the year ended December 31, 2023 was primarily due to some adjustments to research and development schedule during the down trend of revenue.
In fiscal years ended December 31, 2023, 2022 and 2021, the Company recorded exchange gains of NT$364,051 (U.S.$11,889) and NT$42,092,000 (U.S.$1,374,660) and exchange loss of NT$9,864,199 (U.S.$322,149), respectively. As over 90% of the Company’s sales are from exports, primarily in U.S. dollars, exchange rate fluctuations can significantly impact the company’s profitability.
In fiscal years ended December 31, 2023, 2022 and 2021, the Company recorded exchange gains of NT$16,747,820 (US$521,635), NT$364,051 (U.S.$11,889) and NT$42,092,000 (U.S.$1,374,660), respectively. As over 90% of the Company’s sales are from exports, primarily in U.S. dollars, exchange rate fluctuations can significantly impact the company’s profitability.
The Company generates a significant portion of its revenue from sales to customers in the PRC, so the Company’s business is susceptible to any change in the PRC’s general political and economic environment. The Company historically derives a significant portion of its revenue from sales to customers located in the PRC.
The Company generates a significant portion of its revenue from sales to customers in the PRC, so the Company’s business is susceptible to any change in the PRC’s general political and economic environment. The Company has generated a material portion of its revenue from customers in Mainland China.
The PRC’s economy differs from the economies of most developed countries in many respects, including with respect to the amount of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources.
However, any economic reform policies or measures in the PRC may from time to time be modified or revised. The PRC’s economy differs from the economies of most developed countries in many respects, including with respect to the amount of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources.
The Company incurred a net operating loss of NTD 84,948,000 (US$2,773,000) for the year ended December 31, 2023 and a net operating loss of NTD 19,369,000 (US$ 628,863.636) for the year ended December 31, 2022. The Company believes it will continue to incur operating and net losses each quarter in the foreseeable future.
The Company incurred a net operating loss of NTD 176,817 ,000 (US$ 5,392,000 ) for the year ended December 31, 2024 and a net operating loss of NTD 75,127,000 (US$ 2,291,000) for the year ended December 31, 2023. The Company believes it will continue to incur operating and net losses each quarter in the foreseeable future.
The Company’s future growth depends on introducing new products that achieve successful commercialization by OEM partners. For example, the Company is designing the ADB and LiDAR solutions for the open electric vehicle platform of Foxconn’s Mobility In Harmony Platform (the “ MIH Platform ”).
For example, the Company is designing the ADB and LiDAR solutions for the open electric vehicle platform of Foxconn’s Mobility In Harmony Platform (the “ MIH Platform ”).
The Company’s research and development expenses were approximately NTD 40,921,000 (US$1,476,226.55), NTD 26,845,000 (US$874,000) and NTD 24,195,000 (US$790,170) for the years ended December 31, 2021, 2022 and 2023, respectively.
The Company’s research and development expenses were approximately NTD 26,845,000 (US$818695) and NTD 24,195,000 (US$737,877), and NTD 35,033,000 (US$1,068,405),or the years ended December 31, 2022, 2023 and 2024, respectively.
In the year ended December 31, 2023, 2022 and 2021, sales to customers located in the PRC accounted for approximately 62.5%, 73.5% and 83.6% of total revenue for the period. Accordingly, the results of operations and prospects of the Company are subject to economic, political and legal developments in the PRC.
For the years ended December 31, 2024, 2023, and 2022, sales to customers located in Mainland China accounted for approximately 27.8%, 62.5%, and 73.4% of total revenue, respectively. The financial reforms that begun in the late 1970s have resulted in significant economic growth.
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Currently, the Company has multiple collaborating raw material suppliers and outsourcing manufacturers. In the years ending December 31, 2023, 2022 and 2021, the largest supplier of the Company accounted for approximately 88.3%, 39.7% and around 69% of the total purchases, whi le the second-largest supplier accounted for 2.8%, 15.7% and around 18% of the total purchases, respectively.
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This led to delays in the research and development progress of certain ICs, LiDAR and ADB solutions by about 6 months. The increase in R&D expenses from 2023 to 2024 was primarily driven by the Company’s decision to resume and accelerate core development programs that were previously rescheduled during the revenue downturn in 2023.
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The Company’s success will be dependent upon its ability to maintain its relationships with existing suppliers and enter into new supplier agreements. The Company relies on suppliers to provide key components and technology for its products.
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As market conditions stabilized, the Company increased investment in key technology platforms — including IC development, LiDAR systems, and Adaptive Driving Beam (ADB) solutions — which resulted in higher R&D spending in 2024.
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Supplier agreements and purchase orders that the Company has, and may enter into with key suppliers in the future, may have provisions where such agreements can be terminated in various circumstances, including potentially without cause.
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The Company’s ability to scale its business and execute its product development and commercialization strategy depends on maintaining strong relationships with existing suppliers and developing new qualified vendors to support its manufacturing requirements.
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In addition, if the Company’s suppliers experience substantial financial difficulties, cease operations, or otherwise face business disruptions, the Company would be required to take measures to ensure components and materials remain available. Any supply chain disruption could affect the Company’s ability to deliver its products and could increase the Company’s costs and negatively affect the Company’s liquidity and financial performance.
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The Company sources key optical components, semiconductor materials, and outsourced manufacturing services from specialized suppliers, and continued supply chain stability is critical to ensure timely delivery and product quality. For the years ended December 31, 2022, 2023, and 2024, the Company was subject to supplier concentration risk.
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The financial reforms that begun in the late 1970s have resulted in significant economic growth. However, any economic reform policies or measures in the PRC may from time to time be modified or revised.
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The top supplier accounted for approximately less than 10%, 88.3%, and 82.6% of total purchases, respectively, while the second-largest supplier accounted for approximately 39.7%, less than 10%, and 14.2% of total purchases, respectively.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

14 edited+4 added−3 removed285 unchanged
Biggest changeWood-Hi Cheng and Chun-Nien Liu’s R&D team. 2018 ● Obtained approval to establish a Research and Development Center in the Hsinchu Science Park. ● Shipped automotive optical component products to the German manufacturer BMW for laser car lamps. 2020 ● Established partnership with Foxconn through NCHU team. 2021 ● Joined Foxconn’s MIH EV Platform. 2022 ● Obtained IATF 16949 certification for automotive quality management systems. ● Established partnership with ZF group through the Company’s involvement with MIH EV Platform. 2023 ● Established partnership with Pegatron through NCHU team.
Biggest changeWood-Hi Cheng and Chun-Nien Liu’s R&D team. 2018 ● Obtained approval to establish a Research and Development Center in the Hsinchu Science Park. ● Shipped automotive optical component products to the German manufacturer BMW for laser car lamps. 2020 ● Established partnership with Foxconn through NCHU team. 2021 ● Joined Foxconn’s MIH EV Platform. 2022 ● Obtained IATF 16949 certification for automotive quality management systems. ● Established partnership with ZF group through the Company’s involvement with MIH EV Platform. 2023 ● Established partnership with Pegatron through NCHU team. 2024 ● Working with international partners to develop military drones and optical modules Employees and Human Capital The Company is committed to nurturing a culture that places a strong emphasis on teamwork, values creativity, professionalism, transparency, constructive dissent, and accountability among its employees.
The Company is not currently a party to any actions, claims, suits or other legal proceedings the outcome of which, if determined adversely to it, would individually or in the aggregate have a material adverse effect on the Company’s business, financial condition, and results of operations. As of December 31, 2023, the Company has one outstanding dispute.
The Company is not currently a party to any actions, claims, suits or other legal proceedings the outcome of which, if determined adversely to it, would individually or in the aggregate have a material adverse effect on the Company’s business, financial condition, and results of operations. As of December 31, 2024, the Company has one outstanding dispute.
Moreover, the Company secures its proprietary rights through agreements with business partners, supply chain vendors, employees, and consultants, alongside vigilant monitoring of industry trends and product developments. As of December 31, 2023, the Company held 24 approved and granted patents and has two pending patent applications, in the United States, Taiwan and the PRC.
Moreover, the Company secures its proprietary rights through agreements with business partners, supply chain vendors, employees, and consultants, alongside vigilant monitoring of industry trends and product developments. As of December 31, 2024, the Company held 24 approved and granted patents and has two pending patent applications, in the United States, Taiwan and the PRC.
Function Number of Employees Research & Development 18 Manufacturing 27 Administrative 11 Sales and Marketing 2 Total 58 36 Intellectual Property The success and competitive edge of the Company are dependent on its capacity to develop and safeguard core technologies and intellectual property.
Function Number of Employees Research & Development 17 Manufacturing 27 Administrative 11 Sales and Marketing 3 Total 58 36 Intellectual Property The success and competitive edge of the Company are dependent on its capacity to develop and safeguard core technologies and intellectual property.
Recent Successful Technology or Product Developments The Company has achieved the product and technology breakthroughs as outlined in the following table: Year Research and Development Achievements 2017 ● Development of high-temperature resistant isotropic optical component wafer ● Development of flow-temperature static phosphor for advanced laser automotive lighting source 2018 ● Development of high-temperature static phosphor ● Implementation of fully automated inspection system ● Improvement of dielectric coating production technology ● Development of miniaturized white laser light module 31 Year Research and Development Achievements 2019 ● Development of high- reliability static phosphor process ● Optimization of automated production equipment ● Optimization of phosphor wheel production technology and equipment ● Development of high- temperature, high-resolution color automotive GOBO 2020 ● Development of laser stage lighting fixtures ● Development of laser processes for phosphors and optical component substrates ● Improvement of yield in dielectric coating production 2021 ● Development of solid-state LiDAR prototype ● Development of multifunctional optics of ADB headlights ● Development of automation measurement system for isotropic optical components 2022 ● Development of OPA chip ● Development of DMD-Hybrid System of ADB headlight prototype 2023 ● Development of multi-sensor fusion algorithm Competition Competition in the automotive LiDAR and ADB markets is extremely fierce.
Recent Successful Technology or Product Developments The Company has achieved the product and technology breakthroughs as outlined in the following table: Year Research and Development Achievements 2017 ● Development of high-temperature resistant isotropic optical component wafer ● Development of flow-temperature static phosphor for advanced laser automotive lighting source 2018 ● Development of high-temperature static phosphor ● Implementation of fully automated inspection system ● Improvement of dielectric coating production technology ● Development of miniaturized white laser light module 31 Year Research and Development Achievements 2019 ● Development of high- reliability static phosphor process ● Optimization of automated production equipment ● Optimization of phosphor wheel production technology and equipment ● Development of high- temperature, high-resolution color automotive GOBO 2020 ● Development of laser stage lighting fixtures ● Development of laser processes for phosphors and optical component substrates ● Improvement of yield in dielectric coating production 2021 ● Development of solid-state LiDAR prototype ● Development of multifunctional optics of ADB headlights ● Development of automation measurement system for isotropic optical components 2022 ● Development of OPA chip ● Development of DMD-Hybrid System of ADB headlight prototype 2023 ● Development of multi-sensor fusion algorithm 2024 ● Teaming up with international partners to showcase comprehensive drone and defense solutions Competition Competition in the automotive LiDAR and ADB markets is extremely fierce.
The following table sets forth the number of the Company’s employees categorized by function as of December 31, 2023.
The following table sets forth the number of the Company’s employees categorized by function As of December 31, 2024.
The Company believes that its current facilities are adequate to meet its immediate needs and that, should it be needed, additional space will be available on commercially reasonable terms to accommodate any expansion of the Company’s operations.
Facilities The Company leases all of its facilities, and does not own any real property. The Company believes that its current facilities are adequate to meet its immediate needs and that, should it be needed, additional space will be available on commercially reasonable terms to accommodate any expansion of the Company’s operations.
Throughout various stages of growth, the Company has successfully attracted and retained talented individuals and leaders from both the automotive and consumer electronics industries to drive the realization of its ambitious vision. As of December 31, 2023, the Company had a workforce of 58 employees.
This cultural ethos is reflected in the Company’s recruitment decisions. Throughout various stages of growth, the Company has successfully attracted and retained talented individuals and leaders from both the automotive and consumer electronics industries to drive the realization of its ambitious vision. As of December 31, 2024, the Company had a workforce of 58 employees.
The essential components for the Company’s laser lights, LiDAR, ADB modules include laser light source, optical components, photodetectors, semiconductor chips, amplifiers, MEMS, display/control interfaces, power management components, communication interfaces, enclosures and various packaging materials.
The essential components for the Company’s laser lights, LiDAR, ADB modules include laser light source, optical components, photodetectors, semiconductor chips, amplifiers, MEMS, display/control interfaces, power management components, communication interfaces, enclosures and various packaging materials. The Company typically engages multiple suppliers for each type of essential components, and has not experience any shortage of essential components.
The Company has also developed laser light source for various applications including searchlights and laser stage lights. The Company has recently specialized in providing key semiconductor chips, components and solutions for solid-state light detecting and ranging (LiDAR) and adaptive driving beam (ADB) headlights that meet the automotive market standards, such as AEC-Q100, ISO 26262, and IATF 16949.
The Company has recently specialized in providing key semiconductor chips, components and solutions for solid-state light detecting and ranging (LiDAR) and adaptive driving beam (ADB) headlights that meet the automotive market standards, such as AEC-Q100, ISO 26262, and IATF 16949. The Company aims to offer crucial chips and system solutions with good performance, cost-efficiency, and automotive-grade reliability.
With strategically positioned offices at Central Taiwan Science Park and Hsin Chu Science Park campuses, the Company actively fosters collaboration with semiconductor experts and develop technologies leveraging the robust semiconductor supply chain in Taiwan.
The Company believes that its LiDAR and ADB products may empower the implementation of large-scale advanced driver assistance systems and self-driving technologies. With strategically positioned offices at Central Taiwan Science Park and Hsin Chu Science Park campuses, the Company actively fosters collaboration with semiconductor experts and develop technologies leveraging the robust semiconductor supply chain in Taiwan.
Additionally, proactive monitoring of network traffic is performed, and any anomalies are promptly addressed. Employee education and training on information security are conducted periodically to cultivate a culture of security awareness.
Additionally, proactive monitoring of network traffic is performed, and any anomalies are promptly addressed. Employee education and training on information security are conducted periodically to cultivate a culture of security awareness. The Company has not experienced any information security incidents in the year ended December 31, 2024, nor has it incurred any losses or impacts therefrom.
Information contained on, or that can be accessed through, our website or any other website is expressly not incorporated by reference into and is not a part of this annual report. 21 B. Business Overview The Company has historically focused on laser applied modules and their components, which are used in solid-state light source projectors, car headlights, and sensors.
Information contained on, or that can be accessed through, our website or any other website is expressly not incorporated by reference into and is not a part of this annual report. 21 B.
The Company typically engages multiple suppliers for each type of essential components, and has not experience any shortage of essential components during the financial years that ended December 31, 2021, 2022, and 2023. Seasonality The automotive industry, in contrast to many other sectors, exhibits a remarkable degree of stability and is characterized by its resistance to seasonal fluctuations.
Seasonality The automotive industry, in contrast to many other sectors, exhibits a remarkable degree of stability and is characterized by its resistance to seasonal fluctuations.
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The Company aims to offer crucial chips and system solutions with good performance, cost-efficiency, and automotive-grade reliability. The Company believes that its LiDAR and ADB products may empower the implementation of large-scale advanced driver assistance systems and self-driving technologies.
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Business Overview Strategic Business Transition to AI-Driven UAV Systems In the second quarter of 2024, we began a strategic transformation of our business model, shifting from automotive-focused optical components and LiDAR technologies to the design and development of integrated artificial intelligence (AI)-based control systems for unmanned aerial vehicles (UAVs).
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Employees and Human Capital The Company is committed to nurturing a culture that places a strong emphasis on teamwork, values creativity, professionalism, transparency, constructive dissent, and accountability among its employees. This cultural ethos is reflected in the Company’s recruitment decisions.
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This transition was operationalized in May 2024 and formally adopted by our board of directors in June 2024. Our current focus is on delivering intelligent, modular UAV solutions that combine edge computing, real-time navigation, proprietary optics, and mission-critical control systems.
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The Company has not experienced any information security incidents in the years ended December 31, 2023, December 31, 2022 and December 31, 2021, nor has it incurred any losses or impacts therefrom. Facilities The Company leases all of its facilities, and does not own any real property.
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These platforms are being designed for deployment in defense, industrial, and infrastructure applications, with several prototype programs underway through early-stage joint development efforts. This pivot reflects our intent to align with the growing global demand for autonomous systems and to leverage our optical and systems engineering expertise in new, higher-growth verticals.
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Historical Product Lines and Automotive Technology Applications Prior to the second quarter of 2024, the Company has historically focused on laser applied modules and their components, which are used in solid-state light source projectors, car headlights, and sensors. The Company has also developed laser light source for various applications including searchlights and laser stage lights.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

31 edited+35 added−44 removed60 unchanged
Biggest changeCurrently, the applicable tax rate in Taiwan is 20%, while the tax rate for unappropriated earnings is 5%. 47 Results of Operations Comparison of Results of Operations for the Year Ended December 31, 2023 to the Year Ended December 31, 2022 The table below sets forth the results of operations for the year ended December 31, 2022 and the year ended December 31, 2023: For the year ended December 31, Differences 2022 2023 Amount Percentage NTD U.S. $ NTD U.S. $ NTD U.S. $ Item ‘000 ‘000 ‘000 ‘000 ‘000 ‘000 % Total revenue 102,438 3,336 32,840 1,073 (69,598 ) (2,263 ) (67.9 ) Cost of revenue 56,525 1,841 48,049 1,569 (8,476 ) (272 ) (15.0 ) Gross profit/(loss) 45,913 1,495 (15,209 ) (496 ) (61,122 ) (1,991 ) (133.1 ) Operating expenses Selling expenses 12,534 408 11,363 371 (1,171 ) (37 ) (9.3 ) Administrative expenses 25,650 835 24,360 796 (1,290 ) (39 ) (5.0 ) Research and development expenses 26,845 874 24,195 790 (2,650 ) (84 ) (9.9 ) Impairment loss 253 8 - - (253 ) (8 ) (100.0 ) Total operating expenses 65,282 2,126 59,918 1,957 (5,364 ) (169 ) (8.2 ) Net operating loss (19,369 ) (631 ) (75,127 ) (2,453 ) (55,758 ) (1,822 ) 287.9 Non-operating expenses Interest income 3,462 113 14,680 479 11,218 366 324.0 Other income 2,844 93 385 13 (2,459 ) (80 ) (86.5 ) Other gain, net 37,399 1,218 992 32 (36,407 ) (1,186 ) (97.3 ) Interest expenses (2,884 ) (94 ) (2,940 ) (96 ) (56 ) (2 ) 1.9 Total non-operating expenses 40,821 1,329 13,117 428 (27,704 ) (901 ) (67.9 ) Profit/(loss) before income tax 21,452 699 (62,010 ) (2,025 ) (83,462 ) (2,724 ) (389.1 ) Income tax expense 6,429 209 1,019 33 (5,410 ) (176 ) (84.1 ) Net income/(loss) 15,023 489 (63,029 ) (2,058 ) (78,052 ) (2,547 ) (519.6 ) Total comprehensive income/(loss) 15,023 489 (63,029 ) (2,058 ) (78,052 ) (2,547 ) (519.6 ) Less: comprehensive income (loss) attributable to non-controlling interest 194 6 (13,003 ) (425 ) (13,197 ) (431 ) (6,802.6 ) Total comprehensive income (loss) attributable to ordinary shareholders 14,829 483 (50,026 ) (1,633 ) (64,855 ) (2,116 ) (437.4 ) 48 Comparison of Revenue Composition for the Year Ended December 31, 2023 to the Year Ended December 31, 2022 The table below sets forth the revenue contribution by types of products for the year ended December 31, 2023 to the year ended December 31, 2022: For the year ended December 31, 2023 For the year ended December 31, 2022 Revenue Amount Revenue Amount Product Categories NTD ‘000 U.S.
Biggest changeNet Loss Net loss increased from NTD 63,029,000 (U.S.$2,058,000) for the year ended December 31, 2023 to NTD 151,946,000 (U.S.$4,633,000) for the year ended December 31, 2024, representing an increase of NTD 88,917,000 (U.S.$2,712,000), or 141%.This increase was mainly due to higher operating expenses, impairment losses, and a continued gross loss despite strong revenue growth. 50 Comparison of Results of Operations for the Year Ended December 31, 2023 to the Year Ended December 31, 2022 The table below sets forth the results of operations for the year ended December 31, 2021 and the year ended December 31, 2022: For the year ended December 31, 2022 For the year ended December 31, 2023 Differences in Amount and Percentage (%) Item NTD ’000 U.S.$ ’000 NTD ’000 U.S.$ ’000 NTD ’000 U.S.$ ’000 % Total revenue 102,438 3,336 32,840 1,073 (69,598 )) (2,263 ) (67.9 ) Cost of revenue 56,525 1,841 48,049 1,569 (8,476 ) (272 ) (15.0 ) Gross profit 45,913 1,495 (15,209 ) (496 ) (61,122 ) (1,991 ) (133.1 ) Operating expenses Selling expenses 12,534 408 11,363 371 1,171 (37 ) (9.3 ) Administrative expenses 25,650 835 24,360 796 (1,2900 ) (39 ) (5.0 ) Research and development expenses 26,845 874 24,195 790 (2,650 ) (8.4 ) (9.9 ) Impairment loss 253 8 (253 ) (8 ) (100.0 ) Total operating expenses 65,282 2,126 59,918 1,957 (5,364 ) (169 ) (8.2 ) Net operating loss (19,369 ) (631 ) (75,127 ) (2,435 ) (55,758 ) (1,822 ) 287.9 Non-operating income (expenses) Interest income 3,462 113 14,680 479 11,218 366 324.0 Other income 2,844 93 385 13 (2,459 ) (80 ) (86.5 ) Other gains and losses 37,399 1,218 992 32 (36,407 ) (1,186 ) (97.3 ) Interest expenses (2,884 ) (94 ) (2,940 ) (96 ) (56 ) (2 ) 1.9 Total non-operating Income (expenses) 40,821 1,329 13,117 428 (27,704 ) (901 ) (67.9 ) Profit (loss) before tax 21,452 699 (62,010 ) (2,025 ) (83,462 ) (2,724 ) (389.1 ) Income tax expense 6,429 209 1,019 33 (5,410 ) (176 ) (84.1 ) Net Profit (loss) for the Period 15,023 489 (63,029 ) (2,058 ) (78,052 ) (2,547 ) (519.6 ) Total comprehensive (loss) income 15,023 489 (63,029 ) (2,058 ) (78,052) (2,547 ) (519.6 ) Less: Comprehensive (loss) income attributable to non-controlling interest 194 6 (13,003 ) (425 ) (13,197 ) (431 ) (6,802.6 ) Total comprehensive Income (loss) attributable to ordinary shareholders 14,829 483 (50,026 ) (1,633 ) (64,855 ) (2,116 ) (437.4 ) 51 Revenue Total revenue decreased by NTD 69,598,000 (U.S.$2,272,959), or 67.9%, from NTD 102,438,000 (U.S.$3,345,460) for the year ended December 31, 2022 to NTD 32,840,000 (U.S.$1,072,502) for the year ended December 31, 2023.
The table below sets forth the revenue contribution by types of products in the year ended December 31, 2021, 2022 and 2023: Year December 31, 2021 December 31, 2022 December 31, 2023 Revenue Amount Revenue Amount Revenue Amount Product Categories NTD ‘000 U.S. Dollars ‘000 Revenue Proportion/ Share, % NTD ‘000 U.S.
The table below sets forth the revenue contribution by types of products in the year ended December 31, 2022, 2023 and 2024: Year December 31, 2022 December 31, 2023 December 31, 2024 Revenue Amount Revenue Amount Revenue Amount Product Categories NTD ’000 U.S. Dollars ’000 Revenue Proportion/ Share, % NTD ’000 U.S.
Dollars ‘000 Revenue Proportion/ Share, % NTD ‘000 U.S.
Dollars ’000 Proportion/ Share, % NTD ’000 U.S.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements as of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021 and notes to those statements included elsewhere in this annual report.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements As of December 31, 2024 and 2023 and notes to those statements included elsewhere in this annual report.
Income tax expenses occurred in fiscal 2023 due to a deferred tax liability from reduced unrealized exchange gains. Other comprehensive income/(loss) attributable to non-controlling Interest Other comprehensive income attributable to non-controlling interest for the year ended December 31, 2022 was NTD$194,000 and other Comprehensive loss attributable to non-controlling interest for the year ended December 31, 2023 was NTD$15,029,000 (U.S.$125,898).
Income tax expenses occurred in fiscal 2023 due to a deferred tax liability from reduced unrealized exchange gains. Other comprehensive income/(loss) attributable to non-controlling Interest Other comprehensive income attributable to non-controlling interest for the year ended December 31, 2022 was NTD$194,000 and other Comprehensive loss attributable to non-controlling interest for the year ended December 31,2023 was NTD$13,003,000 (U.S.$417,398).
This decrease was primarily due to the capitalization of professional service fees.. 49 Research and development expenses The research and development expenses declined from NTD 26,845,000 (U.S.$876,715) for the year ended December 31, 2022 to NTD 24,195,000 (U.S.$790,170) for the year ended December 31, 2023, representing a 9.9% decrease.
Research and development expenses The research and development expenses declined from NTD 26,845,000 (U.S.$876,715) for the year ended December 31, 2022 to NTD 24,195,000 (U.S.$790,170) for the year ended December 31, 2023, representing a 9.9% decrease.
Dollars ‘000 Revenue Proportion/ Share, % Component 48,281 1,572 38.3 59,256 1,930 57.9 31,530 1,030 96.0 Module 76,268 2,483 60.5 38,331 1,248 37.4 1,154 38 3.5 Others 1,584 52 1.3 4,851 158 4.7 156 5 0.5 Total 126,133 4,107 100.0 102,438 3,336 100.0 32,840 1,073 100 46 Cost of Revenue Cost of revenue primarily consists of costs of product parts and materials purchased from manufacturers, labor costs, depreciation, maintenance, and other overhead related costs, such as salaries and related personnel expenses.
Dollars ’000 Revenue Proportion/ Share, % Component 59,256 1,930 57.9 31,530 1,030 96.0 22,051 673 18.3 Module 38,331 1,248 37.4 1,154 38 3.5 92,235 2,813 76.8 Others 4,851 158 4.7 156 5 0.5 5,942 181 4.9 Total 102,438 3,336 100.0 32,840 1,073 100 120,228 3,667 100 46 Cost of Revenue Cost of revenue primarily consists of costs of product parts and materials purchased from manufacturers, labor costs, depreciation, maintenance, and other overhead related costs, such as salaries and related personnel expenses.
The effect of an immediate 10% change in interest rates on December 31, 2023 would not have a material adverse impact on our future operating results and cash flows as we expect our sales will increase going forward. 54 Cash Flows Summary Presented below is a summary of our operating, investing, and financing cash flows: Years ended December 31 2021 2022 2023 NTD U.S. $ NTD U.S. $ NTD U.S.$ ‘000 ‘000 ‘000 ‘000 ‘000 ‘000 Net cash (used in) generated from operating activities (20,959 ) (682 ) 36,499 1,188 (38,060 ) (1,244 ) Net cash used in investing activities (19,416 ) (632 ) (29,103 ) (948 ) (23,565 ) (770 ) Net cash (used in) generated from financing activities 67,975 2,213 24,638 802 (67,818 ) (2,214 ) Cash Flows (Used in) Generated from Operating Activities Cash flows generated from operating activities are typically re-invested to support the growth of our business.
An immediate 10% change in interest rates as of December 31, 2024 would not have a material adverse effect on our results of operations or cash flows, given our modest level of interest-bearing liabilities and our expectation of business growth in future periods. 54 Cash Flows Summary Presented below is a summary of our operating, investing, and financing cash flows: Years ended December 31 2022 2023 2024 NTD U.S. $ NTD U.S. $ NTD U.S.$ ’000 ’000 ’000 ’000 ’000 ’000 Net cash (used in) generated from operating activities 36,499 1,188 (38,060 ) (1,244 ) 2,214 66 Net cash used in investing activities (29,103 ) (948 ) (23,565 ) (770 ) (36,412 ) (1,111 ) Net cash (used in) generated from financing activities 24,638 802 (67,818 ) (2,214 ) (59,752 ) (1,822 ) Cash Flows (Used in) Generated from Operating Activities Cash flows generated from operating activities are typically reinvested to support the growth of our business.
Administrative expenses The general administrative expenses decreased from NTD25,650,000 (U.S.$837,688) for the year ended December 31, 2022 to NTD 24,360,000 (U.S.$795,558) for the year ended December 31, 2023, representing a 5.0% decrease.
Administrative expenses The general administrative expenses decreased from NTD25,903,000 (U.S.$869,336) for the year ended December 31, 2022 to NTD 24,360,000 (U.S.$795,558) for the year ended December 31, 2023, representing a 5.0% decrease. This decrease was primarily due to the capitalization of professional service fees.
The table below set forth the key commercial terms of the work capital loans as of 2023. Lender Interest Rate Issuance Date Maturity Date Outstanding Amount as of December 31, 2023 (NTD’000) Outstanding Amount as of December 31, 2023 (U.S.$’000) Chuang Hwa Bank 1.81 % November 13, 2023 November 13, 2024 82,000 2,678 E.
Lender Interest Rate Issuance Date Maturity Date Outstanding Amount as of December 31, 2024 (NTD’000) Outstanding Amount as of December 31, 2024 (U.S.$’000) Chuang Hwa Bank 1.94 % November 13, 2024 November 13, 2025 82,000 2,501 E.
We invest in research and development, sales and marketing activities, administrative expenses, and working capital. Our operating cash inflows include cash from sales of its products. These cash inflows are offset by our payments to suppliers for production materials and parts used in our manufacturing process, operating expenses, and interest payments on our financings.
We invest in research and development, sales and marketing activities, administrative expenses, and working capital. Our operating cash inflows primarily consist of cash received from sales of our products and services, while our operating cash outflows mainly include payments to suppliers for production materials, payroll expenses, operating expenses, and interest payments on borrowings.
Interest income The interest income increased from NTD 3,462,000 (U.S.$113,063) for the year ended December 31, 2022 to NTD 14,680,000 (U.S.$479,425) for the year ended December 31, 2023, representing a 324.0% increase. This growth was primarily driven by longer time deposit periods and higher interest rates on deposits offered by the bank in Fiscal 2023.
This growth was primarily driven by longer time deposit periods and higher interest rates on deposits offered by the bank in Fiscal 2023. Other gains and losses Other gains decrease from NTD 37,399,000 (U.S.$1,221,391) for the year ended December 31, 2022 to NTD 992,000 (U.S.$32,397) for the year ended December 31, 2023, representing a 97.3% decrease.
Critical Accounting Policies Management’s discussion and analysis of our results of operations and liquidity and capital resources are based on our audited financial information. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial statements.
We believe that the following estimates are those most critical to the judgments used in the preparation of our financial statements. Critical Accounting Policies Management’s discussion and analysis of our results of operations and liquidity and capital resources are based on our audited financial information.
Nature Interest Rate Issuance Date Maturity Date As of December 31, 2023 (NTD’000) As of December 31, 2023 (U.S.$’000) Guaranteed Borrowing 2.150 % December 5, 2022 December 05, 2027 12,640 413 Credit Borrowing 2.0%~2.1 % August 21, 2020 June 29, 2026 37,833 1,236 Total 50,473 1,648 We recorded net interest income of NTD11,740,000 (U.S.$383,410) for the year ended December 31, 2023 and recorded net interest income of NTD578,000 (U.S.$18,821) for the year ended December 31, 2022.
Nature Interest rate Issuance Date Maturity Date As of December 31, 2023 As of December 31, 2024 Guaranteed borrowing 2.28 % December 05, 2022 December 05, 2027 NT$ 12,640 NT$ 9,480 Credit borrowing 2.0%~2.2 % October 18, 2023 October 18, 2028 37,833 34,395 Total NT$ 50,473 NT$ 43,875 We recorded net interest income of NT$11,740,000 (U.S.$383,410) for the year ended December 31, 2023 and recorded net interest income of NT$5,642,000 (U.S.$172,000) for the year ended December 31, 2024.
This decline was primarily due the delay of the research and development progress of certain ICs, LiDAR and ADB solutions by about 6 months, so the research & development expense in the year ended December 31, 2023 are lower than expected.
This decline was primarily due the delay of the research and development progress of certain ICs, LiDAR and ADB solutions by about 6 months, so the research & development expense in the year ended December 31, 2023 are lower than expected. 52 Interest income The interest income increased from NTD 3,462,000 (U.S.$113,063) for the year ended December 31, 2022 to NTD 14,680,000 (U.S.$479,425) for the year ended December 31, 2023, representing a 324.0% increase.
On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses.
The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses.
Net cash generated from financing activities was NTD 24,638,000 (U.S.$802,279) for the year ended December 31, 2022, which primarily consists of the proceeds of NTD 219,164,000 (U.S.$7,136,568) from short-term loans from Chuang Hwa Bank and partially offset by the repayment of NTD200,904,000 (U.S.$6,541,973) in principal amount of short-term borrowings from Chuang Hwa Bank.
Net cash provided by financing activities was NT$24,638 thousand (U.S.$802 thousand) for the year ended December 31, 2022, primarily due to proceeds of NT$219,164 thousand from short-term bank borrowings and NT$21,790 thousand in long-term loan proceeds, partially offset by the repayment of NT$200,904 thousand in short-term borrowings and NT$15,412 thousand in long-term borrowings.
Material Contractual Obligations and Commitments During the periods presented, we did not have any material contractual obligations and commitments. 56 Off-Balance Sheet Arrangements During the periods presented, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities, which were established for the purpose of facilitating off-balance sheet arrangements.
Off-Balance Sheet Arrangements During the periods presented, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities, which were established for the purpose of facilitating off-balance sheet arrangements. 56 Research and Development Expenses In the fiscal year ended December 31, 2023, our R&D expenses were approximately NT$24,195 thousand (U.S.$790 thousand), representing 73.7% of our revenue and 40.4% of our total operating expenses.
Recent Accounting Pronouncements For a discussion of our new or recently adopted accounting pronouncements, see Note 2(x) “Recently issued accounting pronouncements” to our combined financial statements included in this Form 20-F. 57 Emerging Growth Company Status As defined in Section 102(b)(1) of the JOBS Act, we are as an emerging growth company (“ EGC ”).
Actual results may differ from these estimates under different assumptions or conditions. 57 Recent Accounting Pronouncements For a discussion of our new or recently adopted accounting pronouncements, see Note 2(x) “Recently issued accounting pronouncements” to our combined financial statements included in this Form 20-F.
We expect that as the U.S. lowers the Federal Fund Rate, the interest rate offered on our U.S. dollar deposits will decrease and the net interest income will decrease accordingly.
Federal Reserve lowers the Federal Funds Rate, we expect the yield on our U.S. dollar deposits to decrease, which may reduce our net interest income going forward.
Short-term borrowings As of December 31, 2023, our short-term bank borrowings consist of working capital loans from Chuang Hwa Bank, and E. Sun Bank, each secured by time deposits held within the bank. These collateralized time deposits are classified as restricted cash on our combined balance sheet.
To support these initiatives, we may seek additional financing through equity issuances, bank loans, government subsidies, or strategic partnerships, depending on market conditions and our capital needs. 53 Borrowings As of December 31, 2024, our short-term bank borrowings consist of working capital loans from Chuang Hwa Bank, and E. Sun Bank, each secured by time deposits held within the bank.
During the year ended December 31, 2022, net cash generated from operating activities was NTD 36,499,000 (U.S.$1,188,212). During the year ended December 31, 2023, net cash used in operating activities was NTD38,060,000 (U.S.$1,242,978). The decrease was mainly driven by lower sales revenue, increase in inventories and right of use assets.
During the year ended December 31, 2023, net cash used in operating activities was NT$38,060 thousand (U.S.$1,801 thousand), compared with net cash generated from operating activities of NT$36,499 thousand (U.S.$1,188 thousand) for the year ended December 31, 2022. The change was primarily attributable to a decrease in revenue and increased working capital requirements.
Net cash used in investing activities was NTD23,565,000 (U.S.$769,595) for the year ended December 31, 2023 and NTD29,103,000 (U.S.$947,672) for the year ended December 31, 2022. The decrease was mainly attributed to a decrease in sales and adjustment to research and development schedules, resulting in a decrease in investment in new property and equipment.
Net cash used in investing activities was NT$23,565 thousand (U.S.$769 thousand) for the year ended December 31, 2023, compared to NT$29,103 thousand (U.S.$948 thousand) for the year ended December 31, 2022. The decrease was mainly attributable to lower capital expenditures as we optimized our research and development schedule and equipment procurement.
We enjoyed net interest income for 2022 and 2023 because its short- and long-term borrowings are denominated in NTD, which charge a lower interest rate compared to the interest earned on our deposits, which are primary denominated in U.S. Dollars and enjoy higher interest rate.
We generated net interest income during these periods primarily because our short-term and long-term borrowings are denominated in NTD and bear relatively low interest rates, while a substantial portion of our deposits were denominated in U.S. dollars, which earned higher interest rates. As the U.S.
Costs are computed under the standard cost method, which approximates actual costs determined on the weighted-average basis. We records inventory write-downs as cost of revenue for excess or obsolete inventories based upon assumptions on current and future demand forecasts. If the inventory on hand is in excess of future demand forecast, the excess amounts are written off.
We record inventory write-downs in cost of revenue for excess or obsolete inventory based on assumptions about current and future demand forecasts. If inventory on hand exceeds projected demand, the excess is written off. We also evaluate whether the carrying value of inventory exceeds the net amount realizable upon sale, which involves estimating future selling prices and related costs.
Once inventory is written-down, a new, lower-cost basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis. As of December 31, 2023, the carrying amount of inventories was NTD1,559,000 (U.S.$ 50,914).
Once inventory is written down, a new lower-cost basis is established, and subsequent recoveries are not permitted under U.S. GAAP. As of December 31, 2024, the carrying amount of inventories was NTD15,961,000 (U.S.$487,000). Revenue Recognition We recognize revenue in accordance with ASC 606.
Other gains, net Other gains decrease from NTD 37,399,000 (U.S.$1,221,391) for the year ended December 31, 2022 to NTD 992,000 (U.S.$32,397 ) for the year ended December 31, 2023, representing a 97.3% decrease.
Other gains, net Other income increased from NTD 385,000 (U.S.$13,000) for the year ended December 31, 2023 to NTD 1,711,000 (U.S.$52,000) for the year ended December 31, 2024, representing an increase of NTD 1,326,000 (U.S.$39,000), or 344%.
The increase was primarily attributed to increased investment in new property and equipment for research and development activities. 55 Cash Flows (Used in) Generated from Financing Activities Net cash used in financing activities was NTD 67,818,000 (U.S.$2,214,827) for the year ended December 31, 2023 which primarily consist of repayment of NTD84,151,668 (U.S.$2,748,258) in principal amount and interest of short term borrowings from Chuang Hwa Bank, NTD26,370,000 (U.S.$861,202) in principal amount of short term borrowings from First Commercial Bank, NTD8,000,000 (U.S.$261,267) in principal amount of short term borrowings from E.Sun Bank; and partially offset by the NTD82,000,000 (U.S.$2,677,988) proceeds from short-term loans from Chuang Hwa Bank and NTD16,000,000 (U.S.$522,534) proceeds from short-term loans from E.Sun Bank.
During the year ended December 31, 2024, net cash used in investing activities increased to NT$36,412 thousand (U.S.$1,111 thousand), primarily driven by further investment in production and R&D equipment to support future technological development. 55 Cash Flows (Used in) Generated from Financing Activities Net cash used in financing activities was NT$67,818 thousand (U.S.$2,214 thousand) for the year ended December 31, 2023, primarily reflecting repayments of short-term bank borrowings and deferred offering costs, partially offset by proceeds from short-term bank loans.
Dollars ‘000 Revenue Proportion/ Share, % Component 31,530 1,030 96.0 59,256 1,930 57.9 Module 1,154 38 3.5 38,331 1,248 37.4 Others 156 5 0.5 4,851 158 4.7 Total 32,840 1,073 100.0 102,438 3,336 100.0 Total revenue Total revenue decreased by NTD 69,598,000 (U.S.$2,272,959), or 67.9%, from NTD 102,438,000 (U.S.$3,345,460) for the year ended December 31, 2022 to NTD 32,840,000 (U.S.$1,072,502) for the year ended December 31, 2023.
Dollars ’000 Proportion/ Share, % Component 22,051 673 18.3 31,530 1,030 96.0 Module 92,235 2,813 76.8 1,154 38 3.5 Others 5,942 181 4.9 156 5 0.5 Total 120,228 3,667 100 32,840 1,073 100.0 Total revenue Total revenue increased by NTD 87,388,000 (U.S.$2,665,000), or 266.1%, from NTD 32,840,000 (U.S.$1,073,000) for the year ended December 31, 2023 to NTD 120,228,000 (U.S.$3,667,000) for the year ended December 31, 2024.The significant increase in total revenue was primarily driven by higher demand for component and other product categories, with component sales increasing by NTD 55,985,000 (U.S.$1,819,000), or 178%, and other product sales increasing by NTD 9,978,000 (U.S.$329,000), or over 6,000%.
Other comprehensive (loss) income Other Comprehensive loss decreased by NTD 329,000 (U.S.$10,713) or 100.0% from a loss of NTD329,000 (U.S.$10,713) for the year ended December 31, 2021 to nil for the year ended December 31, 2022. The decrease was primarily due to disposal of foreign subsidiary, Optonomous Inc.
Interest income Interest income decreased from NTD 14,680,000 (U.S.$479,000) for the year ended December 31, 2023 to NTD 8,952,000 (U.S.$273,000) for the year ended December 31, 2024, representing a decrease of NTD 5,728,000 (U.S.$175,000), or 45%.The decrease was primarily due to the decrease of cash in bank.
Sun Bank 2.43 % December 28, 2023 April 28, 2024 8,000 261 Total 90,000 2,939 Long-term borrowings The long-term bank borrowings consist of term loans obtained from Chuang Hwa Bank.
Sun Bank 2.43 % October 30, 2024 March 31, 2025 8,000 244 Total 90,000 2,745 Our long-term bank borrowings consist of term loans obtained from local financial institutions in Taiwan. As of December 31, 2024, the aggregate outstanding principal amount of our long-term borrowings was NT$30,757 thousand (U.S.$938 thousand).
Removed
Impact of COVID-19 on Our Operations and Financial Performance On May 5, 2023, WHO declared that COVID-19 is now an established and ongoing health issue which no longer constitutes a public health emergency of international concern The extent of the impact of COVID-19 on our future financial results will be dependent on future developments such as the length and severity of COVID-19, the potential resurgence of COVID-19, future government actions in response to COVID-19 and the overall impact of COVID-19 on the global economy and capital markets, among many other factors, all of which remain highly uncertain and unpredictable.
Added
Currently, the applicable tax rate in Taiwan is 20%, while the tax rate for unappropriated earnings is 5%. 47 Results of Operations Comparison of Results of Operations for the Year Ended December 31, 2024 to the Year Ended December 31, 2023 The table below sets forth the results of operations for the year ended December 31, 2023 and the year ended December 31, 2024: For the year ended December 31, Differences 2023 2024 Amount Percentage NTD U.S. $ NTD U.S. $ NTD U.S. $ Item ’000 ’000 ’000 ’000 ’000 ’000 % Total revenue 32,840 1,073 120,228 3,667 87,338 2,594 266 Cost of revenue 48,049 1,569 148,706 4,535 100,657 (272 ) 209 Gross profit/(loss) (15,209 ) (496 ) (28,478 ) (868 ) (13,629 ) (372 ) 90 Operating expenses Selling expenses 11,363 371 17,161 523 5,780 152 51 Administrative expenses 24,360 796 80,845 2,466 56,485 1,723 232 Research and development expenses 24,195 790 35,033 1,068 10,838 278 45 Impairment loss - - 15,300 467 15,300 467 100 Total operating expenses 59,918 1,957 148,339 4,524 88,421 2,697 148 Net operating loss (75,127 ) (2,453 ) (176,817 ) (5,392 ) (101,690 ) (3,101 ) 135 Non-operating expenses Interest income 14,680 479 8,952 273 (5,728 ) (206 ) -39 Other income 385 13 1,711 52 1,326 39 344 Other gain, net 992 32 16,747 511 15,755 479 1588 Interest expenses (2,940 ) (96 ) (3,310 ) (101 ) (370 ) (5 ) 13 Total non-operating expenses 13,117 428 24,100 735 10,983 (307 ) 84 Profit/(loss) before income tax (62,010 ) (2,025 ) (152,717 ) (4,657 ) (90,707 ) (2,766 ) 146 Income tax expense 1,019 33 (771 ) (24 ) (1,790 ) (57 ) (176 ) Net income/(loss) (63,029 ) (2,058 ) (151,946 ) (4,633 ) (88,917 ) (2,712 ) (141 ) Total comprehensive income/(loss) (63,029 ) (2,058 ) (151,946 ) (4,633 ) (88,917 ) (2,712 ) (141 ) Less: comprehensive income (loss) attributable to non-controlling interest (13,003 ) (425 ) (31,332 ) (956 ) (18,329 ) (559 ) (141 ) Total comprehensive income (loss) attributable to ordinary shareholders (50,026 ) (1,633 ) (120,614 ) (3,677 ) (70,588 ) (2,153 ) (141 ) 48 Comparison of Revenue Composition for the Year Ended December 31, 2024 to the Year Ended December 31, 2023 The table below sets forth the revenue contribution by types of products for the year ended December 31, 2024 to the year ended December 31, 2023: For the year ended December 31, 2024 For the year ended December 31, 2023 Revenue Amount Revenue Revenue Amount Revenue Product Categories NTD ’000 U.S.
Removed
Given this uncertainty, we currently unable to quantify the expected impact of COVID-19 on its future operations, financial condition, liquidity and results of operations if the current situation continues.
Added
The overall revenue growth was mainly attributed to the recovery of customer orders, new product launches, and stronger export performance after the economic slowdown in 2023.
Removed
Although it is uncertain to assess the total impact of COVID-19 on the financial condition, results of our operation and business, we do not expect that COVID-19 will have a material and adverse impact on our operation in 2023.
Added
Cost of revenue Total cost of revenue increased by NTD 100,657,000 (U.S.$3,070,000), or 209.5%, from NTD 48,049,000 (U.S.$1,569,000) for the year ended December 31, 2023 to NTD 148,706,000 (U.S.$4,535,000) for the year ended December 31, 2024, which was in line with the increase of revenue.
Removed
The decrease was due to a loss in disposal of Taiwan Leisure Sports Technology Inc and a net loss in 2023. 50 Comparison of Results of Operations for the Year Ended December 31, 2022 to the Year Ended December 31, 2021 The table below sets forth the results of operations for the year ended December 31, 2021 and the year ended December 31, 2022: For the year ended December 31, 2021 For the year ended December 31, 2022 Differences in Amount and Percentage (%) Item NTD ‘000 U.S.$ ‘000 NTD ‘000 U.S.$ ‘000 NTD ‘000 U.S.$ ‘000 % Total revenue 126,133 4,107 102,438 3,336 (23,695 ) (772 ) (18.8 ) Cost of revenue 69,310 2,257 56,525 1,841 (12,785 ) (416 ) (18.5 ) Gross profit 56,823 1,850 45,913 1,495 (10,910 ) (355 ) (19.2 ) Operating expenses Selling expenses 10,490 342 12,534 408 2,044 67 19.5 Administrative expenses 18,387 599 25,650 835 7,263 237 39.5 Research and development expenses 40,921 1,332 26,845 874 (14,076 ) (458 ) (34.4 ) Impairment loss - - 253 8 253 8 100.0 Total operating expenses 69,798 2,273 65,282 2,126 (4,516 ) (147 ) (6.5 ) Net operating loss (12,975 ) (423 ) (19,369 ) (631 ) (6,393 ) (208 ) 49.3 Non-operating income (expenses) Interest income 419 14 3,462 113 3,043 99 726.3 Other income 7,166 233 2,844 93 (4,322 ) (141 ) (60.3 ) Other gains and losses (21,627 ) (704 ) 37,399 1,218 59,026 1,922 272.9 Interest expenses (2,196 ) (72 ) (2,884 ) (94 ) (688 ) (22 ) 31.3 Total non-operating Income (expenses) (16,238 ) (529 ) 40,821 1,329 57,058 1,858 351.4 Profit (loss) before tax (29,213 ) (951 ) 21,452 699 50,665 1,650 173.4 Income tax expense (1,298 ) (42 ) 6,429 209 5,131 252 395.3 Net Profit (loss) for the Period (30,511 ) (994 ) 15,023 489 45,534 1,483 149.2 Other comprehensive (loss) Income Foreign currency translation adjustment (329 ) (11 ) - - 329 11 (100.0 ) Total comprehensive (loss) income (30,840 ) (1,004 ) 15,023 489 45,863 1,493 148.7 Less: Comprehensive (loss) income attributable to non-controlling interest (19,201 ) (626 ) 194 6 19,395 632 101.0 Total comprehensive Income (loss) attributable to ordinary shareholders (11,639 ) (379 ) 14,829 483 26,468 862 227.4 51 Revenue Of the total revenue of NTD 126,133,000 (U.S.$4,107,229) for the year ended December 31, 2021, NTD 48,281,000 (U.S.$1,572,159) of revenue was from the sales of Component, NTD 76,268,000 (U.S.$2,483,491) of revenue was from the Modules, and NTD 1,584,000 (U.S.$51,579) of revenue was from the sales of other products.
Added
Gross profit (loss) The gross loss increased from NTD 15,209,000 (U.S.$496,000) for the year ended December 31, 2023 to NTD 28,478,000 (U.S.$868,000) for the year ended December 31, 2024, representing an increase of NTD 13,269,000 (U.S.$372,000), or 87%.Although total revenue increased substantially, the cost of revenue rose at a faster rate due to higher manufacturing overhead, increased depreciation charges, and lower average selling prices in certain product categories, leading to a further deterioration in gross margin.
Removed
The total revenue decreased from NTD126,133,000 (U.S.$4,107,229) for the year ended December 31, 2021 to NTD102,348,000 (U.S.$3,335,656) for the year ended December 31, 2022, representing a 18.8% decrease.
Added
Selling expenses Selling expenses increased from NTD 11,363,000 (U.S.$371,000) for the year ended December 31, 2023 to NTD 17,161,000 (U.S.$523,000) for the year ended December 31, 2024, representing an increase of NTD 5,798,000 (U.S.$152,000), or 51%.The increase was mainly due to expansion of overseas marketing activities and higher sales commission expenses related to the increased order volume.
Removed
The decrease in total revenue from 2021 to 2022 was primarily due to weaker demands from our customers and temporary interruption of our operations and the operation of our customers due to wide spread of COVID-19 in the PRC and Taiwan.
Added
Administrative expenses Administrative expenses increased from NTD 24,360,000 (U.S.$796,000) for the year ended December 31, 2023 to NTD 80,845,000 (U.S.$2,466,000) for the year ended December 31, 2024, representing an increase of NTD 56,485,000 (U.S.$1,723,000), or 209%.The sharp increase was primarily due to higher professional service fees, personnel costs, and recognition of additional provisions and write-offs related to asset impairment and restructuring activities during fiscal 2024. 49 Research and development expenses Research and development expenses increased from NTD 24,195,000 (U.S.$790,000) for the year ended December 31, 2023 to NTD 35,033,000 (U.S.$1,068,000) for the year ended December 31, 2024, representing an increase of NTD 10,838,000 (U.S.$278,000), or 45%.The increase was primarily due to accelerated development of new IC designs and optical sensing modules, as well as the expansion of R&D teams to support next-generation product pipelines.
Removed
Cost of revenue Cost of revenue decreased by NTD 12,786,000, (U.S.$416,346), or 18.4%, from NTD 69,3110,000 (U.S.$2,256,952) for the year ended December 31, 2021 to NTD 56,525,000 (U.S.$1,840,606) for the year ended December 31, 2022. The decrease was primarily due to lower total revenue.
Added
Other gain, net, also increased significantly from NTD 992,000 (U.S.$32,000) to NTD 16,747,000 (U.S.$511,000), up NTD 15,755,000 (U.S.$479,000), or 1,588%, primarily due to foreign exchange gains and disposal income from non-core assets.
Removed
Gross profit The gross profit declined from NTD 56,823,000 (U.S.$1,850,237) for the year ended December 31, 2021 to NTD45,913,000 (U.S.$1,495,050) for the year ended December 31, 2022, representing a decrease of 19.2%. This decline was primarily due to decrease in total revenue and shipped goods.
Added
Interest expenses Interest expenses increased slightly from NTD 2,940,000 (U.S.$96,000) in 2023 to NTD 3,310,000 (U.S.$101,000) in 2024, representing an increase of NTD 370,000 (U.S.$5,000), or 13%.The increase was primarily due to higher interest rates and additional short-term borrowings to support working capital.
Removed
Selling expenses Selling expenses increased by NTD 2,044,000 (U.S.$66,558), or 19.5%, from NTD 10,490,000 (U.S.$341,583) for the year ended December 31, 2021 to NTD 12,534,000 (U.S.$408,141) for the year ended December 31, 2022. The increase was primarily due to higher logistics expenses caused by unavailability of vessels and air cargo space during COVID-19.
Added
Income tax expenses Income tax expense changed from an expense of NTD 1,019,000 (U.S.$33,000) in 2023 to an income tax benefits of NTD (771,000) (U.S.$(24,000)) in 2024.The variance was primarily attributable to the recognition of deferred tax assets arising from operating losses incurred in fiscal 2024.
Removed
Administrative expenses Administrative expenses increased to NTD 25,650,000 (U.S.$835,233) for the year ended December 31, 2022 from NTD 18,387,000 (U.S.$598,730) for the year ended December 31, 2021, representing a 39.5% increase. The increase was primarily due to we preparation for public listing in Taiwan in 2022, which has subsequently cancelled by we to pursue the Business Combination.
Added
The decrease was due to a loss in disposal of Taiwan Leisure Sports Technology Inc and a net loss in 2023. Liquidity and Capital Resources Historically, we have financed our operations primarily through equity contributions from shareholders, bank loans, and payments received from customers in the ordinary course of business.
Removed
Research and development expenses Research and development expenses decreased to NTD 26,845,000 (U.S.$874,145) for the year ended December 31, 2022 from NTD 40,921,000 (U.S.$1,332,498) for the year ended December 31, 2021, representing a 34.4% decrease.
Added
As of December 31, 2023, we had cash and cash equivalents of NT$202,465 thousand (approximately US$6,612 thousand). As of December 31, 2024, we had cash and cash equivalents of NT$117,748 thousand (approximately US$3,591 thousand). In addition, as of December 31, 2023 and 2024, we recorded NT$92,115 thousand and NT$82,000 thousand of restricted cash.
Removed
The expenses decreased because of lower research and development activities during various phases of COVID-19 lock-downs and social distancing rules imposed in Taiwan in 2022. 52 Interest income Interest income increased by NTD 3,043,000, (U.S.$99,088), or 726.3%, from NTD 419,000 (U.S.$13,644) for the year ended December 31, 2021 to NTD 3,462,000 (U.S.$112,732) for the year ended December 31, 2022.
Added
We expect to continue to incur operating losses in the next one to three years as we increase investments in research and development and commercialization activities for LiDAR and ADB technologies.
Removed
The increase was primarily due to an increase in interest rates in 2022 compared to 2021. Other income Other income decreased by NTD 4,322,000, (U.S.$140,736), or 60%, from NTD 7,166,000 (U.S.$233,344) for the year ended December 31, 2021 to NTD 2,844,000 (U.S.$92,608) for the year ended December 31, 2022.
Added
We believe our existing cash resources, together with expected operating inflows and access to credit facilities, will be sufficient to meet our working capital and capital expenditure needs for at least the next twelve months.
Removed
The decrease was mainly due to the lack of NTD 3,325,506 (U.S.$108,606) of R&D subsidies granted by the Taipei Computer Association in 2021. Other gains and losses Other losses were NTD 21,627,000 (U.S.$704,235) for the year ended December 31, 2021 and other gains were NTD 37,399,000 (U.S.$1,217,815) for the year ended December 31, 2022.
Added
Our cash requirements in the next twelve months primarily consist of employee compensation, lease payments for office and factory premises, operational expenditures supporting product development and commercialization efforts, and servicing of short-term and long-term bank borrowings. As of December 31, 2024, our outstanding short-term and long-term borrowings totaled NT$133,875 thousand (approximately US$3,683 thousand) including both current and non-current portions.
Removed
This increase was primarily due to favorable exchange rate gain that the average exchange rate of US dollars was 29.8129 in 2022 increased by 7% compared to 27.992 in 2021.
Added
We plan to continue enhancing our product development capabilities, expanding commercialization of LiDAR and ADB technologies, and strengthening international market presence.
Removed
Interest expenses Interest expenses rose by NTD 688,000, (U.S.$22,403), or 31.3%, from NTD 2,196,000 (U.S.$71,508) for the year ended December 31, 2021 to NTD 2,884,000 (U.S.$93,911) for the year ended December 31, 2022. The increase was primarily due to higher borrowing cost even though Total Liabilities decreased to NTD201,159,000 (U.S.$6,550,277) from NTD220,342,000 (U.S.$7,174,927).
Added
These collateralized time deposits are classified as restricted cash on our combined balance sheet. The table below set forth the key commercial terms of the work capital loans as of 2024.
Removed
Income tax expenses Income Tax Expenses increased from NTD 1,298,000 (U.S.$42,266) in income tax expense for the year ended December 31, 2021 to NTD 6,429,000 (U.S.$209,346) for the year ended December 31, 2022. The increase was due to movement of temporary differences in deferred tax assets.
Added
The aggregate principal amount of the term loan issued to us on August 21, 2020 is NT$23,050,000 (U.S.$703,000) as of December 31, 2024. This loan bears an interest rate ranging from 2.0% to 2.1% and is scheduled to mature on June 29, 2026.
Removed
Liquidity and Capital Resources Historically, we have financed its operations mainly through equity contributions from its shareholders, loans from banks and payments received from its customers during ordinary course of business. On December 31, 2023, we had cash and cash equivalents of NTD 202,465,000 (U.S.$6,612,182), which consisted of cash, checking accounts, demand deposits, time deposits and others.
Added
This borrowing is an unsecured credit facility without collateral.The table below sets out the key commercial terms of the two term loans.
Removed
We expect that it may incur net loss in the next one to three years as it increases its investment in research and development of LiDAR and ADB technologies. Our cash requirements for the next twelve months after the date of the Form 20-F primarily include staff salaries, lease obligations, contractual obligations and other commitments.
Added
During the year ended December 31, 2024, net cash generated from operating activities was NT$2,214 thousand (U.S.$66 thousand). The cash inflow was mainly driven by the increase of payable of professional fees during the year.
Removed
Our staff salaries consists of our obligations to pay out staff under the employment agreements.
Added
Cash Flow Used in Investing Activities Cash used in investing activities primarily relates to purchases of property and equipment, as well as expenditures to support our research and development activities. Proceeds from the disposal of property and equipment partially offset these outflows when applicable.
Removed
Our lease obligations consist of the commitments under the rental agreements for our factory and office premises. 53 In addition, as part of our business strategy, we plan to continue to invest in our research and development activities, particular in the development of our LiDAR and ADB products. These new developments and expansions may generate long-term cash requirements.
Added
These financing outflows mainly resulted from the repayment of NT$118,522 thousand in short-term bank borrowings and NT$18,294 thousand in long-term bank borrowings, as well as payment of NT$31,154 thousand in deferred offering costs, offset by NT$100,152 thousand in proceeds from short-term loans.
Removed
Our research and development activities, including pursuant of equipment, raw materials, IT software and expansion of our R&D term. We intend to fund our future material cash requirements with net proceeds from the Proposed Transactions, debt borrowings from Taiwan banks, equity contributions from our shareholders and payments received from our customers.
Added
For the year ended December 31, 2024, net cash used in financing activities was NT$59,752 thousand (U.S.$1,822 thousand), mainly due to NT$85,944 thousand in payment of deferred offering costs, proceeds from equity financing of NT$32,790 thousand and NT$98,000 thousand in proceeds from short-term bank loans, partially offset by NT$98,000 thousand in repayment of short-term loans, and NT$6,598 thousand in repayment of long-term borrowings.
Removed
We will continue to make cash commitments, including capital expenditures, to support the growth of our business.
Added
Disposal of Optonomous Inc. As referenced in the consolidated financial statements, we previously divested certain non-core subsidiaries as part of our strategic decision to focus resources on our core optical and autonomous technology businesses.
Removed
Taking into account the completion of our business combination, we believe that our cash on hand, including the current available cash and cash equivalents on our balance sheet and the funds contained in Chenghe’s Trust Account (assuming the Interim Redemption Scenario) are sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months from the date of this Form 20-F and sufficient to fund our operations.
Added
In line with this strategy, we completed the disposal of subsidiaries not aligned with our long-term business priorities, allowing us to focus capital and operational support on core R&D and commercialization efforts. The divestitures were aligned with our objective to streamline our investment portfolio and enhance capital efficiency.
Removed
The aggregate principal amount of term loan issued to us on May 12, 2022 is NTD15,800,000 (U.S.$516,003), which is guaranteed by the Credit Guarantee Fund for Small and Medium Enterprises of Taiwan.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

11 edited+0 added−0 removed53 unchanged
Biggest changeTu 72 Independent Director Mu-Jung Yang 56 Independent Director Kwan Sun 59 Independent Director Chun-Nien Liu 35 Chief Technical Officer Tina Hsiu-Chen Hsu 49 Chief Financial Officer Deborah Chang 51 Chief Strategy Officer Mark Chang 53 Chief Engineer Executive Officers Yung-Peng Chang serves as the chairman and Co-CEO of the Company. Dr.
Biggest changeTu 73 Independent Director Mu-Jung Yang 57 Independent Director Shu-Chuan Chien 54 Independent Director Chun-Nien Liu 35 Chief Technical Officer Tina Hsiu-Chen Hsu 49 Chief Financial Officer Mark Chang 54 Chief Engineer Executive Officers Yung-Peng Chang serves as the chairman and Co-CEO of the Company. Dr.
Title Name Total Annual (2023) Remuneration in Thousand NTD Total Annual (2023) Remuneration in USD Chairman Tina Hsiu-Chen Hsu 3,490 113,478 Director Representative of ChiaPei Investment Co., Ltd.: Kuo-Yin Huang 2,526 82,133 Director Alan Chih-Feng Wang 3,502 113,868 Director Representative of PengYu Investment Co., Ltd.: Larry Wu 892 29,013 Director Representative of YiFeng Investment Co., Ltd.: Mark Chang 1,791 58,250 Historical Compensation of TCO’s Executive Officers, Directors and Supervisors For the year ended December 31, 2023, TCO paid an aggregate of NTD$13,682,000 (US$444,904) in cash and its executive officers consisting of the CEO Alan Wang, President YP Chang, Assistant Vice President Kuo-Yin Huang, senior manager Mark Chang, senior manager Stark Tsai, finance manager Tina Huang and audit manager Larry Wu, of which none were paid in the form of stock options.
Title Name Total Annual (2024) Remuneration in Thousand NTD Total Annual (2024) Remuneration in USD Chairman Tina Hsiu-Chen Hsu 3,490 113,478 Director Representative of ChiaPei Investment Co., Ltd.: Kuo-Yin Huang 2,526 82,133 Director Alan Chih-Feng Wang 3,502 113,682 Director Representative of PengYu Investment Co., Ltd.: Larry Wu 892 29,013 Director Representative of YiFeng Investment Co., Ltd.: Mark Chang 1,791 58,250 Historical Compensation of TCO’s Executive Officers, Directors and Supervisors For the year ended December 31, 2024, TCO paid an aggregate of NTD$13,682,000 (US$444,904) in cash and its executive officers consisting of the CEO Alan Wang, President YP Chang, Assistant Vice President Kuo-Yin Huang, senior manager Mark Chang, senior manager Stark Tsai, finance manager Tina Huang and audit manager Larry Wu, of which none were paid in the form of stock options.
Chang of numerous scientific papers on LiDAR solution, intelligent headlight, optical design, and 3D-sensing in leading academic and industry journals such as Optics Express and journals of SPIE. Tina Hsiu-Chen Hsu serves as the Chief Financial Officer of CayCo. She has served as TCO’s Accounting Manager since joining TCO in 2009. Ms.
Chang of numerous scientific papers on LiDAR solution, intelligent headlight, optical design, and 3D-sensing in leading academic and industry journals such as Optics Express and journals of SPIE. Tina Hsiu-Chen Hsu serves as the Chief Financial Officer of Semilux. She has served as TCO’s Accounting Manager since joining TCO in 2009. Ms.
Chenghe Group Limited, a British Virgin Islands incorporated company, is the sole member and the manager of the Sponsor. Mr. Richard Qi Li, who holds 100% of the voting securities of Chenghe Group Limited, may be entitled to the right to receive one (1) CayCo Ordinary Share for each SPAC Class B Ordinary Share owned by Chenghe Investment Co. Mr.
Chenghe Group Limited, a British Virgin Islands incorporated company, is the sole member and the manager of the Sponsor. Mr. Richard Qi Li, who holds 100% of the voting securities of Chenghe Group Limited, may be entitled to the right to receive one (1) Semilux Ordinary Share for each SPAC Class B Ordinary Share owned by Chenghe Investment Co. Mr.
TCO has not set aside or accrued any amount to provide pension, retirement or other similar benefits to its executive officers, directors and supervisors. 62 The following table sets forth information about the compensation awarded to, earned by or paid to TCO’s executive officers, directors and supervisors for the year ended December 31, 2023.
TCO has not set aside or accrued any amount to provide pension, retirement or other similar benefits to its executive officers, directors and supervisors. 62 The following table sets forth information about the compensation awarded to, earned by or paid to TCO’s executive officers, directors and supervisors for the year ended December 31, 2024.
As of April 30, 2024, there were 37,428,354 ordinary shares outstanding. Name and Address of Beneficial Owner (1) Number of Ordinary Shares Beneficially Owned Percentage Directors and Senior Management: Dr. CHANG, YUNG-PENG (2) (4) - * WANG, CHIH-FENG (3) 806,135 3.01 % Dr.
As of April 30, 2025, there were 37,428,354 ordinary shares outstanding. Name and Address of Beneficial Owner (1) Number of Ordinary Shares Beneficially Owned Percentage Directors and Senior Management: Dr. CHANG, YUNG-PENG (2) (4) - * WANG, CHIH-FENG (3) 806,135 3.01 % Dr.
Name Title Compensation in Thousand NTD$ Compensation in USD$ Miscellaneous (1) Alan Chih-Feng Wang Co-CEO and Director 3,502 113,868 — Yung-Peng Chang General Manager and Director — Tina Hsiu-Chen Hsu President, CFO and Director 3,490 113,478 — Kuo-Yin Huang Assistant Vice President and Director 2,526 82,133 — Mark Chang Senior Manager and Director 1,791 58,250 — Stark Tsai Senior Manager 1,481 48,162 — Larry Wu Audit Manager 892 29,013 — XiuWu Dong Supervisor 0 0 — JingYi Cheng Supervisor 0 0 — (1) Miscellaneous includes any benefits in kind, pension, retirement or similar benefits and issue or grant of options or shares or securities of TCO.
Name Title Compensation in Thousand NTD$ Compensation in USD$ Miscellaneous (1) Alan Chih-Feng Wang Co-CEO and Director 3,502 113,682 — Yung-Peng Chang General Manager and Director — Tina Hsiu-Chen Hsu President, CFO and Director 3,490 113,478 — Kuo-Yin Huang Assistant Vice President and Director 2,526 82,133 — Mark Chang Senior Manager and Director 1,791 58,250 — Larry Wu Audit Manager 892 29,013 — XiuWu Dong Supervisor 0 0 — JingYi Cheng Supervisor 0 0 — (1) Miscellaneous includes any benefits in kind, pension, retirement or similar benefits and issue or grant of options or shares or securities of TCO.
For the year ended December 31, 2023, there were no options to purchase any securities of TCO granted to TCO’s employees.
For the year ended December 31, 2024, there were no options to purchase any securities of TCO granted to TCO’s employees.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. 63 The following table sets forth information regarding the beneficial ownership of ordinary shares on March 1, 2024, by ● each person known by us to be the beneficial owner of more than 5% of the outstanding ordinary shares; ● each of our directors, chief executive officer, chief financial officer and other members of Senior Management; and ● all of our Senior Management and directors as a group.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. 63 The following table sets forth information regarding the beneficial ownership of ordinary shares on October 31, 2025, by ● each person known by us to be the beneficial owner of more than 5% of the outstanding ordinary shares; ● each of our directors, chief executive officer, chief financial officer and other members of Senior Management; and ● all of our Senior Management and directors as a group.
TU, WU-CHING - * YANG, MU-JUNG - * HUANG, KUO-YIN 396,730 1.48 % HSU, HSIU-CHEN 911,131 3.40 Dr. LIU, CHUN-NIEN (5) - * Dr. CHANG, SHIH-HSIN 73,973 * CHANG, CHO-YING - * Dr. CHENG, MU-HAI - * SUN, KWAN 20,000 * All directors and Senior Management as a group (6) 2,207,969 8.26 % Five Percent Holders: Clariscope Ventures Group Ltd.
TU, WU-CHING - * YANG, MU-JUNG - * HUANG, KUO-YIN 396,730 1.48 % HSU, HSIU-CHEN 911,131 3.40 Dr. LIU, CHUN-NIEN (5) - * Dr. CHANG, SHIH-HSIN 73,973 * CHANG, CHO-YING - * Dr. CHENG, MU-HAI - * All directors and Senior Management as a group (6) 2,207,969 8.18 % Five Percent Holders: Clariscope Ventures Group Ltd.
Name Age Position Yung-Peng Chang 49 Chairman of the Board, Director and Co-Chief Executive Officer Alan Chih-Feng Wang 50 Co-Chief Executive Officer and Director Charles W.
Name Age Position Yung-Peng Chang 51 Chairman of the Board, Director and Co-Chief Executive Officer Alan Chih-Feng Wang 52 Co-Chief Executive Officer and Director Charles W.